Failed Banking System Prompts Iraqis to Hoard Gold

The Department of Standards and Quality Control is in charge of issues concerning silver and platinum as well as gold. The department licenses jewelers and gold companies and inspects jewelers' shops. It controls the gold that comes into the region through testing, taking samples from shops and companies, and responding to complaints filed by citizens.

Aziz said that there are currently about 1,300 gold shops across the Kurdistan Region, noting that as with gold-crafting shops, this is a small number compared to the increasing demand for gold. Gold shops in Baghdad and other cities had become targets for armed robbery, and some jewelers have been killed, prompting many of them to move to cities in the Kurdistan Region.

Economists believe that the improved economic situation and the increase in per capita income in the Kurdistan Region and some other parts of Iraq have pushed citizens to rely on gold as a way to save their money, given that it is easy to store. In addition, as Idriss Ramadan, an economic analyst and academic, told Al-Monitor, "In recent years, [many] Iraqi citizens have witnessed improved economic situations and their incomes have increased. They have no means of storing their money except through purchasing gold due to the lack of a safe [storage] place. Citizens do not trust banks, whether in the public or private sector."

Abdel Hamid Zebari is a contributing writer for Al-Monitor’s Iraq Pulse. A reporter from Erbil who works in print and radio, he has published in local and international media, including Agence France-Press and Radio Free Iraq (Radio Free Europe).

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