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Clare:  The Currency of Iraq: A Comprehensive Guide

Introduction

The Iraqi Dinar (IQD) is the official currency of Iraq, serving as a critical component of the nation's economic infrastructure. For businesses, investors, and speculators alike, understanding the dynamics of the Dinar is essential for navigating Iraq's market.

The exchange rate of the Iraqi Dinar plays a pivotal role in shaping the country's trade and investment environment, influencing everything from the cost of imports and exports to the profitability of foreign investments.

Meanwhile, the currency has also garnered significant interest from speculators, who are drawn to the potential-however remote-of significant shifts in its value.

The current official exchange rates for the dinar can be found at the Central Bank of Iraq (CBI) website - https://cbi.iq/.

The Importance of the Exchange Rate for Trade and Investment

The exchange rate of the Iraqi Dinar is a key determinant of the country's economic competitiveness on the global stage. A stable and predictable exchange rate is vital for businesses engaged in international trade, as it impacts the cost of importing goods and services and the profitability of exporting to foreign markets. For foreign investors, the exchange rate is a crucial factor in determining the potential returns on investments in Iraq.

Fluctuations in the Dinar's value can significantly affect the cost of doing business, as well as the repatriation of profits. As such, understanding the factors that influence the Dinar's exchange rate-such as oil prices, political stability, and central bank policies-is essential for making informed business and investment decisions in Iraq.

Interest from Speculators

In recent years, the Iraqi Dinar has attracted attention from a specific group of financial actors: currency speculators. These individuals and entities buy and hold large amounts of Dinar in the hope that its value will appreciate dramatically, allowing them to sell it at a significant profit.

This speculative interest is often fuelled by rumours and theories about an imminent revaluation of the Dinar, despite the lack of credible evidence supporting such a scenario. Speculators are drawn to the high-risk, high-reward nature of currency trading, but it is important to note that such activities are highly speculative and carry substantial risks.   LINK

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Donald Trump and the "Great Iraqi Dinar Revaluation"

21st December 2024 in Iraq Banking & Finance News

By a Guest Blogger. Any opinions expressed are those of the author(s), and do not necessarily reflect the views of Iraq Business News.

Anecdotal evidence, including inquiries to Iraq Business News, seems to suggest that supporters of US President-elect Donald Trump are more likely to believe that the Iraqi currency, the Dinar (IQD), will increase in value by an unprecedented multiple, some saying by as much as 1,000-fold!

The correlation between being a Trump voter and believing in a significant revaluation of the Iraqi dinar (often called the "dinar RV" theory) is not rigorously studied, but there are social and cultural dynamics that might help explain the connection between the two groups.

The Dinar revaluation theory emerged after the 2003 Iraq War: The basic premise is that the Iraqi Dinar, which traded at around 3 IQD per USD before the 1991 Gulf War but crashed to roughly 1,310 IQD per USD, would suddenly revalue back to its previous rate or even higher. Believers often hold large quantities of physical Dinar notes, sometimes investing tens of thousands of dollars.

The theory's spread among Trump supporters was facilitated by several factors:

The "Global Reset" Narrative:

Many believers connected the Dinar revaluation to a broader theory about Trump leading a massive reorganization of the global financial system

This often tied into QAnon-adjacent beliefs about Trump secretly fighting a "deep state" that was suppressing the Dinar's true value

Some proponents claimed Trump and his team were directly involved in orchestrating a coming revaluation

Social Media Dynamics:

The theory spread rapidly through Facebook groups, YouTube channels, and forums that also shared pro-Trump content

Many of these platforms used similar language about "mainstream media suppression" of both Trump and the "truth" about the Dinar

Currency speculators and scammers actively targeted these communities, recognizing their receptiveness to anti-establishment financial narratives

Political Context:

The theory appealed to a desire for both financial windfall and validation of political beliefs

Some promoters claimed Trump's Middle East policies, particularly regarding Iraq and Saudi Arabia, would trigger the revaluation

The belief often aligned with broader skepticism of traditional financial institutions and expertise

Psychological Factors:

The combination of potential financial reward and political validation created a powerful motivational force

Believers often interpreted skepticism from financial experts as further evidence of a cover-up

The complexity of international currency markets made it easier for promoters to make plausible-sounding but false claims

Investment in the theory often strengthened social bonds within these communities, making it harder to abandon the belief

Despite years of failed predictions, the theory continues to circulate; some believers have modified the timeline but maintain their basic conviction. The persistence of this belief system despite contrary evidence and expert warnings illustrates how financial conspiracy theories can become deeply intertwined with political identity and resistant to contrary evidence. Both Trump supporters and proponents of the dinar revaluation theory often demonstrate a tendency toward belief in conspiracy theories or "hidden truths" that challenge mainstream narratives.

For more information on the Iraqi dinar, check out IBN's Dinar Page here: https://www.iraq-businessnews.com/the-dinar-page/?swcfpc=1    LINK

Clare:  Italian Defense Minister arrives in Baghdad

12/21/2024

Italian Defense Minister Guido Crosetto arrived in the capital, Baghdad, on Saturday, on an official visit to Iraq.

The Minister of Defense, Thabet Mohammed Al-Abbasi, received his Italian counterpart and the country's ambassador to Iraq, Nicolo Fontana, and the accompanying delegation at the ministry's headquarters in Baghdad.

An official reception ceremony was held for the guest, during which the national anthems of the Italian and Iraqi republics were played, according to a statement issued by the Iraqi Ministry of Defense.

During the meeting that brought together the two sides, he stressed Italy's efforts and its great role through the Italian experts and trainers present within the NATO mission and their support for Iraq through the training and development courses held for the Ministry of Defense cadres inside and outside Iraq.

During an expanded meeting attended by a number of senior leaders and officers in the ministry, the two parties discussed ways to develop future relations between Iraq and the Italian Republic, in addition to the two countries’ efforts to open avenues of joint cooperation in the future.  LINK

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Clare:  Renewing the Iraqi-Japanese partnership with $11 billion in loans for vital projects and development policy

12/21/2024

The United Nations Development Program and the Japan International Cooperation Agency (JICA) office in Iraq renewed their long-standing partnership to promote social and economic development in Iraq through funding from the Government of Japan and JICA.

This partnership, which has spanned more than fifteen years of cooperation with the Government of Iraq, reflects the strong commitment of the United Nations Development Programme and the Government of Japan/JICA to meet Iraq's need for basic services and an efficient, stable and reliable economic infrastructure, according to a JICA report seen by Shafaq News Agency.

He added that this partnership has contributed significantly to human and economic growth in Iraq, in line with Iraq's national development plans and programmes that focus on economic diversification, infrastructure modernisation and improving social services.

In support of reconstruction and development, Iraq has received 36 ODA loans from the Japanese government and the Japan International Cooperation Agency, totaling about US$11 billion. These loans include 34 loans for vital sector projects and two development policy loans.

This development assistance aims to support Iraq in achieving its sustainable development goals, with a focus on improving living conditions nationwide and restoring infrastructure to promote inclusive growth.

“JICA remains committed to addressing development challenges with the Government of Iraq through this impactful partnership with UNDP. This partnership provides comprehensive support to Iraqi officials to achieve international standards in project management, combining technical expertise, capacity development and development finance. All of this aims to improve livelihoods and promote sustainable development in the country,” said Hiroshi Suzuki, Chief Representative of JICA in Iraq. Under this renewed partnership agreement, and in line with the Iraq National Development Plan 2024-2028, UNDP continues to provide critical support to the Government of Iraq to facilitate the smooth implementation of key socio-economic projects financed by JICA ODA loans. This support includes coordination at senior level, fiduciary supervision, progress monitoring, technical assistance, knowledge sharing and capacity development. Furthermore, by enhancing transparency, accountability and adherence to international standards, the partnership ensures the successful implementation of these vital projects.

“This renewed partnership between UNDP and JICA highlights our shared commitment to supporting Iraq’s development goals, with a focus on infrastructure development, sustainable economic growth and human capital. Together, we aim to facilitate the successful implementation of vital projects that will not only rebuild Iraq’s infrastructure, but also enhance long-term socio-economic resilience and improve the lives of Iraqis across the country,” said UNDP Resident Representative in Iraq, Auke Lootsma.

This unique and renewed partnership underscores the benefits of effective trilateral cooperation in promoting prosperity, driving sustainable growth, and improving service delivery and infrastructure for a stable and prosperous Iraq. It also highlights the strong ownership by the Government of Iraq and serves as a model for impactful and sustainable partnerships that can contribute to long-term development in Iraq.  LINK