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Canceling the currency auction, reducing borrowing, and “isolating” the central bank’s reserves ... the most important thing for hard currency in the 2021 budget

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Today, Monday, the Parliamentary Finance Committee revealed a tendency to cancel the currency auction, while indicating that the Central Bank's reserves will not be affected in the general budget for 2021.

The committee's reporter, Ahmed Al-Saffar, said in statements to the official agency and its subsidiary, Yass Iraq, that “when the draft budget is approved in the House of Representatives vote session, it becomes a binding law for the government and enforceable,” indicating that “the Ministry of Finance then issues instructions within a week or two to send to ministries to facilitate The budget execution process ”.

He added that "the budget deficit has been reduced from 71 trillion to 24 trillion only, as the lending scheme was deducting treasury transfers to the central bank 47 trillion, but we reduced it to only two trillion, if the price of a barrel of oil remained at 45 dollars," noting that "the deficit will disappear soon The government will have an abundance of money if the price of a barrel of oil remains high.

Al-Saffar stressed that "the Central Bank's reserves will not be affected at all in this budget, as we have reduced borrowing and canceled foreign loans."

The decision of the Finance Committee indicated that "there is a tendency to cancel the currency auction because it does not exist in all countries of the world except in Iraq," explaining that "the currency auction mechanism is incorrect, and hard currency is supposed to be given to actual importers, students, professors, and patients who travel outside the country and not to banks." “.

Al-Saffar indicated that "there is an increase in social care because large numbers of them were included, with the private sector participating in employing the unemployed," noting that "the budget carries a clear economic and social vision."

He stressed that "the committee will hold a meeting with the political blocs to bridge the gap in views and come up with the draft budget that can be passed easily under the parliament."

Regarding the dollar exchange rate, Al-Saffar pointed out that "the exchange rate is exclusively within the authority of the Central Bank and it is not possible to interfere in its work as it is responsible for the monetary system, the monetary mass, the exchange rate and the cash reserve."