Iraq’s latest economic strategy unfolds a visionary plan by establishing a free zone for trading imported goods using the Iraqi dinar. This ambitious project aims to reshape the nation’s economic framework, offering consumers competitive prices and strengthening the local currency’s position.
The Free Zone Concept
The National Iraqi News Agency reports the proposed free zone as a key to economic transformation. It’s designed to import goods and materials, offering these to the private sector priced in Iraqi dinars. This strategy represents not only an economic shift but also a step towards national economic independence.
Strategy Against Currency Fluctuations
Prime Minister Mohammed Shia Al-Sudani leads the charge, directing the Commerce Ministry to secure essential imports and stabilize their prices in the local currency. This effort is part of a wider strategy to tackle ongoing currency value challenges.
Expanding Economic Measures
The government is broadening its economic horizons with initiatives like re-export projects and a streamlined import process. Simplifying account opening and deposit procedures and facilitating the issuance of importer identities are part of this expansion, aimed at attracting more merchants and importers.
International Trade and Digital Payment Push
Ongoing talks with Iran aim to streamline cross-border trade, focusing on efficient payment methods. Simultaneously, Iraq is advancing digital payment systems, reducing reliance on cash, and preparing to introduce new policies for electronic payment services.
Response to Exchange Rate Issues
A decisive step to combat financial irregularities involves banning cash transactions in US dollars from January 1, 2024. This action addresses the misappropriation of a significant portion of the $10 billion in cash imports from the New York Federal Reserve each year. According to Mazen Ahmed from the Central Bank of Iraq, this is a vital part of transitioning the economy towards a preference for the Iraqi dinar, especially significant since the 2003 US invasion.
With its comprehensive approach, including the free zone, regulatory enhancements, and a shift towards digital transactions, Iraq is charting a new course in economic policy. These initiatives signal the country’s dedication to fortifying its economy, fostering stability, and paving the way for a resilient and prosperous future. As global economic dynamics evolve, Iraq’s forward-thinking measures serve as a model for economic innovation and adaptability.
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