Abadi’s financial adviser criticizes calls to cut the dinar and warns of the effects

Mohammed Saleh, financial adviser to Prime Minister Haider Abadi, criticized on Friday, calls to reduce the value of the Iraqi dinar against the US dollar, stressing that such a step will lead to three crises.
Saleh said in a statement Alsumaria News received a copy of it, “There are parties and personalities working unfortunately, to promote the idea of ​​deterioration of the exchange rate of the Iraqi dinar and bring about a deterioration in the standard of living and hit stability in order to impose a monetary tax urgently affecting all segments of the people, which is inflation, and the creation of a deliberate deterioration of the level of Living in order to fill the state some of its deficit without thinking about the management of revenues from outside the oil revenues, “noting that” the devaluation of the Iraqi currency through the reduction of the exchange rate of the dinar against the dollar, for example, will add destructive consequences in a negative impact of deepening the financial crisis, A new crisis of inflation General level of prices and inevitably generates inflationary recession, which exacerbates the general economic situation and common discontent is intended at the time of fighting the war on terror, and we desperately need the elements of economic stability.”
Saleh added that “the country will enter here with three crises, a financial crisis is not solved by rapid monetary policy methods such as reducing the exchange rate of the Iraqi dinar as the dollar campaign and the dollar-dollar pioneers and the rich who are fighting the people and the misery of the poor and low-income,” noting that “the second crisis is inflation prices and the deterioration caused by the deterioration of stability over the foreign currency and reduce the purchasing power of pensions and incomes of citizens exchange rate because of inflationary expectations and broadcast state of uncertainty and lack of confidence in Iraqi dinars economic stability.”
He explained that “the third crisis will be security because of terrorism and the war on the oppressor, the loser is the people and the winner of the devaluation of the dinar are the rich dollar and terrorism, do not forget that inflation in the regions and the rise of inflation rates there to 3 decimal places and the deterioration of the standard of living has accelerated victory over stability The standard of living in the rest of Iraq, which is the smart economic war practiced by the economic leadership in achieving the urgent victory. “He pointed out that” the government reduced its non-essential expenses and absurd and frivolous, but did not exercise austerity policy such as reduced salaries, pensions or welfare and expenses of War and the necessary investment process.”
“The internal and external borrowing process to finance the budget deficit is not a deflationary process, as some claim, it is a stimulus and expansionary process that fights deflation. Deflationary budgets that lead to economic stagnation are usually those in which the budget is balanced by a lower level of expenditure, budgets contractionary really, but budgets that build on the deficit is financed the deficit by borrowing are the budgets of the expansive nature, especially the current financial policy in Iraq, “asserting that” internal borrowing came in accordance with the vision of monetizing the debt often, any financing a debt by expanding cash relatively basis, not vice versa, either external borrowing same applies like any other external resources in revenues of oil, in terms of impact expansion to account falling on public spending and the money supply expansion according to known to specialists in monetary policy mechanisms external flows.”
“The promotion of controversial economic issues in the time of war and the victory over terrorism is a miserable attempt by a group of detractors who want to weaken the state and spread despair,” adding that “there is a process of programmed ignorance of the Iraqi street to dispel despair, promoted forces driven by suspicious negative in the positive financial conditions is a victory and get out of the neck of the bottle, as well as the military victory and liberating the land and man from the clutches of terrorism.”