Last week we heard the GOI plans to resubmit the budget to parliament on Tuesday 10/14. At least this is their target. According to my sources in the CBI, it is learned that the GOI was requested to update the figures to realistic revenues and projected expenditures. I do not want to keep harping about the Maliki past administration and you probably think I am doing some of politicking but I assure you I am not and just trying to demonstate to you how messed up and bad the mess that was left behind has found its way into every aspect of this new administration of Abadi including the budget he inherited. There is no such thing as an entirely new, clean slate handed over to you when you take office. Abadi has to work with the cards dealt to him when he took office.
Some of us can not fully understand why the budget has not been successful up to now. Remember how the process works. The GOI (the council of ministers) working with the finance committee propose a budget as to what they project they will need to run the government. The finance especially helps in the projected revenue side as they work directly with the government of Kurdistan on the major source of revenue, namely from oil. So you see if you wanted to steal billions how you can easily fluff the upcoming projects and using the system write fraudulent contracts. Iraq also no longer has to report to the IMF on approval for this budget for the first time since post war, post sanction days. They are now free to manage their own allocation of funds. So there is one side that still wants to continue this corruption as usual and the other side that needs to clean it up. This is the stalemate.
Update on the Currency Reform Project
As you may have heard, and it is true, many of the provinces have gone ahead and began rolling out the lower denoms to the public. How can this be, since the plan is to coincide this event with the international rollout and revaluation?
We also know that Iraq has done an in-country RV since they are loading rates beyond the 1166 onto the Qi cards. This is not the first time they have done this. The most recent deployment of funds was at a rate of $3.58. In the past they loaded $3.71 and other rates according to the government program being paid out.
So how can you conduct commerce and trade on the streets and even get money from an ATM machine using two violently apposed rates- that of $3.58 and 11660 ? The answer is obvious. You simply can’t and so you must at some point have a cutoff period. They also learned many lessons last time they loaded these cards. What they learned was they needed to distribute the lower denominations and coins to coincide with these news rates.
The problem that most people are having with reporting on news of this situation is this. They have been told for a long period of time that the lower denoms would coincide with the “international” rollout and revaluation. This was true, this was the plan. They expected it just to happen in unisons when they say the $3.58 rate, but this is purely their interpretation of the plan and maybe not the plan itself.
Was this Dr Shabibi’s plan. But what happened to his plan? Are they executing the original plan? I do not believe they are. It is a variation of it.
It is my very strong contention that Iraq is now doing one of two things:
1) Iraq is taking their sweet time rolling out this currency revaluation by first doing an in-county RV and next working towards the final international rollout. They are being required to have stability in both the political scene and security prior to this taking this to the next step. Under pressure they had to pay out these government programs and could not hold back any longer. The USA has the final power to pull the switch to complete this rollout process. They are working in partnership to complete the process.
2) Iraq knows it now has ample reserves and resources to back the new value of their currency rate. They have been preparing for this event now for four years. Now that Maliki no longer has as much influence in this matter and since they are out of sanctions they feel they should be making the decision are trying to force the international rollout on their own since they strongly feel they are ready and can handle any consequences and aftermath. On the other hand, the USA does not agree and since they still maintain the power to pull the final switch they will continue to hold up the process until they deem Iraq is ready to enter the international financial community. Should the USA now be making this decision or should it be just a matter of course in doing what Iraq now has been requesting?
So my conclusions are this – Based on all we know about Iraq and urgency to get their currency international, one has to stop and think who is holding up the process. Could it be there is still underlying manipulation and reasons why the USA is holding up this RV. Is there in fact corruption going on here? Could there simply be billions being made on the backend over the last year without completing the final rollout? This is hard to give up. Or – maybe the process is taking place and rollout has in fact begun. I will report more on this later in the week…stay tuned.
Recent Hype Once Again About an Imminent RV
This time I can hardly blame many of the Intel Guru’s for disseminating this information about an imminent RV this past week. I too have heard that Iraq has had high level meetings with the USA and the IMF on this matter and had requested a rollout to the international level to occur and do it now….like over the past couple days. There were target dates established and all parties agreed to this plan of action. It is now Monday 10/13 and so where is the RV?
So today I send you an update. It is once again a continuation of the ongoing saga of many events.
But the good news is I too have heard that Iraq is ready and have been pushing the IMF and the USA to rollout the new rates to the international community. Remember the new PM Abadi comes from the finance ministry and so he is fully aware of the ongoing saga of the currency reform project.
They are doing this on the aftermath of their recent funding of the Qi cards and final rollout of the lower denominations and coins. They have advertised the RV in their news papers and even speeches about the process in the mosques. They are fully ready for their revaluation. They have worked so hard in the midst of past political and financial obstacles to get to this point in time. There is now a new sense of urgency coming across to me from the CBI.
This RV was to have occurred over this past 4 day period. So what has happened? Why yet no international rollout? These are all very good very intelligent questions that we should no be asking. Let’s look as some options as to what may be happening.
Is it because we continue to wait once again for the controversial remaining two ministers to be seated?
Is it to get the 2014 budget cleaned up and finally at least through the first reading?
Does Iraq still feel they need more security in place prior to releasing an RV?
Are there still back room dealings and billions being made off the holdup of this RV? This is hard to give up !
Are their other reasons?
I my past news letters I compare the interconnectivity of these ongoing events to a spiders web and how this is very complicated as one event can effect the entire process.
But then we don’t truly know entirely what is going on behind closed doors. We hear that Iraq is more than ready for an international currency. We hear they have pushed and continue to push the USA in allowing the rollout to complete. Iraq claims they need their full currency back at least to pre-war value plus equity and have full sovereignty (out of Chapter 7 sanctions) so why the hold up? They claim having a currency will self-resolve many of their ongoing issues.
On the other hand we are hearing the USA wants these issues first resolved prior to letting the RV rollout complete. So how has the negotiations and agreements broken down. I have some really good contacts in the CBI and they are now telling me that all agreements were made last week and we should expect the final rollout the RV….like now. All agree to the situation and it should happen any day now. But still we wait.
I make these statements because the events going on now in Iraq are complicated and everything is closely interconnected and interdependent.
As spectators we want desperately to peg a single event to the RV. We want to have a pin point date and a target. It is human nature to feel this way. But we feel this way too because this is sometimes what all intel is telling us, as it is now.
If there could be any one thing you can do to speed up this RV process it might be to write your congressman and senators and request that you are demanding an explaination as to why the US is not being more proactive in resolving this ISIS situation. This is all it will take to wake up these politicians to the reality of sending more coalition forces into Iraq to work with Iraqi forces in ending this ISIS and DAASH crisis once and for all. As many of you know I do not like violence and do not like war. I always remember the suffering and dispare I witnessed when I was stationed in Iraq during desert storm. But at times there are simply evil elements (just as there are good) and the defenseless often need help to rid themselves of this evil. Not to mention too that this ISIS in not isolated just to the Middle East and should be a concern for all civilized societies.
Then when can we expect the RV?
All I will say is what I have been saying all along in that we wait for a formal (global) announcement to the public that the Iraq government is now FULLY formed and seated.
I want to emphasize once again this final announcement of the IQD going international will not happen until the USA feels the country of Iraq and its government is stable, non-sectarian and is a functional government. This is has been the plan all along. They may have wavered a bit on how the plan was implemented but the overall plan guidelines have not changed. This I know now as fact not rumor.
Peace and Luv To Ya All,