IRAQ DINAR INVESTMENT
Why Buy Iraq dinar?
IRAQ IS MAKING ALL THE RIGHT MOVES
Iraq's Proven Oil Reserves are over $10 Trillion Dollars
A vibrant country with a highly educated population of just over 22 million people. Released from the repressive regime of Saddam Hussein, Iraq has the potential to become a $70 billion dollar a year economy, with one of the largest oil and gas reserves in the world, second only to Saudi Arabia.
Major industrial nations from around the world are present in Iraq, either as military or civilian support, to assist Iraq in its desire to establish a safe, secure and economically sound country. Trillions of dollars have already been pledged for repair and restoration. Reconstruction of the infrastructure including power; water; road and highways; IT and phone systems; and health and human services, has already begun.
The United States has pledged over $18 Billion, military and civilian support, debt relief and economic ties that will give Iraq the capability to develop it's potential as a $70 billion a year economy, one of the largest in the region.
Iraq is quickly establishing beneficial relationships in an effort to export its oil and gas reserves through already established pipelines in its neighboring countries.
The monetary system established by the new government encourages foreign investment, a key to develop a strong economy.
CBI - Central Bank of Iraq
The Central Bank of Iraq is an independent agency, not affected by the political parties of the many factions in Iraq.
Stock Market. ISX - Iraqi Stock Market
In 2006 a new stock market opened with record trading volumes pushing stock prices drastically upwards for the 27 firms listed, with over 2 billion shares changing hands in only 6 trading sessions. In August 2007 the ISX opened its doors to foreign investors. 2012 ISX is now fully electronic and expected to be linked up with other bourses in the region and around the world shortly. ISX now trades 5 days a week. Today in 2012 there is now 94 companies listed and many more in the pipeline including various nationalised industries.
The central bank of Iraq offered its first treasury bonds on July 18th, with broad participation of the private commercial banks of Iraq.
Real Estate/Property Market.
Real estate in Iraq is booming, largely because of the severely depressed prices due to the restrictive policies of the old regime. With money flowing into Iraq, citizens are now buying houses in neighbourhoods generally reserved for government officials.
With the new government firmly in place, the reconstruction of the infrastructure including rebuilding many of the major oil fields is steadily going forward. Iraq has signed tentative agreements with international oil companies to exploit its vast oil reserves.
History of Iraqi Dinar 1932 - 2011
Currency unit consisting of 1,000 fils or 20 dirhams. When officially introduced at the end of the British mandate (1932), the dinar was equal to, and was linked to, the British pound sterling, which at that time was equal to US$4.86.
Iraqi dinar (ID) equaled US$4.86 between 1932 and 1949 and after devaluation in 1949, equaled US$2.80 between 1949–1971.
Iraq officially uncoupled the dinar from the pound sterling as a gesture of independence in 1959, but the dinar remained at parity with the pound until the British unit of currency was again devalued in 1967.
One Iraqi dinar remained equal to US$2.80 until December 1971, when major realignments of world currencies began.
Upon the devaluation of the United States dollar in 1973, the Iraqi dinar appreciated to US$3.39.
It remained at this level until the outbreak of the Iran-Iraq War in 1980.
In 1982 Iraq devalued the dinar by 5 percent, to a value equal to US$3.22, and sustained this official exchange rate without additional devaluation despite mounting debt.
In early 1988, the official dinar-dollar exchange rate was still ID1 to US$3.22; however, with estimates of the nation’s inflation rate ranging from 25 percent to 50 percent per year in 1985 and 1986, the dinar’s real transaction value, or black market exchange rate, was far lower-only about half the 1986 official rate.
1986–2003 1986–2003 between .33 cents to 1.32 to a dollar.
Oil-production: 2.452 million bbl/day (2001 est.); note — production was disrupted as a result of the March -
April 2003 war (2001est.)
GDP: purchasing power parity — $58 billion (2002 est.)
Exports–partners:US 40.9%, Canada 8.2%, France 8.2%, Jordan 7.5%, Netherlands 6.4%, Italy 5.4%,
Morocco 4.7%, Spain 4.4% (2002)
In october 2003, the official dinar-dollar exchange rate was ID1 to US$0.00027.
August 2004 till 2005, the official dinar-dollar exchange rate is ID1 to US$0.00068. Population: 25,374,691 (July 2004 est.) *See graph at top of this page to chart the dinar from 2004 - 2011
Positive Changes in Iraq
Upon Saddam Hussein’s deposition in 2003, Iraq has undergone political and economic changes. Many believe that the re-building of Iraq’s infrastructure will stabilize Iraq socially, politically, and economically. With the new government establishing a new monetary system that encourages foreign investment, and the central bank of Iraq awarding foreign licences, many also believe that the value of the new Iraqi dinar banknote is poised to escalate.
More Treasury Bills on the Way
The government of Iraq will issue more Treasury bills to the secondary market. For the first time in years, the central bank auctioned Treasury bills in July. Thus far, local banks have bought 900 billion Iraqi dinars ($628 million) worth of three-month bills with coupons ranging between 2.5 percent and 6.8 percent. To improve Iraq’s local currency, the dinar against the dollar, Iraq’s central bank also plans to build up its foreign-currency reserves.
Creating viable domestic capital markets will start the process of trimming the massive pre-war debt. Iraq’s path to debt reduction along with
the generosity of the Paris Club by forgiving 80% of Iraq’s debt is good news for the Iraqi economy. Iraq’s growth-oriented policy, along with Iraq’s prospects of economic stability makes investing in the dinar potentially lucrative.
The Central Bank of Iraq
For the first time in decades, the central bank of Iraq awarded foreign bank licences to the following banks: HSBC, Standard Chartered, National Bank of Kuwait, Iranian National Bank, Commercial Housing bank, and Bahraini Arab Banking Institute. The Bahraini Arab Banking Institute is listed on the Bahrain, Kuwait, and Paris stock exchanges, and its major shareholders include the Kuwait Investment Authority, the central bank of Libya, and the Abu Dhabi Investment Authority. Granting foreign licences and liberalizing interest rates will create a vibrant free-market economy. Iraq’s re-invigorated banking policies will positively effect the value of the dinar in the near future.
The Potential of the Dinar
Prior to United Nations sanctions, the Iraqi dinar traded at 3.35 per U.S. dollar, and prior to the war in Iraq, the Iraqi dinar traded at .33 U.S. Dollars. During major combat operations, the Iraqi dinar declined to an all time low. However, after major combat operations, the value of the dinar increased 25%. Countries such as Germany (post WWII) and Kuwait (post Iraqi invasion) experienced a similar devaluation of their currency, but both countries recovered. Today, the dinar has increased from 3,500 against the dollar during the U.S. led invasion last year to 1,400 against the U.S. dollar. Imagine the growth potential of the Iraqi dinar once Iraq recovers and begins to enjoy the potential revenue of a country rich in oil and other natural resources.
The New Iraqi Dinar Banknote
Today, De La Rue, the world’s largest commercial security printer and papermaker based in Great Britian, prints the new Iraqi dinar banknote. The new Iraqi dinar banknote has various security features making the dinar very difficult to counterfiet, and the dinar banknote is now available in 50, 250, 500,1000, 5000, 10000, and 25000 bills. With the re-building of Iraq’s infrastructure and with the prospect of stability at hand, the Iraqi dinar is quickly becoming a very attractive investment opportunity.
The time to invest in the Dinar is now!
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