In 2006, the Iraq Ministry of Finance (MOF) told the Iraq Central Bank (CBI) to create a plan to introduce new Iraq Dinar currency. No actual date was set until the CBI developed a plan on how it was going to accomplish this task. The CBI sent their plan to the Iraqi government financial committee and the Iraqi government agreed on the plan.
On February 6, 2010, Radio Free Europe Radio Liberty (RDE/RL) reported the intent of the plan by the Iraqi government to redenominate the countries currency. At the time Mudher Salih, who is now the former Deputy Governor of the Central Bank was a member of the Central Bank advisory panel. Salih stated that by the end of 2010 the new Iraqi dinar would be printed and placed into circulation. The old banknotes would be removed from circulation, as both the old and new currencies would co-exist. The Iraq government and the Central Bank did not introduce the new Iraqi dinar in 2010.
The Central Bank has stated on numerous occasions that the new Iraq currency would improve the purchasing power of the Iraqi dinar. There are other positive points of having the new Iraq currency: easier to handle in day to day cash transactions, control inflation, help facilitate payment systems, control banking transactions.
During the years 2011 and 2012 the Central Bank would leak articles to the media about their plan to introduce the new Iraq dinar. The CBI stated that they would release denominations of 50, 100, and 200, as well as one and two dinar coins. Another very significant piece of information that was made public was that the window to conduct the exchange was going to only be one year. The Central Bank announced through the media that they would introduce new currency in September 2012. This was widely reported in the Baghdad local media. Abdul-Hussein Abtan, Economic Committee Member of Parliament in Baghdad, stated in a press conference that there is an initial agreement between Parliament and the central bank to start the process of removing three zeros in September 2012. This was great news and people all over the world were excited about the new Iraq currency. However, not everyone was pleased with this news and on board with this plan. The Securities Exchange in Baghdad had a problem with the CBI and their new currency plan saying it would interfere with the value of the price of stock.
A European company was commissioned to print the new currency and was set to schedule a release into Iraq. The currency would be printed in Arabic, English and the Kurdish language.
As the world waited again for the release of the new Iraq currency in September 2012 the time came and went without any release. It was another major disappointment. It appears that there was too much interference from the committees inside the Iraq government as well as inside the Central Bank. They clearly could not come to an agreement on the timing as well as the plan.
There were two committees set up within the Iraqi government for the deleting of the three zeros. The Parliamentary Economic Committee and the Parliamentary Finance Committee. The Parliamentary Economic Committee thought the deletion of the three zeros would strengthen the Iraqi dinar currency. However, the Parliamentary Finance Committee members feared that it would cause money laundering and counterfeit operations.
Abdul Abbas Shayya, a member of the Parliamentary Economic Committee said “Reforming the management of the Iraqi currency now requires the deletion of the three zeros. This has been endorsed by the Parliamentary Economy and Investment Committee.” Shayya is a member of State of Law Coalition, led by Prime Minister Nuri Maliki. Shayya has been quoted as saying “that the Iraqi currency is weak and that the money supply has amounted to multi-trillions because of the existence of these useless zeros”. Also quoted was “that the country will witness a significant increase in oil revenues, financial earnings and high budgets”. Thus, “we will need to print new banknotes, as estimated by the Central Bank”. Shayya also stated to Al-Monitor “Iraq will need about 9 billion banknotes in the event of applying the three zeros”. Iraq today is dealing with 4 billion banknotes.”
In more recent times, the Council of Ministers has requested a delay in introducing of the new currency because of fears of money laundering.
Today, the current situation in Fallujah and Ramadi has the attention of high officials in the Iraqi government.
The Parliamentary Economic Committee member, Aziz Sharif Mayahi has stated that the committee understands that political blocs are preoccupied with the upcoming elections. The process to delete the zeros and introduce the new Iraqi dinar currency has now been delayed till January 2015.
The Former Deputy Governor Salih stated in a June 24, 2011 article with the RFE/RL media that large denominations equivalent to approximately $100 dollars would be issued to simplify major purchases and new coins.
There is no one individual outside of Iraq who is privy to know when this is all going to go down or happen. Only the Iraqi government can give the go ahead and issue the new Iraq currency.
It is a high probability that some information maybe revealed by the Central bank and by other government officials to the local media. With luck, the Central Bank and the Iraq government will follow through with next years plan to start the implementation of introducing the new Iraq currency.