At a Glance

• The Iraqi Finance Committee officially advises delaying the vote on removing zeros from the dinar.
• Replacing banknotes without deleting zeros remains under the independent authority of the Central Bank.
• Redenomination requires brand-new laws to amend civil, commercial, and penal codes across Iraq.

According to an official legal memorandum obtained by Channel8 from lawmaker Dilan Ghafoor, the Parliamentary Finance Committee has formally recommended postponing the vote on the dinar redenomination draft law. 

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Key Statement and Focus Area

• The memorandum notes that "the process of only changing the Iraqi currency, without removing the zeros, falls strictly within the scope, duties, and responsibilities of the Central Bank of Iraq."
• The proposed delay in the redenomination draft law aims to identify the most significant challenges and obstacles in implementing any changes that may occur to the currency.

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The memorandum, written by Committee Chairman Uday Awad Kadhim, was dispatched to the Office of the Council of Ministers following an emergency Sunday meeting between Finance Committee members and Central Bank officials, during which they discussed strengthening monetary policy, financing the budget deficit, and implementing reforms to resolve the ongoing financial crisis. 

Kadhim clarified that the Central Bank of Iraq will proceed with replacing banknotes without removing zeros during the coming period, a mandate granted under Article 36 of the amended Law No. 56 of 2004.

The memorandum stresses that changing the currency with the removal of zeros from the value of the Iraqi currency requires the enactment of a law drafted by the Prime Minister's office and sent to the Council of Representatives for legislation. 

The document highlights that executing a currency redenomination necessitates comprehensive legal amendments to civil, commercial, and penal codes, along with revisions to active investment contract valuations.

Furthermore, the legislative process requires updating anti-money laundering and institutional integrity laws while clearly defining implementation timelines. 

These statutory adjustments are mandatory to safely preserve the rights and financial obligations of both public and private sector creditors.

"Accordingly and based on the above, the Finance Committee recommends postponing the vote on the draft law (changing the currency and removing zeros) until extensive discussions are held among the following entities (Finance Committee, Council of Ministers, Central Bank of Iraq, Ministry of Finance, Ministry of Planning), to identify the most significant challenges and obstacles in implementing any changes that may occur to the currency," the document concluded.

FYI

The long-shelved currency redenomination debate abruptly returned to the forefront of Iraqi politics due to unexpected public announcements and a deepening domestic budget squeeze.

Yesterday, the Iraqi Parliamentary Finance Committee hosted Central Bank officials on Sunday to evaluate monetary frameworks, optimize deficit-financing strategies, and address pressing issues like public sector payroll delays and inflation metrics. 

lawmaker Rebwar Karim told Channel8 today “the decision to remove the zeros from the dinar has its own procedures.” 

He said although the government plans to delete zeros from the dinar, the initiative remains pending without an official decision due to incomplete legislative steps.

However, Government spokesperson Haider al-Aboudi clarified that an official decision to delete zeros from the dinar has not been finalized, adding that the Finance Committee estimated a three-to-seven-year transition for the redenomination process, which will keep the currency's actual value unchanged.

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