Economic Development Initiative – Baghdad
On Tuesday, the Iraqi government, in collaboration with the Central Bank of Iraq, launched a comprehensive initiative aimed at reforming the banking sector.
According to a statement from the Prime Minister’s media office, banking reforms represent a crucial component of the broader economic reform agenda outlined in the government program. This initiative is designed to build upon the significant measures the government has initiated since taking office, with the ultimate goal of achieving the developmental objectives that necessitate advancements in the banking sector. The initiative encompasses integrated strategic banking reforms, heralding a pivotal moment in Iraq’s financial development, while aligning with the commitment to elevate banking standards, enhance financial flexibility, and strengthen the competitiveness of the financial system.
The statement further detailed that these reforms aim to align with developments both regionally and globally, and to foster partnerships that facilitate robust engagement in modern banking and financial transactions. The Central Bank is dedicated to establishing and refining regulatory and organizational frameworks in collaboration with international partners, thus contributing to sustained growth and fostering the development of the banking sector. In this effort, the government is committed to backing both the Central Bank’s reforms and the broader enhancement of the banking environment.
Key focus areas of the reform initiative include:
- Ownership Structures and Governance: Enhancing transparency and accountability by introducing diverse ownership structures and ensuring independent oversight of administrative councils.
- Service Quality Improvement: Increasing access to essential financial services for all citizens, improving operational efficiency, expanding product offerings, and modernizing the banking infrastructure.
- International Standards Compliance: Adhering to frameworks governing anti-money laundering and combating terrorist financing, alongside commitments to financial transparency to streamline banking services and meet business and citizen demands.
- Financial Resilience: Strengthening the financial safety of Iraqi banks by instituting robust capital and liquidity requirements to safeguard customer deposits and bolster the economy against domestic and international challenges.
This initiative forms part of a comprehensive strategy aimed at overhauling the banking sector, with the Central Bank actively collaborating with Oliver Wyman, a leading global consulting firm, to advance these ongoing reforms in government banks. This strategy represents a significant turning point in the future trajectory of the Iraqi financial system.
Additionally, the statement noted that detailed executive plans for these reforms will soon be presented. In this context, the government and the Central Bank will embrace a unified reform vision aimed at establishing a modern, transparent, and comprehensive banking system that aligns with the dynamic aspirations of the Iraqi economy.
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