Future of Digital Currency in Iraq
Iraq’s Path Towards Digital Currency Implementation
Mazhar Mohammed Salih, the financial and economic advisor to Prime Minister Mohammed Shia Sudani, has indicated that the future introduction of digital currency in Iraq will simplify financial transactions. He stated that this digital currency aligns not only with domestic interests but also resonates with global central banking initiatives.
The concept, as articulated by Salih, originated from the International Package Bank based in Basel, Switzerland. He outlined a project known as MB Bridge, designed to facilitate the purification of financial transactions among central banks utilizing digital currency. "This external reflection will certainly influence internal processes," Salih remarked.
Salih underscored the necessity for the Iraqi Central Bank to engage with MB Bridge, particularly to streamline transactions within the world’s leading oil trade zones, including China, India, Southeast Asia, and several European nations.
The MB Bridge initiative commenced in 2021, supported by international clearing banks alongside Chinese financial institutions, aimed at expediting international payments through digital currencies, thereby lowering transaction costs.
Salih elaborated on the advantages of adopting digital currency, emphasizing that it would enhance banking interactions and mitigate cash-related risks. He pointed out that approximately 90% of cash operates outside the formal banking system in Iraq, which presents challenges for transitioning to a digital currency-focused economy.
Describing this initiative as a hopeful project for Iraq, Salih noted that the development of digital currency is not only aligned with global trends but also comparable to conventional paper currency. He assured stakeholders that there would be no discrepancies in exchange rates, citing the enhanced efficiency of digital currency.
In conclusion, Salih stated that as the world evolves, Iraq must keep pace with these developments, reinforcing the idea that digital currency will serve as a viable alternative to traditional banking methods.