Television Interview with Former Iraq CBI Governor Dr Shabibi.

Thanks to Sunny Bedi for post:

Here’s what was said in the video with Shabibi:
The reporter asked him about the current problems with the CBI, and Shabibi responded with a defensive answer of all they have contributed and done to improve the economy in Iraq. He said they contributed since 2003 to give the CBI a good global image/reputation. He said they are proud of what they have accomplished and do not need to defend themselves. 

He thanked all that have stood by their side in the face of the injustice and unfairness they have faced. He alluded to things that were said are not true, and that the important thing is that the CBI returns to its formal role. He said the removal of Chapter 7 sanctions are a big victory for Iraq. From an economic standpoint, they are able to enter the economic world without restrictions. There is now a need to develop themselves to be equal to the rest of the world, to take full advantage of the opportunities, and to be successful in entering the economic world. 

He said there are some who said there was no true progress on the part of the CBI. But they had introduced the new currency (post Saddam). There are those who said it was the Americans who did this, but the national staff played a large part in this, working with the Americans to distribute it. 

Because of this there was large progress. They had previous inflation of about 68% when they started, but brought it all the way down to 5.2%. This was a result of the monetary policy they introduced whose goal was to reduce inflation and they achieved that goal. He said they greatly reduced inflation and worked with his colleagues on a policy which raised the value of the dinar (which was a part of fighting inflation) from 2,014 in 2002 to 1,169 in 2012. They had programs like the Reserves, Paris Club, etc.

The reporter asked about the CBI issue, if it is political or truly a matter of money laundering and wasteful spending, fraud, etc. He clarified that the role of the CBI is in trading currency, a direct process at a certain rate. He said if you want to see if there is corruption in the CBI, look to and concentrate on the auctions. How the dinar comes in, how it is exchanged to the dollar. Some employees may give better rates to certain banks. When it comes to the purchase, this is not the role of the CBI. This goes to the trade banks. Look at how some money is exchanged in other countries like Dubai for example.

The reporter referred to a statement by Turki, in which he said any amount of over 100 Million US dollars daily at the auctions is money laundering or fraud, but that the CBI report shows that there are some days where there is over 200 Million. Shabibi said that this requires a study. The issue is that the CBI is to preserve the stability of the price of the dinar, and has to fulfill whatever demand there is, taking into consideration what is in the reserve. The issue is the auctions. To solve problems, you also need to develop the economy. 

The reporter asked him about the resignation of Al-Suhail, and his accusations against the CBI. He said that that was unfortunate. He said Al-Suhail concentrated on issues and accusations against the CBI, accused the CBI of money laundering, but never showed them the cases pertaining to that. He said, his colleagues, who are honorable, but are now in prison, is that they were trying to make sure there were dollars behind the dinar and vice versa.

The reporter asked Shabibi about Khalid Shiltar, whom Shabibi accepted to be the head of the money laundering offices, even though he wasn’t qualified. Shabibi said that Shiltar came to the CBI, with a knowledge of the English language. Shabibi says he himself is weak in the English language. He said Shiltar came to the bank, but didn’t give us the truth or reveal the money laundering. The money goes to the trade centers, but go to the money laundering offices first. This is a separate committee, and they weren’t aware of all of this. 

The reporter said that Shiltar’s language of English did not qualify him for the position. He asked if Shabibi was under any kind of pressure from others to accept him. Shabibi said there was no pressure. He even knew some of his family. The truth is that he formed connections with some people who went against the CBI.

The reporter asked him about allegations from Miss. Fawzia Kathum that there was pressure on Shabibi to give amounts of money from the reserves to buy an electric plant which does not work, and to give money from the reserves to the government, and that Shabibi did not comply and that was the problem. Shabibi said this is another issue. This goes against the CBI laws. It is against the law to give funds from the reserve to anything but issues for the stability of the exchange price. That is why the issues of the auctions, taking dinar from the market, reduces pressure on prices and reduces inflation. The monetary policy is not a trade policy.

The reporter asked him who specifically asked Shabibi to take money from the reserves. He didn’t answer but said from the government in general. He said he can’t say who specifically. He said the government wanted 5 Billion from the reserves and the CBI refused. He said even Parliament helped them with that issue and it was lifted. He said if they had changed the law, or if it was in the process of being changed, it would be a different story.

The reporter asked about the reserves, that it is said they had 10 tons of gold. Shabibi said this was published, and with the Treasury. He said, when he left there was 67 or 68 Billion of combined dollars, sterling pound, euro and gold. 

The reporter asked how much in gold. Shabibi said about 32 tons. They went from 5 tons to 32 tons. He said when they decided to buy gold, it was about 1-2 months before he left. He said they did this because it is the most reliable and so there is more confidence.

The reporter asked if the local banks have an affect on the CBI. Shabibi said he did not know. But that the local banks require large reforms and development, to go to free trade, and they need help from the government by the government giving the local banks business. But that the local banks had work to do, increase their capital, not rely on auctions, and need to find loans even if it is with risk.

The reporter asked about the lifting of Chapter 7 sanctions, and if this posed any danger to Iraqi money. Shabibi said that this opened lots of opportunities. But is they have loans, the world is watching them. They (Iraq) have to pay their debts and fulfill their obligations. The CBI is separate.

The reporter then asked if he warned against anything. Shabibi said it is important to be in good standing members globally. They need to fulfill their obligations, specifically those agreed to by the Paris Club. He said he is worried that there are some people or ideas that will go in the direction against the Paris Club, and that they would be revised again by the Paris Club, and will not get the same conditions as in 2004.

The reporter asked what he meant by that. He explained that under the conditions of the Paris Club, they got a reduction or forgiveness of 80% in the loans. This is the best agreement in the world that can be given to an average income country. After the great increase in the Iraqi money and oil, if there is a problem with the Paris Club, they will definitely not get the same conditions. There will be those who will think they will have to pay more than the 20%.

Sources: Sunny Bedi at “The Right Choice”, Iraq Information News and Discussion site )

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Television Interview with Former Iraq CBI Governor Dr Shabibi