Iraqi Swiss Dinar
Since the frenzy is all about the Iraqi Dinar IQD we though it would be a great idea to have a little look at the history of recent times, some of you will remember the Iraqi Swiss Dinar.
Prior to the 1990 Gulf War the Swiss Dinar was the Iraqi currency in circulation at the time of the 1990 war with the foreign coalition forces.
It’s an unusually unique scenario because they chose the word “Swiss” but there are indeed two possible explanations.
- The printing plates for the currency came from Switzerland, although the notes were eventually printed in the United Kingdom. Even after the war, due to the economic sanctions that were authorized by the United Nations, they hit a dead end because importing of the Swiss notes became illegal. At which point the Central Bank of Iraq had no other choice but to begin in-house domestic printing of a new Iraqi Dinar.
- The other scenario which is very possible is that prior to the Gulf War, 1990, Iraq had shown itself to be a traditionally low inflation country, similar to Switzerland.
The monetary situation was further complicated by an essentially separate currency in northern Iraq. The Kurdish area continued to use the banknotes that Iraq had used before the Gulf War, the Kurdish Government did not have access to the printing plates for the Swiss dinars—and because they refused to follow Saddam’s example and print low-quality notes of their own—the supply of Swiss dinars in the north had remained essentially ﬁxed for 13 years.
The Kurdish area actually flourished because of the stance they took not to adopt the new Iraqi Dinar, inflation rates for the Swiss Iraqi Dinar remained low and fairly unaffected by the happenings in the rest of Iraq.
The coalition eventually settled on officially pegging the currency at 150 Saddam dinars per Swiss dinar.
Ultimately the goal was to unify the two currencies, and since Saddam was no longer in power, the aim was to take the two currencies and merge into one. One thing for sure they wanted to take the image of Saddam away from the ordinary Iraqi going about his day to day life.
Reminds us of other currencies, an example being the Tunisian Dinar TND – the image below depicts that of the 10 Dinar Note which has an image of the Roman ruins of Sufetula, a real source of pride for they are among the very best preserved in the world. Then you see the image of the satellite, which is a constant reminder that under the reign on Ben Ali you were/are being watched.
It’s a real modern day version of subtle propaganda whereby just purchasing a newspaper and paying with your 10 TND note you are given a subtle reminder. For the majority it wouldn’t even become apparent but the subconscious mind works in wonderful ways.
So that’s the story, get Saddam of the note and remove as much of the reminders as possible, besides the currency itself was out of control and needed to be kept under control, a task the coalition was very much interested to see come to fruition.
The new Swiss currency was created in a different color to differentiate from the old currency and in fairness the exchange was pretty quick and without any real problems
Okay, now a question for you, knowing that the Coalition Forces pegged the currencies and did a straightforward exchange, and knowing that today the New Iraqi Dinar is out of control. Do you fear Iraq will decide to simply issue a new currency altogether?
After all the previous Saddam Currency represented him, is it possible that Iraq with its Shia fuelled agenda backed by Iran, what do you think is the possibility of Iraq deciding to cut ties with the current New Iraqi Dinar which was implemented at the direction of the Coalition Provisional Authority, remembering that the last 10 years have not exactly been a blessing. Could it be that the Shia Dominated government will take it out of circulation all together and go their own route?
It is very much a power struggle at the moment; is Iraq going to go with China, Russia and Iran or is she to stay with the Americans?
All the while the security situation is a mess we think it is prudent not to do anything with the currency, as ultimately future ongoing growth is dictated by economic activity at home and abroad. Record death tolls are increasing and many international companies are pulling out. If Iraq were to do something major with the currency it would ultimately be a flop meanwhile the socio situation is a mess.
You can’t have a prosperous currency whilst having a messed up country. If something is to happen, it certainly gives no impression of taking place any time soon, Iraq frankly speaking is a complete mess. Just yesterday according to the Iraq Body Count – 33 were killed Friday 20th December 2013.
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