Iraqi Dinar
History The dinar was introduced into circulation in 1932, replacing the Indian
rupee, which had been the official currency since the British occupation of the
country in World War I, at a rate of 1 dinar = 13⅓ rupees. The dinar was pegged
at par with the British pound until 1959 when, without changing its value, the
peg was switched to the United States dollar at the rate of 1 dinar = 2.8
dollars. By not following the devaluations of the U.S. currency in 1971 and
1973, the dinar rose to a value of US$3.3778, before a 5 percent devaluation
reduced the value of the dinar to US$3.2169, a rate which remained until the
Gulf War, although in late 1989, the black market rate was reported at five to
six times higher (3 dinars for US$1) than the official rate.[2] After the Gulf
War in 1991, and due to the economic blockade, the previously used Swiss
printing technology was no longer available. A new, inferior quality notes issue
was produced. The previous issue became known as the Swiss dinar and continued
to circulate in the Kurdish region of Iraq. Due to sanctions placed on Iraq by
the United States and the international community and excessive government
printing of the new notes issue, the dinar devalued quickly, and in late 1995,
US$1 was valued at 3,000 dinars. Following the deposition of Saddam Hussein in
the 2003 invasion of Iraq, the Iraqi Governing Council and the Office for
Reconstruction and Humanitarian Assistance began printing more Saddam dinar
notes as a stopgap measure to maintain the money supply until new currency could
be introduced. Between October 15, 2003 and January 15, 2004, the Coalition
Provisional Authority issued new Iraqi dinar coins and notes, with the notes
printed by De La Rue using modern anti-forgery techniques, to "create a single
unified currency that is used throughout all of Iraq and will also make money
more convenient to use in people’s everyday lives."[3] Old banknotes were
exchanged for new at a one-to-one rate, except for the Swiss dinars, which were
exchanged at a rate of 150 new dinars for one Swiss dinar. These new banknotes
led to a new industry of selling the new Iraqi dinar to oversea investors who
hoped to profit from Iraq's new currency when the economy improved. The
provisional government of Iraq has made this legal, but the banknotes are
exchanged at different rates by companies wanting to make profit. Due to the
success of this program, though, Iraqi dinar has been widely counterfeited.
However, there are six different security features on the 25,000 Iraqi dinar
note that one can check for authenticity. [4] Although the value of the dinar
appreciated following the introduction of the new banknotes from 4,000 dinars
per U.S. dollar, at the time of their introduction, to a high of 980 dinars per
dollar, it is now held at a "program" exchange rate, as specified by the
International Monetary Fund,[citation needed] of 1170 dinars per US dollar at
the Central Bank of Iraq. However, there is not yet a set international exchange
rate and so international banks do not yet exchange Iraqi dinar. The exchange
rate available on the streets of Iraq is around 1200 dinars per US dollar. For a
wider history surrounding currency in the region, see The History of British
Currency in the Middle East. Speculation On May 3, 2007, the IMF released a
statement in relation to the international compact with Iraq, which has turned
the tide in regards to speculation on the Iraq dinar. The contents of the
article discuss changes made in Iraq on the economic front of how the Iraq
government had eliminated fuel subsidies. The article also stated that the
Central Bank of Iraq had raised interest rates in an attempt to allow a gradual
appreciation of the dinar in an attempt to fight dollarization of the Iraq
economy. Although there are claims of widespread optimism of some language used
later in the press release among some dinar speculators, there have been no
publicly released statements or analysis by any news sources or governments.[5]
Since the introduction of the new Iraqi Dinar in 2004 after the fall of Sadaam
Hussein, dinar speculators have resorted to private dealers to buy and sell the
Iraqi Dinar because there is no public market for the Iraqi Dinar. Currently,
dealers registered with the U.S. Treasury as a Money Service Business sell
dinars for around $1100 per 1 million IQD.[6] It is yet to be seen how much of a
return dinar speculators will receive. Redenomination This section does not cite
any references or sources. Please help improve this article by adding citations
to reliable sources. Unsourced material may be challenged and removed. (July
2010) According to a Reuters report on 11 Feb 2010, Iraq expects to redenominate
its dinar currency by knocking three zeros off the nominal value of bank notes
to facilitate currency transactions. Emerging from years of war and sanctions,
Iraq is trying to revamp its economy and boost oil production with a raft of
crude deals that may vault it to one of the world's top oil producers. 'The goal
is to improve the payment and receiving system in the country and consequently
to reform cash management,' said Mudher Kasim, a senior advisor at the central
bank. Kasim said that the central bank expected to start rolling out new notes
by the end of the year or the beginning of 2011. Iraq has 25 trillion dinars in
circulation, officials say. An Iraqi cabinet committee ordered the change in
2007, but the central bank did not think it is appropriate until recently. Coins
Coins were introduced in 1931 and 1932 in denominations of 1, 2, 4, 10, 20, 50
and 200 fils, with the 200 fils known as a rial. The 20, 50 and 200 fils were
minted in silver. In 1953, silver 100 fils coins were introduced. Following the
establishment of the Iraqi Republic, a new series of coins was introduced in
denominations of 1, 5, 10, 25, 50 and 100 fils, with the 25, 50 and 100 fils in
silver until 1969. In 1970, 250 fils pieces were introduced, followed by 500
fils and 1 dinar coins in 1982. Coin production ceased after 1990. In 2004, new
25, 50, and 100 dinars coins were introduced. However, these coins proved to be
unpopular & were withdrawn from circulation. Value Diameter Weight Composition
Obverse Reverse 25 dinars 17.5 mm 2 g Copper plated steel Inscriptions: "Central
Bank of Iraq" and "25 dinars" Outline map of Iraq 50 dinars [citation needed]
Brass plated steel Inscriptions: "Central Bank of Iraq" and "50 dinars" Outline
map of Iraq 100 dinars 22 mm 4.3 g Nickel plated steel Inscriptions: "Central
Bank of Iraq" and "100 dinars" Outline map of Iraq Banknotes Old banknote note
featuring Saddam HusseinIn 1931, banknotes were issued by the government in
denominations of ¼, ½, 1, 5, 10 and 100 dinar. The notes were printed in the
United Kingdom. From 1931 to 1947, the banknotes were issued by the Iraqi
currency board for the government of Iraq and banknotes were convertible into
pound sterling. From 1947, the banknotes were issued by the National Bank of
Iraq, then after 1954 by the Central Bank of Iraq. 100 dinars notes ceased
production in the 1940s but otherwise, the same denominations were issued until
1978, when 25 dinars notes were introduced. In 1991, 50 and 100 dinars were
introduced, followed by 250 dinars notes in 1995 and 10,000 dinars notes in
2002. Banknotes issued between 1990 and October 2003, along with a 25-dinars
note issued in 1986, bear an idealized engraving of former Iraqi President
Saddam Hussein. Following the 1991 Gulf War, Iraq's currency was printed both
locally and in China, using poor grade wood pulp paper (rather than cotton or
linen) and inferior quality lithography (some notes were reputedly printed on
presses designed for printing newspapers). Counterfeited banknotes often
appeared to be of better quality than real notes. Despite the collapse in the
value of the Iraqi dinar, the highest denomination printed until 2002 was 250
dinars. In 2002, the Central Bank of Iraq issued a 10,000-dinars banknote to be
used for "larger, and inter-bank transactions". This note was rarely accepted in
practice due to fears of looting and counterfeiting. This forced people to carry
around stacks of 250-dinars notes for everyday use. The other, smaller bills
were so worthless that they largely fell into disuse. This situation meant that
Iraq, for the most part, had only one denomination of banknote in wide
circulation. Currency printed before the Gulf War was often called the Swiss
dinar. It got its name from the Swiss printing technology that produced
banknotes of a considerably higher quality than those later produced under the
economic sanctions that were imposed after the first Gulf War. After a
change-over period, this currency was disendorsed by the Iraqi government.
However, this old currency still circulated in the Kurdish regions of Iraq until
it was replaced with the new dinar after the second Gulf War. During this time
the Swiss dinar retained its value, whilst the new currency consistently lost
value at sometimes 30 percent per annum. In 2003, new banknotes were issued
consisting of six denominations: 50, 250, 1,000, 5,000, 10,000, and 25,000
dinar. The notes were similar in design to notes issued by the Central Bank of
Iraq in the 1970s and 1980s. A 500 dinars note was issued a year later, in
October 2004. In the Kurdish regions of Iraq, the 50 dinar note is not in
circulation. According to a report on that was shown on February 6, 2010 on Al
Iraqiya TV channel, the Central Bank of Iraq considered a plan to redenominate
the Iraqi dinar in order to increase the strength level of the Iraqi currency,
which will allow people to carry less paper money. Mudhhir Muhammad Salih, a
member of a Central Bank advisory panel, told RFI that the plan is to remove the
zeros from the currency and phase out the current banknotes late this year. This
will be while the old banknotes will be gradually removed from circulation. He
did not specify when the new notes would be issued. Both will be legal tender in
Iraq until the old notes are completely withdrawn.” 1990-2002 Series 1990-2002
Series Image Value Main Color Description Obverse Reverse Obverse Reverse 1/4
Dinar (1993) Green Palm trees Building 1/2 Dinar (1993) Violet Astrolabe Great
Mosque of Samarra 1 Dinar (1992) Pink & Green A gold dinar coin Mustansiriya
Madrasah 5 Dinar (1992) Red Saddam Hussein The Monument to the Unknown Soldier
10 Dinar (1992) blueish-green Saddam Hussein Lamassu 25 Dinar (1990) Green
Horses Abbasid Palace 25 Dinar (1986) Brownish-Green Saddam Hussein & Horses
Al-Shaheed Monument 25 Dinar (2001) Green Saddam Hussein Ishtar gate 50 Dinar
(1991) Pink and Green Saddam Hussein Great Mosque of Samarra 50 Dinar (1994)
Brown and Blue Saddam Hussein Saddam Bridge 100 Dinar (1991) Green & Purple
Saddam Hussein Hands of Victory 100 Dinar (1994) Blue Saddam Hussein Baghdad
Clock 100 Dinar (2002) Blue Saddam Hussein Old Houses 250 Dinar (1995) Violet
Saddam Hussein Liberty Monument friese 250 Dinar (2002) Violet Saddam Hussein
Dome of the Rock 10,000 Dinar (2002) Pink / Violet Saddam Hussein, The Monument
to the Unknown Soldier Mustansiriya Madrasah, Arabic astrolabe Current banknotes
2003 Series Image Value Main Color Description Obverse Reverse Obverse Reverse
50 dinars Purple Grain silos at Basra Date palms 250 dinars Blue An astrolabe
Spiral minaret of the Great Mosque of Samarra 500 dinars Bluish-Green Dûkan Dam
on the Al Zab river Assyrian carving of a winged bull 1,000 dinars Brown A gold
dinar coin Mustansiriya School , Baghdad 5,000 dinars Dark blue Gelî Ali Beg and
its waterfall Desert fortress at Al-Ukhether 10,000 dinars Green Abu Ali Hasan
Ibn al-Haitham Hadba Minaret at the Great Nurid Mosque, Mosul 25,000 dinars Red
A Kurdish farmer holding a sheaf of wheat Carving of the Code of King Hammurabi