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The Iraqi dinar () (
Arabic Arabic (, ' ; , ' or ) is a Semitic language spoken primarily across the Arab world.Semitic languages: an international handbook / edited by Stefan Weninger; in collaboration with Geoffrey Khan, Michael P. Streck, Janet C. E.Watson; Walter ...
: دينار;
sign A sign is an object, quality, event, or entity whose presence or occurrence indicates the probable presence or occurrence of something else. A natural sign bears a causal relation to its object—for instance, thunder is a sign of storm, or ...
: ID in
Latin Latin (, or , ) is a classical language belonging to the Italic languages, Italic branch of the Indo-European languages. Latin was originally a dialect spoken in the lower Tiber area (then known as Latium) around present-day Rome, but through ...
, د.ع in
Arabic Arabic (, ' ; , ' or ) is a Semitic language spoken primarily across the Arab world.Semitic languages: an international handbook / edited by Stefan Weninger; in collaboration with Geoffrey Khan, Michael P. Streck, Janet C. E.Watson; Walter ...
;
code In communications and information processing, code is a system of rules to convert information—such as a letter, word, sound, image, or gesture—into another form, sometimes shortened or secret, for communication through a communicati ...
: IQD) is the currency of
Iraq Iraq,; ku, عێراق, translit=Êraq officially the Republic of Iraq, '; ku, کۆماری عێراق, translit=Komarî Êraq is a country in Western Asia. It is bordered by Turkey to Iraq–Turkey border, the north, Iran to Iran–Iraq ...
. It is issued by the
Central Bank of Iraq The Central Bank of Iraq (CBI) ( ar, البنك المركزي العراقي) is the central bank of Iraq. It was established in 1947, the same year in which the British occupation of Iraq was ended. CBI's primary objectives are to ensure domestic ...
and is subdivided into 1,000 fils (فلس), although inflation has rendered the fils obsolete since 1990. On 26 December 2022, the exchange rate with the US Dollar was US$1 = 1556 dinars.


History

The Iraqi dinar entered circulation on 1 April 1932, replacing the
Indian rupee The Indian rupee ( symbol: ₹; code: INR) is the official currency in the republic of India. The rupee is subdivided into 100 '' paise'' (singular: ''paisa''), though as of 2022, coins of denomination of 1 rupee are the lowest value in use ...
, which had been the official currency since the British occupation of the country in
World War I World War I (28 July 1914 11 November 1918), often abbreviated as WWI, was one of the deadliest global conflicts in history. Belligerents included much of Europe, the Russian Empire, the United States, and the Ottoman Empire, with fig ...
, at a rate of 1 dinar = 11 rupees. The dinar was pegged at par with sterling until 1959 when, without changing its value, the peg was switched to the
United States dollar The United States dollar ( symbol: $; code: USD; also abbreviated US$ or U.S. Dollar, to distinguish it from other dollar-denominated currencies; referred to as the dollar, U.S. dollar, American dollar, or colloquially buck) is the officia ...
at the rate of ID 1 = US$2.80. By not following the US
devaluation In macroeconomics and modern monetary policy, a devaluation is an official lowering of the value of a country's currency within a fixed exchange-rate system, in which a monetary authority formally sets a lower exchange rate of the national curre ...
s in 1971 and 1973, the official rate rose to US$3.3778, before a 5% devaluation reduced its rate to US$3.2169, a rate which remained until the
Gulf War The Gulf War was a 1990–1991 armed campaign waged by a 35-country military coalition in response to the Iraqi invasion of Kuwait. Spearheaded by the United States, the coalition's efforts against Iraq were carried out in two key phases: ...
in 1990, although in late 1989 the black market rate was reported at five to six times higher than the official rate.


Post-1990 developments

After the Gulf War in 1990, due to UN sanctions, Iraq was no longer able to place orders with
De La Rue De La Rue plc (, ) is a British company headquartered in Basingstoke, England, that designs and produces banknotes, secure polymer substrate and banknote security features (including security holograms, security threads and security printe ...
for further issues of the previously high quality notes, so new, inferior quality notes were produced. The pre-1990 notes became known as the “
Swiss dinar The Swiss dinar ( ar, دينار سويسري) was the Iraqi currency in circulation prior to the 1990 Gulf War. Name The reason for the adjective "Swiss" is unknown, two possible explanations have been offered. It has been claimed the printi ...
s” while the new dinar notes were called “Saddam dinars”. Due to United States and the international sanctions on Iraq along with excessive government printing, the Saddam dinar currency devalued quickly. By late 1995, US$1 was valued at ID 3,000 on the black market. Swiss dinars notes continued to circulate in the politically isolated Kurdish regions of Iraq. The Kurdish government refused to accept the low quality Saddam dinar notes (which were issued in huge amounts). Since the supply of Saddam dinar notes increased while the supply of Swiss dinar notes remained stable (even decreased because of notes taken out of circulation), the Swiss dinar notes appreciated against the Saddam dinar note. By having its own stable currency, the northern part of Iraq effectively evaded inflation, which ran rampant throughout the rest of the country. After
Saddam Hussein Saddam Hussein ( ; ar, صدام حسين, Ṣaddām Ḥusayn; 28 April 1937 – 30 December 2006) was an Iraqi politician who served as the fifth president of Iraq from 16 July 1979 until 9 April 2003. A leading member of the revolutio ...
was deposed in the
2003 invasion of Iraq The 2003 invasion of Iraq was a United States-led invasion of the Republic of Iraq and the first stage of the Iraq War. The invasion phase began on 19 March 2003 (air) and 20 March 2003 (ground) and lasted just over one month, including ...
, the Iraqi Governing Council and the
Office for Reconstruction and Humanitarian Assistance ) , capital = Baghdad , largest_city = capital , common_languages = Arabic KurdishEnglish (''de facto'') , government_type = Transitional government , legislature = Iraqi Governing Council , title_leader = Administrator , leader1 = Jay ...
printed more Saddam dinar notes as a stopgap measure to maintain the money supply until a new currency could be introduced. Between 15 October 2003 and 15 January 2004, the
Coalition Provisional Authority ) , capital = Baghdad , largest_city = capital , common_languages = Arabic Kurdish English (''de facto'') , government_type = Transitional government , legislature = Iraqi Governing Council , title_leader = Administrator , leader1 = Ja ...
issued new Iraqi dinar notes and coins, with the notes printed by the British security printing firm
De La Rue De La Rue plc (, ) is a British company headquartered in Basingstoke, England, that designs and produces banknotes, secure polymer substrate and banknote security features (including security holograms, security threads and security printe ...
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". Multiple trillions of dinars were shipped to Iraq and secured in the Central Bank to exchange for Saddam dinar notes. Saddam dinar notes were exchanged for the new dinars at par, while Swiss dinar notes were exchanged at a rate of one Swiss dinar = 150 new dinars. Inflation and depreciation of the currency has continued since. On 19 December 2020, Iraq's Central Bank devalued the dinar by 24% to improve the government's revenue, which was affected by the
COVID-19 pandemic The COVID-19 pandemic, also known as the coronavirus pandemic, is an ongoing global pandemic of coronavirus disease 2019 (COVID-19) caused by severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2). The novel virus was first identi ...
and low oil prices. On 2 March 2019, the Central Bank's indicative exchange rate was ID 1,190 = US$1. and on 18 June 2021 it was ID 1,460.5000 = US$1. There is considerable confusion (perhaps intentional on the part of dinar sellers) around the role of the
International Monetary Fund The International Monetary Fund (IMF) is a major financial agency of the United Nations, and an international financial institution, headquartered in Washington, D.C., consisting of 190 countries. Its stated mission is "working to foster glo ...
in Iraq. The IMF as part of the rebuilding of Iraq is monitoring Iraq's finances and for this purpose uses a single rate (not a sell/buy) of ID 1170 per US$. This "program rate" is used for calculations in the IMF monitoring program and is not a rate imposed on Iraq by the IMF. For a wider history surrounding currency in the region, see British currency in the Middle East.


Use in speculation and fraud since the Iraq war (2003–present)

Since Iraq has few exports other than oil, which is sold in dollars, there is little international demand for dinars, resulting in an extremely high
exchange rate In finance, an exchange rate is the rate at which one currency will be exchanged for another currency. Currencies are most commonly national currencies, but may be sub-national as in the case of Hong Kong or supra-national as in the case of t ...
compared with other currencies. However, the downfall of
Saddam Hussein Saddam Hussein ( ; ar, صدام حسين, Ṣaddām Ḥusayn; 28 April 1937 – 30 December 2006) was an Iraqi politician who served as the fifth president of Iraq from 16 July 1979 until 9 April 2003. A leading member of the revolutio ...
resulted in the development of a multi-million-dollar industry involving the sale of dinars to speculators. Such exchange services and companies sell dinars at an inflated price, pushing the idea that the dinar would sharply increase in value to a profitable exchange rate some time in the future, instead of being redenominated. This activity can be either a legitimate service to currency speculators, or
foreign exchange fraud Foreign exchange fraud is any trading scheme used to defraud traders by convincing them that they can expect to gain a high profit by trading in the foreign exchange market. Currency trading became a common form of fraud in early 2008, according to ...
: at least one major such currency exchange provider was convicted of fraud involving the dinar. This trade revived after the election of
Donald Trump Donald John Trump (born June 14, 1946) is an American politician, media personality, and businessman who served as the 45th president of the United States from 2017 to 2021. Trump graduated from the Wharton School of the University of P ...
in November 2016, with many buyers believing that Trump would cause a sharp revaluation in the dinar (often referred to by the abbreviation "RV" by supporters of the dinar trade,) to an exchange rate comparable to the US dollar. In 2014, Keith Woodwell (director of the Utah Division of Securities) and Mike Rothschild (writer for '' Skeptoid'' blog) stated that the speculation over the Iraqi dinar originated from a misunderstanding of why the value of the Kuwaiti dinar recovered after the
First Gulf War The Gulf War was a 1990–1991 armed campaign waged by a Coalition of the Gulf War, 35-country military coalition in response to the Iraqi invasion of Kuwait. Spearheaded by the United States, the coalition's efforts against Ba'athist Iraq, ...
, leading to an assumption that the Iraqi dinar would follow suit after the fall of Saddam: Woodwell and Rothschild noted substantial differences in economic and political stability between Iraq and Kuwait, with Iraq facing pervasive sectarian violence amid near-total reliance on oil exports. In response to the growing concerns about fraud and scams related to investment in the Iraqi dinar, State agencies such as Washington State, Utah, Oklahoma, Alabama and others issued statements and releases warning potential investors. Further alerts were issued by news agencies. These alerts usually warn potential investors that there is no place outside Iraq to exchange the dinar, that they are typically sold by dealers at inflated prices, and that there is little evidence to substantiate the claims of significant appreciation of their investment due to revaluation of the currency. In February 2014, the
Better Business Bureau Better Business Bureau (BBB) is a private, 501(c)(6) nonprofit organization founded in 1912. BBB's self-described mission is to focus on advancing marketplace trust, consisting of 97 independently incorporated local BBB organizations in the Unite ...
included investing in the dinar as one of the ten most notable scams in 2013. There has also been a book written on the subject.


Coins

Coins were introduced in 1931 and 1932 in denominations of round 1 and 2 fils in bronze, and scalloped 4 and 10 fils in nickel. 20, 50, and 200 fils were 50% silver. The 200 fils coin is also known as a ''rial''. Bronze substituted nickel in the 5 and 10 fils from 1938 to 1943 during the World War II period and reverted to nickel in 1953. Silver 100 fils coins were also introduced in 1953. These coins first depicted King Faisal I from 1931 to 1933,
King Ghazi Ghazi ibn Faisal ( ar, غازي ابن فيصل, Gâzî ibn-i Faysal) (21 March 1912 – 4 April 1939) was the King of Iraq from 1933 to 1939 having been briefly Crown Prince of the Kingdom of Syria in 1920. He was born in Mecca, the only s ...
from 1938, and King Faisal II from 1943 until the end of the kingdom. 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 this series an allegorical sun replaced the image of the king, shapes and sizes remained the same with the exception of the 1 fil which was decagon shaped. This image was then replaced by three palms in 1968. In 1970, 250 fils pieces were introduced, followed by 500 fils and ID 1 coins in 1982. A number of the coins for 1982 were a commemorative series celebrating Babylonian achievements. During this period, many of the coins were identified by their shape due to being made of similar composition metals, as from 1980 onward 250 fils were octagonal, 500 fils square, and ID 1 decagon shaped. Coin production ceased after 1990 due to the emergency conditions generated by the
Gulf War The Gulf War was a 1990–1991 armed campaign waged by a 35-country military coalition in response to the Iraqi invasion of Kuwait. Spearheaded by the United States, the coalition's efforts against Iraq were carried out in two key phases: ...
and international sanctions. In 2004, a new series of coins were issued in denominations of ID 25, ID 50 and ID 100 and were struck in bronze, brass, and nickel-plated steel respectively. They are sparse in design and depict an abstract map of Iraq and the main rivers. File:4 Fils, 1933, obverse.jpg, 4 Fils, 1933, obverse File:4 Fils, 1933 reverse.jpg, 4 Fils, 1933, reverse File:Iraq Bronze Coin King Ghazi.jpg, 10 fils 1938, obverse File:IRAQ, GHAZI I 1938 -50 FILS b - Flickr - woody1778a.jpg, 50 fils 1938, obverse File:IRAQ, GHAZI I 1938 -50 FILS a - Flickr - woody1778a.jpg, 50 fils 1938, reverse


Banknotes

On 16 March 1932, banknotes were issued by the government in denominations of , , 1, 5, 10 and 100 dinars. The notes were printed in the United Kingdom by Bradbury, Wilkinson & Co. From 1932 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 The Central Bank of Iraq (CBI) ( ar, البنك المركزي العراقي) is the central bank of Iraq. It was established in 1947, the same year in which the British occupation of Iraq was ended. CBI's primary objectives are to ensure domestic ...
. 100 dinars notes ceased production in the 1940s, however, the same denominations were used until 1978, when ID 25 notes were introduced. In 1991, ID 50 were introduced and ID 100 reintroduced, followed in 1995 by ID 250 notes and ID 10,000 notes in 2002. Banknotes that were issued between 1990 and October 2003, along with an ID 25 note issued in 1986, bear an idealized engraving of former Iraqi President
Saddam Hussein Saddam Hussein ( ; ar, صدام حسين, Ṣaddām Ḥusayn; 28 April 1937 – 30 December 2006) was an Iraqi politician who served as the fifth president of Iraq from 16 July 1979 until 9 April 2003. A leading member of the revolutio ...
. Following the 1991 Gulf War, Iraq's currency was printed both locally and in China, using poor grade
wood pulp Pulp is a lignocellulosic fibrous material prepared by chemically or mechanically separating cellulose fibers from wood, fiber crops, waste paper, or rags. Mixed with water and other chemical or plant-based additives, pulp is the major raw ...
paper (rather than cotton or
linen Linen () is a textile made from the fibers of the flax plant. Linen is very strong, absorbent, and dries faster than cotton. Because of these properties, linen is comfortable to wear in hot weather and is valued for use in garments. It also ...
) and inferior quality
lithography Lithography () is a planographic method of printing originally based on the immiscibility of oil and water. The printing is from a stone (lithographic limestone) or a metal plate with a smooth surface. It was invented in 1796 by the German a ...
(some notes were reputedly printed on presses designed for printing newspapers). The primitive printing techniques resulted in a limitless variety in coloration and detail, one layer of the printing would be too faint while another would be too dark.
Counterfeit To counterfeit means to imitate something authentic, with the intent to steal, destroy, or replace the original, for use in illegal transactions, or otherwise to deceive individuals into believing that the fake is of equal or greater value tha ...
banknotes often appeared to be of better quality than real notes. Some notes were very poorly cut, and some notes even lacked serial numbers. Despite the collapse in the value of the Iraqi dinar, the highest denomination printed until 2002 was ID 250. In 2002, the
Central Bank of Iraq The Central Bank of Iraq (CBI) ( ar, البنك المركزي العراقي) is the central bank of Iraq. It was established in 1947, the same year in which the British occupation of Iraq was ended. CBI's primary objectives are to ensure domestic ...
issued an ID 10,000 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 ID 250 note for everyday use. The other, smaller notes were so worthless that they largely fell into disuse. This situation meant that Iraq, for the most part, had only one denomination of currency in wide circulation. Currency printed before the Gulf War was often called the ''
Swiss dinar The Swiss dinar ( ar, دينار سويسري) was the Iraqi currency in circulation prior to the 1990 Gulf War. Name The reason for the adjective "Swiss" is unknown, two possible explanations have been offered. It has been claimed the printi ...
'', a term of obscure and uncertain origins. These notes were manufactured in England by
De La Rue De La Rue plc (, ) is a British company headquartered in Basingstoke, England, that designs and produces banknotes, secure polymer substrate and banknote security features (including security holograms, security threads and security printe ...
and were of significantly 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 unendorsed 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% per annum. In 2003, new banknotes were issued consisting of six denominations: ID 50, ID 250, ID 1,000, ID 5,000, ID 10,000, and ID 25,000. The notes were similar in design to notes issued by the
Central Bank of Iraq The Central Bank of Iraq (CBI) ( ar, البنك المركزي العراقي) is the central bank of Iraq. It was established in 1947, the same year in which the British occupation of Iraq was ended. CBI's primary objectives are to ensure domestic ...
(CBI) in the 1970s and 1980s. An ID 500 note was issued a year later, in October 2004. In the Kurdish regions of Iraq, the ID 50 note is not in circulation. In March 2014, the CBI began replacing banknotes with anti-counterfeiting enhanced versions that include SPARK optical security features, scanner readable guarantee threads in addition to braille embossing to assist vision-impaired persons.Iraq new 5,000- and 25,000-dinar notes confirmed
Banknote News. 29 November 2014. Retrieved on 2014-11-30. In February 2015, the CBI announced the removal from circulation on 30 April 2015 of the ID 50 notes. Persons holding these banknotes were advised to immediately redeem them at their nearest bank for the ID 250 and higher denomination dinar notes at a one-to-one rate at no charge. In November 2015, the CBI announced the introduction of a new ID 50,000 banknote. This is the first new denomination banknote since the new series was first issued in 2003, and also the largest ever printed by the CBI. The current notes no longer depict
Saddam Hussein Saddam Hussein ( ; ar, صدام حسين, Ṣaddām Ḥusayn; 28 April 1937 – 30 December 2006) was an Iraqi politician who served as the fifth president of Iraq from 16 July 1979 until 9 April 2003. A leading member of the revolutio ...
and now feature inscriptions in both Arabic and Kurdish. The banknotes are printed using new security features from Giesecke & Devrient &
De La Rue De La Rue plc (, ) is a British company headquartered in Basingstoke, England, that designs and produces banknotes, secure polymer substrate and banknote security features (including security holograms, security threads and security printe ...
and measure 156 × 65 mm. They feature an outline map of Iraq showing the
Euphrates The Euphrates () is the longest and one of the most historically important rivers of Western Asia. Tigris–Euphrates river system, Together with the Tigris, it is one of the two defining rivers of Mesopotamia ( ''the land between the rivers'') ...
&
Tigris The Tigris () is the easternmost of the two great rivers that define Mesopotamia, the other being the Euphrates. The river flows south from the mountains of the Armenian Highlands through the Syrian and Arabian Deserts, and empties into the ...
rivers as well as the Great Mosque of Samarra.


Kingdom of Iraq dinar series (1932–1939)


Swiss dinar series (1979–1986)


1990–2003 series


2003–present


Exchange rate


See also

* British currency in the Middle East *
Central Bank of Iraq The Central Bank of Iraq (CBI) ( ar, البنك المركزي العراقي) is the central bank of Iraq. It was established in 1947, the same year in which the British occupation of Iraq was ended. CBI's primary objectives are to ensure domestic ...
*
Economy of Iraq The economy of Iraq is dominated by the oil sector, which has provided about 99.7% of foreign exchange earnings during its modern history. As of 2021, the oil sector provides about 92% of foreign exchange earnings. Iraq's hitherto agrarian econom ...
* Iraqi art *
Iraqi Swiss dinar The Swiss dinar ( ar, دينار سويسري) was the Iraqi currency in circulation prior to the 1990 Gulf War. Name The reason for the adjective "Swiss" is unknown, two possible explanations have been offered. It has been claimed the printi ...
* Kuwaiti dinar


References


External links


Central Bank of Iraq homepage

Council on Foreign Relations: benefits of the new Iraqi dinar

Iraqi Dinar Scam – Washington State Department of Financial Institutions warning

Iraqi Dinar Scams – Oklahoma Securities Commission warns residents

Dmoztools.net – Iraqi Dinar
{{Portal bar, Asia, Iraq, Money, Numismatics Currencies of Iraq Economy of Iraq Currencies introduced in 1932