Central Bank Digital Currencies (CBDCs): An Analysis of Global Experiences and the Feasibility of Implementing a Digital Dinar in Iraq

Abstract

This study aims to investigate the possibility of Central Bank Digital Currencies (CBDC) in Iraq, with the digital dinar as a way to strengthen financial stability and digital transformation. Various leading global experiences were analyzed to extract the key factors for the success of such projects, including technological, regulatory, and legal. The results show that Iraq faces significant challenges, weak digital infrastructure, and heavy cash transactions, so comprehensive strategies must be developed to overcome these obstacles and ensure the success of the project. To achieve success in the implementation, the technical capabilities of banks must be enhanced, and a regulatory environment that is adaptable to digital transformation and encourages financial innovation must be created. The study recommends a phased approach, starting with pilot projects between the public and private sectors, to assess the risks and make necessary adjustments to achieve the desired goals. The study emphazises the importance of collaboration with international financial institutions and leverages previous experiences to ensure compliance with international standards and build trust and security in the digital currency. The digital dinar is a strategic opportunity to increase financial inclusion, transparency, and provide innovative tools to support monetary policies, achieve sustainable development and economic stability in Iraq, and give the government greater means to fight corruption and promote good financial governance.