Al-Sudani: Restrictions are useful, and I asked the Americans about their silence on the dollar chaos before me!
Answered about selling 300 million daily
Prime Minister Mohammed Shia al-Sudani asserted that US sanctions were the best way to eliminate “rogue shops” and that the punitive measures imposed on Iraqi banks were a result of the previous government’s failure to fulfill its commitments to the US. He also said that the Treasury described the progress in reforming the banking system as “the revolution we dreamed of.” During a lengthy interview, al-Sudani justified the increase in the Central Bank’s dollar sales by the acceleration of construction activity and the import of building materials. He also promised to launch a reform plan to correct the banking sector, which is “the most important in Iraq’s history.”
The video for this My FX Buddies Blogpost is below here:
Mohammed Shia Al-Sudani, during an interview with journalist Samer Jawad:
There is an exaggeration of the problems facing Iraq, even though countries face many similar challenges, even on the security level. During the ISIS crisis, they said that Iraq was finished, and on the economic level, they said that the economy was finished, but things later proceeded normally.
After assuming the premiership, I faced the issue of the agreements between the previous government, the Treasury, and the US Federal Reserve, which were two years old at the time, regarding a roadmap for Iraq to enter the global financial compliance circle. However, the previous government did not implement any of them, and the deadline expired at the beginning of my government.
My government was able to transform the challenge and commitment to the U.S. Treasury and the Federal Reserve into an opportunity to reform the Iraqi financial and banking system. This came at a social and political cost, which our opponents exploited. However, we leveraged the issue to end the anomalous situation of dollar-selling shops, which we all complained about, and we were able to implement the imposed obligations.
The sanctioned banks were sanctioned for violations committed during the previous government's term. The sanctions imposed by international institutions were related to that period, but there are no violations in this regard now.
We have been able to implement the standards, and now the Iraqi banking system operates transparently, in accordance with international compliance standards and certified by international institutions. During my last visit to New York, the US Treasury representative informed us that Iraq has achieved a revolution we had dreamed of in previous periods. International compliance standards have been applied to all Iraqi financial transfers, via correspondent banks and the US audit firm. Not a single dollar is spent without passing through these bodies.
The only cash dollars exchanged are for travelers, and are spent at the plane door. Therefore, not a single dollar is exchanged outside of improper transactions and procedures. The Central Bank's increased dollar sales have a different interpretation related to construction and development in the country, unlike what used to happen in the days when the process was conducted through receipts and chaos. Thirty percent of the value of our annual imports goes to construction materials, and this reflects the scale of construction and development.
The Iraqi banking system has reached such a level of reliability that international banks have begun opening credit lines here. We have contracted with Oliver Wyman to reform the private banking system, and we will launch the reform plan after Eid. It will be the most important plan since the founding of the Iraqi state. The government banking sector will be reformed under the supervision of Ernst & Young.
Al-Sudani: There is no American request to permanently dissolve the Popular Mobilization Forces, and Iraq's account in the Federal Reserve is not subject to guardianship.
Al-Sudani said in a press statement that "Iraq's account with the US Federal Reserve is now under the control of the government and is not subject to Washington's tutelage." He explained that he responded to questions about the United States' silence over the past 20 years by saying, "America wants to verify the final destinations of its dollar, and this is its legitimate right."
He stressed that "there is no American request to dissolve the Popular Mobilization Forces permanently."
The Prime Minister indicated that his government has no regrets about the one million job positions included in the three-year budget, stressing that this decision stems from the government's commitment to addressing accumulated structural and social problems.
Regarding the industrial sector, Al-Sudani revealed that products from 54 Iraqi factories are being exported to foreign markets, indicating that this step reflects a significant development in enhancing national production capabilities.
In the energy sector, Al-Sudani announced an increase in electricity production from 19,000 to 27,000 megawatts, stressing that these efforts are part of the government's strategy to improve services and meet citizens' needs.
Employees withdraw 8 trillion dinars from banks in two hours.. The Ministry of Finance seeks a solution.
Crisis of confidence despite the electronic system
Member of the Parliamentary Finance Committee, Moeen Al-Kadhimi, called for stopping the provision of subsidized dollars at an exchange rate of 1,320 dinars for non-essential luxury imports, and instead providing them for the import of necessities such as production lines and agricultural equipment, to reduce the volume of imports later. He pointed out that many private banks were not established according to the needs of economic sectors and that they profit from transfer operations despite being inactive due to their inability to deal with foreign correspondent banks. He also confirmed that the government deposits about 8 trillion dinars monthly as salaries for employees and retirees, but they are withdrawn within only two hours, calling for the matter to be addressed.
Moeen Al-Kadhimi, in an interview with journalist Saadoun Mohsen Damd:
The banking system is linked to the Central Bank, the body responsible for regulating banking operations. Numerous workshops have been held recently to develop the banking system. However, there are external factors that influence banks attempting to link up with foreign banks, which also impact the development process.
From our perspective as a parliamentary committee, we believe the Iraqi banking system is still in its early stages of adapting to global regulations. The Central Bank and the Ministry of Finance are required to support the work of banks so they can fulfill their role beyond limited tasks, such as supporting the agricultural and industrial sectors, and other diverse economic sectors.
Some banks are trying to profit solely from dollar transfers, without contributing to other developmental aspects. One of our most important observations is the increasing number of banks being established without feasibility studies. This is despite the fact that they are practically at a standstill because most of them have been unable to link up with international banks to conduct financial transfers, thus preventing them from accessing the currency window.
The Central Bank sometimes justifies some of the violations of its instructions by private banks. It must then address the missing relationship between the public and the banks. Some citizens lost their money after certain banks declared bankruptcy, and the Central Bank must also address this issue.
Improving banking performance is key, and we have approached the Central Bank about addressing the issue of depositing funds and the difficulty depositors face in withdrawing them later, while improving interest rates to ensure depositors feel valued. Most importantly, we are increasing automation, moving away from cash transactions.
The internet is no obstacle to the electronic transformation of financial transactions. Banks must improve their digital applications and technologies to benefit from the country's internet services and quality. Employee and retiree salaries, which amount to approximately 8 trillion dinars, are now paid electronically, but they are withdrawn within two hours, immediately emptying all banks. This must be addressed.
The Ministry of Finance's monthly priority is to convert its dollar balances into dinars to boost remittances and foreign imports, which are often for luxury goods, as traders benefit from the exchange rate difference. This must stop, and subsidized dollars must be allocated to essential needs, such as importing production lines, to reduce imports later.
The House of Representatives postpones its session
The House of Representatives decided, on Wednesday evening, to postpone its session scheduled for today.
The House of Representatives' media department said in a statement that the House of Representatives postponed its session due to a lack of quorum, without specifying a date.
The House of Representatives held a session on Monday and adjourned until Tuesday, but it was not held due to a lack of quorum.
Iraqi Ports Authority discusses operating mechanisms for the Grand Faw Port with the American company KBR.
The General Company for Iraqi Ports announced on Wednesday that a meeting was held at the Ministry of Transport headquarters with representatives from the American company KBR, in the presence of representatives from the Ministry of Planning, to discuss the mechanisms for the actual transition to operating the Grand Faw Port after the completion of the project's basic work.
Farhan Al-Fartousi, Director General of Iraqi Ports, told Shafaq News Agency, "The Grand Faw Port is going through a pivotal phase, as many preliminary works have been completed. This meeting is a strategic step to coordinate efforts between government agencies and international companies, ensuring the success of future operations."
Al-Fartousi pointed out that "the meeting comes within the framework of preparing for the transition to the actual operational phase of the port, relying on available international expertise and in line with the Prime Minister's government program," stressing that "qualifying Iraqi cadres to manage and operate the port is a key priority in the programs for contracting with international companies."
The cost of the Faw Port is approximately 4.6 billion euros, with an estimated capacity of 99 million tons annually, making it one of the largest ports overlooking the Gulf and the tenth largest in the world. The foundation stone for this project was laid on April 5, 2010.
The Grand Faw Port issue and the delays in its completion have sparked widespread controversy in Iraq. MPs have accused successive governments of striking deals with neighboring countries that squandered the port's construction in favor of those countries' ports. The project has also experienced some delays following the mysterious suicide of the technical director of the South Korean company Daewoo, which was implementing the Grand Faw Port project.
Geopolitical Fluctuations and Oil Markets: How Can Iraq Protect Its Economy from Shocks?
Amid the geopolitical turmoil sweeping the world, energy markets remain vulnerable to extreme volatility, posing significant challenges for oil-producing countries, including Iraq.
In this context, Mazhar Mohammed Salih, the Prime Minister's advisor for financial affairs, confirmed that Iraq's public finances are well-prepared to withstand any disruptions to global oil prices.
Peace Economics: Post-War Is Not Necessarily Stable
Despite global anticipation of an end to the Russian-Ukrainian war, Saleh believes that the post-war period will not mean immediate market stability. Rather, affected countries will enter what is known as "peace economies," which focus on reconstruction and increased investment to offset losses. This will create a new wave of demand for oil, driving prices higher.
Saleh explained that every 1% increase in global economic growth leads to a 0.5% increase in oil demand, which enhances oil price stability and prevents sharp collapses in the energy market.
Between Washington and Moscow... the oil balance game
While the United States is the world's largest crude oil producer, it faces major challenges if prices fall below $70 per barrel, due to the high cost of shale oil production. Russia, the second-largest producer, is not in its interest to sell oil at low prices, as it seeks to maintain international consensus within OPEC, especially in the post-Ukrainian war period.
The Iraqi economy: financial hedging and relative stability
Despite global challenges, Salih affirmed that Iraq's financial situation is stable, with the first quarter of 2025 drawing to a close without any financial disruptions. The country's fiscal policy is also operating with high discipline, ensuring the provision of salaries, pensions, and social welfare, in addition to the continued implementation of service projects according to the government's program.
He pointed out that the three-year federal budget, approved under Law No. 13 of 2023, set the price of oil at $70 per barrel, ensuring stable public revenues despite global economic fluctuations.
Finally, is Iraq heading towards financial stability?
While the world experiences severe volatility in oil markets, Iraq's fiscal policy appears to be moving steadily toward hedging and stability, while ensuring the sustainability of public revenues. As the three-year budget continues, the question remains: Will Iraq remain immune to the coming economic storms, or will geopolitical challenges impose a new reality on global oil markets?
The Central Bank of Iraq announces new plans to expand the "Asraflak" campaign over the next two months
The Central Bank announced new plans on Thursday to expand the "Asraflak" campaign over the next two months, while explaining the campaign's key outcomes.
Hussein Abdul Amir, Director of the Financial Inclusion Department at the Central Bank, told the Iraqi News Agency (INA): "There is communication with officials regarding the "Asraflak" campaign, through which the public is being promoted with financial literacy through the campaign's channels. We are developing plans and programs to monitor and measure the campaign's impact through the outcomes it generates with the public."
He pointed out that "the campaign will expand its scope over the next two months, and there will be widespread dissemination in the southern governorates for various aspects of financial awareness and education."
He explained that "the outcomes the "Asraflak" campaign is currently working on are diverse, and the most important effort will be the field effort in cooperation with financial institutions as well as public institutions."
The Ministry of Finance determines the disbursement mechanism in the event of a delay in approving the general budget.
Nouri explained in an interview with Al Furat News Agency that "the Minister of Finance will issue a circular allowing the disbursement of 1/12 of the total actual expenditures for current allocations for the previous fiscal year, excluding non-recurring expenditures, on a monthly basis until the budget is approved. Disbursements will also be made from the total annual allocation for ongoing investment projects according to the peaks achieved or actual equipment."
He pointed out that "the delay in approving the budget will affect the implementation of new investment projects, while funding for ongoing investment projects will continue to depend on the cash available to the Ministry of Finance."
PM's Advisor: Iraq's Oil Exports to the US Increased by 110% in Two Years
The Prime Minister's Financial Advisor, Mazhar Mohammed Salih, confirmed that Iraq's oil exports to the United States have increased by more than 110% in two years.
Salih told the Iraqi News Agency (INA): "Economic cooperation between Iraq and the United States extends to many diverse investment, trade, and economic fields. Economic cooperation between Iraq and the United States has witnessed remarkable developments in recent years." He noted that "the volume of trade between the two countries has more than doubled over the past two years, with Iraq's oil exports to the United States increasing by more than 110%, and Iraq's imports from the United States increasing significantly over the past two years, with the value of this trade ranging between $9 and $10 billion."
He explained that "Iraq's imports were primarily in automobiles, transportation equipment, and engineering and electrical equipment. However, the trade balance remained in Iraq's favor, with a difference of $5.7 billion, reflecting the continued superiority of Iraqi exports to the United States, particularly in the crude oil sector." He noted that "economic cooperation between Iraq and the United States is developing, with a focus on enhancing trade exchange and supporting joint investment activities, serving the economic interests of both countries."
Salih stated that "financial and economic cooperation is part of a positive joint dialogue between the two countries. Since the beginning of this year, many mutual understandings have been reached in the field of economic cooperation, which are consistent with supporting stability and economic reforms outlined in the government's program, particularly the development of an attractive investment cooperation environment for investors between the two friendly countries, within the country's general economic policy to achieve sustainable development goals."
Khamenei's representative calls on Iraqis to take to the streets in mass demonstrations.
Mojtaba al-Husseini, the representative of Iranian Supreme Leader Ayatollah Ali Khamenei in Iraq, called on Iraqis on Thursday to hold mass marches "with the participation of men and women from all social classes" tomorrow, Friday, to mark International Quds Day.
In a statement issued today from his office in Najaf, Al-Husseini urged Iraqis to condemn the "heinous violations" committed by Israel and the United States in Gaza.
He also called for what he called harmony with the peoples of Lebanon, Yemen, Syria, Iran, and "other revolutionary peoples, standing with the Palestinians in Gaza and within the occupied territories."
World Al-Quds Day, or International Day of Al-Quds, is observed on the last Friday of Ramadan each year. It is an annual event opposing Israel's occupation of Jerusalem, the capital of Palestine, and involves mobilization and demonstrations in several Arab and Islamic countries.
After salaries are paid, Erbil markets are crowded with shoppers before Eid al-Fitr (photos)
Erbil's markets are witnessing a brisk trade movement as Eid al-Fitr approaches. Demand for clothing, sweets, and gifts is on the rise, amid a noticeable recovery in sales, driven by several factors, most notably the start of salary distributions and commercial offers .
Ahmed Saeed, owner of a clothing store in Al-Qaysariyah Market, told Shafaq News Agency, "We are witnessing a greater turnout this year, especially after salaries were paid. Families come to buy Eid clothes, mainly for children, and there is a high demand for both traditional and modern clothing ."
As for Mohammed, a sweets shop owner, he confirms, “Demand for Klicha and oriental sweets has increased significantly. Every year, demand for sweets increases as Eid approaches, but this year there is more activity, especially since customers prefer to buy Klicha and pastries in large quantities .”
On a related note, some citizens believe that prices are relatively high. Umm Saifan, a housewife, told Shafaq News Agency, "Prices are slightly higher than last year, but we cannot ignore the children's joy of Eid. We are trying to take advantage of the offers and discounts to buy clothes for them, especially since salaries have been paid ."
For his part, Ali, a government employee, explained, "The disbursement of salaries has helped many shop more comfortably. Delays in some months of salaries have affected purchasing power, but now, with salaries being disbursed before Eid, things have become easier ."
A number of merchants confirm that "the last few days before Eid typically witness peak shopping, with some people preferring to buy their necessities at the last minute, after iftar ."
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Tehran: Iran sent its response to Trump's message via Oman yesterday.
Iranian Foreign Minister Abbas Araqchi said on Thursday that his country sent its response to Trump's message via the Sultanate of Oman yesterday.
In a statement carried by the IRNA news agency, Araqchi said: "We sent our response to Trump's message via the Sultanate of Oman yesterday," indicating that "the possibility of indirect negotiations with the United States remains as before."
He added: "Our policy is not to engage in direct negotiations with the United States in light of maximum pressure and military threats."
Talking about $2 billion missing and a catastrophic situation, a deputy confirms the continued smuggling of dollars through "new methods.
Parliamentarian and member of the parliamentary economic committee, Sipan Shirwani, confirmed that billions of dollars are lost in government bank accounts, pointing to "a new way to smuggle US currency to sanctioned countries."
"According to the reviews we conducted on the banks in the past period, we found a catastrophic situation in which Iraqi banks are operating, including those affiliated with the Ministry of Finance," Sherwani said in an exclusive interview with Al-Jabal platform on Thursday. "When you look at the expenditures, you find billions of dollars in corruption cases," he added, noting that "the numbers are beyond the range of expectations, and there is no oversight of these amounts."
Sherwani stated that "in one case at the Trade Bank of Iraq (TBI), two billion dollars are missing, and in another case, two trillion dinars were given as loans to the people, and nothing was returned. This reflects negligence on the part of the bank itself and the Ministry of Finance." He pointed out that "if there was no collusion between these parties, there is certainly a reason for the failure to return these funds. This proves the failure of the bank and the authorities responsible for managing the people's money."
At the same time, Shirwani added, "The smuggling of dollars abroad is continuing, and smugglers have found a way to smuggle the currency to neighboring countries and from neighboring countries to countries subject to US sanctions," stressing that "this is documented."
The parliamentarian said, "We see astronomical amounts of Iraq's financial resources being squandered, left unattended, and these sums are public funds deposited by the ministry in these banks for citizens to benefit from in various projects." He added, "These funds are being given to specific entities without revealing the identity or private information of those entities, and they are not returned."
According to Sherwani, "There are banks that have lost an estimated two billion US dollars due to non-performing loans, and in other banks, the amount of lost funds has reached one billion dollars, or trillions of Iraqi dinars," indicating that they "were granted to private entities, individuals, and companies."
The MP had previously held a press conference at the Parliament's press center regarding the "failure of the Ministry of Finance and government banks to manage state funds." He said that "in the absence of accurate oversight, billions of dollars have been lost in government banks without any real accountability, which raises questions about the management of these financial institutions." He pointed out that "Rafidain Bank has not been audited for more than nine years, in clear violation of transparency and accountability standards."
He added that "TBAB has not been audited for four years, despite the volume of financial transactions it conducts," stressing that "there are two trillion dinars in unrecovered loans at the bank, which constitutes a continuous financial drain. Financial obligations are converted from dinars to dollars, then sent to other countries and then smuggled to countries subject to sanctions. What raises suspicions about dollar smuggling operations is the disappearance of two billion dollars when it was received from Hamdia Al-Jaf at TBI."
Sherwani pointed out that "TBI's smart cards are ineffective outside Iraq, which requires an official explanation for this disruption. Obtaining loan funds in dinars instead of dollars leads to price differences of up to 10% between the official rate and the parallel rate, causing losses to the state treasury."
To protect public funds and recover defaulted loans, the MP confirmed, "We contacted the Ministry of Finance and the relevant banks to obtain the required data, but TBI Bank refused to provide us with the information under the pretext of account confidentiality, ignoring its responsibility to protect citizens' funds instead of covering up suspicions of corruption. The Ministry of Finance and Rafidain Bank refrained from responding to our official communications despite repeated confirmations." He stressed, "Based on this, and in accordance with Law No. 15 of the Council of Representatives and its formations, we will resort to the necessary legal measures and refer the entire file to the Integrity Commission, the Financial Supervision Bureau, the judiciary, and the Public Prosecution to ensure accountability and recover state funds."
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The nice article from that website
The Empire Strikes Back: Trump 2.0 and Iraq's Dollar Accounts at the Federal Reserve
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