Warning against the "illusion of wealth": Iraq ranks among the poorest countries.
Economic expert Manar Al-Obaidi confirmed on Tuesday that the Iraqi economic crisis is not a crisis of money or oil prices, but rather a crisis of the absence of real production outside the oil sector, indicating that the per capita share of real production does not exceed $850 annually.
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Al-Ubaidi said in an economic analysis entitled “The Illusion of Oil Wealth,” which was reviewed by Shafaq News Agency, that the size of the Iraqi non-oil economy does not exceed 90 trillion dinars, almost half of which goes to government spending on salaries and employment, while the real output of the private sector does not exceed $38 billion annually.
He pointed out that dividing this output by the population reveals a shocking reality, as it puts Iraq at the level of resource-poor countries like Mali and Chad, stressing that what appears to be relative prosperity is a “temporary veneer” financed by oil revenues.
He added that the Iraqi private sector, despite its size, is still indirectly linked to oil, because its activity is concentrated in import and trade, and the dollar it depends on comes mainly from oil exports, which means a lack of productive independence.
Al-Ubaidi called for what he described as a “corrective revolution” to get out of the cycle of selling oil in exchange for imports, based on privatizing the banking sector, supporting huge productive projects capable of exporting, in addition to developing tourism and services as an “enduring oil” that does not run out.
He also stressed the need to simplify the business environment and eliminate bureaucratic red tape, and to adopt a trade diplomacy that obliges exporting countries to invest within Iraq, warning that the continuation of the current situation will keep the country merely a large consumer market subject to the fluctuations of oil prices.
The Iranian central bank announces direct intervention in the "exchange market" following sharp judicial criticism.
The spokesman for the Central Bank of Iran announced, in conjunction with the head of the judiciary's criticism of the bank's performance in the foreign exchange market, that it has been decided that the Central Bank will intervene in this market.
According to Iranian media reports, Mohammad Shirjian said that the board of directors and the exchange market management committee, chaired by the governor of the central bank, held a meeting today and it was agreed that the central bank would "intervene in the foreign exchange market using modern methods, on a large scale, continuously and intensively."
He did not provide details about the nature of this intervention, simply saying that an announcement would be made later.
Foreign currency prices in Iran have witnessed a rapid rise again in recent weeks. According to the latest reports from exchange rate monitoring websites, the price of the dollar exceeded 132,000 tomans on Monday, while the price of the euro reached 155,000 tomans, and the price of the British pound reached 177,000 tomans.
Monitoring by the “Tejarat News” website shows that the price of the dollar rose during the period from November 20 to December 20 of this year by about 18,000 tomans, which is equivalent to an increase of nearly 16 percent.
Media outlets inside Iran attribute the new jumps in the dollar's price to the recent policies of Masoud Pezeshkian's government, particularly the move towards economic liberalization and the abolition of the subsidized exchange rate.
The spokesman for the Central Bank of Iran said that, in cooperation with the Securities and Exchange Organization, two funds are planned to be launched: the “Foreign Currency Project Fund” and the “Foreign Currency Fixed Income Fund.” He explained that “all citizens and economic actors can, using their various foreign currency resources, whether cash, remittances, or foreign currency accounts, purchase units of these funds.”
The central bank's announcement came hours after Gholam Hossein Mohseni Ejei, the head of Iran's judiciary, criticized the bank's performance, saying: "The central bank has responsibilities and powers, and it must fulfill them; there should be no expectation that the judiciary will replace the central bank in carrying out its duties."
Referring to the Central Bank’s announcement of “identifying and freezing more than six thousand bank accounts belonging to 251 individuals suspected of money laundering and disrupting the exchange market,” Ejei asked: “How were these six thousand bank accounts created by a limited number of people? Isn’t it the Central Bank’s job to monitor banks?”
Egei also denied the claim of the Central Bank spokesman, who had announced on December 15 that the files of 13 people suspected of disrupting the banking system and the exchange market had been referred to the judicial authorities.
He said in this regard: “Until yesterday, when I followed up on the matter, such a file had not reached the judiciary. It is true that during the past weeks we received information about the case from some regulatory bodies such as the Revolutionary Guard Intelligence Organization, but we did not receive anything from the Central Bank.”
KRG Nears Completion of National Bank Establishment and Consolidation of Specialized Financial Institutions
KRG nears final stage of establishing a National Bank with 250 billion dinar capital and unifying 28 specialized banks to reform the financial sector.
That is an Ai generated concept of the building
The Kurdistan Regional Government (KRG) is entering the final stages of a significant restructuring of its financial sector, a move that includes the imminent establishment of a National Bank and a sweeping consolidation of specialized banking institutions across the region. The initiative, confirmed by officials on Tuesday, represents a central pillar of the administration’s broader economic reform agenda aimed at modernizing the region’s banking architecture and aligning it more closely with federal standards in Baghdad.
On Tuesday, a source within the Ministry of Finance and Economy of the Kurdistan Regional Government provided detailed updates regarding the status of these reforms to Kurdistan24.
According to the official, the procedural steps required to formally establish the National Bank are nearly complete, marking a pivotal moment for the financial governance of the Kurdistan Region. The new entity is designed to function as a branch of the Central Bank in the Kurdistan Region, ensuring a direct institutional linkage between Erbil and the federal financial authorities in Baghdad.
The Ministry source indicated that the technical and administrative preparations have advanced to the point where only "routine procedures" remain to be finalized with the Central Bank of Iraq.
This coordination highlights the administration's intent to ensure that the new National Bank operates within the federal regulatory framework, thereby facilitating smoother financial interactions between the regional and federal governments.
The establishment of this institution is not an isolated event but is described as a key component of the Ninth Cabinet of the Kurdistan Regional Government's efforts to reform the banking sector and develop an advanced banking system.
Parallel to the creation of the National Bank, the Ministry of Finance and Economy is executing a comprehensive reorganization of the region’s specialized financial institutions.
The official stated that the government is currently undertaking the unification of specialized banks—specifically those focused on sectors such as agriculture and real estate—across the various governorates and independent administrations of the Kurdistan Region.
This consolidation effort is set to impact 28 separate banking entities, which will undergo significant structural changes to streamline operations and reduce administrative redundancy.
The source provided a granular breakdown of how this unification will be implemented across the region’s geography.
In Erbil, the capital of the Kurdistan Region, the reform plan dictates that only one specialized bank will remain operational, centralizing services that were previously dispersed. In the surrounding districts, the operational footprint of these institutions is being recalibrated.
Specifically, in the districts of Koya and Shaqlawa, the existing real estate and agricultural banks are to be converted into offices rather than full-fledged independent banks. However, the banking facility in the Soran administration is slated to remain, preserving its current status within the new framework.
The reorganization strategy extends to the governorate of Sulaimani, where the consolidation is particularly extensive. The Ministry source confirmed that all specialized banks within Sulaimani will be unified into a single banking entity.
A similar approach is being applied in the Duhok governorate, where banks serving the districts of Shekhan, Bardarash, and Akre are to be merged into one consolidated bank. Meanwhile, the central bank in the city of Duhok will remain as is, maintaining its current operational structure amidst the changes in the outlying districts.
In addition to the structural reorganization, the government is moving forward with the administrative staffing of the new National Bank.
Work is currently underway to establish the administrative board that will oversee the institution. The Ministry source noted that the process of receiving "CVs" from potential employees has begun, signaling the start of the recruitment phase.
The hiring strategy outlined by the official is specific and targeted: the administration plans to hire one person in each directorate and governorate, while allocating two positions for Erbil, reflecting the capital's central role in the new financial infrastructure.
The financial scale of the new National Bank is substantial.
According to the information provided to Kurdistan24, the bank will be established with a capital of 250 billion dinars. This capitalization is intended to provide the institution with the necessary liquidity and financial weight to operate effectively as a government bank directly linked to the Central Bank of Iraq.
The government views this capital injection as a foundational step in securing the bank's stability and operational capacity.
The Ministry of Finance and Economy anticipates that the opening of the National Bank will yield several distinct economic benefits for the Kurdistan Region.
First, the source emphasized that the bank will enable the provision of advances to citizens, offering financial services similar to those available through other Iraqi banks. This move aims to expand access to credit for the local population, addressing a long-standing demand for equitable financial services.
Second, the establishment of the bank is expected to strengthen the trust of foreign investors. By creating a National Bank that is directly linked to the federal Central Bank and capitalized at 250 billion dinars, the KRG aims to signal a commitment to regulatory stability and financial transparency.
This, in turn, is projected to improve the investment climate by providing a more reliable banking partner for international commercial interests operating in the region.
Third, the official highlighted that the new institution would facilitate international banking transactions.
As a government bank integrated with the Central Bank of Iraq, the National Bank is expected to streamline cross-border financial flows, making it easier for businesses and individuals in the Kurdistan Region to engage in global commerce. This capability is seen as essential for the region’s economic development and its integration into the wider global economy.
The reforms described by the Ministry source reflect a systematic approach by the Ninth Cabinet to overhaul the legacy banking systems in the region.
By reducing the number of specialized banks from 28 down to a consolidated network and simultaneously launching a well-capitalized National Bank, the government is attempting to correct structural inefficiencies while expanding the range of financial services available to its citizens.
As the process enters its final stage, the focus remains on clearing the last procedural hurdles in Baghdad to bring the new system online.
Iran Cuts Off Gas to Iraq, Plunging Millions Into Darkness
The ministry reported a loss of 4,000–4,500 megawatts from the national grid, exacerbating Iraq's pre-existing power shortages.
NEWS BRIEF
Iran has cut off all gas supplies to Iraq, the Iraqi electricity ministry announced on Tuesday, crippling the country’s power grid and eliminating between 4,000 and 4,500 megawatts of generating capacity. The sudden halt, which Iran attributed to “unfortunate circumstances,” deepens Iraq’s chronic electricity crisis and highlights its extreme energy dependency on a neighbor under stringent U.S. sanctions.
WHAT HAPPENED
- Iran has completely halted gas supplies to Iraq, according to an official statement from Iraq’s electricity ministry.
- The ministry reported a loss of 4,000–4,500 megawatts from the national grid, exacerbating Iraq’s pre-existing power shortages.
- Iran cited “unfortunate circumstances” for the stoppage, without providing further technical or political details.
- The cutoff comes months after the U.S. rescinded a sanctions waiver that had allowed Iraq to pay Iran for electricity imports.
WHY IT MATTERS
- Iran supplies between 35–40% of Iraq’s electricity and gas needs, making the cutoff a severe blow to Iraq’s stability and basic service provision.
- The timing suggests political and economic pressure, likely linked to U.S. sanctions enforcement, regional tensions, or bilateral disputes over unpaid debts.
- Iraq’s vulnerability exposes the failure of successive governments to diversify energy sources and build self-sufficient power infrastructure despite massive oil revenues.
- The blackout risks triggering widespread social unrest, especially during peak demand periods, further destabilizing the fragile Iraqi state.
IMPLICATIONS
- Iraq may face extended blackouts, disrupting economic activity, healthcare, and daily life, potentially sparking protests similar to the 2019–2021 electricity demonstrations.
- The crisis could force Iraq to seek alternative suppliers or accelerate deals with Gulf states, though infrastructure constraints limit short-term solutions.
- Iran may be using energy as leverage to renegotiate payment terms or to signal displeasure with Iraq’s alignment with U.S. sanctions policy.
- The U.S. decision to revoke the sanctions waiver has effectively weaponized Iraq’s energy dependency, increasing Tehran’s influence over Baghdad’s domestic stability.
This briefing is based on information from Reuters.
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Peshmerga and a US official discuss expanding military support in 2026
On Tuesday (December 23, 2025), the Minister of Peshmerga Affairs in the Kurdistan Regional Government, Shorsh Ismail, received Colonel **** Bilwick, the head of the US military group at the US Consulate General in the Kurdistan Region, in the presence of the Undersecretary of the Ministry, Abdul Khaliq Babiri.
The Peshmerga media office stated in a statement received by "Baghdad Today" that "the minister congratulated the American official on the occasion of the new year, expressing his hope that it will be a year of prosperity and peace for the Kurdish people and all the peoples of the world."
According to the statement, the two sides also discussed "joint programs for 2026 and the security situation in Iraq and the Kurdistan Region," emphasizing "the Peshmerga's hope for expanded support from the United States and its allies for its forces in the new year."
For his part, Colonel Bailoik expressed his pleasure at the meeting, stressing his "commitment to joint work and continued support for the Ministry of Peshmerga."
A qualitative leap for Iraqi transit: Kuwait receives its first international shipment from Iran
The General Authority of Customs announced on Tuesday the receipt of the first international transit shipment under the (TIR) system from Iran to Kuwait, noting that "this event is a qualitative strategic shift in the development of transit work in Iraq."
The General Authority of Customs stated in a press release received by Al-Mutlaa that it received today the first international transit shipment from the Islamic Republic of Iran via the Shalamcheh border crossing, destined for the State of Kuwait via the Safwan border crossing.
This shipment was processed under the TIR (Transit Agreement) system, utilizing internationally approved electronic tracking and locking systems. The Authority added that "this event represents a significant strategic leap forward in the development of transit operations in Iraq, following the activation of this vital route.
It will have a direct impact on streamlining the flow of goods, enhancing customs security, and reducing transportation time and costs, in accordance with international standards of the TIR Convention and strengthening the competitiveness of Iraqi transit routes." The Director General of the General Authority of Customs, according to the statement, affirmed that "this achievement is the fruit of a clear administrative reform approach aimed at modernizing customs procedures and adopting smart digital solutions."
He emphasized that "the Authority is committed to transforming Iraq into an effective regional transit hub connecting neighboring countries and serving international supply chains with confidence and security." He noted that "the successful execution of the first shipment under the TIR system was achieved thanks to the high level of professionalism of the transit staff at the relevant customs centers, with direct support from senior management." He emphasized that "the next phase will witness the expansion of international transit routes and the widespread adoption of modern electronic systems, which will contribute to supporting the national economy and enhancing the confidence of regional and international partners in Iraqi customs operations."
The Director General concluded by affirming that "Iraqi Customs operates according to a modern institutional vision that makes sustainable development, security, and transparency essential elements in building an advanced customs sector that keeps pace with global changes, because Iraq is no longer just a transit route, but a reliable logistics partner in the region."
Key": 0% commission for merchants on all electronic payments starting in 2026
: Key announced today, Tuesday, a 0% commission for the merchant on all electronic payments starting from 2026.
Key stated in a press release received by Al-Da'i News that, starting January 1, 2026, merchants will be charged 0% commission on all electronic payments made through point-of-sale (POS) terminals and the Super Key app.
The statement added: "No deductions, no commissions, just real growth and clearer profits with Key in 2026."
The oil agreement between Baghdad and Erbil has been extended until
2026, and Kurdistan's revenues will remain at 120 billion dinars.
The Cabinet, in its session held today, Tuesday, approved the extension of the oil agreement concluded with the Kurdistan Regional Government to include the year 2026. This step comes to ensure the continuity of oil and financial flows and to achieve economic stability between the central government and the region.
Under this decision, the region's share of non-oil revenues remains unchanged, with Erbil continuing to transfer 120 billion dinars monthly to the federal Ministry of Finance as part of its budget allocation, in exchange for Baghdad's commitment to funding employee salaries. This extension coincides with the approaching end of the three-year budget (2023-2025) at the end of this year, amidst technical and legal assurances from SOMO (State Oil Marketing Organization) regarding the readiness and continuity of its operational mechanisms.
In a related development, Prime Minister Mohammed Shia al-Sudani directed the federal Ministry of Finance to immediately begin disbursing the outstanding salaries for employees in the Kurdistan Region for the month of October. For its part, the Ministry of Finance and Economy in the region confirmed its full readiness to begin distributing the salaries as soon as the funds are received from Baghdad.
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