Diversifying foreign currencies: An anticipated Iraqi step to reduce dependence on the dollar
Amid the rapid geopolitical and economic shifts the world is witnessing, calls are growing within Iraqi political and economic circles to reconsider the near-total reliance on the US dollar and to seek alternative currencies that ensure greater flexibility for foreign trade.
These moves stem from a growing conviction among many observers and decision-makers that the US currency is no longer merely a tool for trade exchange, but has become a political and economic weapon used to exert pressure and engage in what they describe as “financial blackmail” against Iraq, through control of the hard currency market and tightening restrictions on foreign financial transfers.
Faced with these challenges, which are casting a heavy shadow on the stability of the local market and import activity, voices are increasingly urging the Iraqi government and the Central Bank to abandon their passive stance and take bold and decisive steps to protect the country’s economic sovereignty.
In this context, Member of Parliament Qusay Abbas announced his categorical rejection of what he described as the continued American blackmail against Iraq through the issue of hard currency and financial transfers. He called on the government and the Central Bank to take decisive and bold steps to protect the country’s economic sovereignty and limit external interference and restrictions in financial and banking affairs.
Abbas told the Al-Maalomah News Agency, “The continued use by the United States of the dollar and financial transfers as a tool to pressure and blackmail Iraq politically and economically is completely unacceptable and represents a violation of national sovereignty and a direct threat to the country’s financial and economic stability.”
He added, “Keeping the Iraqi economy and financial revenues hostage to American measures and restrictions puts the local market in a state of constant instability and negatively impacts trade and the purchasing power of citizens.”
He stressed that “the government and relevant financial authorities are required today to take serious action to activate economic alternatives and diversify the basket of foreign currencies in foreign trade transactions with regional and international partners in order to break the one-sided dependence on the dollar and protect the national economy from any external pressures or dictates.”
For his part, Russian Foreign Minister Sergey Lavrov affirmed that the process of moving away from the dollar globally is well underway, including in Russia’s bilateral relations with various countries.
Speaking to lawmakers during the “Government Hour” session of the State Duma, Lavrov stated, “We must understand the tasks we have set for ourselves. These tasks, as the President has said, are to ensure that, on strategic issues upon which our security, socio-economic development, and the well-being of our citizens depend, we are no longer bound to the discredited mechanisms that have been dominated for many years by the West, led by the United States.”
Lavrov reiterated President Vladimir Putin’s remarks that the US currency has “become a weapon,” leading countries worldwide to question whether they need to use it in their transactions.
Lavrov said: “The process of de-dollarization is well underway, and we are doing it bilaterally. With China, almost 90 percent (of trade volume) is already conducted in national currencies. Around 50 percent with India. Trade figures with Iran and many other countries are similar. The transition to national currencies will continue.”
Almaalomah.me