Regional events are shaping Iraq’s economic trajectory: a financial crisis, rising prices, and a change in the value of the dinar.

Regional events are directly impacting Iraq’s economic situation, as the country lies at the heart of the turmoil engulfing the so-called Middle East. Following the war instigated by the US and its Zionist ally against the Islamic Republic and its repercussions on the Strait of Hormuz, these factors may lead governments, particularly in Iraq, to ​​adopt decisions that mitigate the damage but ultimately burden the people. This could manifest as salary reductions if the dinar is devalued, austerity measures implemented, and increased fees across various sectors, all of which will negatively affect citizens.

Imran Karkoush, a member of the State of Law Coalition, told Al-Maalouma, “Everyone in Iraq, including its government and the rest of the world, is monitoring the unfolding events in the region and awaiting the outcome of the indirect negotiations between the US and Iran.”

He added, “The Iraqi economy has been affected by the regional developments and military escalation. Iraq is anxiously awaiting the results of the negotiations between Washington and Tehran to restore the status quo in the Strait of Hormuz.”
He explained that “Iraq has been directly affected by the ongoing war in the region. The government is waiting for this conflict to end and for the government to work on strengthening relations within the region and building robust economic ties through rail and trade links between the countries of the region, Iraq, and the world, as Iraq is currently at the heart of the storm and directly affected by current events.”

For his part, economic expert Diaa al-Muhsin explained to Al-Maalomah that “Mustafa al-Kadhimi’s government was the first to take the step of raising the exchange rate of the dollar against the Iraqi dinar under the pretext of providing financial liquidity and addressing the pressures on public revenues resulting from the repercussions of the Coronavirus pandemic. Therefore, any new economic measures must be in line with the requirements of the local market and take into account the living conditions of citizens.”
He added that “raising the exchange rate will lead to a decrease in the purchasing power of citizens and weaken the real value of employees’ salaries, in addition to causing an increase in the prices of goods and foodstuffs, which will negatively affect the standard of living of Iraqi families.”

Al-Muhsin pointed out that “addressing the financial crises should not rely on placing additional burdens on citizens, but rather on revitalizing productive economic sectors, primarily agriculture, industry, and manufacturing, thereby contributing to diversifying income sources and reducing dependence on oil revenues.”

He noted that “the government may resort to other measures beyond raising the exchange rate, including reducing or eliminating some forms of subsidies for fuel, food, and medicine, with the aim of increasing public revenues,” emphasizing that “such steps will directly impact citizens because they target their daily spending and living standards.”
In a related context, political analyst Qasim al-Tamimi told Al-Maalouma that “Iraq has internal debts amounting to $90 billion and external debts of around $30 billion, which Iraq obtained through borrowing due to the decline in domestic cash liquidity.”

He added that “the government will face difficulty in controlling the dollar currency in local markets, especially since this currency is directly linked to the US Federal Reserve, as Iraq depends on oil sales that reach the aforementioned bank before being sent to Baghdad.”

He added that “Iraq is suffering from many problems caused by the current situation in the region after the significant decline in oil sales, and this has clearly affected the availability of funds. Therefore, the al-Zaidi government faces a major challenge regarding the financial and economic situation.”

Almaalomah.me

Barzani refuses to hand over Peshmerga and Asayish weapons to the federal government.

Independent Kurdish politician Didar Haval revealed on Friday that Masoud Barzani informed a US official of his refusal to hand over the Peshmerga and Asayish weapons to the federal government.
Haval told the Information Agency, “A US envoy asked Masoud Barzani to hand over the Peshmerga weapons to the federal government, but he refused this request. Washington’s move comes as it seeks to dissolve these forces and integrate them into a single security system.”

He added, “Masoud Barzani emphasized to the US envoy that the Peshmerga weapons represent the identity and symbol of the history and sacrifices of the Kurdish people, and are not merely a fighting arsenal. He also stressed that the region’s forces and security institutions are not subject to any plans to dissolve or merge the factions.”

He explained that “disagreements arose between the Trump administration and Masoud Barzani following the theft of a shipment of advanced American weapons intended for the Iranian opposition and their distribution to the Peshmerga forces, in addition to the fact that the Peshmerga forces did not participate with the Iranian opposition in striking inside Iran to overthrow its regime,” noting that “Barzani refused to include these forces in the “weapons control” projects of the federal government in Baghdad.”

He confirmed that “these are regular forces under the supervision of the regional presidency.”

Almaalomah.me

Al-Saadi: International companies have apologized for not transporting Iraqi oil through the Strait of Hormuz for security reasons.

Economic expert Rashid al-Saadi revealed on Friday that international companies specializing in transporting petroleum products have apologized for not being able to transport Iraqi oil through the Strait of Hormuz due to security concerns and increased fuel costs.

Al-Saadi told the Information Agency, “The international companies specializing in exporting petroleum products from Iraq to other countries have apologized to the relevant authorities for their inability to continue this task due to the dangerous security situation in the Strait of Hormuz.”

He added, “Iraq’s exemption from the embargo imposed on the Strait of Hormuz remains in effect, but foreign companies have refused to continue transporting Iraqi oil through the Strait of Hormuz due to increased insurance costs, fuel expenses, and the risks associated with using the strait.”

He pointed out that “Iraq relies on the Strait of Hormuz for 90% of its oil exports,” and emphasized that “Iran’s facilitation of Iraq’s use of the Strait of Hormuz to export its oil to various countries around the world remains in effect without imposing any security or navigational restrictions.”

Almaalomah.me

Iraq plans to export its surplus wheat crop abroad.

Iraqi Trade Minister Mustafa Nizar Al-Ani announced on Friday a government plan to export surplus wheat crops abroad, while reassuring farmers that their outstanding financial dues from last year would soon be disbursed.

Al-Ani said in a press conference held on the sidelines of his visit to the grain storage silo in Erbil that the Ministry of Trade has introduced an advanced electronic mechanism for marketing wheat, which relies on registering the data of farmers and trucks in advance, in order to avoid routine and bureaucracy and to avoid the long waiting lines that used to extend for several days when delivering the crop.

Regarding the financial file, the minister acknowledged that there are outstanding payments owed to farmers since last year, stressing that the Prime Minister is paying close attention to settling this file.

Al-Ani indicated that a batch of these delayed entitlements has been released to include all governorates, and that new batches will follow in the coming days to complete the file completely.

Regarding production expectations for the current season, the minister predicted an outstanding production plan, indicating that the areas planted with wheat – including the Kurdistan Region – far exceeded the plan approved by the Council of Ministers.

Al-Ani addressed the farmers, saying: “I assure you that your efforts will not be in vain, and there is a comprehensive plan to receive the entire crop and export what exceeds the country’s actual needs,” stressing that the ministry’s main goal is to establish sustainable food security.

Shafaq.com

Comprising 14 points… Key features of the memorandum of understanding between Washington and Tehran

Bloomberg News reported on Friday that Washington and Tehran will sign a memorandum of understanding in Geneva next Sunday, noting that the signing will be limited to a preliminary memorandum of understanding and not a final agreement.

The agency, quoting a G7 official, indicated “the possibility of the signing being completed on the sidelines of the group’s meeting next week.”

In this context, the Iranian news agency Mehr revealed new details of a draft 14-point memorandum of understanding between Iran and the United States, as reported by a source close to the Iranian negotiating team.

According to the agency, the draft includes a permanent and immediate cessation of hostilities on all fronts, including Lebanon, an American pledge not to interfere in Iranian internal affairs and to respect Iran’s sovereignty, in addition to the complete lifting of the naval blockade within 30 days, an American commitment to withdraw its forces from the vicinity of Iran, as well as the reopening of the Strait of Hormuz within 30 days according to Iranian arrangements.

The draft also includes “suspending sanctions on exports of oil, petrochemical products and their derivatives, ensuring Iran’s full access to its financial resources, and providing plans for the reconstruction of Iran worth no less than $300 billion by the United States and its allies, in addition to a 60-day deadline for negotiations to reach a final agreement based on the nuclear file and the complete lifting of primary and secondary US sanctions, as well as the resolutions of the UN Security Council and the Board of Governors of the International Atomic Energy Agency.”

According to the Iranian news agency Mehr, the draft indicates that its provisions include “renewing Iran’s commitment to the Treaty on the Non-Proliferation of Nuclear Weapons (NPT) not to produce a nuclear weapon, an American pledge during the negotiation period not to strengthen its forces in the region and not to impose any new sanctions, as well as releasing $24 billion of frozen Iranian assets during the final 60-day negotiation period, with half of this amount to be made available to Iran before the start of negotiations, in addition to establishing a monitoring mechanism to implement the agreement, and adopting the final agreement under a resolution of the UN Security Council.”

The draft adds other provisions, including “the final negotiations will not begin before half of the frozen Iranian assets are released, oil sanctions are suspended, and the naval blockade is lifted, with the final agreement being limited to the fate of enriched materials, the enrichment process, lifting sanctions, and the program to rebuild the Iranian economy. Any discussion of the Iranian missile program or Tehran’s support for resistance groups will be removed from the agenda entirely.”

Earlier on Friday, the American website Axios revealed that the memorandum of understanding between the United States and Iran includes the full opening of the Strait of Hormuz, and stipulates the extension of the ceasefire for 60 days, including Lebanon, with the resumption of nuclear negotiations during this period, and the immediate reopening of the Strait of Hormuz to international navigation without fees.

For his part, a US official said that “one of the options on the table is to reduce the level of uranium enrichment inside Iran under the supervision of UN inspectors.”

According to Axios, the mediators reached the current formula after talks between the Qatari mediator and the Iranian foreign minister, with ongoing contacts with US envoys Steve Wittkopf and Jared Kushner.

The website noted that the text has received high-level approvals within Iran, but has not yet received final approval from Supreme Leader Mojtaba Khamenei, while mediators continue to work on finalizing it and setting a date for the signing ceremony.

Last night, US President Donald Trump announced that a “settlement” to the war with Iran had been reached, indicating that the agreement was in its final stages, with the last arrangements to be completed in the next few days.

Shafaq.com

The government: Salaries for employees and retirees are guaranteed and there is no printing of currency.

The spokesman for the Prime Minister, Haider Al-Aboudi, confirmed today, Wednesday, that the Prime Minister, Ali Falih Al-Zaidi, will not hesitate to expose the corrupt, while he indicated that the salaries of employees and retirees are secured and there is no printing of currency.

Al-Aboudi said in a press conference held at the Council of Ministers that “the government decided, based on the directive of the Prime Minister, Ali Falih Al-Zaidi, to adopt a program budget in coordination with the World Bank,” noting that “the Prime Minister adopted the development fund project through effective international contributions.”

He added that “the Prime Minister has adopted a policy of restricting weapons to the state within a specific timeframe, in addition to adopting the development fund project,” noting that “the Prime Minister will not hesitate to announce those involved in stealing public funds.”

Al-Aboudi pointed out that “the government is committed to paying the dues of contracts and workers, and their transfer to the budget is left to the Ministry of Finance,” indicating that “the salaries of employees and retirees are secured and there is no printing of currency.”

He explained that “the Development Fund is an investment vehicle that receives international contributions from Iraq’s friends, and this contribution covers the requirements of the development situation. The Ministry of Finance is working on preparing a program budget, and the Prime Minister has decided to adopt a program budget to promote economic reforms.”

Al-Aboudi stressed that “the government is looking forward to completing the ministerial cabinet to complete its tools, but currently the House of Representatives is in legislative recess, and if the political consensus is completed, it is possible to hold a session to vote on what remains of the ministerial cabinet,” noting that “Iraq will not accept being a launching pad for targeting any country, and it will also not accept any country’s interference in Iraqi affairs.”

Alforatnews.iq

Al-Zidi is preparing for a visit to Washington with several key issues on his agenda, most notably attracting major companies to Iraq.

A government source reported on Wednesday that Prime Minister Ali Faleh al-Zaidi’s upcoming visit to Washington will include several topics, including opening partnerships with giant American companies and raising the rate of oil exports to the United States to about half a million barrels per day.

The source told Shafaq News Agency that “Al-Zidi will carry with him important files that address intractable problems in the country, which he will discuss with the American administration, including exporting 500,000 barrels per day to America in exchange for entering into important partnerships with giant companies to solve complex problems in Iraq, including electricity, in addition to the industrial and agricultural sectors and others.”

He pointed out that “these partnerships are conducted according to a known time and financial ceiling and binding controls for both sides, whereby the oil revenues referred to will be used to finance projects to improve the economic, service and even tourism situation.”

He explained that “these economic partnerships will positively impact the political and economic direction of the government, by achieving sustainable interests that meet the country’s needs and enhance the implementation of the government program promised by Al-Zidi, which focuses on prioritizing public interests over private ones.”

The source indicated that “the measures that the government will adopt to achieve an investment, reconstruction and service revolution will be with the approval of all partners in the political process without discrimination.”

Iraqi Prime Minister Ali Faleh al-Zaidi announced last Saturday an official visit to the United States accompanied by businessmen to expand mutual and joint investment opportunities, noting at the same time that the development fund is for the private sector and will absorb a contribution from the Central Bank worth $10 billion.

Al-Zaydi stressed that the government is counting on cooperation with the private sector to make its reform efforts in the economy and development a success, and that it will adopt an open-door policy towards the proposals, requests and problems that businessmen put forward that require intervention and resolution.

Al-Zaydi added: “We have an upcoming official visit to the United States, and we will be taking a number of businessmen with us to expand mutual and joint investment opportunities.”

Shafaq.com

Political agreements to expedite the passage of the remaining cabinet positions

Abdul Rahman al-Jazaeri, head of the political body of the National Tribal Movement, confirmed the possibility of replacing rejected candidates in the cabinet and bringing in other figures to be voted on in parliament to complete al-Zaidi’s government.
Al-Jazaeri told Al-Maalouma, “It is clear and natural that there will be objections to some candidates for the cabinet, which has already happened recently, but today there is a genuine move to proceed with completing the cabinet.”

He added, “There are discussions and agreements among the political parties to prioritize professionalism over sectarian quotas in selecting candidates for Ali al-Zaidi’s cabinet, with the aim of forming a strong government.”

He explained that “any candidate who does not receive support from the political blocs in parliament will be replaced by another candidate from the same bloc, who will then be presented to the House of Representatives for a vote, thus finalizing all remaining cabinet positions.”

Almaalomah.me

An economist calls on Al-Zaidi to bring specialized ministers to Washington to prevent businessmen from taking “commissions”.

Economic expert Hashim al-Haboubi criticized on Wednesday Prime Minister Ali al-Zaidi’s intention to take groups of businessmen and investors with him on his upcoming visit to Washington, D.C., describing the move as “unfortunate” and a repetition of previous scenarios.

Al-Haboubi told the Information Agency, “Prime Minister Ali al-Zaidi’s announcement of his intention to take businessmen and investors to Washington, similar to what al-Sudani did previously, is not at all in the public interest.” He pointed out that “these individuals will not invest in America, but rather seek to act as intermediaries between the government and American companies to obtain commissions.”

He added, “Preserving public funds requires taking ministers specializing in the financial and economic sectors, along with a very limited number of advisors. This is the correct approach to ensure that contracts and economic activities are concluded directly between the state and companies without any intermediaries, thus avoiding suspicions of corruption.”

Almaalomah.me

Al-Marsoumi reveals the conditions set by foreign companies for resuming oil production in Kurdistan.

Economic expert Nabil al-Marsoumi explained on Wednesday that foreign companies operating in the oil sector have set a number of conditions before resuming production and exports in the Kurdistan Region.

Al-Marsoumi stated in a Facebook post that “these conditions include, firstly, the necessity of protecting oil fields and wells from drone and missile attacks to ensure the safety of facilities, workers, and foreign technical staff.”

He added that “the second condition is the establishment of a clear and regular mechanism to guarantee the payment of current financial dues upon the resumption of exports, in accordance with the amendments to the federal budget law.”

He pointed out that “the third condition pertains to the necessity of settling outstanding debts and previous dues owed by the companies, including those owed to the Norwegian oil company DNO, which previously announced the cessation of production and exports via pipelines in the region due to delayed payments estimated at approximately one billion dollars.”

Al-Marsoumi emphasized that “resolving these issues is essential for the normal resumption of oil activity in the region.”

Almaalomah.me