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Frank26
[Iraq boots-on-the-ground report]
OMAR: The Central Bank of Iraq has recorded notable shifts and marked a decline in its financial indicators...Official reserves are shrinking.
FRANK: Not good. But good for us...Iraq's reserves...$77.8 billion. That's it. That'll be gone in 3 months or less. You can't do that. That's not how you run a government ... your household ...your purse... Iraq has to stop cannibalizing it's reserves and they have to raise the value.
FRANK: Trump is not happy with the collection of the [Iranian militia in Iraq] weapons.
OMAR: We are doing something we have never done before. We're cracking down on anything that is pretending to be a militia. Iraq is acting like a sovereign state, not a scared one...They tell us on TV that this is not symbolic. This is state power...
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🇮🇶⚠️ NEWS SUMMARY: IRAQ, THE MILITIAS, AND A CRISIS THAT COULD GO FAR BEYOND SAUDI ARABIA
Iraqi armed factions that threatened to retaliate militarily against Saudi Arabia have now temporarily frozen their decision to retaliate, but they have established conditions for keeping that option open.
Their demands reportedly include:
🔴 Saudi Arabia officially acknowledging that it made a mistake.
🔴 An official apology.
🔴 Financial compensation for the families of those killed.
🔴 Compensation for damage to public property.
🔴 A reduction in Saudi media rhetoric against the factions.
If they consider the Saudi response inadequate, the factions are maintaining the possibility of retaliation.
Meanwhile, the Iraqi government has raised the level of security and military readiness across the country.
And this is where the story becomes much bigger.
What we are witnessing is a much more fundamental struggle:
Who really has the authority to decide matters of war and national security in Iraq — the Iraqi state or armed factions?
Iraq is trying to rebuild, attract investment, strengthen its institutions, and improve relations with the Gulf states, including Saudi Arabia.
At the same time, however, there are armed organizations with significant military capabilities, political influence, and regional connections that can threaten to initiate a confrontation with another state.
That creates an enormous contradiction.
🇮🇶 The government can say it wants stability.
🇸🇦 It can seek better relations with Saudi Arabia.
🇺🇸 It can pursue strategic and economic cooperation with the United States.
💰 It can try to attract foreign investment.
⛽ It can develop its oil and energy sectors.
But if an armed organization can effectively say:
“If the government does not act as we demand, we will respond militarily ourselves,”
then the sovereignty of the Iraqi state is seriously challenged.
We need to make an important distinction.
It does not necessarily mean that these factions formally control the Iraqi state.
But it does demonstrate that some of them possess enough political, military, and social power to pressure government decision-making and limit Baghdad's room for maneuver.
And that is already extremely significant.
Prime Minister Ali al-Zaidi has placed the issue of state control over weapons at the center of his government's agenda.
His government wants weapons to remain exclusively under state authority and has established September 30, 2026, as a critical date in the process of bringing armed factions under state control.
Al-Zaidi has also emphasized that there should be no armed groups operating outside the framework of the state.
And this is where the real test for his government begins.
In any sovereign state, there is a fundamental principle:
The decision to go to war cannot belong to independent armed groups.
It must belong to the state.
If Iraq decides to establish diplomatic relations with Saudi Arabia, no armed faction should be able to independently declare Saudi Arabia an enemy and initiate a war.
If Baghdad decides to negotiate with Washington, no militia should be able to determine on its own whether American forces will be attacked.
And if the government decides to strengthen economic relations with the Gulf states, no armed organization should have the ability to destroy those relationships through military action.
That is precisely the challenge facing Al-Zaidi.
The government is attempting to bring military decisions under official state institutions.
Some factions have shown willingness to integrate into state structures or place their weapons under government authority.
Others — particularly factions such as Kataib Hezbollah and Harakat al-Nujaba — have resisted disarmament or conditioned it on broader political and regional circumstances.
That makes September 30 potentially decisive.
This is not simply about handing over weapons.
It is about answering a much deeper question:
Because even if weapons are formally incorporated into state structures, the fundamental problem remains if the decision to use those weapons ultimately follows a political or foreign chain of command separate from the Iraqi government.
That is one of the most sensitive issues in Iraq today.
The Iraqi problem cannot be separated from Iranian influence over some of these organizations.
Several of the factions most resistant to disarmament maintain relationships with the so-called “Axis of Resistance” and with Iran.
This turns Iraq's internal struggle into something much larger than a domestic dispute.
Iraq is situated in the middle of competing interests involving:
🇮🇷 Iran
🇺🇸 United States
🇸🇦 Saudi Arabia
🇮🇱 Israel
🇹🇷 Turkey
🇮🇶 and, above all, Iraq's own national interests.
The danger is that Iraq could once again become a battleground for regional power competition, instead of becoming a state capable of making its own sovereign decisions.
Here is one of the biggest paradoxes.
Iraq needs stability to attract investment.
It needs security to develop infrastructure.
It needs stable relations with Saudi Arabia and the Gulf states.
It needs to develop its oil, gas, energy, transportation, and trade sectors.
It needs international cooperation.
But every time an armed faction threatens to open another military front, Iraq's political and economic risk increases.
The very organizations that may claim to be defending Iraq's interests can ultimately undermine Iraq's own strategic interests.
The Iraqi government is trying to maintain and strengthen its relationship with Saudi Arabia.
At the same time, the armed factions are saying that they may retaliate militarily.
That is the contradiction:
Baghdad wants to be treated as a sovereign and responsible state, but it must demonstrate that it can actually control what happens inside its own territory.
For that reason, the real test for Al-Zaidi is not simply what he says about Saudi Arabia.
It is not simply what he says about the United States or Iran.
The real test is much simpler:
If the answer is yes, Iraq will be taking a major step toward consolidating its sovereignty.
If the answer is no, then Iraq's institutions will continue sharing real power with armed organizations capable of imposing their own red lines.
And that severely limits Iraq's ability to develop an independent foreign policy.
The government has made that date a key point in its effort to place weapons under state authority.
The question will be:
Will the factions ultimately accept the authority of the Iraqi state, or will they insist on maintaining an independent military capability?
Because if they accept, Iraq could enter a new phase.
But if they refuse while retaining the ability to act militarily on their own, the crisis will become much deeper.
Then we would no longer be talking simply about militias.
We would be talking about two centers of power inside one country:
One institutional.
And one armed.
🇮🇶 And no country can build lasting stability while the decision over war and peace is not exclusively in the hands of the state.
#Iraq #AlZaidi #SaudiArabia #Iran #MiddleEast #IraqiPolitics #Militias #ArmedFactions #Sovereignty #NationalSecurity #Geopolitics #ForeignPolicy #Iraq2026
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EXCLUSIVE: FACTIONS SET FOUR CONDITIONS FOR FREEZING THEIR RESPONSE TO SAUDI ARABIA
An informed source revealed on Thursday that the armed factions have “temporarily” frozen their decision to respond to Saudi Arabia, and have put forward their demands, which include an official apology and compensation from Saudi Arabia, otherwise they will proceed with a response.
The source told Shafaq News Agency that “the factions that threatened to respond to the Saudi bombing that targeted a number of Popular Mobilization Forces headquarters in some provinces have frozen their decision to respond, and have made its implementation or non-implementation contingent on the extent of Saudi Arabia’s response to the event.”
He added that “the demands of the factions include Saudi Arabia acknowledging that it made a mistake in the bombing and paying financial compensation to the families of the victims, in addition to granting compensation for the damages inflicted on public property, and calming the Saudi media discourse against the factions in general, otherwise the factions will respond.”
This afternoon, the Security Media Cell announced on Thursday that it had raised the security readiness and combat preparedness in Iraq.
The cell said in a statement received by Shafaq News Agency: “Under the direction of the Commander-in-Chief of the Armed Forces, it was decided to raise the level of security readiness and combat preparedness of the security and military forces, including the implementation of training exercises and troop movements.”
She added, “This is within the framework of maintaining the high level of readiness of all security forces formations and enhancing their ability to perform their duties, which contributes to consolidating security and stability and protecting citizens and public interests.”
Regarding the position of the factions and their conditions, political researcher Ghaleb Al-Daami believes that “there is an Iraqi-Saudi rapprochement, and a genuine desire between the two countries to improve political, economic and security relations, including that Iraq should control weapons and not allow them to be directed against any Arab country.”
Al-Daami continues, during his interview with Shafaq News Agency, that “the conditions of the factions are not governmental, but rather they are from parties outside the state system and have no relation to the political system, and therefore they are not acceptable, because such matters are resolved only through the state, and Iraq has economic relations and common interests with Saudi Arabia in addition to oil and energy files, which the Prime Minister will discuss with Saudi officials during his upcoming visit.”
Prior to the official statement, a security source told Shafaq News Agency that orders had been issued by senior leaders to raise the level of readiness among the various branches of the security and military forces throughout Iraq.
The source said the orders included cancelling the leave of commanders and officers and keeping them on high alert. She added that the precautionary measures coincide with the end of a deadline set by armed factions for the Iraqi government to take a position on Saudi Arabia, as well as preparations to carry out new arrests of those accused in corruption cases.
According to the sources, raising the level of preparedness is also linked to the decision taken by the State Administration Coalition regarding restricting weapons to official institutions and ending the activity of armed factions by September 30.
On Wednesday evening, the State Administration Coalition declared that entities engaging in behavior that threatens the country’s security outside the framework of official institutions are “outlaws and must be fought,” warning that any armed activity after September 30, 2026, will be subject to the provisions of the Counter-Terrorism Law.
On July 29, groups calling themselves the “Iraqi Resistance” announced that they had given the Iraqi government a deadline, ending this Thursday, to take action against Saudi Arabia, following accusations that it had targeted headquarters belonging to armed faction.
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🇮🇶🔥 IRAQ HAS REACHED THE “PAYING THE PRICE” PHASE — BUT IS THE COUNTRY FINALLY BUILDING THE STRUCTURE IT NEEDS?
📰 NEWS SUMMARY
Economic expert Ziad Al-Hashemi says Iraq has entered a phase of “paying the price” for more than two decades of accumulated corruption, mismanagement and failed economic policies.
His warning is significant: Iraq’s current problem is not simply a temporary liquidity crisis. It is the consequence of an economic system built around oil dependence, oversized government spending, political quotas and insufficient structural reform.
He argues that continuing to borrow money or postpone payments without fixing the underlying system will only extend the problem — and ultimately the citizens will pay the price.
The deeper issue is not simply:
💵 “Iraq needs more liquidity.”
It is:
🏛️ Iraq needs a stronger economic structure.
For years, Iraq had the opportunity to use enormous oil revenues to build:
🛢️ A diversified economy
🏭 Strong private-sector industries
🏦 A modern banking system
📊 Better fiscal management
🌾 Agriculture and food production
🌐 International trade
💻 A digital economy
But according to Al-Hashemi, too much of that opportunity was lost through corruption, political division and poor resource management.
This connects directly to the recent reports about Iraq's liquidity problems.
If the government simply:
💰 Borrows more
💵 Prints more money
⏳ Delays payments
🛢️ Continues depending almost entirely on oil
then Iraq may solve today's cash-flow problem without solving tomorrow's economic problem.
The IMF has likewise identified Iraq's excessive dependence on oil, large public-sector footprint and institutional weaknesses as structural constraints on non-oil growth. (IMF)
This is where the picture becomes VERY interesting.
Iraq has not finished the transformation, but there is evidence that several pieces of the new economic structure are already being built.
Iraq has been working to modernize its banking sector, strengthen compliance and bring financial institutions closer to international standards.
The banking system remains underdeveloped, with state-owned banks dominating the sector, and public distrust and non-performing loans remain significant problems. But regulatory and AML/CFT reforms have advanced. (BTI 2026)
➡️ STATUS: 🟡 IN PROGRESS — significant work remains.
Iraq is pushing toward greater use of electronic payments and reducing dependence on cash.
That matters because a modern economy requires money to move through transparent, traceable financial channels rather than remaining outside the banking system.
UNDP has described Iraq's transition toward digital payments as a potential turning point for economic modernization, financial transparency and inclusion. (UNDP)
➡️ STATUS: 🟢 ADVANCING
Iraq is also working on improving customs and revenue collection, an essential step if Baghdad wants to reduce its dependence on oil.
This directly addresses the structural problem identified by Al-Hashemi:
Oil cannot remain the only engine financing the state.
➡️ STATUS: 🟡 UNDER DEVELOPMENT
This is where Iraq has the most work to do.
The IMF says non-oil growth remains constrained by low productivity, limited investment, inefficient use of human capital, an oversized public sector and continued dependence on oil. (IMF)
At the same time, Iraqi authorities have been discussing economic and financial reforms specifically aimed at diversifying income sources and reducing dependence on oil revenues. (Iraq Business News)
➡️ STATUS: 🟡 STARTED, BUT FAR FROM COMPLETE
Look at the direction:
OLD IRAQ
🛢️ Oil dependence
💵 Cash economy
🏦 Weak banking infrastructure
🏛️ Heavy government spending
📉 Limited non-oil revenue
🔴 Structural corruption & inefficiency
⬇️
TRANSITION
🏦 Banking reform
💳 Digital payments
🛃 Customs modernization
📊 Fiscal reform
🌐 International financial integration
🏭 Private-sector development
🛢️ Economic diversification
⬇️
THE IRAQ THEY ARE TRYING TO BUILD
🇮🇶 A more diversified economy
💵 A more efficient monetary system
🏦 A modern banking sector
💳 A digital financial infrastructure
🌐 Greater integration with international markets
📈 Stronger non-oil economic activity
The important question isn't simply:
“When will Iraq change the exchange rate?”
The bigger question is:
“Is Iraq building the economic and financial infrastructure necessary to support a fundamentally stronger monetary system?”
And the answer today appears to be:
YES — but the transformation is NOT finished.
Iraq is actively working on many of the components needed for a modern economy, but major weaknesses remain, particularly in banking, governance, public-sector dependence and economic diversification. (BTI 2026)
That means the current period could be viewed as a structural transition rather than simply a liquidity crisis.
And if Iraq succeeds in completing these reforms, the country could eventually have a much stronger foundation for whatever monetary changes the CBI decides to implement.
⚠️ Important: None of this confirms a specific RV, exchange-rate change or “Delete the Zeros” timetable. Those would require an official announcement from Iraqi authorities.
🇮🇶 Iraq isn't simply trying to find more money. It is being forced to rethink how its entire economic system works.
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#IQD #Iraq #IraqiDinar #CBI #MonetaryReform #EconomicReform #BankingReform #DeleteTheZeros #IraqEconomy #DigitalPayments #DeDollarization #EconomicDiversification
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Al-Hashemi said, in a statement followed by “Baghdad Today”, that financial and administrative losses and failures have accumulated during the past years without real treatment, accusing political forces of being preoccupied with “dividing the spoils”, while the regulatory and legislative bodies were unable or negligent in performing their role in accountability and reform.
He added that, in his view, the responsibility is not limited to governments, but extends to the parliament that approved large budgets, the political forces that dealt with the state according to the logic of power-sharing, as well as regulatory institutions, elites, media and the public, some of whom he said contributed, to varying degrees, to the continuation of the existing approach.
Al-Hashemi pointed out that Iraq is not facing a temporary liquidity crisis, but rather is going through the repercussions of what he described as an economic and political system that relied on quotas, corruption and buying loyalties, considering that the reform opportunities that were available during the years of financial abundance were not invested in building a diversified economy that is more capable of facing crises.
He warned that continuing to address the crisis through borrowing or postponing payments, without implementing structural reforms, could prolong the economic challenges, stressing that the cost of this would be borne by the citizens.
Economic and political experts offer differing views on the causes of the crisis and ways to address it, amid repeated calls for the implementation of financial and economic reforms, diversification of income sources, and a reduction in dependence on oil.
(Mnt Goat: I could not have said it any better than Al-Hashemi. I think he is spot on.)
Sandy Ingram
I am an IQD investor who believes this investment would help me fund my retirement. I am an experienced U.S. tax professional with the Department of Treasury for over 25 years...The IQD was once worth $3.22 in 1991...But here's what Iraqi dinar investors are not being told. Iraq has been through hell since 2003.
A historical exchange rate does not automatically establish what a currency should be worth today. There are new standards. Today the goal post has moved. A currency value of $3.00 to 1 Iraqi dinar banknote 25 years ago is no longer worth that today. This is 2026. Before 2003, Iraq had two lavish flowing rivers through the countryside, amazing infrastructure and people with money in the bank. Life was good until it wasn't.
The problem with comparing the dinar of decades ago with today's dinar ignores major changes in Iraq's monetary system, economy and the amount of IQD banknotes scattered around the world.
They have overprinted the money...Back before 2003, Iraq had a closed currency ...The currency was not readily available to foreigners.
You couldn't get your hands on the Iraq dinar... The mere fact that we have possession of the currency is an indication that things are very different...This is why you must hold on to your currency. The supply and demand factor is coming back into play because the CBI has admitted to destroying Iraqi dinar banknotes.
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