🇮🇶🔥 IRAQ: PRESSURE MOUNTS TO MOVE KEY LAWS FORWARD
A member of the Iraqi Parliament is calling on the government to stop delaying several priority laws and officially submit them to Parliament.
🛢️ OIL & GAS LAW
The Oil & Gas Law remains one of the major pieces of legislation awaiting action.
The government had previously been asked to submit the law, but it was not presented. Now there is renewed pressure to move it forward.
Why does this matter?
🛢️ Oil & gas management 💰 Revenue distribution 📊 Government finances 🌎 Investment 🇮🇶 Federal–regional economic relations
🛡️ PMF LAW
Parliament is also waiting for the proposed Popular Mobilization Forces Law, which would establish the legal framework governing the PMF.
💰 SALARY SCALE
Another major issue is the unified salary scale for government employees.
The previous government began work on the issue but did not complete it. Parliament is now calling for the remaining work to be finalized and submitted.
⚖️ OTHER ECONOMIC LEGISLATION
The government is also expected to work on legislation related to:
🔹 Recovery of funds 🔹 Settlement and recovery 🔹 Establishment of a settlement fund
🔥 THE BIGGER PICTURE
What stands out is that several important pieces of Iraq’s institutional and economic framework are being pushed forward at the same time:
For those watching Iraq’s monetary and economic transformation, these developments are important because a stronger legal and institutional framework can support greater economic stability, investment, and financial integration.
🇮🇶 The next step is implementation.
👀 Watch the Oil & Gas Law. 👀 Watch the PMF Law. 👀 Watch the Salary Scale.
👀 Watch the CBI and monetary reforms.
🔥 Iraq continues working through the pieces of a much larger economic transformation.
A MEMBER OF PARLIAMENT DEMANDS THE GOVERNMENT SEND THE LAWS ON THE POPULAR MOBILIZATION FORCES, OIL AND GAS, AND THE SALARY SCALE TO PARLIAMENT: “DELAY IS UNACCEPTABLE.”
The head of the National Statement Alliance and member of Parliament, Abdul Amir al-Mayahi, affirmed the existence of several priority laws that cannot be postponed within Parliament, urging the government to expedite their submission for enactment.
Al-Mayahi stated that “the Popular Mobilization Forces Law is a very important law, and the government must submit it,” noting that the Oil and Gas Law is also among the important laws awaiting Parliament.
He added, “There was a request from the government in the previous session to submit the Oil and Gas Law, but it was not submitted,” emphasizing the necessity of moving forward with this matter.
Regarding the salary scale, al-Mayahi explained, “We are also waiting for the government to address the salary scale to ensure fairness for state employees and achieve equality,” indicating that this issue is of great importance given the continuous demands from employees and the Iraqi people for the adoption of a unified salary scale. He added, “There are numerous demands and voices from employees and the Iraqi people constantly calling for a salary scale,” urging the government to finalize the related procedures and submit it to Parliament. He noted that “the previous government started but did not complete it,” calling on the current government to “finalize the remaining aspects of the salary scale and send it to Parliament.”
Al-Mayahi reiterated the importance of the oil and gas law, while also pointing to other laws, including the recovery law, as well as the settlement and recovery law and the establishment of a settlement fund, which he said the government is serious and eager to submit to Parliament.
The Oil & Gas Law is once again becoming a major focus in Iraq.
🏛️ PARLIAMENTARY PRESSURE
A member of Parliament is calling on the government to urgently submit several priority laws to Parliament, including:
🛡️ Popular Mobilization Forces Law
🛢️ Oil & Gas Law 💰 Salary Scale Law
The message is clear: these laws should no longer be delayed.
🛢️ WHY IS THE OIL & GAS LAW SO IMPORTANT?
Iraq holds enormous energy resources, but the country still needs a comprehensive legal framework governing the management and distribution of oil and gas revenues.
A completed Oil & Gas Law could help establish clearer rules for:
🇮🇶 Federal–regional relations 🛢️ Oil production and management 💰 Revenue distribution 🏦 Government finances 📈 Investment 🤝 Economic cooperation
This could become another important component of Iraq’s broader economic modernization.
💵 THE BIGGER PICTURE
Look at what is happening simultaneously:
🛡️ State control of weapons 🏦 Banking reforms 💻 Financial digitalization 🛢️ Oil & Gas legislation 📦 Trade modernization 🌎 Foreign investment 💰 Monetary reform
These are not isolated issues. Together, they form a much larger restructuring of Iraq’s economic and financial system.
🔢 AND THEN THERE IS DELETE THE ZEROS
CBI contact intel has pointed toward early 2027 as a potential timeframe for activating the Delete the Zeros project.
If the monetary reform timeline continues developing alongside the political, security, banking, and economic reforms, the coming months could become extremely important.
👀 WHAT TO WATCH:
➡️ Oil & Gas Law ➡️ PMF legislation ➡️ Disarmament progress ➡️ CBI monetary policy ➡️ Official vs. parallel exchange rates ➡️ Banking reforms ➡️ Delete the Zeros
🇮🇶 Iraq’s transformation is much bigger than the dinar alone.
The question now is how quickly these pieces move from legislation and planning into actual implementation.
🇮🇶🔥 WHY IS ELIMINATING IRAQ’S PARALLEL MARKET SO IMPORTANT?
A recent analysis of Iraq’s dollar market explains why the gap between the CBI’s official exchange rate and the parallel-market rate continues to pressure the dinar.
💵 The dollar’s rise is not being attributed to one single factor. Experts point to commercial demand from importers, cash-dollar demand, hoarding, speculation, banking compliance requirements, customs procedures, and political and regional uncertainty.
🏦 The key issue is that part of the legitimate demand for dollars remains outside the banking system. Stricter requirements for international transfers have pushed some transactions toward the cash market, while citizens and businesses may also hold dollars as a hedge against uncertainty.
📦 At the same time, Iraq is tightening customs procedures, implementing ASYCUDA, and increasing scrutiny of import invoices. These reforms are designed to bring more trade and foreign-currency activity into official channels.
🔎 WHAT DOES THIS MEAN?
The important point is that the widening gap does not necessarily mean Iraq lacks foreign-currency reserves.
Instead, it shows a mismatch between:
💵 Demand for dollars and
🏦 The banking system’s ability to satisfy that demand through approved channels.
That is why strengthening the banking system, improving trade-finance procedures, increasing transparency, and moving more dollar transactions through official channels are so important.
🔥 MY VIEW
This is exactly why I believe what the CBI is doing right now is so important.
The CBI is working to reduce the gap between the official dinar rate and the parallel-market rate, with the broader objective of bringing more currency activity into the official financial system.
The path I’m watching is:
📉 Narrow the exchange-rate gap ⬇️ 🏦 Move more transactions into official banking channels ⬇️ 💵 Reduce pressure from the parallel market ⬇️ 🇮🇶 Strengthen dinar stability ⬇️ 🚫 Eventually eliminate the parallel market
The parallel market is currently putting pressure on the dinar and affecting exchange-rate stability.
🔥 For me, this is one of the most important developments to watch.
If the CBI continues narrowing the gap and eventually succeeds in eliminating the parallel market, that would represent a major step in Iraq’s monetary and financial reform.
👀 Watch the gap. Watch the CBI. Watch the parallel market.
WHO IS DRAINING DOLLARS FROM THE MARKET? UNVEILING THE GAP PRESSURING THE DINAR
The rise in the dollar exchange rate against the Iraqi dinar has once again taken center stage in economic and public discourse. This follows a widening gap between the official rate set by the Central Bank of Iraq and the rates circulating outside official channels, raising questions about the factors driving the market upward despite the continued inflow of foreign currency and the Central Bank’s capacity to meet legitimate demand.
An analysis of market dynamics suggests that this rise is not attributable to a single cause but rather to a complex interplay of variables. These range from commercial demand for dollars and import financing to hoarding, speculation, banking compliance requirements, customs procedures, and political and regional tensions.
The Central Bank of Iraq sets the official dollar rate at 1,310 dinars, whereas the rate outside official channels fluctuates based on different dynamics—specifically, the demand for physical cash dollars, merchants’ access to banking transfers, and the behavior of savers and speculators.
A widening gap between the two rates does not necessarily indicate a shortage in Iraq’s foreign currency reserves; according to experts, the issue stems from a portion of demand that remains outside the banking system or fails to meet the requirements for external transfers.
Shifts in the Dollar Market
Part of the gap between the official exchange rate and the market trading rate stems from shifts in foreign trade financing mechanisms in recent years. These changes involve stricter requirements for auditing transfers, verifying ultimate beneficiaries, and adhering to anti-money laundering and counter-terrorism financing standards.
As stricter requirements were applied to outward transfers, certain trade transactions failing to meet documentation and compliance criteria struggled to access US dollars through the banking system.
This drove a portion of the demand toward alternative channels at higher rates.
Simultaneously, restrictions were imposed on the US dollar operations of several Iraqi banks, coinciding with the Central Bank’s implementation of a banking sector reform program aimed at enhancing compliance and governance standards and expanding relationships with international banks.
The restrictions placed on certain banks do not mean a cessation of all banking activities; rather, they limit the banks’ ability to conduct dollar-based transactions, depending on the specific nature of the restrictions and regulatory requirements imposed upon them. Concurrently, the trade and customs sector has undergone significant changes, marked by the expanded implementation of the ASYCUDA system and stricter scrutiny of import invoices and commercial documents—measures aimed at regulating the flow of goods and revenue while curbing invoice manipulation.
While these measures seek to channel the bulk of foreign trade through the banking system and enhance transparency, the fact that a portion of commercial demand remains outside these channels renders the market highly sensitive to any surge in demand or shift in expectations.
**Traders Withdrawing Dollars from the Market**
Financial expert Dr. Majid Khalid Al-Darraji identifies commercial demand as a primary factor exerting pressure on the exchange rate, particularly when traders and importers resort to purchasing cash dollars to finance transactions that cannot easily be processed through banking channels.
Speaking to *Al-Ahed News*, Al-Darraji explains that a trader needing to settle payment for a shipment on short notice—and unable to secure an external transfer at the official rate due to missing documentation or procedural delays—may turn to licensed exchange bureaus to acquire the currency.
When large numbers of traders seek dollars simultaneously, the demand for cash dollars rises while market supply dwindles, driving up the price even in the absence of changes to official reserve levels.
Al-Darraji notes that a portion of the dollars purchased by importers effectively exits the local circulation cycle to settle trade transactions outside Iraq; this differs from dollars used for speculation, which may return to the market once prices shift.
The impact of this factor intensifies during peak import seasons and religious or social occasions, driven by increased demand for foodstuffs, appliances, vehicles, construction materials, and various other goods.
And whenever [there is a failure]… As banking channels struggled to accommodate legitimate commercial demand with the required speed and efficiency, a portion of this demand found its way to the cash market, placing fresh pressure on the exchange rate.
**Citizen Hoarding: A Different Kind of Pressure**
Demand for the dollar does not stem solely from merchants; another factor is the tendency of some citizens and savers to purchase the US currency and keep it at home or in safes as a means of saving and hedging.
Dr. Faisal Al-Bayati, a professor at the College of Administration and Economics at Wasit University, tells *Al-Ahad News* that this behavior typically intensifies amid rising fears of dinar depreciation, or the spread of rumors regarding exchange rate changes or new restrictions on accessing foreign currency.
While individual purchases may seem limited, the cumulative effect of buying by large numbers of citizens and business owners can withdraw significant amounts of dollars from circulation.
The impact of this type of demand differs from daily speculation; hoarded dollars may remain out of the market for extended periods, thereby reducing available supply and making prices more sensitive to any new wave of demand.
Al-Bayati describes the phenomenon as a self-reinforcing cycle: a price increase stokes fears among some savers of further hikes, prompting them to buy dollars; this reduces available supply and intensifies pressure on the price.
Consequently, demand for the US currency is no longer tied solely to imports; instead, the dollar—alongside gold and other instruments—becomes a savings haven for those with financial surpluses during times of uncertainty.
Shifting the Demand Landscape
Separately, economist Nabil Al-Marsoumi links fluctuations in the exchange rate to the implementation of the ASYCUDA customs system and changes in customs tariffs and procedures.
Al-Marsoumi tells *Al-Ahad News* that stricter scrutiny of import invoices has helped curb inflated invoicing and the phenomenon known as “returned dollars”—a practice involving the acquisition of dollars at the official rate for imports with exaggerated values, followed by the resale of the surplus in the market.
According to Al-Marsoumi, the contraction of this artificial source of supply has contributed to a relative scarcity of dollars circulating outside official channels, coinciding with a shift of some trade activity toward alternative routes.
Al-Marsoumi also attributes part of the demand to the financing of imports passing through Kurdistan Region border crossings, noting the disparities in procedures and costs between different entry points.
This issue highlights the importance of unifying customs procedures; applying stricter regulations at one crossing while procedures differ at another can drive commercial activity toward the less costly route, thereby impacting trade financing methods and the demand for dollars.
Economist Safwan Ghazi concurs with aspects of this analysis, linking previous surges in the dollar’s value to the implementation of advance customs duties and the resulting shift—in his view—of a portion of demand outside the banking system.
Ghazi believes such pressure could prove temporary if imbalances are rectified and official channels succeed in absorbing genuine commercial demand.
Why does the rise in the dollar’s value quickly affect the average citizen? The impact of a rising exchange rate is not confined to currency markets or exchange bureaus; it gradually filters through to the prices of goods and services—particularly in an economy heavily reliant on imports.
Importers who acquire dollars at a higher rate pass the exchange rate differential on to the cost of the goods; this price increase then travels through the supply chain—spanning transport, distribution, and wholesale and retail sectors—until it reaches the consumer.
These repercussions are most evident in imported goods, including appliances, consumer products, certain foodstuffs, pharmaceuticals, and various other supplies.
Furthermore, the mere expectation that the dollar will continue to rise can prompt merchants to reprice their goods in anticipation of higher future import costs, meaning the exchange rate’s impact extends beyond the dollar’s actual movement to influence market expectations themselves.
How can this rise be contained?
Hashem Al-Zoubi, a finance and banking expert, argues that addressing the issue cannot rely on a single, isolated measure; rather, it requires a cohesive package of actions, starting with facilitating the financing of genuine trade through the banking sector. Al-Zoubi tells *Al-Ahed News* that enabling merchants who provide valid documents and invoices to secure foreign transfers quickly and at a transparent cost would shift a significant portion of demand from the cash market to the banking system, thereby easing pressure on the dollar circulating outside official channels.
He emphasizes that streamlining procedures does not mean abandoning anti-money laundering and financial compliance requirements; rather, it necessitates building a system that balances speed with oversight.
He also underscores the importance of standardizing procedures and customs tariffs, implementing the ASYCUDA system at all border crossings—including those in the Kurdistan Region—and electronically linking customs systems with the Central Bank, tax authorities, and commercial banks.
Al-Zoubi believes that disparities in import costs and procedures across different border crossings create distortions in commercial activity, which can, in turn, impact the demand for foreign currency.
**Restoring Confidence in the Dinar**
According to Al-Zoubi, addressing dollar hoarding is linked to the issue of confidence; it is difficult to persuade citizens to keep their savings in dinars without a reliable banking sector and savings instruments capable of attracting funds.
He calls for strengthening deposit protection, improving banking services, and offering dinar-denominated savings instruments—such as deposits, certificates of deposit, and government bonds aimed at individuals—alongside transparently publishing economic data and swiftly addressing rumors regarding the exchange rate.
He also stresses the importance of publishing periodic data on foreign transfers and import financing, enabling the market to distinguish between genuine commercial demand and demand driven by speculation or hoarding.
In the longer term, Al-Zoubi highlights the restructuring of the banking sector and the enhancement of its capacity… …establishing international correspondent banking relationships is considered a fundamental solution; an economy the size of Iraq’s cannot sustainably rely on the circulation of physical US dollars to finance a significant portion of its foreign trade.
Conversely, there are warnings that tightening market oversight or shutting down trading channels—without providing effective banking alternatives—could backfire by reducing available supply and driving up prices.
**It Is Not Just a Dollar Crisis**
Expert opinions gathered by *Al-Ahad News* reveal that exchange rate fluctuations in Iraq cannot be explained by a single indicator; focusing solely on speculators or traders fails to provide a complete picture of the situation.
Commercial demand draws dollars to finance imports, while hoarding removes another portion from circulation. Meanwhile, compliance requirements limit the ability of certain transactions to access dollars at the official rate, and customs disparities influence trade routes; furthermore, expectations, rumors, and political and regional tensions exert additional pressure on the market.
Although the motivations of traders and savers differ, the outcome is the same from the perspective of the currency market: a decline in the volume of dollars available for circulation relative to demand.
Moreover, the widening gap between the official rate and the rate in unofficial channels does not, in itself, indicate a shortage of Iraq’s foreign currency reserves. Rather, it reveals a disparity between the demand for dollars and the financial and banking system’s capacity to accommodate that demand within approved channels and regulations.
**What Does the Market Need?**
According to experts, solutions should focus on addressing the sources of demand rather than merely reacting to price hikes. This involves expanding trade finance…
Iraq is entering a decisive stage of political, financial, and monetary transformation.
🛡️ STATE CONTROL OF WEAPONS The process of bringing armed factions under state control is moving toward 2027, with March expected for the handover of strategic weapons and June as the target for completing the process.
🇺🇸
SEPTEMBER 30 The coalition mission transition marks a critical point. From there, Iraq increasingly assumes responsibility for its own security.
💵 PARALLEL MARKET The CBI continues working to narrow the gap between the official dinar rate and the parallel-market rate. Convergence between the two rates will be a key signal to watch.
🔢 DELETE THE ZEROS CBI contact intel points toward a possible activation of the Delete the Zeros project in early 2027.
This could be a major step in Iraq’s monetary reform process.
📈 AND THE RV?
The sequence to watch:
🛡️ State control of weapons ⬇️ 💵 Narrowing of the exchange-rate gap ⬇️ 🏦 Financial strengthening ⬇️ 🔢 Activation of Delete the Zeros ⬇️ 💰 DINAR RV
🇮🇶 Iraq is not only working on monetary reform. The country is also advancing security, sovereignty, banking, digitalization, investment, and economic modernization.
👀 The coming months will be critical.
📌 September 2026 📌 March 2027 📌 Early 2027 — Delete the Zeros 📌 June 2027 — target for completing disarmament
🔥 The pieces are on the table. Now we watch how each stage unfolds.