An Understanding Looms On The Horizon Between Iraq And Iran To Use Currencies Other Than The Dollar In Commercial Transactions
September 14, 2023 Baghdad/Al-Masala Al-Hadath: The financial advisor to the Iraqi Prime Minister, Mazhar Muhammad Salih, confirmed that there is an understanding on the horizon with Iran to use a basket of foreign currencies other than the dollar to settle commercial transactions between Iraq and Iran.
Saleh said in statements followed by Al-Masala, that allowing an international means of payment other than the dollar and identifying trade flows in a transparent and highly governance manner with the Islamic Republic of Iran within the international trading system will undoubtedly contribute to the stability of the exchange market in Iraq, in addition to enhancing the stability of the external payments system in our country. It leads to high stability in trade and financial movements without negative monetary impacts on our national economy.
He added: Therefore, there is a high understanding on the horizon in using a basket of foreign currencies other than the dollar to settle commercial transactions with the neighboring country [Iran], without this constituting an international obstacle, and at the same time providing the desired monetary stability in our country, especially the foreign currency market.
He pointed out that it is clear that there is a correlation between trade with the Islamic Republic of Iran on the part of the Iraqi private sector and the need to have an international payment currency to settle trade exchange, at a time when there is a ban by the United States in the field of financial transfers that was imposed on Iran more than a decade ago. , and is subject to high degrees of stringency.
He continued: Such requirements led, over time, to dealing with commercial settlements in foreign currency, but from outside the official markets, especially in the demand for cash dollars on the local black market.
He concluded his speech by saying that it has become logical to find an alternative international monetary medium for trade settlements with the neighboring country instead of the United States currency. The alternative monetary medium is used in a transparent and clear manner before the international financial community and at the same time spares the local exchange market from the pressures of international restrictions, their complications and their effects on our country’s economy.
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