Iraq’s Financial Crisis: Parliament Member Reveals Loss of 35 Trillion Dinar
On Thursday, Mohammed Al-Nouri, a member of the Iraqi Parliament’s Finance Committee, disclosed the disappearance of a staggering 35 trillion Iraqi dinars in printed currency, shedding light on the challenges besieging Iraq’s financial system. The revelation, made to the Al-Sumaria satellite TV channel, underscores the prevalence of smuggling, which accounts for 60-70% of the country’s financial activity.
Roots of the Financial System’s Failure
The roots of the financial system’s failure, according to Al-Nouri, lie in the dominance of certain parties and the quota system within financial institutions. The lack of electronic automation and final accounts in banks exacerbates the issue. With more than 73 private banks, Iraq’s banking system is under considerable strain. Al-Nouri stressed the urgent need for an independent financial system to restore economic balance in the country.
Government Banks and the Central Bank
The government banks, Al-Nouri said, find themselves tied down by the Ministry of Finance and the Prime Minister’s Office. Mismanagement at the Central Bank has had a detrimental effect on the dollar exchange rate and the budget. The United States’ Federal Reserve plays a decisive role in Iraq’s monetary policy, with funds being provided only with American approval.
Smuggling and Its Impact on Revenue
Al-Nouri also highlighted the rampant smuggling in Iraq under the current government, which has turned the country into a hub for drugs. The smuggling of imported goods such as cigarettes, gold, mobile phones, and alcohol has severely affected the country’s revenue. Dollar sales in Iraq are insufficient to meet the country’s needs due to smuggling, which necessitates stricter control of open and party-dominated ports.
Economic Impact and Dependence on the United States
The loss of the Iraqi dinar has inflicted significant economic damage, suspending small projects and construction loans. The Iraqi economy is heavily reliant on the United States, with sanctions from the U.S. Federal Reserve causing a surge in the exchange rate. The financial dealings have been further affected by missiles targeting Ain Al-Assad base and the embassy. The shocks to the economic system underline the urgent need for reform and greater control over financial institutions.
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