🚨🇮🇶 IRAQ: THE DOLLAR RISES, THE DINAR FALLS, AND POLITICAL TENSIONS GROW
💵 Iraq’s recent exchange rate adjustment has sparked protests and public concern. According to the report, the Iraqi dinar has lost approximately 15% of its value against the US dollar following the official adjustment.
🏛️ Who really made the decision? Prime Minister Ali al-Zaidi accepted responsibility before Parliament, but political figures claim that the Coordination Framework also participated in approving the measure.
📉 Why was this measure taken? The government argues that it needs to secure public-sector salary payments, avoid further borrowing, and address a difficult financial situation.
⚠️ However, critics question why more concrete measures have not been presented to reduce public spending, review government privileges, and combat corruption.
🛢️ Iraq remains heavily dependent on oil revenues, making foreign currency management and decisions by the Central Bank crucial to the country’s economic stability.
🔎 What does this mean for the Iraqi dinar?
• The devaluation could make imported goods more expensive. • The purchasing power of the Iraqi population could be affected. • Oil revenues converted into dinars may provide more local currency for the government budget. • A future recovery of the dinar is not guaranteed and will depend on economic conditions and official policy decisions.
📌 IMPORTANT: This report does not announce a revaluation of the Iraqi dinar or confirm a date for its value to return to previous levels. It describes a devaluation that has already been implemented and a growing political dispute over how to address Iraq’s financial crisis.
💬 Do you believe Iraq should prioritize cuts in public spending before implementing further exchange rate measures?
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DISARMAMENT IS NOT FREE… NEW MINISTRIES AND A RISE IN THE DOLLAR TO COVER ADDITIONAL EXPENSES
(Mnt Goat: Who runs the government, the prime minister once in office or the coordination framework?)
The factions will manage “artificial intelligence” and tourism? What?
The Coordination Framework was apparently surprised by the extent of the anger sparked by the decision to raise the dollar exchange rate.
According to Al-Mada, it began promoting the possibility of dismissing Ali al-Zaidi in an attempt to contain the public pressure.
Ironically, however, the decision was not a surprise within the Shiite alliance itself. According to informed sources, its constituent forces had agreed to raise the exchange rate before some of them found themselves facing the repercussions of a decision that now required political containment.
Since the end of last week, political and popular movements have been organizing demonstrations and protests against the measure, which has devalued the Iraqi dinar by about 15%.
In a late-night session of Parliament on Thursday, Prime Minister Ali al-Zaidi defended the decision, declaring himself solely responsible. However, this admission of responsibility, which appeared to be an attempt to end the controversy surrounding who made the decision, did not resolve the debate about its political motivations.
According to Ali al-Jurani, a member of the Hikma Movement, the dollar exchange rate increase originated from the Coordination Framework and received the approval of the heads of the political blocs and the State Administration Coalition.
Al-Mada newspaper revealed in a report published on June 11 that the economic plan being discussed among political forces is based on three tracks: changing the exchange rate, selling indebted institutions, and recovering funds from corrupt individuals. According to this information, the plan was discussed and approved during a meeting of the Shiite Alliance held that same month at the home of Ammar al-Hakim, leader of the Hikma Movement.
In this climate, the possibility of a vote of no confidence against the Prime Minister emerged. Falah al-Khafaji, a member of parliament from the State of Law Coalition, stated that several parliamentary blocs might move to withdraw confidence from al-Zaidi’s government if the decision to raise the exchange rate continues.
However, informed sources who spoke to Al-Mada believe that promoting the possibility of a no-confidence vote is also being used to try to absorb public anger and redirect attention to the fate of the government, rather than focusing the discussion on the decision itself and the parties that approved it.
Three options… but where is the austerity?
In Parliament, al-Zaidi explained that his government faced three unpalatable options to secure salaries and overcome the financial crisis: “forced savings and leaving employees to live on promises, distributing salaries every 45 days, or borrowing and plunging the country into debt.”
According to a statement from his media office, al-Zaidi said his government “took over the task with the economy under siege,” and that borrowing was not a suitable option given the size of the existing debt. He added that Iraq is going through “a dire situation and an undeclared siege” due to the war and the closure of the Strait of Hormuz, stressing that his government does not want to resort to further borrowing to avoid overburdening the economy.
In defending the adjustment of the exchange rate, al-Zaidi said that the difference in the previous dollar price “was being exploited by speculators,” emphasizing that the government is continuing its fight against corruption and that the economy must be treated with an “economic mindset.” He also announced that “good amounts”—estimated at more than $3 billion—of foreign currency will arrive in the coming days, confirming that the government will inject them into circulation.
But what sparked objections from economic experts was not only what the Prime Minister said, but what he did not address in his speech: reducing public spending, abolishing some privileges, reviewing salaries and positions, and investigating the areas of waste that drain public funds.