THE FINANCIAL PAIN HAS REACHED ITS PEAK, AND IMPLEMENTING REFORMS NOW IS MERELY A PUBLICITY STUNT FOR THE SUDANESE – EXPERT
Following the Economic Council’s decision on Monday to reduce government spending and maximize revenues, during a meeting chaired by Prime Minister Mohammed Shia al-Sudani, economist Ziad al-Hashemi said that the caretaker government’s presentation of a financial reform plan at the last minute aims to whitewash its reputation in its final days.
He hopes this announcement will encourage political parties to reappoint al-Sudani for a second term and give him the opportunity to implement this plan.
Al-Hashemi expressed surprise at what is happening in Iraq, noting that governments around the world present their financial plans at the beginning of their formation to address financial errors, improve the quality of spending, maximize returns, and formulate their financial policies in a systematic and disciplined manner.
He emphasized that the financial pain has reached the core of the government, and only harsh and painful measures that harm the citizen above all others will suffice.
(After the axe has fallen) The Iraqi government is playing for time and trying to score last points in its favor, and is proposing a financial reform plan to reduce spending and increase revenues!
Governments around the world, at the beginning of their formation, present their financial plan to address financial errors, improve the quality of spending, maximize returns, and formulate their financial policy in a systematic and disciplined manner, but what is happening in Iraq is something else entirely!
For the past four years, the Iraqi government’s program has been based on expanding spending through a highly politicized budget, which has inflated salaries and subsidies, piled up government employees beyond the needs and capacity of state institutions, magnified the financial deficit and accumulated debts, and allowed corruption to operate freely!
All of this happened at a time when Iraq’s financial revenues from oil sales and other sources were decreasing, yet that government paid no attention to either internal warnings or international reports, all of which were sounding the alarm in the face of that government and warning it of the dangers of inflated spending in light of deteriorating revenue, but there was no response!
After the opportunities for reform were lost and the financial problem grew dangerously during the past years, the government now appears at the end of its lifespan with a financial reform plan after the financial pain reached the government’s core and nothing but harsh and painful treatments that harm the citizen before anyone else will work for it!
It is unclear how the caretaker government will implement its financial plan, as it is a government stripped of powers and does not have enough time to implement all those major reform measures. Who will implement, who will commit, and who will set the timelines for implementation, and we are on the verge of forming a new government!
It is highly likely that this government wants to whitewash its reputation in its final days by announcing the financial reform plan, perhaps as a way to encourage political parties to reappoint the current Prime Minister and give him the opportunity to implement his reform plan!
But in any case, the next government, whether the current prime minister is reappointed or someone else is appointed, will face a difficult financial test that will force it to implement more harsh and painful measures, in which financial austerity may be the order of the day for the next four years!
STATUS OF THE RV: Keep the Champagne Cold… For Now
If I were you, I would keep the champagne in the fridge 🍾. The show is not over until the fat lady sings… and yes, she hasn’t stepped on stage yet.
We are now in mid-December, and while the Central Bank of Iraq (CBI)could still move forward with removing the zeros in preparation for a January release, timing remains flexible. Remember:
It does not have to happen on January 1st
January has 31 days
Plans can shift:
Zeros removed early January
Public release late January
There are multiple paths, not a single fixed date.
Early 2026 vs. Early 2025: What the Evidence Suggests
Contrary to emotional hype, there is more evidence than not pointing toward early 2026 as the window for fully normalizing the dinar and returning it to FOREX trading.
This does not mean inactivity in 2025. On the contrary:
2025 appears to be the final execution year
Structural reforms, budgets, salaries, customs, and reserves are being finalized
The foundation must be unshakable before a global-facing currency event
Political Noise vs. Reality on the Ground
Much of today’s Iraqi news revolves around:
Elections
Government seating
Competing political opinions
Be cautious.
Many economists and former parliament members offering commentary:
Live insulated lives of privilege
Are disconnected from everyday Iraqi citizens
Have historically benefited from corruption and bribery
Serve elite interests rather than constitutional reform
This disconnect has been one of Iraq’s longest-running problems.
Corruption Exposure: Iraq & the United States in Parallel
We are witnessing a firestorm of corruption exposure, not only in Iraq but also in the United States.
This exposure is necessary.
Under a Trump-led U.S. administration:
Cooperation with Iraq increases
Economic sovereignty becomes the goal
U.S. companies gain opportunity while Iraq advances
This is part of a global financial reset — but not the globalist version.
🚫 Not control 🚫 Not surveillance 🚫 Not digital enslavement
✅ Freedom ✅ Individual wealth ✅ Prosperity and abundance
If an RV occurs, it will be under leadership aligned with sovereignty, not globalism.
Political Theater: Who Really Matters?
Recent article: “AL-ABADI RETURNS AGAIN… AL-MALIKI CONCEDED THE PREMIERSHIP TO US”
Behind the scenes:
Al-Sudani seeks a second term
Al-Maliki does not want the position
Support is floated for Haider al-Abadi
Reality check:
Al-Maliki’s coalition performed poorly
His influence is exaggerated
Iraq does not move forward under figures tied to the past
For investors and reform-watchers, Al-Sudani remains the key figure. There is no other leader currently positioned to continue Iraq’s reform trajectory.
A New Financial Plan: Not a Stunt — A Signal
Article: “THE FINANCIAL PAIN HAS REACHED ITS PEAK…”
Some critics label Al-Sudani’s reforms as “publicity stunts.” That assessment ignores reality.
This is the exact timing when leaders:
Outline next-term economic strategy
Signal seriousness to parliament
Build momentum for continuity
Like Trump, Al-Sudani has a record of delivering.
Cabinet Approval: Reforms Are Already Moving
Another article confirms: “THE CABINET APPROVES REDUCING EXPENDITURES AND MAXIMIZING REVENUES”
Actions include:
Equalizing salaries
Cutting unnecessary spending
Exposing corrupt allocations
Ending elite privileges
This isn’t theory. This is execution.
A New Financial Roadmap for Iraq
Article: “A NEW FINANCIAL ROADMAP FOR IRAQ”
Key highlights:
Reforming salary structures
Eliminating senior privilege abuse
Enforcing financial justice
Protecting social stability
Ensuring long-term budget sustainability
This article is long, detailed, and critical. It confirms Iraq is moving from:
crisis management → sustainable development planning
Sound familiar? It should.
Featured Snippet: What’s Really Happening?
Is Iraq undergoing a financial reset? Yes. Iraq is actively restructuring salaries, cutting elite privileges, modernizing revenue streams, protecting reserves, and aligning government, CBI, and parliament toward long-term economic stability.
Diversification: The End of Oil Dependency
The CBI openly acknowledged:
Oil price fluctuations impact reserves
Liquidity withdrawals affect markets
Over-reliance on oil is unsustainable
This is why Iraq is pushing:
Development Road Project
Customs & tariffs
Logistics corridors
Private sector growth
These systems will eventually rival oil revenues.
CBI & Monetary Policy: Institutions in Tandem
Article: “MONETARY POLICY INDICATORS CONFIRM THE CENTRAL BANK WILL BE FIRST IN 2025”
This confirms:
CBI independence
Institutional cooperation
Monetary stability as priority
Citizens as the end beneficiaries
True growth happens when money circulates, not when corruption traps it at the top.
Liquidity, Reserves & the 2026 Budget
Article: “THERE IS NO LIQUIDITY CRISIS”
Facts:
Iraq holds ~$115 billion in reserves
Spending discipline is intentional
Budget planning is medium-term and strategic
Key takeaway:
The challenge is not how much is spent, but how well it is spent.
That statement alone separates responsible governance from reckless systems.
Q&A Section
Is Iraq facing a real financial crisis?
No. Iraq is managing reserves responsibly amid fluctuating oil prices.
Does this delay the RV?
No. It strengthens the foundation required for a sustainable RV.
Why talk about 2026 so much?
Because normalization, FOREX trading, and long-term stability require completed systems — not shortcuts.
Is this part of a global reset?
Yes, but one focused on sovereignty and prosperity, not control.
If I were you, I would keep the champagne in the frig. The show is not over until the fat lady at the circus sings….. lol.. lol..
It is mid-December and the CBI may still go ahead with removing the zeros in time for a January release or in January. Oh… but remember it does not have to happen exactly on January 1st as there are thirty-one days in the month. They could also change the plan and remove the zeros in early January and release in late January. There are options.
There is much more evidence than not that everything is pointing to early 2026 for them to normalize the dinar and place it back on FOREX to trade. Today we put together yet more evidence.
The news today is also about the election and the progress of getting the new government seated. Again, there is some propaganda as many of the economists and former parliament members give their ‘opinion’ on the situation in Iraq. Remember that these people are isolated from reality as they live in luxury in Iraq and do not often go out to the streets to see how the citizens actually live. They feel privileged. They are paid off and take bribes to do the dirty work of the elite globalist.
They are not patriotic or constitutionalists even though they pretend a lot. Their pockets are full of slush fund money. Yes, their overall attitude has been part of the problem all along with politicians just living in luxury off the system, surviving in their own sewers of reality and really do not care much about the people in their districts they are supposed to represent.
So, there is a firestorm of political corruption being exposed in the U.S. and in Iraq. Remember that this corruption had to be exposed so that under the Trump administration they finally could work closely with Iraq and move that country forward in the meantime U.S. companies getting a piece of the pie. Remember also this is all part of the reset in the financial system of the world. NO! This is not the globalist idea of their sinister reset, as theirs means more control over you through your money. This coming reset is about freedom, individual weatlh with prosperity and abundance for everyone. There will be prosperity for both the U.S. and Iraq. If you notice how Trump is working his deals, he mostly wants both parties to succeed. If we are going to get this RV is will be under the Trump administration.
In the news today we find the article titled “AL-ABADI RETURNS AGAIN… HIS BLOC: AL-MALIKI CONCEDED THE PREMIERSHIP TO US – BEHIND THE SCENES OF THE FRAMEWORK MEETING”. The Coordination Framework meeting discussed extensively the issue of deciding on a candidate for the position of the next Prime Minister.
The spokesman for the Victory Coalition, Salam al-Zubaidi, revealed on Tuesday the details of yesterday’s coordination framework meeting, indicating that al-Sudani is still clinging to the second term, but al-Maliki has no desire to assume the position of Prime Minister, and he supports the nomination of Haider al-Abadi for the position. I have to say who the hell cares what al-Maliki wants. His coalition got the least votes of all the large coalitions.
I don’t know why the news even pumps what this idiot al-Maliki thinks. As far as I am concerned this ‘peanut-head’ should be locked up. He is a swamp rat. I still firmly believe that al-Sudani will get a second term, and we just have to go through the motions. For our investment this of course is who we want in power. I do not believe there is any other leader in Iraq that can do the job that al-Sudani has done for Iraq so far and will continue his progress. This means RV…
A NEW FINANCIAL PLAN INITIATIVE
So here we go some positive news for al-Sudani. The article is titled “THE FINANCIAL PAIN HAS REACHED ITS PEAK, AND IMPLEMENTING REFORMS NOW IS MERELY A PUBLICITY STUNT FOR THE SUDANESE – EXPERT”.
I wouldn’t exactly call it a “publicity stunt” as it does have merit and al-Sudani usually delivers on his promises. Remember this is typical to announce your plans for the next term of office at this time and so the author is being a bit harsh in the title.
Following the Economic Council’s decision on Monday to reduce government spending and maximize revenues, during a meeting chaired by Prime Minister Mohammed Shia al-Sudani, economist Ziad al-Hashemi said that the caretaker government’s presentation of a financial reform plan at the last minute aims to whitewash its reputation in its final days. He hopes this announcement will encourage political parties to reappoint al-Sudani for a second term and give him the opportunity to implement this plan.
Like president Trump, al-Sudani also makes good on his promises once elected. So this plan is see as the Iraqi government playing for time and trying to score last points in its favor with it’s proposing a financial reform plan to reduce spending and increase revenues!
Then we can already see movement on this new financial reform plan of al-Sudani in the recent article titled “THE CABINET APPROVES {REDUCING EXPENDITURES AND MAXIMIZING REVENUES}”.You can read about more details on his new plan that I mentioned in the last paragraph above. Oh… al-Sudani is not even elected and yet he is still working tirelessly to help the Iraqi people. Does this guy remind you of Trump or what? Yes, he is equalizing salaries, cutting unnecessary expenditures and exposing corruption spending.
Sound familiar? His Cabinet yesterday approved the recommendations issued by the Ministerial Council for the Economy regarding reducing expenditures and maximizing revenues, as part of the al-Sudani’s new economic and financial reform program.
Then also in another recent article titled “A NEW FINANCIAL ROADMAP FOR IRAQ: THE SUDANESE GOVERNMENT BEGINS REFORMING SALARIES AND BENEFITS.”
We read about the movement of al-Sudani’s new financial reform plan described as bold and unprecedented, the government of Prime Minister Mohammed Shia al-Sudani is moving towards redrawing the financial map of Iraq by opening one of the most sensitive and complex files: the file of salaries and senior privileges in the state. Oh boy does this sound familiar.
This could be headlines in the news in America under president Trump.
In the article it says and I quote “the government is putting forward a reform vision aimed at streamlining spending and controlling operational expenses, with a focus on ending special privileges for presidencies and senior ranks, in an attempt to achieve financial justice, protect social stability, and ensure the sustainability of the general budget”
This article is VERY LONG but I encourage everyone to read it and absorb it. This new financial plan to cut expenditure and clean up this government is going to be the topic for a long time in al-Sudani’s next term.
Hey something is going on here…. Did you figure it out yet? Could this all be part of the ‘reset’ in action.
DIVERSIFY, DIVERSIFY, DIVERSIFY
In this next article I am not going to dwell on this issue of diversification. We all should be aware of the need for Iraq to generate many more sources of income to support the economy besides oil revenues (petro-dollar). “THE CENTRAL BANK OF IRAQ ACKNOWLEDGES THE CRISIS: OIL PRICES AND LIQUIDITY WITHDRAWALS HAVE AFFECTED “CASH RESERVES”.The Central Bank of Iraq confirmed on Wednesday that the decline in oil prices and the withdrawal of liquidity from the markets are two factors that negatively affect Iraq’s hard currency reserves. We all should know that
“Iraq’s reserves are closely linked to the size of oil revenues, which makes them vulnerable to fluctuations in global oil prices. Also, the monetary sterilization carried out by the Central Bank to withdraw liquidity from the market has a negative impact, due to the need to utilize foreign reserves.” How many more of these oil cycles does Iraq have to deal with before their measures take effect and begin producing real revenues as “oil prices fell from $81 for the second quarter of 2024 to $69 for the same quarter of 2025, and consequently reserves decreased from 142.69 trillion dinars to 126.16 trillion dinars for the same period.”
Yes, it is just a matter of time before these measures put in place like the Development Road Project, Customs and Tariffs and other projects begin working together and in harmony to generate the jobs and revenues rivaling the oil revenues. Remember too that the oil revenues are doubling. Sorry but I have to compare this Iraq future progress to what is happening in the U.S. too, as the Trump administration is working hard to put in place tariffs and reign in financial corruption that will soon pay off big too. He is reforming the U.S. financial system and years from now it too will look entirely different. Don’t forget also that like al-Sudani with the Iranian threat, Trump is also slowly reforming the “political system” in the U.S. from the swamp rats. The same old is not going to be the same old anymore….
Next I wanted to present this recent article in that it is good that the author Samir Al-Nassiri is also recognizes and is giving credit for the past four year reform progress in Iraq to the CBI in the article titled “MONETARY POLICY INDICATORS CONFIRM THE CENTRAL BANK WILL BE FIRST IN 2025”. Remember that the GOI does not work alone and needs the continued support of the Central Bank just as the Central Bank needs the continued support of the GOI.
They must work in tandem along with the parliament to pass any needed bills to get the job done. This statement by al-Nassiri stuck me as very important in his article today and I quote – “In countries that adopt an institutionally managed economic system, each institution retains its independence and authority to manage economic affairs according to the methodology and philosophy that aims to achieve economic stability and the well-being of society.”
I especially liked what al-Nassiri had to say because true economic growth is all about serving the citizens and keeping the money flowing. With corruption the money is either taken out of the system or much of it flows to the top and stays confined. The economy thus is deprived of the capital needed for opportunities and fulfilling dreams.
Here we go yet another recent article on the same topic of monetary policy titled “SALEH’S STATEMENT: THERE IS NO LIQUIDITY CRISIS, AND THE GOVERNMENT IS PROCEEDING WITH PREPARING THE 2026 BUDGET.” Saleh is not talking about the stashes of cash kept from the banks so much as he is talking about preserving the CBI reserves. With $115 billion in reserves this is liquidity to be used for emergency situations that may crop up due to dropping oil prices once the budget is set.
The Prime Minister’s financial advisor, Mazhar Muhammad Saleh, said in a press statement that “governments usually resort to spending cuts when faced with pressures resulting from fluctuations in revenues or high current obligations, especially in rentier economies dependent on a single resource such as oil.” There are many other articles out there in the news telling the citizens there is a financial crisis. Is this really a financial crisis?
Saleh explained that “these measures come in light of fluctuating oil prices and increasing spending requirements, which necessitates discipline in managing liquidity.” In other words it should be a normal practice and not get pressured into over spending and borrowing money. You can’t just throw money at a problem and expect it to go away. Is this now what the democrats in the U.S. tend to do in a crisis instead of working to solve the root cause. Iraq does not want to follow this practice.
Regarding the preparation of the draft federal general budget law for 2026, he indicated that “the financial authority and the government have made significant progress in preparing it within the medium-term framework of fiscal policy,” expecting that “the draft will focus on achieving a balance between fiscal sustainability and development requirements.” Enough said on how they are thinking in Iraq on managing responsible spending. You can go read the rest of the article. It gives us a real good idea on how the government plans to spend money and overall manage the economy.
To me this last paragraph in the article is profound and I quote – He stressed that “the real challenge lies not in the size of the spending itself, but in its quality and efficiency, and in the ability of public finances to gradually move from the logic of crisis management to the logic of sustainable development planning.” Let’s look at how the democrats in the US tend to run the government when they are in control. Is it not all just crisis management, yet one crisis after another and let’s just throw money at it hoping it will solve it. Is this responsible spending? Is this responsible governance? I hope this is sinking in today?
AL-ABADI RETURNS AGAIN… HIS BLOC: AL-MALIKI CONCEDED THE PREMIERSHIP TO US
BEHIND THE SCENES OF THE FRAMEWORK MEETING
The spokesman for the Victory Coalition, Salam al-Zubaidi, revealed on Tuesday the details of yesterday’s coordination framework meeting, indicating that al-Sudani is still clinging to the second term, but al-Maliki has no desire to assume the position of Prime Minister, and he supports the nomination of Haider al-Abadi for the position.
The Coordination Framework meeting discussed extensively the issue of deciding on a candidate for the position of the next Prime Minister.
Sudani is clinging to a second term, but Maliki has no desire to assume the position of Prime Minister and supports the nomination of Haider al-Abadi for the premiership.
The coordinating framework did not reach a final agreement on a single candidate, because the constitutional timelines gave the framework some leeway until the council convenes and its leadership and the presidency of the republic are elected, and the framework is keen not to exceed the constitutional deadlines.
The latest coordination framework statement carries political messages to Sunni leaders about the need to make their choice in the session.
Iraq Dinar RV Update: Key Developments Driving the Revaluation Narrative
As the year comes to a close, conversations around the Iraqi Dinar revaluation (RV) continue to intensify. Recent discussions highlight major banking reforms, White Paper implementation, bond processing updates, and political shifts that many believe are laying the groundwork for a significant monetary change.
While no one can claim to know exact timing, the convergence of economic reform, digitization, and sovereignty measures suggests Iraq is entering a decisive phase.
Disclaimer (MarkZ): Please consider everything on this call as my opinion. People who take notes do not catch everything, and it’s best to watch the video so that you get everything in context. Be sure to consult a professional for any financial decisions.
Bond Updates & RV Expectations
A recent bond update indicates that processing is still ongoing, with expectations remaining that completion could happen at any time, although delays of a few days are still possible. Importantly, there is no negative news—only confirmation that systems are actively moving forward.
This aligns with long-standing expectations that bond completions and currency value changes
Iraq’s Banking Reforms: The Core of the White Paper Strategy
Monetary Policy Indicators Signal Completion
Statements from Iraqi leadership confirm that:
Banking and monetary reforms spanning 2023–2025 are effectively completed
The reforms are specifically designed to lift the purchasing power of the dinar
Remaining banking adjustments are expected to conclude
within this month
This supports the narrative that Iraq is no longer “planning reforms”—they are executing the final stages.
Digital Transformation: Ports, Customs & Currency Control
Iraq is rapidly modernizing its infrastructure:
Digital customs systems to track goods and improve tax collection
Sonar and networking technologies at ports
Full tracking of boats, trucks, planes, and trains
Reduction of black-market dollar leakage
These measures are essential for currency stability and international trust, both prerequisites for any meaningful RV.
Is Iraq Implementing a QFS-Style System?
Many observers note similarities between Iraq’s reforms and what’s often referred to as QFS-style financial architecture, including:
Real-time tracking of funds
Transparent customs processing
Digitized banking oversight
Reduced corruption through automation
Whether labeled QFS or not, the outcome is the same: a controlled, transparent financial ecosystem.
HCL Law, Sovereignty & Political Signals
The discussion surrounding the Hydrocarbon Law (HCL) remains critical. Many believe:
The HCL must be implemented with an accurate rate in place
Parliamentary action before year-end strongly suggests immediate economic intent
Statements from Prime Minister Sudani reinforce urgency—not delays until 2026
Additionally, Iraq is actively:
Reducing Iranian influence
Strengthening ties with Gulf nations
Preparing to export electricity in the future
All signs point toward economic independence and stability.
RV Timing: January 2025 or Earlier?
While January 2nd is often mentioned as a logical starting point for monetary changes, no one can confirm exact timing.
However:
New fiscal years historically align with currency adjustments
Banking reforms are reportedly completing now
Political and infrastructure readiness is accelerating
Many hoped for a “Christmas RV,” but logic suggests the start of a new year remains a strong window.
Featured Snippet: Quick Summary
Is Iraq preparing for a Dinar revaluation? Yes. Iraq has completed major banking reforms, digitized customs and ports, strengthened monetary policy from 2023–2025, reduced foreign influence, and modernized its financial system—all key prerequisites for a currency value adjustment.
Q&A Section
Will the Vietnamese Dong RV happen at the same time as the Dinar?
Most believe they will move together, although exact coordination remains unconfirmed.
Does Iraq need a new rate before passing the HCL?
Many experts believe so, as revenue calculations depend on an accurate currency valuation.
Is Forex showing the dinar at $4.81 real?
Unverified rates appear periodically and should not be considered official until confirmed by central banks.
Is RV guaranteed?
No financial event is guaranteed. All information discussed is opinion-based and speculative.
Mindset Matters During the Waiting Period
Community discussions remind us:
Patience is essential
Humor helps during uncertainty
Positive attitude doesn’t change reality—but it helps us navigate it
As one member joked:
“The RV is happening at continental drift speed.”
Final Thoughts
Iraq’s progress is no longer theoretical. Digital infrastructure, banking transparency, sovereign control, and completed monetary reforms all suggest the country is positioning itself for a historic shift.
Whether the RV happens tomorrow or months from now, the foundation appears stronger than ever.
WHAT AWAITS IRAQIS IS “WORSE THAN OCCUPATION”… A SUMMARY OF WASHINGTON’S MESSAGES AND ACTIONS TOWARDS BAGHDAD – URGENT
While political forces in Baghdad are preoccupied with negotiations to form a new government and address post-election obligations, an Iraqi voice from Washington, privy to the inner workings of American decision-making, paints a harsher picture. Intifadh Qanbar , a resident of the US capital and privy to the behind-the-scenes workings of the Iraqi situation, succinctly summarizes these fears with a shocking statement: what awaits Iraq could be “worse than occupation,”
because the next battle may not be fought with tanks on the ground, but rather with a financial weapon: cutting off the dollar supply to Baghdad if the political class fails to meet the conditions presented by US President Donald Trump’s envoy, Mark Savaya. This assessment raises a weighty question: what does it mean for the flow of dollars from the US Federal Reserve to become a central bargaining chip in Washington’s relationship with Baghdad under the current Trump administration, and how might such a battle impact a fragile economy that is almost entirely dependent on the US currency?
From America to Baghdad… a warning about a “deadly weapon”
In numerous media appearances and commentaries, Intifadh Qanbar emphasized that Iraq faces not so much the threat of a new military invasion as it does a financial one that could paralyze the state from within. His warning is not about a theoretical possibility, but rather an escalating trajectory whose signs began to appear years ago when the US Treasury and the Federal Reserve tightened restrictions on the currency auction and excluded several Iraqi banks from dollar transactions under the pretext of their involvement in currency smuggling and financing networks linked to Iran.
From this perspective, Qanbar’s talk of “something worse than occupation” becomes an attempt to describe a scenario that requires no soldiers on the ground: it would suffice for Washington to gradually or suddenly tighten the flow of dollars, and for employee salaries, food and medicine imports, the value of the dinar, and the daily lives of citizens to become hostage to a political-financial decision made in New York and Washington.
The Iraqi dollar dilemma… when oil revenues pass through the Federal Reserve gate
Since 2003, a special mechanism has been in place for managing Iraqi oil revenues.
The funds are deposited in accounts at the Federal Reserve Bank of New York before being used to finance Iraq’s imports and meet the budget’s dollar needs. This arrangement has made the United States an involuntary partner in Iraq’s financial cycle, and the Fed accounts a mandatory gateway for every dollar entering Baghdad.
Simultaneously, the Central Bank of Iraq continued to operate a currency auction to cover imports and private sector transfers, which opened the door to smuggling, corruption, and exploitation of the gap between the official and parallel exchange rates. With mounting suspicions that billions of dollars were leaving Iraq for neighboring countries through money laundering and the financing of sanctioned networks, Washington began to view this as a vulnerability that could be used as both a tool for punishment and control.
In recent years, the US Treasury has translated this vision into concrete steps:
Tightening controls on the electronic platform for foreign transfers, barring several banks from accessing dollars, imposing rigorous scrutiny on every transfer transaction, and even rejecting requests suspected of being linked to sanctioned entities or smuggling networks. This experience has shown Iraqis, in practice, what it means for the life of the economy to hang by a single thread called “Federal Authority approval,”
and it has given Qanbar’s words today added weight, because Iraqis have seen firsthand how a series of US measures can drive up the dollar on the parallel market, disrupt markets, and put pressure on the government within weeks.
Savaya’s conditions… from factions to the dollar
At this critical juncture, Trump’s envoy to Iraq, Mark Savaya, arrived with a list of demands that reportedly represent the new administration’s core thinking toward Baghdad: a unified state and a single armed force; a halt to the funding of armed factions with public funds; control over the smuggling of dollars to Iran, Syria, and Lebanon; and a clearer definition of Iraq’s role in the equation of the conflict between Washington and Tehran. While these conditions have not been officially announced in full, they are being circulated behind the scenes as the “ceiling” of the American position in the coming phase, with the Federal Reserve’s leverage and the dollar’s influence being the most effective tools to push Baghdad toward this ceiling.
From this perspective, Qanbar interprets the situation as a shift from a phase of “advising and warning” to one of “dictating through financial instruments.” If the dominant forces in Baghdad—politically and militarily—accept the American conditions, the dollar can continue to flow with some restrictions and controls. However, if they decide to persist in their duplicitous stance, Qanbar believes that the American response this time will not take the form of statements and protest notes, but rather a gradual tightening of dollar channels, which could, at its most extreme, lead to a severe restriction or near-freezing of the use of Iraqi dollar reserves.
What does “cutting the dollar” mean in practice?
When Qanbar warns against “cutting off dollars to Iraq,” he is not necessarily referring to a complete and immediate halt to all transfers, as this would be a costly scenario for everyone and would unleash global financial chaos, something Washington does not want. What he is talking about is closer to a gradual punitive approach, which could include:
A wider crackdown on Iraqi banks and the denial of more of their ability to deal in dollars, which turns them into local institutions unable to finance foreign trade; tightening the ceilings on transfers allowed through the platform, which pushes traders to the black market, raises the exchange rate and weakens the dinar; and perhaps at an advanced stage, using the reserves card itself, by imposing certain formulas for their use or threatening to freeze part of them if it is considered that the Iraqi government is proceeding with policies that contradict American demands.
In such a scenario, the difference between military occupation and financial pressure becomes clear: the former destroys infrastructure and leads to direct armed clashes, while the latter gradually strangles the state from within, turning every issue—from salaries to electricity to food—into a bargaining chip on the political table. It is precisely here that Qanbar’s talk of “something worse than occupation” seems more like a warning of a silent collapse, one where tanks aren’t visible in the streets, but citizens witness it daily in a soaring exchange rate, stalled projects, and a government unable to fulfill its obligations without federal approval.
Does Iraq have any real options for escaping the grip of the federal government?
Faced with this scenario, there is much talk in Baghdad about “diversifying partners” and turning towards China and Russia, settling transactions in currencies other than the dollar, or even building reserves in other currencies. However, these ideas clash with a number of hard realities: Iraqi oil is still priced in dollars, global markets still use the dollar as the benchmark currency, and the Iraqi banking system is structurally weak and, in its current state, incapable of managing the shock of a sudden transition to a new settlement system. Furthermore, any significant shift away from the dollar requires a different international political framework and a considerable amount of time to build the confidence of markets and financial institutions—a luxury that seems unattainable given the fragile economic and social situation and mounting internal pressures.
In this sense, talk of “escaping the grip of the Federal Reserve” may be a long-term strategic goal, but it is not a realistic shield against the rapid pressure scenarios that Qanbar warns of. In the short term, Iraq remains largely exposed to American leverage, making the real arena for maneuver not only economic but also political: Where does Iraq stand in the struggle between the axes, how does it distribute the cost of its relations with Washington and Tehran, and what discourse does it use to manage the issues of factions, weapons, and the state?
The question of the moment: Will Baghdad learn before it’s too late?
Qanbar’s warning is based on the conviction that Washington, in its new iteration, does not intend to maintain the status quo; and that Savaya’s visit to Baghdad is not a courtesy call but rather the beginning of a serious pressure campaign whose objective is “either a genuine change in the behavior of the Iraqi state, or facing a system of harsh pressure, foremost among which is the weapon of the dollar.” In contrast, Savaya presents himself, in his statement, as a “partner ready to support,” affirming that the United States, “under the leadership of President Trump, stands fully prepared to support Iraq during this critical phase,” and that he and his team are “committed to working closely with Iraqi leaders to establish a strong state, a stable future, and a sovereign Iraq capable of shaping its own destiny in the new Middle East.”
Between Qanbar’s warning of “something worse than occupation” if the federal system is used as a punitive weapon, and Savaya’s talk of a “unified and rational option” that opens the door to American support, a new framework of pressure on Baghdad is taking shape: the stick of the dollar on one hand, and the carrot of “support and partnership” on the other. In this narrow space, the Iraqi state faces a new test: Does it possess the ability to formulate a unified and balanced position that spares the country a scenario of financial strangulation and prevents its reserves and oil revenues from becoming a tool for reshaping its political decision-making? Or will continued hesitation and internal conflict give Washington the pretext to use its harshest tools, leaving Iraqis suddenly at the heart of a suffocating financial crisis, unlike occupation in its outward appearance, but potentially surpassing it in its profound impact and its ability to shatter what remains of the state’s capacity to control its economic and political destiny?
