After meeting with the US Federal Reserve, The Central Bank denies that Iraqi banks were subject to sanctions Baghdad – Mawazine: The Central Bank of Iraq denied the existence of international sanctions on some Iraqi banks, after the media circulated news about sanctions that included dozens of banks in the country.
The Central Bank said in a statement that received “Mawazine”, a copy of it, that “the first quarterly meetings of 2025 with the US Treasury Department and the US Federal Reserve Bank, which were held in Dubai / United Arab Emirates with the participation of international auditing and consulting companies (EY, K2 Integrity, Oliver Wyman), and the meetings were culted in praise for the steps taken by the Central Bank of Iraq and the Iraqi government in reforming the banking sector, the most important of which was: the development of the cash distribution system of the US dollar in Iraq,
which they considered the most controlled and controlling system in the world, which limits the manipulation and smuggling of the US dollar, in addition to the qualitative shift in foreign transfers and the steps taken by the Central Bank of Iraq. To address the risks arising from these operations, which are rising the levels of transfers carried out by international banks.
The statement stressed that the consulting companies (EY and Oliver Wyman) reviewed the plans to reform and upgrade the public and private banking sector in line with international standards and to facilitate the involvement of Iraqi banks in the financial relations network internationally.
The statement added: “Because the operations carried out by banks operating in Iraq depend heavily on the confidence of international correspondent banks in the Iraqi banking sector, we emphasize the need to ensure the adoption of the official channels of this bank to know the latest news and not to report incorrect news, such as the exposure of some Iraqi banks to international sanctions and others.”
In a significant development from Iraq, Foreign Minister Fuad Hussein announced efforts to resolve outstanding technical issues with the Kurdistan Regional Government (KRG) to restart crude oil exports to Turkey. The suspension of these exports has resulted in a staggering loss of $19 billion over nearly two years.
The legal framework for resuming oil exports has been established, and discussions are now focused on technical matters involving oil companies and both the Federal and Regional governments. Hussein expressed optimism that negotiations could commence the following week and conclude shortly thereafter.
This news is critical for Iraq, which is grappling with financial difficulties exacerbated by the lengthy suspension of oil exports. In a parallel diplomatic effort, Iraqi Prime Minister Muhammad Shia Al Don met with U.S. Democratic Senator Alysa Slotkin in Munich to discuss enhancing bilateral relations and cooperation in various sectors, underscoring the importance of a strategic partnership to bolster regional stability and economic growth.
🚨 Resumption of Oil Exports: Iraq is working to resolve technical issues to restart crude oil exports to Turkey.
💰 Financial Impact: The suspension of oil exports has resulted in a loss of $19 billion for Iraq.
📜 Legal Framework Established: A legal framework for resuming exports has been agreed upon, facilitating upcoming negotiations.
🔧
Technical Discussions: Current discussions are focused on technical matters between oil companies and the governments.
🤝 Strengthening U.S.-Iraq Relations: Iraqi Prime Minister met with U.S. Senator to discuss enhancing cooperation.
🌍 Focus on Regional Stability: Both Iraq and the U.S. emphasize the importance of a long-term strategic partnership.
🗓️ Optimistic Timeline: Foreign Minister Hussein expressed hope that negotiations could begin next week.
Key Insights
📉 Economic Ramifications: The $19 billion loss due to the suspension of oil exports indicates a severe economic strain on Iraq. This situation reflects the country’s heavy reliance on oil revenue, highlighting the importance of stable export agreements for national financial health. The ability to restore exports is not just a matter of revenue but also a crucial step towards economic recovery and stability in the region.
🛠️ Legal and Technical Framework: Establishing a legal framework is a critical step in resuming oil exports. It allows both the Federal Government and the KRG to navigate the complex regulatory environment that governs oil production and exportation. The focus on technical discussions suggests that resolving operational issues will be essential to ensure smooth exports and avoid future disruptions.
🤔 Negotiation Dynamics: The optimism expressed by Foreign Minister Hussein regarding the timeline for negotiations indicates a willingness from both sides to find common ground. Swift negotiations are crucial, as delays could lead to further financial losses and exacerbate existing tensions between the Federal Government and the KRG.
🇺🇸 Bilateral Relations with the U.S.: The meeting between Prime Minister Al Don and Senator Slotkin underscores Iraq’s strategic interest in maintaining strong ties with the United States. This relationship is pivotal for Iraq, especially in terms of security cooperation and economic support, which can help stabilize the region amid ongoing challenges.
🌐 Importance of Regional Stability: Both Iraq and the U.S. recognize the significance of a stable and cooperative regional environment. The commitment to fostering a long-term strategic partnership reflects an understanding that regional stability is interlinked with economic growth and security, which is crucial for both nations.
⚖️ Balancing Federal and Regional Interests: The negotiations between the Federal Government and the KRG are emblematic of the broader challenges Iraq faces in balancing diverse political and economic interests. Successfully navigating these discussions will be vital for the unity of Iraq and the effective governance of its oil resources.
⏳ Urgency for Action: With the financial losses mounting and the pressure to restore oil exports intensifying, there is a clear urgency for both the Iraqi government and the KRG to act swiftly. The prompt resolution of technical issues and the resumption of oil exports will be critical in addressing Iraq’s immediate economic needs and stabilizing its financial outlook.
In conclusion, the developments surrounding Iraq’s crude oil exports and its diplomatic engagements highlight the intricate relationship between economic stability, regional cooperation, and international partnerships.
As negotiations progress, the focus will remain on not only restoring vital revenue streams but also ensuring that Iraq can navigate its complex political landscape effectively. The outcomes of these efforts will have significant implications for Iraq’s financial health and its role in the broader geopolitical framework of the region.
Iraqi government sources reported on Sunday that Baghdad received an official notification from the US Treasury Department of imposing sanctions on five Iraqi banks, in addition to a number of exchange companies, for their involvement in illegal financial transfers inside and outside Iraq, and smuggling the dollar to prohibited parties, most notably the Islamic Republic of Iran.
According to the US communiqué, the sanctions will not stop there, as the work of other banks that may face similar measures is being closely monitored in the near future.
The new US decision also included a comprehensive ban on the use of Iraqi electronic payment cards outside the country during the next two months, in a move aimed at preventing currency smuggling after monitoring suspicious financial movements by a specialized American team.
The US Treasury Department previously imposed sanctions on 14 Iraqi banks in July 2023, and prevented four other banks from accessing the dollar in November of the same year, and imposed strict restrictions on remittances in cooperation with the Central Bank of Iraq.
These measures come within the framework of an escalating US policy to control financial transactions in Iraq, amid fears of continued money laundering and currency smuggling, which imposes additional challenges on the Iraqi banking sector and its financial stability.
Don't pay attention to the rumors. Where is the logic in the rumor...?
If it turns out that President Trump and Vance have asked Sudani to hand in his resignation as Prime Minister then I might just walk away. I'll just walk away.
The relationship between the two of them is the reason why we're going to the new exchange rate soon IMO.
The Central Bank announced on Sunday the details of its meetings with the US Treasury Department and the Federal Reserve, which witnessed praise for the reform measures taken by the Central Bank and the Iraqi government in the banking sector.
The bank said in an official statement received by {Al-Furat News} that “the meetings praised the development of the US dollar cash distribution system in Iraq, and described it as “the most controlled and controlling system in the world,” because of its role in reducing manipulation and dollar smuggling operations.”
The statement explained that
“the reforms also included a paradigm shift in external remittances, as the central bank took measures to address the risks associated with these operations, to reach levels comparable to transfers implemented by international banks.”
The bank pointed out that “the international consulting companies (EY and Oliver Wyman) presented during the meetings plans to reform the public and private banking sector, in line with international standards, and support the involvement of Iraqi banks in the global financial network.”
