GOLDILOCKS: The announcement that the value of investment licenses in Iraq has reached $88 billion could potentially influence the value of the Iraqi dinar, 13 APRIL

 GOLDILOCKS

The announcement that the value of investment licenses in Iraq has reached $88 billion could potentially influence the value of the Iraqi dinar, but the extent and direction of that influence depend on several factors. Let’s break it down.

Iraq’s economy is heavily reliant on oil, which accounts for the vast majority of its government revenue and foreign exchange earnings. 

The Iraqi dinar’s value is managed by the Central Bank of Iraq (CBI) through a controlled exchange rate regime, rather than being freely determined by market forces.

 This means any impact from investment licenses on the dinar’s value would likely occur indirectly, through economic fundamentals, rather than immediate market speculation.

If these $88 billion in investment licenses translate into real, productive projects, let's say in infrastructure, energy, or non-oil sectors, they could boost Iraq’s economic growth, diversify its revenue streams, and strengthen its fiscal position. Over time, this might increase confidence in the economy, potentially putting upward pressure on the dinar’s value. For example, successful investments could attract more foreign capital, increase demand for the dinar in transactions, and bolster Iraq’s foreign exchange reserves, which stood at $97 billion in 2022 according to the IMF. A stronger reserve position could give the CBI more flexibility to adjust the exchange rate favorably.

Historically, speculation about the dinar’s value has been fueled by Iraq’s oil wealth and comparisons to currencies like the Kuwaiti dinar, which recovered post-Gulf War. But Iraq’s ongoing sectarian tensions, governance challenges, and a lack of economic diversification make a dramatic revaluation unlikely without structural reforms. The $88 billion figure alone doesn’t change that equation overnight.

So, will it influence the dinar’s value? Possibly, but not immediately or dramatically. If the investments materialize and diversify the economy, they could lay the groundwork for a stronger dinar in the future, perhaps prompting the CBI to tweak the peg. But absent concrete progress and broader stability, the impact might be more noise than substance. For now, the dinar’s trajectory hinges more on oil prices, government policy, and regional dynamics than on this headline number.

© Goldilocks

https://ina.iq/eng/39215-pm-the-value-of-investment-licenses-in-iraq-reaches-88-billion.html

Mr. Pool: Tier4b activation has begun!! @DINARREVALUATION #iraq #iraqidi...

How Turkmenistan can help Iraq end its Energy Crisis, 13 APRIL

How Turkmenistan can help Iraq end its Energy Crisis, 

Deep Dive: How Turkmenistan can help Iraq end its energy crisis

With growing energy needs and ongoing US pressure, now seems to be the right time for all involved countries -- Iraq, Iran and Turkmenistan -- to implement the swap model.

The unfolding of Iran-US diplomacy only provides further impetus for a win-win approach.

The full article can be viewed here.

TIDBIT FROM FRANK26, 13 APRIL

  Frank26 

 They've been working with the World Bank, the US  Treasury, the IMF.   The CBI and Sudani have...done a lot of amazing things.  The way they're talking, the World Bank and IMF, these people are talking like they got a new exchange rate.

 What do we need?  

Security and stability.  

From who ?  Iran. 

 Why?  They steal everything they can from Iraq.  That's why they haven't raised the value of their currency? Yes.

MNT GOAT: How will this...the digital dinar... impact the dinar paper we HAVE? #iraq

 

Knights: "The Danger of Letting Iraq's PMF Authority Law Pass" , 13 APRIL

Knights: "The Danger of Letting Iraq's PMF Authority Law Pass"

For years now, Iraq’s Popular Mobilization Forces have been recognized as a danger to both American national security interests and Iraqi civilians, with U.S.-designated terrorists holding senior PMF leadership posts(including chairman and chief of staff) while exploiting the force’s structure to provide government paychecks to tens of thousands of rank-and-file militia members belonging to designated terrorist groups like Kataib Hezbollah and Asaib Ahl al-Haq. 

Despite this blatant puppeteering by Iran-backed elements accused of killing Iraqis and U.S. troops alike, Baghdad is currently considering two pieces of legislation that would further legitimize the PMF as a permanent national security institution. 

One is the “PMF Service and Retirement Law,” which the author recently assessed as a primarily internal measure for removing rival militia leaders.

 A second, even more consequential bill is the amended “PMF Authority Law,” which would add reams of provisions to PMF Commission Law No. 40, the barebones legislation passed to regulate emergency militia recruits in 2016. 

Amid so many pressing global developments, the U.S. government could be forgiven for letting this seemingly niche issue slide, but allowing the legislation to quietly pass would be cause for major regret later. 

Among its most troubling consequences, the draft Authority Law would permanently enshrine the PMF and its estimated 238,000 personnel as a parallel armed force empowered to do as its commanders see fit on the domestic and regional stage. Put another way, it would embed the equivalent of Iran’s Islamic Revolutionary Guard Corps (IRGC) at the heart of Iraq’s security sector—no longer as just an emergency force raised by the prime minister

 and overseen by a provisional commission (its original role during and after the war against the Islamic State in 2014), but as a fully empowered ministry-like institution that would be very difficult to reform later, let alone dissolve.

The draft law would also formally identify the PMF as the guarantor of Iraq’s political system, which has been led by Shia factions since 2003—another nod to the IRGC, which was established to guarantee Iran’s post-revolutionary political order. In addition to striking a blow at the prestige and legitimacy of Iraq’s armed services, granting such a role to the PMF would essentially cast the militias as a reactionary force with a mandate to preserve a fixed political order and militarize political processes like candidate registration, voting, and government formation. It could also further embolden them to attack protesters and civil society groups, as seen in 2019 when PMF units committed gross human rights violations against such targets. (These abuses continue to this day against Iraqis who question the PMF’s unchecked power grabs.)

To avoid these outcomes occurring under its watch, the Trump administration must make Washington’s strident objections known to Baghdad. Luckily, this may not require strenuous U.S. efforts—only a private signal to Iraq’s president, prime minister, and speaker of parliament that the PMF Authority Law should not be forwarded to the legislature for final passage. Baghdad is currently caught in the middle of a high-stress moment in the Middle East, with U.S. forces massed in the region in great strength and Iraqi militias keen to stay off their targeting lists. Washington’s leverage is strong right now, but only if the administration sends a clear message behind the scenes about how that leverage will be exerted should Iraqi officials decide to midwife another IRGC in the heart of the region. 

If such a warning has already been delivered, then the U.S. government is to be commended for attending to this important detail at a time when so few new appointees are in place yet on the Iraq file. Even so, policymakers in Washington and Embassy Baghdad should still reinforce the message posthaste. Once the PMF is permanently enshrined through the passage of detailed implementing legislation, the toothpaste would be out of the tube, and the future lift would far heavier for U.S. officials seeking to prevent the rise of an Iraqi “Revolutionary Guard.” Indeed, leaders in Baghdad need to understand that the United States would have few “quiet” levers left in that scenario and would have to use “loud” ones like imposing sanctions on the entire PMF, as it has done on the IRGC—a move that could have untold budgetary ripple effects on the rest of the Iraqi financial system due to the PMF being government-paid forces. 

Some Iraqis have been questioning why the Trump administration claims to have different policies from its predecessor but acts very similarly in practice (at least so far, and excepting its recent denial of an Iraqi waiver to buy Iranian electricity). Forestalling a legislative breakthrough for the PMF would be a good sign that the administration is attentive to important under-the-radar events in Iraq and aware of how best to deter adventurism by Iran-backed terrorist groups—ideally before they resort to launching rockets and drones at U.S. bases or kidnapping and murdering Americans. A good way to reinforce this message without immediately sanctioning the whole PMF—which includes many non-terrorist members—would be to quickly designate the Muhandis General Company, the PMF’s equivalent of Khatam al-Anbia, the IRGC economic conglomerate that has long been sanctioned by the UN, the European Union, and the United States as a major source of terrorist threat financing.

TIDBIT FROM BABYSMOM, 13 APRIL

  Babysmom 

 ACCORDING TO WHAT I HEARD...THE RV HAPPENED ON MARCH 28 IN IRAQ AND HAS NOT BEEN MADE INTERNATIONAL, YET. 

 JUST LIKE WHEN KUWAIT REVALUED...IT HAPPENED IN KUWAIT ON MARCH 24, 1991, A SUNDAY, DURING RAMADAN, IT WAS ANNOUNCED IN THE NY TIMES ON MARCH 25TH...BUT NOT MADE INTERNATIONAL FOR DAYS...