Iraq Economic News And Points To Ponder Tuesday Afternoon 6-16-25
Iraq’s Foreign Exchange Reserves Decline
Iraq Amr Salem June 17, 2025 The Central Bank of Iraq. Photo: INA Baghdad (IraqiNews.com) – The Central Bank of Iraq (CBI) revealed on Tuesday that the country’s foreign exchange reserves declined in May 2025.
Official data released by the CBI indicated that the country’s reserves of foreign exchange reached 126 trillion Iraqi dinars ($96.9 billion) on May 31 compared to 127.32 trillion Iraqi dinars ($97.94 billion) on May 1, Shafaq News reported.
Iraq’s foreign exchange reserves declined from 127.51 trillion Iraqi dinars ($98.089 billion) in April.
The country’s foreign exchange reserves amounted to 130.34 trillion Iraqi dinars ($100.27 billion) in 2024, down from 145.25 trillion Iraqi dinars ($111.73 billion) in 2023.
The director of the Investment Department in the CBI, Mohammed Younis,
revealed earlier in June that foreign reserves surpassed $100 billion.
Iraq’s foreign reserves are managed in accordance with thoroughly planned policies
based on
highly secure standards and
invested in safe financial products
that yield appropriate returns, according to Younis.
The CBI disclosed last month that its
official reserves fell by more than 11 trillion Iraqi dinars ($8.39 billion) in a single year.
Foreign reserves provide comprehensive coverage of the monetary base,
as well as financial indicators including trade and foreign obligations.
Iraq, the world’s fifth-largest oil producer,
can quickly and effectively increase its foreign exchange reserves
due to consistent international financial flows.
https://www.iraqinews.com/iraq/iraqs-foreign-exchange-reserves-decline/
Iraq Seeks A Balance That Avoids Escalation Between Iran And Israel.
June 17, 2025 Baghdad (AFP) - Iranian drones and missiles, as well as Israeli fighter jets, are crossing Iraqi airspace, a situation that is forcing Baghdad to redouble its efforts to maintain a delicate balance and prevent the country from slipping into a new regional conflict.
"There is a great risk that the escalation will spread to Iraq," political analyst Sajjad Jiyad told AFP.
Iraq has long been an arena for regional conflicts, which is currently raising concerns that it could slide into the throes of war between Iran and Israel.
US forces are stationed in Iraq as part of the US-led international coalition fighting ISIS. However, armed Iraqi groups affiliated with the Iranian-led "Axis of Resistance" are also present, and have previously targeted US forces.
During US President Donald Trump's first presidential term in 2020, a US drone killed Major General Qassem Soleimani, commander of the Quds Force of the Iranian Revolutionary Guard Corps, in Baghdad.
Amid the ongoing conflict between Iran and Israel, the country that receives the largest amount of US military aid, attention is turning to these Iraqi armed factions that have so far remained uninvolved.
But for how long?
Political analyst Tamer Badawi believes that "the more Iran struggles to maintain its firepower in the face of Israel, the greater the likelihood of involvement" of pro-Iranian Iraqi armed groups.
He added, "Iran is trying to spare its network collateral damage by keeping its regional allies on alert. However, this position could change."
A senior Iraqi security official told AFP that "everyone" within the pro-Iranian Iraqi camp "is cooperating with the government to keep Iraq out of the conflict."
- American "response"? -
Baghdad has been working for years to reconcile its strong alliance with its neighbor, Iran, a regional heavyweight with which it shares a long border and political, economic, and cultural ties, and its strategic and military partnership with Washington, which opposes Iran's nuclear program.
At dawn on Friday, Israel launched a large-scale attack, targeting military and nuclear sites in Iran in particular. Iran responded hours later with missile and drone strikes against the Jewish state. The exchange of fire between the two countries continues and expands.
The Iraqi government called on Washington to "prevent" Israeli aircraft "from repeatedly violating Iraqi airspace and carrying out attacks" on Iran.
The violation of Iraqi airspace angered pro-Iranian Iraqi factions, who accused US forces in Iraq of allowing it.
While the Secretary-General of the Hezbollah Brigades, Abu Hussein al-Hamidawi, affirmed in a statement on Sunday that Iran "does not need any military support from anyone to deter the criminal Zionist entity," he said, "We are closely monitoring the movements of the American enemy army in the region."
He added, "If America intervenes in the war, we will act directly against its interests and bases spread throughout the region without hesitation."
"We once again call on the Iraqi government to protect US diplomatic missions and military personnel present in the country at the request of the Iraqi government," a US official told AFP.
He added, refusing to reveal his name, "Iraq will be more stable and sovereign through its energy independence and distancing itself from harmful Iranian influence," referring to the import of Iranian gas to power Iraq's power plants.
The official also condemned the "violent and destabilizing" activities carried out by "Iran-backed militias."
Sajad Jiyad believes that “if Iran confirms that the United States (…) supports Israel in its attacks against Iran, this could prompt pro-Iranian elements inside Iraq to target the US embassy or consulate in Erbil, or US forces and the Ain al-Assad base,” where the international coalition is stationed in western Iraq to combat ISIS.
This could lead to a "US response inside Iraq, targeting these pro-Iranian groups, as well as a direct attack from Israel."
- "The Godfather" -
Tensions escalated in Iraq when war broke out in the Gaza Strip following the unprecedented attack launched by Hamas against Israel on October 7, 2023. Iraqi armed factions loyal to Iran claimed responsibility for launching dozens of missiles and drones at sites in Iraq and Syria where US troops were deployed as part of the international coalition. Washington responded by bombing sites belonging to these factions.
These same groups, part of what is known as the "Islamic Resistance in Iraq," claimed responsibility for launching drones at targets in Israel. The Israeli military intercepted most of these drones, before one killed two Israeli soldiers in the occupied Syrian Golan Heights in October 2024.
Tamer Badawi believes that the Iraqi armed factions loyal to Iran "retain the ability to target Israel from western Iraq" or even "target American interests in Jordan."
However, Iraq is preparing to hold parliamentary elections at the end of this year, motivating the political class, including armed factions represented by parliamentarians, to strive to maintain stability.
A leader in the Iraqi armed factions told AFP, "We do not deny that some parties have recently become involved in political activity. It is the nature of battle that preparations are sometimes made, and it is not normal to carry a sword throughout the battle."
He added, "There is a period when the sword must be in its sheath, but that does not mean abandoning the weapon or fearing confrontation."
He pointed out that Iraqi factions consider Iran their "spiritual father," adding, "We will not leave our father to fight the battle alone." He continued, "The United States, France, and Britain stand openly with Israel... so why don't we support the Islamic Republic?" LINK
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