Tuesday Iraq News posted by Tishwash at TNT 9-8-2026
TNT:
Tishwash: After September 30th, a new security agreement will keep Marines protecting the US Embassy in Baghdad.
On Monday, Hoshyar Zebari, a leader in the Kurdistan Democratic Party, revealed new details regarding the American withdrawal from Iraq, pointing to bilateral security arrangements between Baghdad and Washington, which include the continued presence of US Marines to protect the embassy .
Zebari said in a televised interview followed by Al-Sa’a Network that “this operation will end on September 30,” explaining that “the Iraqi government agreed with the American side two years ago that in 2026 there will be no need for Operation Inherent Resolve .”
He added that "Operation Inherent Resolve is an international coalition operation against ISIS, in which US forces and forces from the international coalition are participating," indicating that "this operation will be declared over, which means there is no need for the presence of US combat forces for this mission ."
Zebari explained that "the end of the mission in Iraq does not mean the end of the operation in Syria or Jordan," stressing that "the American side has already reduced its presence in Baghdad and Baghdad Airport, as well as in Erbil Airport ."
He noted that "Washington has contacts with the Iraqi government to reach security arrangements other than Operation Inherent Resolve and the military presence," indicating that "these arrangements may be bilateral, and may include the Kurdistan Region ."
He added that "the United States has an embassy in Baghdad and needs to protect it," noting that "Marine forces are present in American embassies around the world, including the embassy in London," as he put it link
Tishwash: Expert: The Iraqi banking sector faces tough reform, not collapse.
Economic expert Manar Al-Obaidi said on Monday that the Iraqi banking sector is not going through a phase of collapse, but rather a process of "sorting, reforming and restructuring" that may be harsh, but is necessary to prepare the sector for a phase of greater growth.
Concerns have recently increased after the Central Bank of Iraq decided to place Al-Taif Islamic Bank under guardianship for 18 months, following the detection of serious violations that affected its financial position. This sparked demonstrations and protests by depositors in front of the bank's branches in Baghdad and Basra to demand their money, while these events further deepened the erosion of Iraqis' confidence in banks.
Al-Ubaidi said in a post followed by Shafaq News Agency that his monitoring of the data and indicators of Iraqi banks for more than five years showed that the banking sector is practically divided into three categories, foremost among them the leading banks that were able to develop their systems, management and services and approach international standards, and build real trust with customers and depositors, noting that their number does not exceed about five banks.
He explained that the second category consists of medium-sized banks, some of which have an opportunity to grow and move to the leading category, provided they develop governance, capital, technical systems, risk management and compliance, while others may decline if they do not move at the required speed.
As for the third category, according to Al-Obaidi, it is the small banks, which are the weakest link and the most vulnerable to change during the next stage, suggesting that some of these banks will face limited options including mergers, restructuring, or exiting the market.
He stressed that these developments "are not necessarily an indication of the sector's collapse," explaining that banking is no longer limited to licenses, branches, and receiving deposits, but requires real capital, governance, risk management, compliance, advanced technological infrastructure, the ability to protect depositors' funds, and dealing with a financial system more connected to international markets.
He pointed out that the crises facing some banks may affect public confidence in the short term, but the essence of what is happening is "a sorting, reforming and reshaping process of the Iraqi banking market."
He added that some institutions "will not be able to continue in the current form," but the banking sector itself, in his opinion, is about to enter a major growth phase driven by the increasing need of the Iraqi economy for financial services.
Al-Obaidi pointed out that the trade, import, payments, transfers, corporate services, liquidity management, credit, guarantees and digital services sectors all need a more efficient and developed banking sector, stressing that the next stage will witness a shift in confidence from weaker banks to stronger ones, and from traditional services to digital ones.
He concluded by saying that Iraq will still need government, commercial and Islamic banks, "but not necessarily all the banks that exist today in the same form, size and model," stressing that the real question for the next stage is "which banks will be able to survive and gain the trust of the market?" link
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Tishwash: Central Bank: No more sanctions on the banking sector.
The Central Bank of Iraq affirmed on Sunday its continued commitment to the reform process and denied the existence of any sanctions on the banking sector.
A statement issued by the bank, and reported by Al-Maalomah News Agency, quoted Governor Nizar Nasser Hussein as saying during a meeting with economic experts that the banking sector reform process is ongoing in coordination with Oliver Wyman. He clarified that there are no longer any international sanctions on the banking sector.
The statement added that international confidence in the Central Bank is very high, noting that the seven banks authorized to conduct transactions in currencies other than the US dollar may begin operations soon.
It further stated that the majority of depositors' funds at Al-Taif Bank are guaranteed, and that the Central Bank will intervene if a shortfall occurs. The statement emphasized that Iraq invests in the United States as a safe haven and the only country that has granted Iraq immunity, adding that the risks of investing in other countries are significant.
The statement concluded by noting that the total issued currency amounts to 107 trillion dinars, while the amount circulating in the markets is close to 40 trillion dinars.
He pointed out that "changing the currency is within the purview of the Central Bank," noting that "removing zeros requires legislation in the House of Representatives."
He affirmed that "the current government is run with a private sector mindset, and the media plays a crucial role in improving Iraq's international image," adding that "there are new lending initiatives to support important and vital projects." link
Tishwash: The "cash economy" weakens investment and deepens the shadow economy.
Cash liquidity outside the banking system constitutes one of the most prominent challenges facing the banking sector and the Iraqi economy, given the continued reliance of individuals on cash transactions and keeping part of their savings outside banks, which raises questions about the reasons for this phenomenon and its repercussions on investment, growth and confidence in the banking sector.
Economic experts believe that the large amount of liquidity leaving the banking system is not related to a single factor, but rather to factors related to confidence, banking services and procedures, as well as the nature of the Iraqi economy and its extensive reliance on cash.
Trust gap
In this regard, economist Abdul Rahman Al-Mashhadani said that the percentage of liquidity held by individuals outside the banking system exceeds 85 percent, while the Central Bank estimates it at about 90 percent, attributing this to the existence of a trust gap between the citizen and the banking system, both governmental and private.
Al-Mashhadani explained in an interview with Al-Sabah that bureaucratic procedures and inflexible dealings with customers are among the reasons for citizens’ reluctance to use banks, in addition to the large number of documents and procedures that accompany deposit and withdrawal operations.
He added that the measures taken by banks during crises, particularly restricting withdrawals, reinforce depositors' fears and push them to keep their money in cash, noting that citizens want to ensure they can access their money when needed.
He explained that the banking system relies primarily on individual deposits, and therefore restricting withdrawals or the bank's inability to provide the required amounts to depositors leads to a decline in confidence in the banking sector.
Deposit Guarantee
Al-Mashhadani pointed out that the failure of some banks or their exposure to bankruptcy represents another factor that affects the confidence of depositors, calling for strengthening the role of the Central Bank in protecting the banking system and individuals’ deposits.
He called for the establishment of an effective deposit guarantee system in order to contribute to reassuring citizens and encouraging them to deposit their money, noting that the limited guarantee is not commensurate with the amount of liquidity that individuals can deposit.
He pointed out that the weakness of banking services and the imposition of commissions on some transactions represent an additional reason for citizens’ reluctance, explaining that the need to pay commissions for some services, coupled with the insufficient availability of services, reduces the attractiveness of banking transactions.
He stressed the need for a "reform revolution" in this regard, explaining that the entry of savings into banks could allow them to be reinvested in development projects and productive sectors.
Disrupted liquidity
For his part, Dr. Maitham Al-Aibi, Professor of Public Finance at Al-Mustansiriya University, believes that the high percentage of liquidity outside the banking system means that there is a weakness in individual savings within the banking system, which makes the banking system less able to inject real investment into the local economy.
Al-Aibi told Al-Sabah: “The dominance of the cash economy affects the ability of monetary and fiscal policies to manage the money supply effectively and efficiently, and the money supply becomes outside the control of the two authorities, with the resulting negative effects on inflation and government spending.”
He added that storing money at home leads to a decrease in the velocity of money circulation between individuals and businesses, which is reflected in the recovery and economic growth, and leads to a decline in private sector growth and unemployment.
High liquidity is an important indicator of the growing phenomenon of the shadow economy, indicating that this leads to the emergence of money laundering, currency trading and informal operations that deprive the treasury of significant revenues.
He stressed that the lack of trust in the state by individuals has become a major obstacle to abandoning household cash, noting that the salary crisis, the delay in its disbursement, and the ill-considered and contradictory government announcements contribute to perpetuating this behavior.
He called for strengthening confidence by not allowing banks to withhold any part of individuals’ deposits and guaranteeing those deposits, guaranteeing deposits and withdrawals in the same currency, protecting the funds of depositors and small banks, as well as promoting digital transformation in a real and effective way.
hybrid economy
In contrast, economist Ahmed Al-Ansari believes that the rise in the money supply outside the banking system is due to two reasons together, but to varying degrees. The first is a relative weakness in confidence and use of banking services, while the second is related to the hybrid nature of the Iraqi economy and the spread of cash transactions and the informal economy.
Al-Ansari explained in an interview with Al-Sabah that the high percentage of liquidity outside the banking system cannot be considered on its own as evidence of a banking confidence crisis, but rather represents an indicator of weak financial inclusion and the economy’s reliance on cash, as well as the significant delay in digital transformation.
Experts suggest that addressing the phenomenon of liquidity outside the banking system requires addressing multiple aspects, starting with restoring citizens' trust in banks, moving through improving services and reducing their cost and protecting deposits, and culminating in promoting inclusion.
Finance and digital transformation.
According to previous arguments, keeping savings outside the banking system not only means losing them from the economy, but also limits the possibility of employing them through banking channels in investment and production activity, at a time when strengthening confidence remains one of the key factors in changing individuals’ behavior towards saving and banking transactions. link