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Paying dues for Iranian gas exports causes a problem with America and threatens Iraq's electricity production 2023-06-02 08:49 Shafaq News/ The Electricity and Energy Committee in the Iraqi Parliament confirmed, on Friday, that the payment of financial dues for Iranian gas exports has become a political problem between Washington, Tehran and Iraq, and while it indicated that there is no alternative for Iraq for these exports in the short term, it called for the need to solve this obstacle The political process quickly, since Iranian gas is the fastest and most suitable in terms of quality and price for Iraq. Committee member Dakhil Radi told Shafaq News agency, "The current production of electric power ranges from 18.5 to 19 thousand megawatts per day, but there are obstacles in delivering Iranian gas dues through the Iraqi Trade Bank, and this is a major problem." He explained, "Iran supplies Iraq with the required amount of gas for a price, and this price is set by the Ministry of Electricity in the Iraqi Trade Bank, but the problem is in the transfer process, so the sums do not reach Iran," noting that "Iranian gas has turned into a political problem between the United States." Iran and Iraq." He stressed, "Iraq needs 28-30 thousand megawatts, but if Iranian gas is available, it is expected that production will reach 22-23 thousand megawatts, and this percentage covers a sufficient area in all provinces with processing from 16 to 18 hours per day," expressing his hope solve the gas problem in the near future. A member of the Electricity Committee called for "solving the problem of Iranian gas in a political and rapid manner, given that there is no alternative to Iranian gas for the country in the short term, and all countries that supply the country with gas are supplied by ships, while Iranian gas arrives through pipelines, so it is the fastest and most appropriate." In terms of quality and price." On the other hand, Radhi pointed out, "There are memorandums of understanding and contracts with companies in more than one Iraqi province regarding solar energy investment and energy purchase from neighboring countries. The government is trying to sustain electric current for all provinces, even if it is at a rate of 16-18 operating hours per day." And he indicated, "The stations that were under maintenance have been completed and entered service, and now supply the national grid with energy, as it was days before the opening of stations and entered the national system." Rady stressed, "The prime minister has a special interest in the issue of energy, both parts of renewable energy (clean energy), and also with regard to gas and steam stations, energy purchases, and transmission and distribution lines." On Saturday, May 13, Iranian Oil Minister Javad Oji announced the extension of two contracts related to his country's gas exports to two power stations in the capital Baghdad and Basra Governorate, based on an agreement between Iran and Iraq. Iraq relies heavily on Iranian gas imports to feed the electricity grid, as the country generates about 14 thousand megawatts from the local network, in addition to nearly four thousand additional megawatts through importing gas and energy. Iraq is the main importer of more than 80 percent of Iran's electricity exports over the past few years, according to previous data from the Iranian Ministry of Energy. Iraq has been suffering from chronic electricity shortages for decades as a result of the blockade and successive wars. Residents have been protesting for many years against the frequent power outages, especially in the summer, when temperatures sometimes reach 50 degrees Celsius. Iraq is in talks with Gulf countries, led by Saudi Arabia, to import electricity from them by linking its organization with the Gulf system, after it had relied on Iran alone during the past years by importing 1,200 megawatts, as well as gas fuel to feed local electric power stations. Iraq also intends to import electricity from Jordan and Turkey, in an effort by Baghdad to fill the shortage until power stations are built that are able to meet domestic consumption.

Exclusive: Iraq to end all dollar cash withdrawals by Jan. 1, 2024, central-bank official says By Timour Azhari October 5, 20236:36 AM EDTUpdated 3 hours ago [1/5]A man counts U.S. dollars at a currency exchange shop in Baghdad, Iraq, January 23, 2023. REUTERS/Ahmed Saad Acquire Licensing Rights BAGHDAD, Oct 5 (Reuters) - Iraq will ban cash withdrawals and transactions in U.S dollars as of Jan. 1 2024 in the latest push to curb the misuse of its hard currency reserves in financial crimes and the evasion of U.S. sanctions on Iran, a top Iraqi central bank official said. The move aims to stamp out the illicit use of some 50% of the $10 billion that Iraq imports in cash from the New York Federal Reserve each year, Mazen Ahmed, director-general of investment and remittances at the Iraqi central bank (CBI), told Reuters. It's also part of a broader push to de-dollarize an economy that has seen the greenback preferred over local notes by a population weary of recurring wars and crises following the 2003 U.S. invasion. People who deposit dollars into banks before the end of 2023 will continue to be able to withdraw funds in dollars in 2024, Ahmed said. But dollars deposited in 2024 could only be withdrawn in local currency at the official rate of 1,320. The parallel market rate of the Iraqi dinar sat at 1,560 on Thursday, roughly 15% percent below the official rate. "You want to transfer? Transfer. You want a card in dollars? Here you go, you can use the card inside Iraq at the official rate, or if you want to withdraw cash, you can at the official rate in dinars," Ahmed said. "But don't talk to me about cash dollars anymore." Iraq has already set up a platform to regulate wire transfers that make up the bulk of its dollar demand and that used to be a hotbed of fake receipts and fraudulent transactions that siphoned dollars to Iran and Syria, both countries under U.S. sanctions Set up in concert with authorities in the U.S., where Iraq's$120 billion in reserves from oil sales are held, that system was now nearly airtight, Ahmed said, providing dollars at the official rate to those engaged in legitimate trade such as imports of food and consumer goods. But the cash withdrawals have continued to be misused, he said, including by would-be travellers provided with a state quota of $3000 who have found ways to game the system. Iraq is heavily reliant on Washington's goodwill to ensure oil revenues and finances do not face U.S. censure. At the same time, the current government, which is backed by powerful parties and armed factions close to Iran, has been careful not to alienate Tehran, nor anger the parties and armed groups with deep interests in Iraq's highly informal economy. DOLLAR SHORTAGE Many local banks have already been limiting dollar cash withdrawals in the past months, compounding a shortage that has seen the parallel market exchange rate continue to rise. Ahmed said some banks were low on dollars because many people were trying to withdraw dollars at once amid a feeling of unease over the financial system, while some banks also had shortages because they provided dollar-denominated loans that were then paid back in dinars. The CBI had also limited the amount of dollars it was providing as part of an agreement with the Fed to limit cash and shift towards e-payment, he said. Ahmed said the CBI expected the dinar to lose more value as the new measures went into force but said it was an acceptable side-effect of formalising the financial system and the CBI was providing dollars at the official rate for all legitimate purposes. "The cost we are carrying today is nothing compared to this goal," he said. "We don't have a problem with the exchange rate hitting 1,700. If they tell me the rate is 1,700, I tell them: 'you want to import from Iran. You want to smuggle. You have corrupt money that you want to get out.'" He added: "As long as all transparent and legal financing operations happen via us (at the official rate), the rest does not matter." But signs have emerged that the CBI's plans will not be met with open arms. On Thursday, video circulated on social media showing a depositor at a Baghdad bank threatening to burn it down if he did not receive his deposit in cash dollars, a scene reminiscent of steps depositors have taken amid Lebanon's banking crisis. "I swear I will burn it down. I swear I will enter the safe and take my money" the man says. Reporting by Timour Azhari; Editing by William Maclean

Sudani says his government will end dollar crisis after deal with Iran economy Sudani says his government will end dollar crisis after deal with Iran (ultrasawt.com) 11-Sep-2023 Prime Minister Mohamed Shia al-Sudani announced on Monday new steps in the issue of the dollar exchange rate crisis, saying that these steps will "break" the parallel market. Al-Sudani spoke about the currency market file during a meeting with a number of media professionals held at the government palace, noting that "the dollar issue requires reform of the banking and financial sector, and is linked to tax, customs and fees, protection of products and economic policies." Al-Sudani said that this sector "has not witnessed any reform since 2003, and it was necessary to adhere to global compliance standards, which were supposed to be dragged in the previous government," noting that "the decision to reduce the exchange rate to 1320 dinars per dollar, was a correction to the previous decision to raise the exchange rate, which was not studied." Al-Sudani pointed out that the existence of "the parallel market is linked to a number of commercial operations, including trade with Iran," and explained in this regard that traders cannot send money legally under US sanctions on Tehran, "which forces them to deal with the parallel market." The prime minister stressed that "the Iranian side informed the government in the last meeting to stop dealing with the dollar, and replace it with euros, yuan, dirhams, Iraqi dinars or Iranian toman," and revealed that there is "a mechanism on which the Central Bank of Iraq and its Iranian counterpart are working to prepare a plan to regulate this trade." Al-Sudani said the new mechanism with Iran would "break the back of the parallel market", while explaining that other problems associated with the parallel market related to the trade in tobacco, gold and medicines. The Prime Minister pointed out that "his government is working to solve problems and organize the work of major traders in these sectors in preparation for their inclusion in the procedures for buying dollars from the Central Bank."