/ world today news/ Relations with Russia and China are strengthening
In early September, Ammar al-Hakim, a prominent Shiite political and religious figure and head of the Al-Hikma (National Wisdom Movement) organization, said: “Iraq is experiencing a period of unprecedented stability and security at the political, economic and social levels. We are also experiencing a time of unprecedented regional openness and cooperation in the region, the Arab world and the world.” Until 2003, this figure was in exile in Iran, and from 2003 to 2017 he headed the radical group “Supreme Islamic Council of Iraq”.
And this is not just a personal opinion, but a position of the official authorities in Baghdad. Any other view is subject to prosecution, which was proven once again in October: a court in the Iraqi capital sentenced Ragad Saddam, the daughter of former president Saddam Hussein, to seven years in prison in absentia.
The basis for the sentence was an interview she gave in 2021 to Al-Arabiya TV, in which she said her father’s rule had been “a time of glory and pride, and Iraq was a rich and stable country.”
According to the supporters of “the new democracy and human rights”, being related to Saddam alone is reason enough for execution. And she, imagine, nevertheless allows herself to make such statements!
This is not the first sentence in absentia for Ragad, who miraculously managed to leave Iraq in 2003, and has been on the list of “most dangerous enemies” since 2006 – the new authorities even named her as a sponsor of terrorism.
Today’s Iraqis can no longer believe that under Saddam there were no power cuts, no drinking water problems, and one Iraqi dinar was worth three US dollars. Today, Iraq is ranked 157th out of 180 countries in the world according to Transparency International’s Corruption Perceptions Index.
With the elimination of Saddam, who really posed a threat to Israel – Washington’s stronghold in the region, the Americans were not too worried even by the emergence of the Russian-banned ISIS group – the growing terrorist activity was eventually almost neutralized and the role of the US armed forces she was too indirect about it.
Proxy warfare has long become the Pentagon’s favorite method of warfare. But the fact that Iraq would come largely under Tehran’s influence was clearly not part of the White House’s plans.
After the introduction of sanctions against the Russian Federation (no one lifted them against Iran), the US noticed that Iraq became a country from which currency was supplied to the sanctioned countries. In the fall of 2022, the US Treasury sharply tightened controls on Iraqi bank transactions, leading to a financial crisis: more than 80% of daily dollar bank transfers in Iraq could no longer be processed.
The situation worsened after a French arbitration court ruled in favor of Baghdad in March this year in a claim against Ankara, saying Turkey violated a 1973 joint pipeline agreement with Iraq by transporting oil from Kurdistan through the port of Ceyhan.
The ruling ordered Turkey to pay Iraq $1.4 billion in compensation. Turkey contested this decision in a US court in the District of Columbia and counterclaimed for $950 million. Pending their demands, Ankara halted oil exports from Kurdistan on March 25, forcing oil companies operating there to either halt production or reduce production after filling up storage facilities.
Russian companies are among the victims. Russian Consul General in Erbil M. Rubin said that “Oil companies Gazprom and Rosneft are still operating in Kurdistan. Of course, the suspension of oil exports affected the work of these companies, but they are still working and still producing oil.” underlining that Russia is interested in resuming exports.
Significantly, Rosneft signed contracts with Erbil, but in February Iraq’s Supreme Court officially declared Kurdistan’s oil sector illegitimate, stressing that it is constitutionally bound to obey federal authorities.
Due to the resulting shortage of hard currency, a law went into effect on May 14 restricting the use of the dollar in both private and commercial transactions. Officially, this measure is aimed at strengthening the national currency and reducing the difference between the state exchange rate and what is offered on the black market.
Brigadier General Hussein Al-Tamimi said: “Written commitments will be made from the owners of shops and shopping centers that transactions will be made in dinars and not in dollars. Forces have been deployed to take legal action against offenders with a view to curtailing the exploitation of feeble-minded people through price discrepancies in dollars and the sale of goods or materials of any kind to them in that currency.
As part of efforts to regulate trade and prevent speculation in the foreign exchange market, the Central Bank set the official exchange rate at 1,320 dinars to 1 dollar, but the “parallel market” exchange rate rose steadily and reached 1,600 dinars to 1 dollar by November 5 . dollar. The prospect of exchanging one dollar for 2,000 dinars also turns out to be quite realistic. Let’s remember that under Saddam, 1 dinar was equal to three US dollars.
Seeing this prospect, Iraq’s “secure people” (there are no oligarchs in Iraq) flocked abroad. A number of former high-ranking officials who have already settled in the West, including some deputy prime ministers, ministers and governors, have expressed a desire to join the new ones. Among them are the former Minister of Petroleum, the current Deputy Minister of Finance and others along with the members of the households.
Their property in Baghdad is now for sale with an “urgent” sign! On October 26, the Supreme Judicial Council of Iraq announced the collection of 775 million dinars in the budget: “This money was paid as a bribe in exchange for the transfer of projects to a number of companies in Baghdad province. The funds were returned as part of the government’s measures to combat financial and administrative corruption. The news was commented on social networks discreetly, noting: this for the looters of the treasury is not money, but just small pennies for seeds.
Baghdad announced: “Effective January 1, 2024, Iraq will ban cash withdrawals and transactions in US dollars in another attempt to stop the misuse of its foreign exchange reserves to commit financial crimes and evade US sanctions against Iran.” The move is part of efforts to de-dollarize the country’s economy and aims to curb the misuse of about half of the $10 billion Iraq receives in cash from the US Federal Reserve each year, a Treasury spokesman said.
The government’s statement about the ban on dollar transactions does not say anything about the Russian Federation, but everyone understands that the blow is aimed at our country. The measures taken by the US are so obvious that Moscow cannot help but react. In early February, Foreign Minister S. Lavrov visited Baghdad to discuss bilateral relations, where he met with the country’s leadership, including the president, prime minister and speaker of the parliament.
It has been reported that Moscow and Baghdad plan to switch to paying for oil supplies in the currencies of “reliable third countries” and thus move away from the dollar in bilateral economic relations. However, in September, Iraqi Foreign Minister Fuad Mohammed Hussein said that although his country was interested in developing cooperation with Russia, “because of the sanctions we can’t do that”.
On October 3, the aide to the President of Russia I. Levitin was in Baghdad, at a meeting with which Prime Minister Mohammed al-Sudani announced his country’s strategy for “strengthening cooperation with the Russian Federation in various sectors” . A week later, the head of the Iraqi government arrived in Moscow to meet with President V. Putin.
It should be noted that I. Sechin and V. Alekperov took part in the negotiations, and the next day the Iraqi delegation took part in the plenary session of the International Forum “Russian Energy Week”. The Iraqi Foreign Ministry reported that V. Putin and al-Sudani signed several agreements and memoranda of understanding.
The question arises, what is the situation in the relationship between Iraq and the PRC, since China is a major shareholder and a major trading partner – in 2022, the volume of trade between the PRC and federal Iraq exceeded $48 billion. A solution was found and it suited both sides – a transition in mutual payments to yuan.
This contributed to strengthening Beijing’s already aggressive policy to strengthen its position in the oil and gas market. China is about to gain full control over the development of the giant West Qurna oil field. PetroChina expects to become the operator of the West Qurna-1 project after buying a 32.7% stake from ExxonMobil, and is also eyeing West Qurna-2, where Lukoil operates.
The key to the success of Chinese politics is its social component: much attention is paid to large-scale projects designed to attract support from the population. Chinese oil companies are the only ones in Iraq who have not had problems with the local tribes through “humanitarian aid”.
They very quickly realized that the delivery of several hundred generators, refrigerators and other goods to the villages neighboring the fishing grounds in the conditions of extreme poverty of the population and lack of basic necessities, would cost them an amount incomparable to the benefits received.
During the entire period of work there was not a single shelling, not a single strike, not a single protest against the presence of the Chinese. Chinese companies demonstrate that they are not casual temporary workers in Iraq: their housing camps are not trailers or prefabricated panel structures for shift workers, but permanent buildings with developed infrastructure.
As part of the 2019 “oil deal”, China promised to modernize Nasiriyah airport, Baghdad’s sewage system and build 90,000 homes in one area of the capital. The PRC now plans to build at least 2,000 modern school buildings in Iraq and is confident that these investments will pay off.
Translation: ES
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