The governor of the Central Bank of Iran unveiled plans for using non-dollar accounts for oil and gas trade with Iraq.

Abdolnaser Hemmati on Wednesday held a meeting with presidents of Iraqi banks, members of Iraq’s chamber of commerce and the Arab country’s business people during a trip to Baghdad.

In the gathering, the top Iranian banker unveiled a new mechanism to continue Iran’s trade with Iraqi businesses, saying the CBI is going to open euro and dinar-based accounts to process transactions for trade in oil and gas.

Describing Iraq as Iran’s major partner, Hemmati said the two countries have agreed to make the banking ties much stronger.

“According to the agreements, Iranian exporters should be able to continue activities via Iraqi banks, and Iranian banks could also open dinar accounts in Iraqi banks.”

He also stated that Iraqi companies can reciprocally open accounts in Iranian banks and conduct transactions in dinar.

In December 2018, Chairman of Iran-Iraq Chamber of Commerce Yahya Ale-Eshaq said the central banks of Iran and Iraq were finalizing negotiations to begin trade in their own currencies.

Iraq’s Foreign Minister Mohamed Ali Alhakim has made it clear that his country cannot cut off trade ties with Iran under the US sanctions, saying the value of annual trade between Iran and Iraq amounts to $12 billion.

(Source: Tasnim, under Creative Commons licence)

Governor of the Central Bank of Iran (CBI) Abdonnaser Hemmati said Iraqi Prime Minister Adil Abdul-Mahdi has voiced “his firm support” for the banking deal reached between the two countries on Tuesday night and called for its rapid implementation.

“After a long and four-hour meeting last night with the governor of the Central Bank of Iraq, I had a very good and constructive meeting with the Prime Minister of Iraq on Wednesday, February 6,” Hemmati said in a post on social media.

“I appreciated his determination to develop political and economic relations between the two countries,” he wrote.

“He declared his firm support for the two sides’ banking agreement and urged the governor of Iraq’s Central Bank to quickly pursue and implement the deal,” Hemmati stated.

In a meeting between Hemmati and his Iraqi counterpart, Ali Mohsen al-Allaq, in Baghdad on Tuesday night, the agreement to develop a payment mechanism aimed at facilitating banking ties was signed.

In addition to natural gas and electricity, Iraq imports a wide range of goods from Iran including food, agricultural products, home appliances, and air conditioners.

Speaking at a joint press conference with Iraqi President Barham Salih in Tehran in November, Iranian President Hassan Rouhani said the value of trade and economic interaction between Tehran and Baghdad stands at around $12 billion, adding that the two neighbors have the potential for a $20-billion trade target.

Rouhani hoped that cooperation between Tehran and Baghdad would contribute to regional security and stability.

(Source: Tasnim, under Creative Commons licence)

Governors of the central banks of Iran and Iraq signed an agreement to develop a payment mechanism aimed at facilitating banking ties between the two neighboring countries.

The deal on the payment mechanism was signed in a meeting between Iran’s Abdolnaser Hemmati and Iraq’s Ali Mohsen al-Allaq in Baghdad on Tuesday night.

Speaking at the meeting, Hemmati described Iraq as Iran’s biggest trade partner and said banking relationship is the factor needed for the durability of bilateral ties between the two countries.

Hemmati further pointed to the US sanctions against Iran and said by waging an economic war against the Islamic Republic, Washington has made extensive efforts to disturb the economic and political conditions of Iran.

However, he added, with the arrangements made by Iran, fortunately, the enemy plots have been thwarted and the Iranian economy has become stable.

In addition to natural gas and electricity, Iraq imports a wide range of goods from Iran including food, agricultural products, home appliances, and air conditioners.

Speaking at a joint press conference with Iraqi President Barham Salih in Tehran in November, Iranian President Hassan Rouhani said the value of trade and economic interaction between Tehran and Baghdad stands at around $12 billion, adding that the two neighbors have the potential for a $20-billion trade target.

Rouhani hoped that cooperation between Tehran and Baghdad would contribute to regional security and stability.

(Source: Tasnim, under Creative Commons licence)

By Bruce Riedel, Brookings Institution.

The opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.

What Iran’s Revolution meant for Iraq

The collapse of the shah’s government in Iran in early 1979 impacted the entire world but no country was more affected than Iraq.

Saddam Hussein’s regime was the shah’s deadly enemy and had hosted the Ayatollah Khomeini in exile for years, but Saddam became the top foreign target of the revolutionaries in Tehran once they took power.

Many countries were caught off balance by the Iranian revolution but none got it as wrong as Iraq. Its response—war—led to decades of conflict which have yet to end.

The full report can be read here.

(Source: Brookings Institution)

By John Lee.

Iraq has been ranked last out of 153 countries in this year’s Good Country Index, placing it just behind Libya and Yemen. Iran was ranked 138th.

The idea of the Good Country Index to measure what each country on earth contributes to the common good of humanity, and what it takes away, relative to its size. Using a wide range of data from the U.N. and other international organisations, each country is given a balance-sheet to show at a glance whether it’s a net creditor to mankind, a burden on the planet, or something in between.

The creator of the Index, Simon Anholt, commented:

“Today as never before, we desperately need a world made of good countries. We will only get them by demanding them: from our leaders, our companies, our societies, and of course from ourselves.”

Top ranking went to Finland, followed by Ireland and Sweden.

(Source: The Good Country Index)

By John Lee.

The UK’s foreign office minister for the Middle East has reportedly said that Iraq must wean itself off economic reliance on Iran and become more energy self-sufficient.

On a visit to Iraq on Sunday, Alistair Burt (pictured) told Reuters:

“To expect Iran to have no influence in Iraq is fanciful … What is important is that Iraq finds the opportunity to follow its own future in terms of foreign relations and that its economy is strong, and isn’t reliant on Iran.”

(Source: Reuters)

By John Lee.

The US Army has published a report on its 2003 invasion of Iraq, and subsequent developments until the withdrawal of troops, claiming that Iran was the only real winner of the operation.

The U.S. Army in the Iraq War” was released Thursday in two volumes entitled “Invasion and Insurgency—Civil War, 2003-2006” and “Surge and Withdrawal, 2007-2011.

The two volumes comprise nearly 1,500 pages.

According to the conclusions in the second report:

In terms of geostrategic consequences, the war produced profound consequences. At the time of this project’s completion in 2018, an emboldened and expansionist Iran appears to be the only victor.

“Iraq, the traditional regional counterbalance for Iran, is at best emasculated, and at worst has key elements of its government acting as proxies for Iranian interests.

More here – Volume 1, and Volume 2

(Source: Strategic Studies Institute of the US Army)

Iranian Foreign Minister Mohammad Javad Zarif met a group of Iraqi tribal leaders from south of the country in the holy city of Karbala.

During the last leg of his meetings with Iraqi officials, elites and representatives of Iraqi society from various ethnicities and regions, Zarif sat for talks with the tribal leaders and clans’ representatives of southern Iraq in the consulate of the Islamic Republic of Iran in the holy city of Karbala.

During the cordial meeting on Wednesday, some of Iraqi tribal leaders and representatives expressed their views and ideas about the strong bonds between the two nations of Iran and Iraq, Foreign Ministry website reported.

For his part, Iran’s top diplomat referred to the close relations between the two nations over the past centuries and pointed out that nothing, even the imposed war by the former dictator of Iraq on Iran, could not separate the two nations.

“The love of the third Shiite Imam, Hussein ibn Ali (AS) has served as a bond connecting us together,” he said, adding that Arbaeen, the anniversary of 40th day after the martyrdom of Imam Hussein (AS) is a beautiful picture of companionship, self-sacrifice, hospitality and sympathy between the peoples of Iran and Iraq.

He also thanked Iraqi tribes for their warm hospitality to the Iranian pilgrims flocking to the holy cities of Najaf and Karbala each year to commemorate Arbaeen.

Zarif then underlined that Iran and Iraq are now involved in the construction process and added the two sides should put their focus on improving the living conditions of their people through overcoming the current obstacles and preparing the ground for further economic cooperation.

“Building on the two sides’ capacities, we can increase our annual trade volume by 20 billion dollars and if the ground is prepared, the Islamic Republic is ready to proudly share its achievements in energy, engineering, agriculture and trade areas with the Iraqis,” he concluded.

Iranian foreign minister arrived in Iraq on Sunday afternoon and held separate meetings with various Iraqis officials from the central government in Baghdad to Kurdistan semi-autonomous region.

(Source: Tasnim, under Creative Commons licence)

Iranian Foreign Minister Mohammad Javad Zarif, who is on an official visit to Iraq, highlighted the positive outcomes of the Iran-Iraq Joint Trade Conference in Baghdad and said the doubling of the bilateral trade “is on the horizon”.

“Today, I, accompanied by 6 Iraqi ministers, addressed hundreds of participants at the Iran-Iraq Joint Trade Conference; exploring paths to significantly expand bilateral trade and investment,” Zarif said on his twitter account early on Tuesday.

“With implementation of shared vision, doubling of annual trade volume is on the horizon,” he added in his tweet.

Heading a high-ranking Iranian delegation, Zarif arrived in Baghdad on Sunday for an official visit.

The visit comes against the backdrop of Iran’s efforts to boost its foreign trade in the US sanctions era.

Iraq’s foreign minister said recently that his country is “not obliged” to abide by sanctions imposed by the US against Iran and would be pursuing options to continue bilateral trade.

(Source: Tasnim, under Creative Commons licence)

Iran’s Foreign Minister Mohammad Javad Zarif said the fact that each year, 7 million Iraqis and Iranians visit each other’s country is a sign of the two neighboring countries’ close ties.

Speaking at a meeting with Iraqi Parliament Speaker Mohammed Al-Halbousi in Baghdad on Monday, attended by the chairmen of the Iraqi parliamentary factions, Zarif hailed the relations between the two countries, the parliamentary ties in particular.

The fact that seven million Iranians and Iraqis visit each other’s country each year is an outstanding sign of “the proximity of the two great nations,” Zarif said.

Every year, a large number of Iranians visit Iraq for pilgrimage. Iranian pilgrims travel to Karbala, Najaf and Baghdad to pay homage to Shia Imams buried in Iraq.

Iraqis visit the Iranian cities of Mashhad and Qom for pilgrimage.

The Iraqi parliament speaker, for his part, referred to the two countries’ common interests and praised Iran’s role in helping the Iraqi people defeat the Daesh (ISIS or ISIL) terror group.

Daesh militants made swift advances in much of northern and western Iraq over the summer of 2014, after capturing large swaths of northern Syria.

However, a combination of concentrated attacks by the Iraqi military and the volunteer forces, who rushed to take arms after top Iraqi cleric Ayatollah Ali al-Sistani issued a fatwa calling for fight against the militants, blunted the edge of Daesh offensive.

In November 2017, the self-proclaimed caliphate of Daesh collapsed after Syrian and Iraqi armed forces and their allies managed to recapture the terror group’s last strongholds in the two Arab countries.

(Source: Tasnim, under Creative Commons licence)