The United States, which takes a dim view of Iran’s growing political influence in Iraq, will step up its sanctions on the Iraqi economy, which is already in danger of collapse.
The United States is increasing pressure on the Iraqi government, by attacking its already fragile economy. Washington thus concretizes the threats of sanctions launched by US President Donald Trump in early January, in reaction to a resolution on the withdrawal of foreign forces from this country, adopted by the Parliament of Baghdad. Washington has decided to reduce the exemption granted to Iraq for importing electrical energy from Iran granted to Baghdad to 45 days, which usually spans 3 or 4 months.
These exemptions push Iraq at the same time to reduce its energy dependence on neighboring Iran. Iraq, where power cuts sometimes last 20 hours a day, especially in summer, maybe in an unprecedented situation if it were to face a great energy shortage. Worse still, according to observers, American pressures can in the very short term lead the entire Iraqi economy, already weakened, to collapse.
The Iraqi economy and its currency would then plunge since oil revenues represent 90% of government revenues. And in the event that Washington decides to no longer renew its exemption, Baghdad would have only two options: face massive shortages or continue to import Iranian energy but expose itself at that time to severe collateral sanctions the US.
The latter option seems, according to experts, increasingly realistic in view of the growing tensions between Iraq and the United States. In addition to the rise in anti-American sentiment since the US assassination on January 2 of Iranian General Qassem Soleimani in Baghdad, Washington regularly sees its interests targeted in Iraq.
At least twenty rocket attacks – the last going back to Thursday – targeted American sites and bases in the country. In response, US Secretary of State Mike Pompeo warned that “if these attacks continue, his country will end negotiations on a renewal of the exemption,” a senior Iraqi official recently quoted as saying.
These pressures were partly realized through the US Federal Reserve, the FED. You should know that every month, it is this bank that provides dollars to the Iraqi central bank. It sends between one and two billion dollars, drawn from the revenues of Iraqi oil stored in the United States.
However, last month, the shipment was delayed by more than a week for “political reasons,” said senior Iraqi officials quoted in the media. If Washington has been considering the option of turning off the dollar valve for months, the Iraqi parliament’s vote calling on Baghdad to expel the country’s 5,200 American soldiers seems to have speeded things up.