The administration of US President Joe Biden has refused to provide Iraq with the proceeds of its oil sales at a time that the Arab country is struggling with a crippled economy due to Washington’s illegal sanctions, Iraqi officials say [c2c32bcd].
Iraq's ban on cash withdrawals in US dollars was aimed at stabilizing the exchange rate of the Iraqi dinar and reducing reliance on the US currency [65c23fdd]. However, the US rejection of Iraq's request for access to oil dollars further exacerbates the economic challenges faced by the country.
The US sanctions on Iraq have severely impacted its economy, leading to a depletion of oil dollars. Iraq, as an oil-dependent country, relies heavily on the revenue generated from its oil sales. The refusal of the US to provide Iraq with these funds adds to the financial strain and hampers Iraq's ability to stabilize its economy.
The denial of Iraq's request for oil dollars highlights the complex relationship between the two countries. While the US has been a key player in Iraq's reconstruction efforts since the 2003 invasion, it has also imposed sanctions on the country, creating economic hardships for the Iraqi people.
Iraq's struggle with a crippled economy and the US refusal to provide access to oil dollars underscores the need for Iraq to diversify its economy and reduce its reliance on oil revenue. This incident serves as a wake-up call for Iraq to explore alternative sources of income and strengthen its economic independence.
In a broader context, the recent proposal for dollarization of the Argentinian economy by presidential candidate Javier Milei raises concerns about the potential problems associated with full dollarization [adf7e927]. Dollarization, which involves adopting the US dollar as the official currency, puts foreign economies at the mercy of the US regime. Dollarized countries become more vulnerable to control by the US government, especially in the event of economic sanctions. The Panamanian economy, which has been fully dollarized for decades, serves as a cautionary example. When the US imposed economic sanctions on Panama, the impact was severe, leading to a significant economic contraction. The reliance on US banks, resulting from dollarization, increased the US government's ability to impose sanctions and control the economy. Ordinary Panamanians, who use dollars for everyday transactions, were most affected by the sanctions, particularly those not involved in the informal economy. The speed and ease with which the US was able to devastate the Panamanian economy by cutting off dollars demonstrates the potential for direct political control over dollarized economies.
The situation in Iraq and the experience of Panama highlight the risks associated with dollarization. While it may offer benefits such as exchange rate stability, it also exposes countries to the whims of the US government. This underscores the need for countries to diversify their economies and reduce reliance on a single currency. By exploring alternative sources of income and strengthening economic independence, countries can mitigate the potential negative impacts of dollarization and economic sanctions.
In conclusion, the US rejection of Iraq's request to access oil dollars further compounds the economic challenges faced by Iraq. It highlights the need for Iraq to diversify its economy and reduce its dependence on oil revenue. The ban on cash withdrawals in US dollars, aimed at stabilizing the exchange rate and promoting the use of the Iraqi dinar, now faces additional obstacles due to the US sanctions and denial of access to oil dollars [c2c32bcd] [65c23fdd]. Furthermore, the potential risks of dollarization, as seen in the case of Panama, emphasize the importance of economic diversification and reducing reliance on a single currency [adf7e927].