In this geopolitics video, the presenter analyzes Iraq's decision to ban cash withdrawals and transactions in US dollars, set to take effect on January 1, 2024. Citing statements from senior Central Bank of Iraq officials—including Governor Ali Mohsen Al‑Alaq and Director General Mazin Ahmed—the video explains the official rationale: curbing misuse of hard‑currency reserves, preventing financial crimes, and evading U.S. sanctions on Iran. The analyst argues the deeper driver is Iraq’s strategic alignment with the ongoing de‑dollarization wave spurred by the expansion of BRICS, which now includes Iran, Saudi Arabia, and the United Arab Emirates. Iraq is positioning itself to conduct oil and trade transactions in alternative currencies such as the euro, UAE dirham, Turkish lira, Indian rupee, and already the Chinese yuan. Recent U.S. actions—banning 14 Iraqi banks from dollar transactions—are presented as a catalyst that accelerated Iraq’s shift. The video concludes by inviting viewer commentary and emphasizing the everyday relevance of geopolitics.
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Hello everyone and welcome to Geopolitical Trends. As an analyst, I ask, why is the Iraqi government ending all cash withdrawals in US dollar? In this video, I'm going to provide you my assessments about this major development and answer this question for you. Let's dive in. In a sudden move, the Iraqi government decided to ban usage cash withdrawals and transactions in the US dollar. And this decision was confirmed by a senior official at the Central Bank of Iraq, who confirmed that indeed the ban will enter into effect starting January 1st, 2024. Very interesting developments. So the reason this official argued, uh, that at the Central Bank is that the Iraqi government wants to curb the misuse of the country's hard currency reserves in financial crimes, in addition to evading U.S. sanctions on Iran. Hmm, I find it very interesting, the timing of it. So another official at the Central Bank of Iraq by the name of Mazin Ahmed, who happens to be the director general of the investments and remittances departments at the central bank, argues that the objective of this financial move is to stop the illegal use of about 50% of the $10 billion in cash imported annually by Iraq from the Federal Reserve in New York. Even the government, the Iraqi government that is, is saying that the move is part of a wider campaign to stop the economy's dependence on the dollar as residents began now to prefer the US currency over the local currency, which is the dinar. The reality is much more complicated than that. What's at the heart of this matter? I believe it's the expansion of BRICS, which now includes 3 main, uh, countries from the Middle East: Iran, Saudi Arabia, and United Arab Emirates. Why is this important? Because all those 3 countries are energy producers and oil exporters. So I think Iraq is prepositioning itself in this cycle of de-dollarization. Because remember, most of the transactions in BRICS is going to be conducted outside the US dollar when it comes down to energy. And mind you also that Iraq announced a few months ago the dumping of the US dollar for the Chinese yuan. I did a video for you on that. There is a video out there. So Iraqi central government's governor, he's the central bank Governor, his name is Ali Mohsen Al-Alaq, pointed out that the bank, the central bank, seeks to open sort of direct communication and channels for Iraqi banks with their foreign counterparts in correspondence and trade exchange. So in other words, they want to communicate how they're going to conduct or transact and which currency they're going to be using. And he added that work is underway to convert— and this is exactly my point— to convert in different currencies, including the euro, United Arab Emirates dirham, the Turkish lira, and Indian rupees. So the reason they are not mentioning the Chinese yuan, because Iraq has already entered into exchange with the Chinese currency, with China, when dealing in trade in bilateral currencies. Recently in July, just about a month and a half ago or so, or 2 months, the United States banned 14— yeah, 14 Iraqi banks from conducting dollar transactions as part of a broader crackdown on the illegal use Yeah, the illegal use of the dollar. I don't buy that argument, you know. How come they didn't crack on this a year ago, 2 years ago? The reason being because they are seeing more and more are de-dollarizing. That is what's at the heart of it. And Iraq started to think, because Iraq is an oil producer, it's a major oil producer, part of OPEC, is saying to itself We don't want to miss the boat, miss the train here. So they better— we better preposition ourselves for what's coming. And what's coming is most countries gonna move away from the US dollar. So Iraq doesn't want to end up holding so much dollars that it will be useless for it. So, so what do you think? Because I like to keep these videos short, concise, and to the point. What do you think? Make sure to leave me some comments in the comment section. I always like to read your feedback. And please don't forget to hit the like button if you like this content of this video, and remember to subscribe. I will greatly appreciate it. As always, remember, geopolitics impact your daily life in more ways than one. Till next time, bye-bye.
