On Nov. 5, the United States began implementing its second package of economic sanctions on Iran, expanding them to affect the country’s energy, finance, and shipping sector.
Although former Iraqi Prime Minister Haidar al-Abadi had declared his country’s commitment to US sanctions against Iran, especially in respect to transactions made using the US dollar, his successor Adel Abdul-Mahdi later said that Baghdad would not be part of the sanctions row and would instead “protect its national interest.”
In September, Chairman of the Iran-Iraq Chamber of Commerce Yahya Ale-Eshagh announced the abolition of the dollar in trade between Baghdad and Tehran, noting that the euro, Iranian rial, and the Iraqi dinar would replace it.
“Exchanges in commodities between Iranian exporters and Iraqi traders will continue in a consensual manner,” Iran’s Mehr News agency quoted Ale-Eshagh as saying.
According to the Iranian official, just a small portion of the eight billion dollars’ worth of trade between Tehran and Baghdad is done through banks.
Meanwhile, in a recent meeting with his Iraqi counterpart Barham Salih, Iran’s President Hassan Rouhani said his country could boost trade with Iraq from $12 billion to $20 billion.