The Iraqi economy's vulnerability to fluctuations in the US dollar exchange rate highlights the need for economic diversification and financial independence.
The disparity between the official and black market exchange rates indicates a lack of confidence in the central bank's ability to stabilize the currency.
If Iraq successfully joins the BRICS bloc, it may reduce its reliance on the US dollar and improve its economic stability.
Continued fluctuations in the dollar exchange rate could lead to increased social unrest as citizens face rising costs of living.
Iraq's economy is facing significant challenges due to its dependence on the US dollar, which has led to rising prices and declining purchasing power for citizens. The exchange rate disparity between the official and parallel markets exacerbates these issues, with the dollar trading at 1,320 Iraqi dinars officially, while the black market rate ranges from 1,490 to 1,510 dinars.
Economic experts highlight the complexities of Iraq's financial system, noting that the US Federal Reserve's control over dollar transactions imposes restrictions that hinder economic stability. The Iraqi government is attempting to manage capital flows and reduce reliance on external financial systems, including the SWIFT system, by exploring membership in the BRICS economic bloc.
