New Currency Options Open for Iraqi Trade Financing

Iraq’s Central Bank has introduced a broader range of currencies for financing international trade. In addition to the US dollar, Iraqi banks can now engage in transactions using the Jordanian dinar, Saudi riyal, and euros for trade with Turkey. Previously, financing via euros was only permitted for transactions with European Union countries.

This step reflects the Central Bank’s ongoing efforts to diversify and expand foreign trade financing options, providing more flexibility for Iraqi businesses engaged in international transactions. The bank has also made it possible to facilitate transfers in other widely used currencies, including Emirati dirhams, Chinese yuan, and Indian rupees. These changes aim to streamline financial operations and better serve Iraq’s growing trade relationships across various global markets.

The move is a key part of the Central Bank’s strategy to provide transfer operations at official exchange rates, ensuring greater transparency and efficiency. Additionally, it is designed to involve more banks in foreign transfer operations, thus expanding economic cooperation between Iraq and countries like Jordan, Saudi Arabia, China, India, and Turkey.

The Central Bank highlighted that these developments will contribute to meeting the increasing demand for various foreign currencies, in line with Iraq’s evolving trade relations.

In 2024, the Central Bank successfully transitioned from its previous electronic platform to directly accredited correspondent banks, marking a major transformation in Iraq’s banking system. This shift aligns with international banking practices and has been widely praised for its efficiency and modernization, further reinforcing Iraq’s position in global financial networks.

Source: Central Bank of Iraq