Will Sudani Adopt the Previous Iraqi Government’s Economic Policies?

A handout picture released by Iraq's prime minister's office shows the new Prime Minister Mohamed Shia al-Sudani arriving for the official handover ceremony at the Republican Palace, the government's seat, in Baghdad's green zone. (Iraq's prime minister's office/ AFP)
A handout picture released by Iraq's prime minister's office shows the new Prime Minister Mohamed Shia al-Sudani arriving for the official handover ceremony at the Republican Palace, the government's seat, in Baghdad's green zone. (Iraq's prime minister's office/ AFP)
TT
20

Will Sudani Adopt the Previous Iraqi Government’s Economic Policies?

A handout picture released by Iraq's prime minister's office shows the new Prime Minister Mohamed Shia al-Sudani arriving for the official handover ceremony at the Republican Palace, the government's seat, in Baghdad's green zone. (Iraq's prime minister's office/ AFP)
A handout picture released by Iraq's prime minister's office shows the new Prime Minister Mohamed Shia al-Sudani arriving for the official handover ceremony at the Republican Palace, the government's seat, in Baghdad's green zone. (Iraq's prime minister's office/ AFP)

These days, we are seeing increasing speculation, especially among Iraqi elites and economists, about the extent to which the country’s new prime minister, Mohamed Shia al-Sudani, can reverse some of the critical economic decisions that the Coordination Framework had criticized Mustafa al-Kadhimi’s government of taking. Topping the list are the decision to devaluate the Iraqi dinar and a couple of other economic policies.

Dr. Nabil Al-Marsoumi, an academic and economist, said the program put forward by Sudani’s government did not mention reversing the decision to devaluate the currency by over a fifth - with 1,480 rather than 1,180 dinars becoming the equivalent of one US dollar.

The failure to reverse the decision of the former government demonstrates that its critics, most of whom are part of the pro-Iran Coordination Framework, had exploited the devaluation and its ramifications for the Iraqi people’s purchasing power as a pretext to undermine Kadhimi’s government.

“There was no amendment to the exchange rate in the government’s 2023 budget,” Marsoumi stressed. This affirms that Sudani’s government - and with it, the Coordination Framework deputies who dominate parliament - has backtracked on the exchange rate.

Marsoumi added that reversing the decision taken by Khadimi’s government and bringing the US dollar exchange rate back to 2020 levels would increase the government’s budget by 24 billion dollars.

He noted that over 50 MPs recently petitioned the government to reverse the decision. Sudani’s government, however, did not show any enthusiasm for this step, meaning that the decision taken by the former government had been correct despite the sharp criticism that had been levied at it at the time. Indeed, it is a decision several figures and platforms close to the Coordination Framework continue to criticize it.

Moreover, other economists have noted that the new government’s program did not mention the economic agreements that Kadhimi’s government had concluded with Arab countries.

Many within the Coordination Framework had criticized this decision and fiercely opposed it, especially those that are particularly close to Tehran.

Among them is the accord to sell Iraqi oil to Jordan at a discount and the economic agreements concluded with Egypt and Jordan, and the electric grid agreements with the Gulf states and Türkiye - more evidence that “Iraqi political forces usually pursue their private interests.”

While Sudani had called for reducing the salaries of high-ranking Iraqi officials, which he said would save the government 500 billion dinars (about 400 million dollars) a month, this seems unlikely. Indeed, many observers have said that they doubt Sudani will be able to do that since most ministers and senior officials are affiliated with the parties and groups in power. They are not simply going to roll over and surrender their privileges.

Experts believe that instead of a reduction in salaries, we could see Sudani make cuts to the privileges and financial incentives that come with such positions. In fact, they often cost the government multiples of the officials’ salaries. These incentives often take the form of funds allocated to the minister or official’s office, as well as a budget allocated for security.



Father of Six Killed ‘For Piece of Bread’ During Gaza Aid Distribution

 Palestinians carry the body of Hossam Wafi who, according to family members, was killed in an Israeli strike, during his funeral in Khan Younis, southern Gaza Strip, Monday, June 2, 2025. (AP)
Palestinians carry the body of Hossam Wafi who, according to family members, was killed in an Israeli strike, during his funeral in Khan Younis, southern Gaza Strip, Monday, June 2, 2025. (AP)
TT
20

Father of Six Killed ‘For Piece of Bread’ During Gaza Aid Distribution

 Palestinians carry the body of Hossam Wafi who, according to family members, was killed in an Israeli strike, during his funeral in Khan Younis, southern Gaza Strip, Monday, June 2, 2025. (AP)
Palestinians carry the body of Hossam Wafi who, according to family members, was killed in an Israeli strike, during his funeral in Khan Younis, southern Gaza Strip, Monday, June 2, 2025. (AP)

Cries of grief echoed across southern Gaza's Nasser Hospital Monday as dozens came to mourn Hossam Wafi, after the father of six was killed while attempting to get supplies to feed his family.

His mother, Nahla Wafi, sobbed uncontrollably over her son, who was among 31 people killed by Israeli fire while trying to reach a food distribution site the previous day, according to the Palestinian territory's civil defense agency.

"He went to get food for his daughters and came back dead," said Nahla Wafi, who lost two sons and a nephew on Sunday.

Hossam Wafi had travelled with his brother and nephew to a newly established distribution center in the southern city of Rafah.

"They were just trying to buy (flour). But the drone came down on them," his mother said, as she tried to comfort four of her granddaughters in the courtyard of Nasser Hospital in Khan Younis.

Israel has faced growing condemnation over the humanitarian crisis in the war-ravaged Gaza Strip, where the United Nations has warned the entire population faces the risk of famine.

-'Go there and get bombed'-

The International Committee of the Red Cross (ICRC) said that its field hospital in Rafah received 179 cases on Sunday, including 21 pronounced dead on arrival.

The ICRC said that all those wounded "said they had been trying to reach an aid distribution site", and that "the majority suffered gunshot or shrapnel wounds".

Israeli authorities and the Gaza Humanitarian Foundation, a US and Israeli-backed outfit that runs the distribution centers, denied any such incident took place.

The military instead said that troops fired "warning shots" at people who approached them one kilometer away from the Rafah distribution site before dawn.

A witness told AFP thousands of people gathered at the area, known locally as the Al-Alam junction, between 2:00 and 4:00 am (2300 GMT and 0100 GMT) in the hopes of reaching the distribution center.

At Nasser Hospital, Hossam Wafi's young daughters called out for their father, kissing his body wrapped in a white shroud, before it was taken away.

Outside the hospital, dozens of men stood in silence before the body, praying. Some cried as the remains were taken away, one of them holding the father's face until he was gently pulled away.

His uncle, Ali Wafi, told AFP he felt angry his nephew was killed while trying to get aid.

"They go there and get bombed -- airstrikes, tanks, shelling -- all for a piece of bread," he said.

"He went for a bite of bread, not for anything else. What was he supposed to do? He had to feed his little kids. And the result? He's getting buried today," he added.

- Militarized aid -

The deaths in Rafah were one of two deadly incidents reported by Gaza's civil defense agency on Sunday around the GHF centers, which the UN says contravene basic humanitarian principles and appear designed to cater to Israeli military objectives.

There have been several other reports of chaotic scenes and warning shots fired in connection with the distribution sites over the past week.

The UN's humanitarian agency (OCHA) published a video of one such distribution site in central Gaza's Netzarim corridor on Thursday.

A large crowd is seen gathered around four long corridors made from metal fences installed in the middle of an arid landscape, corralling men and women into files to receive flour.

The distribution site and its waiting area sit on a flattened piece of land surrounded by massive mounds of soil and sand.

It is manned by English-speaking security guards travelling in armored vehicles.

Palestinians exiting the distribution area carry cardboard boxes sometimes bearing a "GHF" logo, as well as wooden pallets presumably to be repurposed as fuel or structures for shelter.

In the large crowd gathered outside the gated corridors, some men are seen shoving each other, and one woman complains that her food package was stolen.

Hossam Wafi's uncle Ali said he wished Gaza's people could safely get aid.

"People take the risk (to reach the distribution site), just so they can survive."