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Iran’s War on Iraq’s Economy: The Ally Made to Pay

 Ahmed Kawa

Few things in international relations are more bitter than a friendship that becomes a burden, or an ally that helps impoverish the very country it claims to protect. Such is the paradox of Iraq’s troubled relationship with Iran: a nation whose need for economic independence grows ever more urgent, even as its choices narrow under the weight of Iranian influence and the entanglement of politics, sectarian loyalties, and armed power.

When shipping through the Strait of Hormuz was disrupted, Baghdad had no say in the decision to go to war. Yet it found itself paying the price. Iraq’s losses reached approximately $60 billion. Iraqis discovered that their oil, the lifeblood of their economy, could become hostage to a conflict waged by a neighboring country supposedly regarded as an ally.

But the economic bleeding neither begins nor ends at Hormuz.

Networks smuggling Iraqi fuel generate, by some estimates, at least $1 billion annually for Iran and its proxies. The US Treasury went further, accusing networks linked to the Revolutionary Guards of introducing counterfeit Iraqi dinars, allegedly printed in Iran, into Iraq’s financial system.

In agriculture and industry, the irony is more painful still. With its land, water, and oil wealth, Iraq possesses the foundations of a substantial productive economy. Instead, it has become a market for Iranian goods, while its farmers and manufacturers struggle against unequal competition and inadequate protection. More troubling still is the talk of direct Iranian instructions to allied factions to obstruct the development of these sectors. The networks of influence and vested interests certainly invite an uncomfortable question: who benefits from Iraq’s continued economic weakness?

Then there is gas, perhaps the clearest illustration of the predicament.

Iraq imports Iranian gas to generate electricity while its efforts to develop domestic production face repeated attacks. In Kurdistan, the Khor Mor gas field has become a target for drones, disrupting energy production and undermining Iraq’s quest for self-sufficiency.

The problem is not Iran as a neighbor, nor Shiism as a religious identity. It is the exploitation of sectarian ties as a cover for political and military influence, subordinating Iraqi national interests to calculations made beyond its borders.

Iran pursues its national interests. That is what states do. The tragedy begins when Iraq is expected to sacrifice its own national interests in the name of alliance, its economy in the name of brotherhood, and its sovereignty in the name of sectarian solidarity.

Iraq need not become Iran’s enemy to reclaim its independence. It must simply recognize that a friendship which cripples its economy is a form of aggression by other means.

A nation denied the freedom to develop its wealth, protect its currency, secure its oil and gas fields, and control its borders will not be saved by the abundance of its allies.

The cruelest form of dependence is to make a country pay for wars it never chose, and then demand that it call the sacrifice loyalty.

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