Abdolnasser Hemmati, Governor of the Central Bank of the Islamic Republic, left Tehran for Baghdad at the head of a delegation to meet with banking and economic officials in Iraq.

According to an official announcement, the purpose of this trip is to deepen cooperation, remove “structural bottlenecks” in the commercial and banking interactions between the two countries, and to design new mechanisms for joint transactions within the framework of an agreement between the heads of the central banks of the two countries.

Hemmati’s trip comes as the Central Bank of Iraq, over the past three years and under pressure from Washington, has lost a large part of its banking network’s access to the dollar.

In Tir 1402 (July 2023), the United States barred 14 Iraqi banks from dollar transactions, and the Central Bank of Iraq prohibited cash withdrawals and dollar transactions starting from Dey 1402 (December 2023).

With this move, the Islamic Republic’s access to export currency and the smuggling of dollars via Iraq were cut off.