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Prolotario
@Prolotario1
In My Opinion- What Is Not Feasible For Iraq
Iraq cannot formally submit a credible, WTO-compliant 2027 budget using a phantom program rate (1,310) that nobody not the IMF, not the World Bank, not their own central bank governors believes reflects economic reality. A budget denominated in a currency that has no operational international Forex rate is a fiscal fiction. It cannot be audited. It cannot be stress-tested.
It cannot support the letters of credit, sovereign guarantees, and cross-border investment instruments that a functioning state requires. The IMF’s Article IV consultations, the WTO accession protocol, the bilateral trade agreements with BRICS+ nations all of them require a convertible, internationally recognized exchange rate.
Iraq currently has none. The 1,310 program rate is a managed float maintained for domestic transactions. It is not tradable. It is not convertible. It is not real.
The Rudaw report I referenced Iraq preparing its 2027 budget using a “new system” is the signal that Baghdad is not planning to submit a budget under the phantom rate. They are building the budget architecture to accommodate the post-revaluation rate.
The “new system” is likely a dual-currency or transition-capable platform that can denominate line items in the current program rate for domestic continuity but instantly convert to the new international rate the moment the Central Bank of Iraq flips the switch. This is not speculation.
This is standard IMF technical assistance protocol for countries transitioning from managed-floating to fully convertible currencies. The CBI has received IMF technical guidance on exactly this process since at least 2023. The 2027 budget is being prepared on a framework that anticipates the revaluation during the fiscal year. The budget is the vehicle, not the obstacle. The new system is the adapter that allows the budget to survive the transition without triggering a fiscal crisis the moment the zeros drop.
Final Assessment
Iraq can submit a provisional 2027 budget with a placeholder exchange rate to satisfy the parliamentary calendar, then amend it within 60-90 days when the international rate goes operational. This is standard procedure for countries undergoing currency reform during a fiscal cycle.
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The Real Exchange Rate
More likely, however, Baghdad will delay formal submission until the rate is public because submitting under the phantom 1,310 locks in domestic obligations at an artificially devalued rate that would create chaos if the revaluation occurs mid-year.
The Logistics Are Locked
The “new system” Rudaw references is designed to prevent exactly that. It allows the budget to be finalized with the phantom rate for continuity, but all international-facing obligations (debt service, trade credits, investment guarantees) are denominated in the future rate as “contingent line items” that activate automatically when the CBI announces the new exchange rate.
This Is Key
Iraq doesn’t need the rate to be public to submit the budget. Iraq needs the rate to be public to e*****e the budget. The submission is the starting gun. The e*******n requires the Forex rate. And the rate requires Vought’s trigger. The sequence holds.
Source(s):
• https://x.com/Prolotario1/status/2111231289923604641
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