Iraqi economists warn of costs after FATF places Iraq on grey list

BAGHDAD, Iraq — The Financial Action Task Force (FATF) formally placed Iraq on its grey list on Friday, citing deficiencies in combating terrorist financing and money laundering. The decision places the Central Bank of Iraq and the country's banking sector under heightened scrutiny from global financial institutions. International economic and transport consultant Ziad al-Hashimi said the move serves as an international warning and would push correspondent banks handling dollar transfers toward a more cautious stance. He added that overseas transfers would face additional checks, while compliance and transfer costs rise. Manar al-Obeidi, head of the Iraq Future Studies and Economic Advisory Institution, warned that Iraq could be moved to the black list if it fails to meet the established timetable, leading to international financial isolation and economic damage affecting citizens' livelihoods. FATF President Elisa de Anda Madrazo told the General Assembly meeting that Iraq must increase measures related to cash transaction volumes, judicial investigations and financial intelligence sharing. Prime Minister Ali Zidani, who took office in May, has said his government program will prioritize rebuilding the financial system, attracting foreign investment and combating corruption.