Multiple protests hit Iraq over currency devaluation, non-payment of salaries

The government has tried to justify the currency devaluation as a necessary measure to prevent the country’s foreign reserves from running out. Other austerity measures have also been planned for the near future

December 23, 2020 by Peoples Dispatch
Protests in Iraq
(Photo: Rudaw.net)

Multiple protests hit Iraq over the last few days against the government’s plan to devalue the national currency by 20%. Protests also broke out in the oil-rich city of Basra against the delay in the payment of salaries to thousands of daily wage government employees. 

On Monday, December 21, hundreds of protesters demonstrated across several Iraqi cities against the government’s plan to reduce the value of the Iraqi Dinar against the US dollar by a fifth. This is expected to increase the prices of daily items and negatively affect trade in the country. On Sunday, protests in the southern city of Basra saw thousands block several main roads in anger over non-payment of salaries for the last nine months.

Protests on Monday were witnessed in capital Baghdad, the eastern city of Kut, the city of Najaf and Basra. Shop owners and small traders claim that devaluation of the currency will result in a sudden rise in prices of essential commodities and other basic items. It will also reduce their purchasing power to import goods, which could result in a shortage of various products. Protesters in Baghdad’s Tahrir Square were seen holding banners reading “the government should collapse before the Dinar.” They demanded the reversal of the decision to devalue the currency from its current rate of 1,182 Iraqi Dinars to a dollar to 1,460 Dinars to a dollar. A significant deployment riot police was reported at the largely peaceful protest.

Media reports said that senior citizens who survive on pensions have also complained about the reduction in the value of their pensions after the adjustment to the new exchange rate. This, combined with the increase in prices, will have an extremely adverse impact on their expenses. 

The government has tried to justify the currency devaluation as a necessary measure to prevent the country’s foreign reserves from running out. Other austerity measures have also been planned for the near future, including cutting the salaries of government employees and large-scale increase in tax rates. This is part of a ‘reform package’ planned in the lead up to the parliamentary elections scheduled for 2021.

Protests hit Basra on Sunday against the non-payment of wages to over 30,000 workers who were hired by the local administration in coordination with the central government as daily wage employees in various government institutions, including oil and other energy facilities. They have not been paid their salaries since March, when the government had launched the day-rate employment scheme. The protesters blocked several of the highways leading into the city as well as many vital roads going towards oil refineries and other installations, causing major traffic disruptions. Roads leading to the South Oil Refineries Company and the port of Umm Qasr were severely affected. The organizing committee of the protest has warned that the unpaid workers will resort to civil disobedience and block more roads across the city until the authorities release their months overdue salary. The local Basra governorate administration had reportedly announced last month that funds for the salaries have been allocated. However, no statement has come on why the salaries have not been released yet or the cause of the delay.

× To Subscribe