Iraq's PM heads to Washington in July to pitch investment and trade to Trump

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Iraq’s new Prime Minister is heading to Washington next month to meet Trump, in the first major diplomatic test for the former banker and businessman, who will be leading a delegation of Iraqi business leaders to pitch investment and trade opportunities.
The business agenda: Securing US investment for rehabilitating the Syria-Iraq pipeline will be on top of Al-Zaidi’s agenda during the visit, with Al Zaidi expected to sign an MoU with the US-based TI Capital to rehabilitate the Kirkuk-Baniyas pipeline at an estimated cost of USD 8 bn. Other areas would be supporting US companies to resume operations after they ceased due to security concerns. Iraq also just granted Musk’s Starlink the license to provide internet services in the country after Al Zaidi met with the US special presidential envoy for Syria and Iraq Tom Barrack.

The timing matters: The visit was announced just after the US and Iran announced an interim agreement to end the war, which we think is ultimately good for a productive visit for Al Zaidi. The new US-Iran de-escalation could take off the heat over two major fraught issues in US-Iraqi relations: the US demand that Iraq disarm the powerful Iran-backed, quasi-state militias and sever Iranian energy imports that Baghdad depends on for electricity — possibly giving Al Zaidi breathing room to focus on business and trade ties.

Sign of the times

The US is now pushing to unify Libya’s rival governments — the political track of a wider business-driven US push that we reported was coming last April. Massad Boulos, President Trump’s senior adviser for Arab and African affairs, told the FT that Washington wants to fold Libya’s split institutions into a single government, with the explicit aim of clearing the way for American oil majors to scale up in the country.

The business case for Libya is clear: Many international oil companies (IOCs) view Libya as very promising medium and long-term investment ground — that’s why some IOCs, including many US-based ones like Chevron, ExxonMobil, and ConocoPhillips, rushed to Libya’s first tender in 17 years back in February. Libya holds the largest crude reserves on the African continent and also boasts friendly extraction geology, with shallow fields that are quick to bring into service and cheap to operate. For IOCs working on 15- to 25-year horizons, securing a foothold in Libya despite political fragmentation is seen as a rational business decision.

How the US plan would work: Washington’s focus on Libya is on three sequenced tracks, Jalel Harchaoui, a Libya analyst at the Royal United Services Institute, previously told us. The military track came first — the Flintlock joint exercises in mid-April that Bloomberg just reported on, which brought eastern and western forces together for the first time since the 2020 ceasefire. The economic track followed with the US-engineered unified budget in April — Libya's first in 13 years, which forced a degree of revenue-sharing and transparency between the two governments. And the political track — folding the rival administrations into one, which is the hardest of the three, and the one now in motion.

What’s next: Harchaoui argued that the political track would be complicated and slow. The real test for Washington’s ability to get things done in Libya would be how compliant the competing governments would be on the unified budget — and the moment to check in on that would be next August when the US is expected to audit the execution of the budget for the first time.