Iraq appoints Nizar Hussein as new central bank governor

Iraq has tapped anti-money laundering expert Nizar Hussein as the new governor of its central bank. A career bureaucrat who held posts in the Trade Ministry and the National Investment Commission, Hussein was leading the anti-money laundering unit in the Central Bank. He replaces Ali Al Alaq, who had led the Central Bank of Iraq (CBI) from 2014 to 2020 and then again from 2023 before being tapped now as the prime minister advisor for economic affairs.

Hussein’s anti-money laundering expertise matters. He takes over CBI just a few days after the Financial Action Task Force (FATF), which the G7 body that tracks and makes policy to fight money laundering and terrorist financing, added Iraq to its grey list, which makes foreign banks and investors leery of doing business with Iraq. His time with the AML unit means he has an already-established working relationship with FATF, which could help as Iraq races to get off the list once again ahead of the next update in October.

Getting off the FATF grey list is just one of many difficult issues that the new governor will face. Iraq’s crude exports came to a halt when Iran closed the Strait of Hormuz — and hydrocarbon sales account for 90% of Iraq’s foreign sales. Flatlining crude sales meant Iraq’s foreign reserves have come under pressure, pushing the country toward a fiscal cliff. Experts told us last month that the new government had just weeks of breathing room before it would be forced to start curbing spending on investment and seek IMF financing to meet its public salary obligations.