The United States has declared dollar smuggling and money laundering in Iraq by Iranian forces a top priority in combating Iranian influence. Due to rampant Islamic Revolutionary Guard Corps (IRGC) illicit market access, Iranian-backed militias, and corruption within the Iraqi government, the US Treasury Department is pressuring Prime Minister Sudani to crack down on IRGC activity in the country.
Key Judgement 1. The US is highly likely to heighten its pressure campaign against the Iraqi government to continue its financial reforms and crackdown on Iranian currency smuggling in the coming 12 months.
Key Judgement 2. The Sudani-led government is likely to collapse due to domestic frustrations with the pro-Iranian coalition and US pressure within the next 12 months.
Key Judgement 3. The US is unlikely to militarily challenge IRGC activity in Iraq within the next 12 months, as the US likely aims to avoid derailing talks with Iran
