The new Prime Minister of Iraq, Ali Al Zaidi, faces a difficult task in curbing corruption as he attempts to meet US demands while also maintaining relations with Iran, his country's other major ally, officials and analysts told The National.
Mr Al Zaidi assumed office last month and has since announced a major cabinet reshuffle, as well as sweeping arrests aimed at clamping down on corruption.
However, officials in Baghdad believe that he faces a Herculean task in addressing corruption, which Washington has set as a condition for co-operation with Mr Al Zaidi’s government. Another is the disarmament of Iran-backed militias.
“There is no end to corruption in Iraq, it is part of the culture and is deeply embedded in the system. Corruption has become part of the Iraqi political elite; it is there in all parties, despite them being Shia, Sunni, Kurdish, Christian,” an Iraqi official told The National.
One of the first steps Mr Al Zaidi took after taking office was to arrest Adnan Al Jumaili, deputy oil minister at the time, on suspicion of corruption. Mr Al Zaidi said Mr Al Jumaili tried to gain his own release by offering a $200 million bribe through an intermediary, in exchange for dropping the case.
“Every time a new prime minister gets elected, he comes in with an anti-corruption stance, but in reality nothing major happens,” said the source.
“Every once in a while, they choose someone to be their scapegoat. They would arrest him, and then after a while release him, take him out of the country, give him a new name and identity and let him live in another country. This is the real Iraq,” he said.
Iraq was ranked 136 out of 181 on Transparency International’s 2025 Corruption Perceptions Index. It is estimated that the country lost billions of dollars through embezzlement.
"Many challenges lie ahead for the new government. And for it to be a functioning democracy, corruption must be controlled and all militia groups should be disarmed and integrated into the government forces," said an Iraqi MP.
"For years, many prime ministers have attempted to do this but failed. Mr Al Zaidi has a long road ahead, he has a big fight to win, it will not be easy and will need a lot of power to do so," he told The National.
Balancing ties
In an unprecedented move, one of Iraq’s most powerful Iran-backed armed groups said on Tuesday it would begin transferring its weapons to the government, a major step for Mr Al Zaidi's government to bring militias under state control.
Asaib Ahl Al Haq said it had formed a committee to oversee the integration, which includes an inventory of its fighters, weapons and equipment, and co-ordination with the commander-in-chief of the armed forces.
The move comes as Mr Al Zaidi's government is under pressure to choose between the US and Iran. US President Donald Trump's administration has tied defence and economic co-operation to curbing Iran-linked factions and has warned it opposes the participation of any militia in the government.
"The new government has to balance and meet some of the American demands, which include going after militias and also going after corruption insofar as they see it connected to Iran,” Renad Mansour, director of the Iraq Initiative at Chatham House, told The National.
For years, Iraq has maintained a neutral stance while balancing ties between Washington and Tehran. The war in the region has exposed the fragility of Iraq’s state institutions and their limited ability to restrain these groups.
"In the latest iteration of the war, some militia groups working closely with the Iranian Revolutionary Guard Corps took part as part of Iran's bigger strategy to respond to the US and Israeli attacks by wreaking havoc across the region," Mr Mansour said.
“This included using Iraq as a launch pad to attack the Gulf and elsewhere and the Kurdistan region and other US and western interests,” he said, adding that it all came at a time when a new government was being formed.
Mr Al Zaidi's government wants to improve relations quickly with the US, to have sanctions lifted and gain some economic benefits, Sajad Jiyad, a senior fellow at the Century Foundation think tank, told The National.
The Prime Minister must "complete the transition of these militia groups into politics and separation of their major wings in exchange for maybe some sanctions relief on particular people or agencies," he added.
"Also seeing the return of US companies, in terms of investing, operating in Iraq and making sure Iraq continues to have good access to dollar flows. That would be a major success given the financial constraint he's under."
