The Iraq-US relationship is a pillar of stability in the Middle East

Iraq's economic transformation could offer renewed opportunities for investment partnerships with American firms. EPA

Iraq's relationship with the US is entering a new and promising phase.

In recent weeks, Iraqi Prime Minister Mohammed Shia Al Sudani repeated the country's commitment to strengthening its ties with Washington. Following his phone call with president-elect Donald Trump last month, Mr Al Sudani emphasised his vision of a future "based on equality and mutual interests".

This commitment to a strategic partnership reflects not just security concerns, but a broader focus on sectors such as economics, energy, technology and finance. Iraq’s goals are clear: to maintain its sovereignty while fostering beneficial relationships with both regional and global powers.

For Iraq, this new phase marks an important shift that balances its security needs with economic ambition. While Iraq’s strategic partnership with the US has long been grounded in military co-operation, the relationship is evolving to incorporate broader avenues of collaboration that will be critical to the country’s long-term stability and prosperity.

At the heart of the relationship lies a shared commitment to countering terrorism and ensuring regional security. Iraq’s position as a key player in the fight against ISIS cannot be overstated. The sacrifices made by Iraq’s security forces, in collaboration with the US-led Global Coalition, have been pivotal in eradicating ISIS from Iraqi soil. As US Secretary of State Antony Blinken acknowledged in a recent speech, Washington remains “immensely grateful” for Iraq’s role in this ongoing effort.

With ISIS significantly weakened, the US and Iraq are now focusing on the next phase of their security co-operation. Both nations recognise that while ISIS has been defeated militarily, its ideological influence remains a destabilising force across the region. Consequently, American assistance – in the form of training, intelligence sharing and counterterrorism expertise – will continue to be vital. Importantly, Iraq is now taking on greater responsibility for securing its borders and maintaining internal stability, marking a shift towards a more self-sufficient security apparatus.

The fight against terrorism will continue to define Iraq-US relations in the near term. But looking ahead, it’s clear that both nations recognise the importance of broadening their partnership to include other sectors that can also contribute to regional security and prosperity.

Beyond security, the Iraqi government is keen to reshape the bilateral relationship to focus on economic development and investment. During his visit to Washington in April, Mr Al Sudani expressed Iraq’s desire to "open a new chapter" in its relationship with the US that highlights the potential for commercial trade and investment opportunities.

Spanish Prime Minister Pedro Sanchez and Iraqi Prime Minister Mohammed Shia Al Sudani attend the signing of bilateral agreements after their meeting at Moncloa Palace in Madrid last month. EPA

Looking ahead, it’s clear that both nations recognise the importance of broadening their partnership

This shift aligns with Iraq’s ongoing economic transformation, marked by reforms in finance, banking and infrastructure. In particular, Iraq has made great strides in modernising its banking sector, which has gained international credibility through partnerships with major American financial institutions such as JPMorgan Chase and Citibank. Such reforms not only boost Iraq's economic standing but also create a more attractive environment for US businesses looking to invest in Iraq’s growing market.

Energy remains a central pillar of the economic relationship between the two countries. As one of the world’s largest oil producers, Iraq holds significant sway in global energy markets, and both Iraq and the US have a shared interest in stabilising these markets. Iraq’s ongoing reforms in the energy sector, especially its push for gas independence and the development of natural gas infrastructure, offer additional opportunities for American companies. A notable example is the partnership with French firm TotalEnergies for the development of gas fields and energy projects, which signals Iraq’s commitment to becoming a regional energy hub. Further investments in energy infrastructure, such as the deal with US-based KBR for the development of a liquefied natural gas terminal in Al Faw Port, will cement Iraq’s role as a central player in global energy markets.

Iraq’s relationship with the US has long been focused on security and energy, but the two nations are increasingly exploring new avenues of collaboration. As Iraq emerges from the ashes of conflict and seeks to diversify its economy, there is immense potential for growth in sectors like agriculture, health care, technology and education.

Iraq’s ambition to become a regional business hub is clear. The country’s growing infrastructure needs, its demand for technology transfer and its efforts to develop human capital create significant opportunities for US companies. This expanding partnership offers mutual benefits: American firms gain access to a rapidly developing market, while Iraq benefits from the expertise and technological innovation they can provide.

In the tech space, there is potential for US firms to collaborate with Iraq on matters ranging from digital infrastructure to artificial intelligence. Education and health care, too, present opportunities to build sustainable partnerships that contribute to Iraq’s human development and long-term prosperity. The US can play a key role in providing expertise and resources that will help Iraq address some of its most pressing challenges.

The evolving Iraq-US relationship is a critical factor in the stability and prosperity of the Middle East. As Iraq continues to rebuild and assert its sovereignty, the US remains an indispensable partner. However, for this partnership to be truly successful, it must be based on mutual respect and shared interests, rather than framed through the lens of other regional dynamics. Iraq is an independent state, and its relationships – whether with the US or other countries – must reflect its sovereignty and national priorities.

The opportunities for Iraq and the US to expand their partnership are vast. From security co-operation to economic development, both nations stand to benefit from a deeper, more comprehensive relationship. With the right focus and commitment, the Iraq-US partnership can reach unprecedented heights, contributing not just to the two countries' prosperity, but to the broader stability of the Middle East. The road ahead is filled with promise, and the future of Iraq-US relations has the potential to be a pillar of Middle Eastern stability for decades to come.