Iraq's economic vitality 'really evident' for the first time, Barbara Leaf says

US diplomat faces tough questions on Biden administration's Middle East policy

Barbara Leaf said that Iraq's growing economic strength has positive implications for the wider Middle East. Reuters

Barbara Leaf, the US assistant secretary for Near Eastern affairs, expressed optimism on Wednesday about Iraq's economic prospects and Washington's growing relationship with Baghdad.

Ms Leaf, who previously served as the US ambassador to the UAE, told the Senate Foreign Relations Committee that 20 years after the US-led invasion, Iraq's “economic vitality for the first time is really evident”.

The World Bank said Iraq’s economy was “rebounding” in 2022, with gross domestic product growth forecast to accelerate to 8.7 per cent, “driven by rising oil output and a post-pandemic recovery in non-oil sectors”.

Ms Leaf added that Iraq's growing economic strength has positive implications for the wider Middle East as well.

“[Iraq] is a keystone in the arch of regional security and stability … what's good for Iraq then becomes good for certainly the near neighbourhood and then for the broader region,” she said at the hearing focused on the Biden administration's fiscal year 2024 budget for the Mena region.

Democrat Tim Kaine highlighted that the White House's 2024 budget request allocates $271 million for the US partnership with Baghdad, which “puts Iraq on par” with some of Washington's closest political partners.

Mr Kaine was among the senators to spearhead the repeal of the congressional authorisations used for the Gulf and Iraq wars, which the chamber passed in March.

Ms Leaf agreed that Washington's posture towards Iraq is transitioning into a “360-degree relationship”.

She added that the “full-spectrum” relationship between Washington and Baghdad has produced “significant results” in its security independence.

“We are far away from the days of 2014 when we saw that just calamitous collapse of a part of the Iraqi security forces in the face of waves of ISIS fighters,” Ms Leaf said.

“The Iraqi Air Force can itself do counter-ISIS missions. The Iraqi security forces can hold territory that they've cleared of ISIS fighters. They're a more professional force. They're increasingly capable”.

But outside of the positive notes on Iraq, senior Democrats pressed Ms Leaf about the budget proposal for next year, arguing cuts on regional funding “don't reflect” Washington's values.

On foreign policy, the fiscal year 2024 proposal continues a sharpened focus on the Indo-Pacific and Russia's war in Ukraine, while generally pivoting away from the Middle East.

It allocates about $6.4 billion for Washington's regional partners, including $3.3 billion to the US-Israel Memorandum of Understanding; $1.45 billion to Jordan; $1.4 billion to “support the US strategic partnership with Egypt”; and $259 million for “critical assistance” for Palestinians in the West Bank and Gaza.

Senators Ben Cardin and Chris Murphey emphasised the budget's cuts for democracy support in Tunisia and a lack of conditions for funding to Egypt.

“I worry that this budget doesn't communicate right the values that we share, in that it doesn't make any significant changes to the way in which we flow dollars to countries that either have worsening human rights records like Tunisia, or countries that have shown no meaningful commitment to change like Egypt,” Mr Murphey said.

Last year, Democratic representatives sent a letter to Secretary of State Antony Blinken urging President Joe Biden's administration to withhold $300 million in military aid from Egypt until it fully meets human rights requirements outlined in the annual appropriations bill.

Democrat Chris Van Hollen also pressed Ms Leaf about the administration's efforts at accountability for Israel's killing of Palestinian-American journalist Shireen Abu Akleh last year, demanding an updated report on her death by Friday.

“I will otherwise use whatever powers I have here in ways that I've never done before. I'm a dear friend of the Foreign Service, but I can tell you I'm at the end of my rope in terms of a simple request for a report,” Mr Van Hollen said.

Ms Leaf “apologised” for the delay and said the report would be coming soon.