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Driven by the United Arab Emirates (UAE), there is a trend in the Arab world toward normalisation with Israel. Yet some regional states want nothing to do with this agenda.

Last month, the Iraqi parliament called “Criminalising Normalisation and Establishment of Relations with the Zionist Entity Law.” Based on from 1969, the law contact with Israeli entities in the “cultural, political, scientific, commercial, economic, media, or security sphere.” Punishments are harsh, and include life imprisonment and death sentences.

All 275 lawmakers who attended the session voted for this law. The main agent behind this legislation was , who declared that he would, if necessary, shed his own “blood” to prevent any Iraqi-Israeli diplomatic accord. Al-Sadr effectively unified both his political allies and rivals behind this legislation. This was a that threw red meat to conservative Shia Islamists—including those aligned (and not) with Iran.

“I would look at this primarily as a politically motivated action, particularly by those pro-Sadrists and Sadr himself, who I think is using this as a way to build a broader consensus among the pro-Iranian militias and the pro-Iranian groups that he has failed to bring on board in this current stage of forming a government,” explained Andreas Krieg, an associate professor at the School of Security Studies at King’s College London, in an interview with ������.

“It’s a way for Sadr to bridge the gap to bring some of these socially conservative Shia Islamists on his side, who’ve been usually on the pro-Iranian side and against him. It’s a form of political populism more than anything else.”

Domestic tensions inside Iraq

The Iraqi parliament put out a about this legislation reflecting “the will of the [Iraqi] people.” But in the Kurdistan Region, there has been much sympathy for Israel and Iraqi Kurds have long maintained political relationships with Tel Aviv.

In September 2021, a took place in Erbil. The event was organised by the, a New York-based non-profit, approved by the Kurdistan Regional Government (KRG) and attended by Iraqi sheikhs. Yet the conference led to arrest warrants for certain participants and even .

Considering the between the Kurdistan region and Israel, the enforcement of this law has much potential to exacerbate friction between Iraqi Arabs and Kurds against the backdrop of many long standing problems between Iraq’s central government and the KRG.

The new anti-normalisation law could also be weaponised against Sunni Arab dissidents, warned Tallha Abdulrazaq, an expert in Middle Eastern strategic and security affairs, in an interview with ������.

“I’m a British-Iraqi and in my academic work I engage sometimes with Israeli academics, policymakers, and even lawmakers on occasion…I’m exactly the kind of target whom they’d like to sweep up in this sort of thing because I’m a dissident of the political process and I’m a Sunni. There’s a political aspect and a sectarian aspect to this…So, if you have any interactions with an Israeli entity, they can target you with this law.” He added that “this is going to have a chilling effect on academics abroad and people who work in the media.”

Implications for doing business in Iraq

This legislation could also have negative implications for and foreign investment climate. Depending on the extent to which authorities enforce this law, investors might worry more about the potential risks of doing business in Iraq on top of concerns surrounding the country’s overall state of insecurity.

There could be “possible obstacles to foreign direct investment in Iraq by companies that feel constrained by their own policies or the laws in their home countries that would penalise anything that looks like cooperating in a boycott of Israel,” to analysts Yerevan Saeed and Hussein Ibish.

Initially, a more draconian draft version of the law containing a provision to expel international firms and investors and have the state take over their assets if they were doing business in Israel and Iraq was proposed.

Ultimately, the lawmakers decided to remove that provision, but there is a fair amount about the law’s framing which leaves questions open. “It’s still very hard to understand what this means in practice—not for Iraqis but particularly for companies and internationals who go into Iraq and work in Iraq,” Krieg told TNA.

Yet, Abdulrazaq believes that this law will not be weaponised against foreign corporations with links to Israel given Iraq’s current economic problems.

“The Iraqi economy is in absolute shambles…They need these foreign companies [and] foreign direct investment…This is more for popular consumption. It’s not meant as a stick meant to beat foreign companies with. They need them for their economy…If these guys were to leave, then that’s it for Iraq. There’d be almost nothing there for them. Even in terms of their oil sales, it’s not enough. It’s not enough to sustain Iraq itself. They will not chasing any foreign corporations any time soon.”

Regional ramifications

It came as no shock that Iran quickly expressed support for the legislation. Equally unsurprising was the condemnation from Western powers. The US State Department immediately spoke out against the new law, that Washington “stands in stark contrast to the progress Iraq’s neighbours have made in building bridges and normalising relations with Israel, creating new opportunities for people throughout the region.” Officials in London had a.

President Joe Biden’s team seeks to on the Trump administration’s efforts to lure Arab countries toward the normalisation path. Although no new Arab state has entered the Abraham Accords during Biden’s presidency, US Secretary of State Antony Blinken has made it clear that this is one of the current administration’s goals in the Middle East and North Africa. The passage of this law was a strong message to Washington that Iraq has zero interest in this wave of .

Some experts, however, don’t expect this legislation to have much of any impact on Iraq’s ties to Western governments. “As is the case with many Middle Eastern nations, rhetoric against Israel sells and it’s something that they can always fall back on when they’re doing poorly. If they’re politically suffering in the sense that people aren’t buying their spiel anymore, they’ll immediately fall back on this,” said Abdulrazaq.

“Western capitals are very clued up to this fact that generally so-called anti-Zionist governments aren’t really that anti-Zionist and eventually over time they can be cajoled into either working with Israel under the table, or they’ll formalise some kind of diplomatic deal like they have done with the Abraham Accords.”

This law is also a signal from Iraq to Gulf Cooperation Council (GCC) members. Baghdad’s message is that Abu Dhabi’s US-backed efforts to bring more Arab countries into the is something Iraq’s officials want nothing to with as they firmly reject normalisation.

So far, the GCC states have had muted responses to the Iraqi parliament passing this anti-Israel legislation. The Gulf monarchies hope to avoid increased friction with Baghdad vis-à-vis this law as well as perceptions of GCC states meddling in Iraq’s internal affairs.

Backlash against the Abraham Accords

With the UAE and three other Arab countries having entered the Abraham Accords while Washington seeks to bring more in, there is good reason to expect friction surrounding this normalisation question to intensify. States such as Iraq, which stand against forming full-fledged diplomatic ties with Tel Aviv, are under growing pressure to make their decades-old positions against normalisation clear to domestic, regional, and international audiences.

In Iraq’s case, lawmakers have shown that they’re willing to support extreme measures to signal Baghdad’s rigid stance on this issue. Yet, it remains to be seen what consequences this legislation produces.

Giorgio Cafiero is the CEO of Gulf State Analytics. 

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