The Pharaohs unexpectedly rose to the occasion in their 4-3 loss to the five-time world champions on Monday, and were close to salvaging a precious draw.
Iraq's clash with Spain could be even sterner than the Egyptians' first game, but the Lions of Mesopotamia are sharpening their teeth to emulate the quality of the African champions' honorable display.
"The morale of my players and the whole country has been lifted by what Egypt achieved," Iraq head coach Bora Milutinovic stated.
"OK in the end they narrowly lost, but they played some fantastic football—and I have a team that can do the same. We will try and follow their example.
"Iraqis never have fear. We will face them with pride, with the right attitude, controlling our emotions."
Perfect
However, Milutinovic is keeping his feet on the ground.
The Serbian tactician admitted that he would settle for a draw with Spain, whom he thinks of as a 'perfect' team.
"Spain are one of the best teams in the world. They have always promised but never delivered and now they have a great generation of players with superior talent who can win things," he added.
"They won the Euros last year playing some great football, and people like them which you don’t get very often. They seem to be perfect.
"If I thought it would ensure us a point I would be happy to do that but you always go into a match wanting to win. It will be hard against Spain but look at what Egypt did. You must always have belief."
Iraq played out a goalless draw with hosts South Africa, and they would still have a chance of reaching the semi-finals even if they lost to Spain.
Optimistic
Spain haven't lost in their last 33 matches, and will equal the all-time FIFA record of 14 consecutive wins if they beat Iraq in their second Group A game.
Vicente del Bosque's men battered New Zealand 5-0 in their opening match, and another victory would see them qualify for the next round.
The Spaniards are widely perceived to be favorites to claim the Confederations Cup title, and Del Bosque is 'optimistic' ahead of Wednesday's game.
"Spain has always been very pessimistic and now we are very optimistic. We have to all realize that we have responsibilities," the veteran coach said.
"Our main objective is to get to the semi-finals."
The European champions are on top of the group with three points, while Iraq and South Africa have one point each.
Bottom team New Zealand, the most unfancied side in Group A, have no points.