Iraq's oil revenue dominates first four months of 2024 budget
Shafaq News / Iraq's Ministry of Finance revealed, on Monday, that the country's federal budget revenues surpassed 42 trillion dinars ($31 billion) over the past four months, with oil revenues contributing nearly 89% of the total.
According to data released by the Ministry of Finance, the figures for January, February, March, and April of the current fiscal year highlight the central role of oil in Iraq's economy. The revenues for the four-month period totaled 42.725 trillion dinars, while total expenditures, including advances, amounted to 3.678 trillion dinars.
The oil revenues specifically accounted for 38.003 trillion dinars, making up 89% of the total budget, whereas non-oil revenues were reported at 4.698 trillion dinars.
Economic expert Mohammed Al-Hassani told Shafaq News Agency that the reliance on oil revenues exposes Iraq's economy to global market fluctuations. He urged the Iraqi government to leverage the financial surplus from oil to develop other economic sectors, such as agriculture, and reduce dependency on oil.
"Corruption and bureaucracy dominate most of the governmental institutions, hindering any economic development in Iraq," Al-Hassani warned. He emphasized the urgency of diversifying Iraq's economy to avoid future financial crises, which could render the state unable to pay its employees.
In March 2021, Mudhhir Mohammad Saleh, the financial advisor to the Prime Minister, cited the impacts of past wars and economic sanctions, alongside ongoing political conflicts, as reasons for Iraq's continued reliance on a rentier economy. He noted that these factors have fragmented the country's economic resources.
"The sustained dependence on oil as Iraq's sole budgetary resource poses a significant risk, particularly amid global economic disruptions that frequently affect oil prices. This situation often forces Iraq to cover budget deficits through external or internal borrowing, highlighting a critical need for effective financial management and alternative funding solutions."
