Iraq finance panel warns of cash crunch, urges boost in non-oil revenues

Shafaq News – Baghdad

Iraq’s parliamentary finance committee warned on Thursday of a shortage in state cash reserves, citing weak oil revenues and widespread waste of public funds.

Committee member Moeen al-Kadhimi told Shafaq News that Iraq faces a liquidity crunch because of insufficient oil and non-oil income, calling on the government to urgently expand revenues, particularly from non-oil sectors, to stabilize the budget.

According to al-Kadhimi, oil revenues amount to about 120T IQD ($91B) annually, while non-oil revenues have not exceeded 13T IQD ($10B), falling short of the 20T IQD ($15B) target. “If total revenues reach 140T IQD ($106B), that would be enough for the Iraqi state.”

He noted that state coffers currently receive about 6T IQD ($4.5B) from the Tax Authority, 7T IQD ($5B) from Customs, 3T IQD ($2B) from the Communications and Media Commission, and another 5T IQD ($3.8B) from ministries such as Interior, Electricity, Construction, Municipalities, and Baghdad’s municipality.

Al-Kadhimi also criticized wasteful spending, pointing to inflated project costs. “3B IQD (~$2M) are spent on building a school when the actual cost should be only 1.25B IQD,” he said.

The federal Ministry of Finance has repeatedly denied the existence of a financial deficit or liquidity shortage. However, pressures often surface at the end of each month when funding begins for public-sector salaries, pensions, and social welfare programs.

Implementation of Iraq’s investment budget has also been hampered in recent months by delays in financial allocations and contractor payments, resulting in stalled projects across several provinces.