On Sunday, the Ministry of Finance reported that the volume of Iraqi financial earnings in the federal budget for the previous seven months topped 65 trillion dinars, indicating that the oil contribution to the budget has increased to 95%, while an economist expects that non-oil income “will not improve.”
Shafaq News Agency followed the data and tables released by the Ministry of Finance this September for the accounts from January to July of the current fiscal year, which revealed that oil is still the main resource for Iraq’s general budget, accounting for 95% of the total, indicating that the rentier economy is the foundation of Iraq’s general budget.
According to the financial tables, total revenues until last July were 65 trillion and 195 billion and 3 million and 735 thousand and 974 dinars, after excluding transfer revenues of one trillion and 995 billion and 73 million and 713 thousand dinars, indicating that total expenditures with advances were 52 trillion and 916 dinars. 1 billion, 562 million, 761 thousand dinars.
Oil income totaled 62 trillion and 259 billion and 118 million and 923 thousand and 534 dinars, accounting for 95% of the general budget, while non-oil receipts totaled two trillion and 935 billion and 884 million and 812 thousand and 439 dinars.
Economist Muhammad al-Hassani stated in an interview with Shafaq News Agency that “non-oil revenues will not improve or rise as long as Iraq lacks domestic industrial and agricultural production,” adding that “the Iraqi economy is a rentier economy that depends on taxes and customs for non-oil revenues.”
He stated that “the successive Iraqi governments did not direct the surplus oil revenues resulting from the rise in oil prices towards investment and the development of the industrial and agricultural base, but rather relied on imports to meet local needs,” emphasizing that “Iraq has become a living off neighboring countries.”
Mazhar Muhammad Salih, the Prime Minister’s Advisor for Financial Affairs, confirmed in March 2021, in an interview with Shafaq News Agency, that the reasons for the economy remaining rentier are due to previous wars and the imposition of an economic blockade on Iraq, as well as the political conflicts we are witnessing today, which have led to the dispersion of… for economic resources.
The Iraqi state’s continued reliance on oil as the sole source of the general budget puts Iraq at risk from periodic global crises because oil is affected by them, causing the country to cover the deficit through borrowing from abroad or within, indicating the inability to manage state funds.