The government faces a choice between two bitter options: borrowing from friends or turning to the World Bank to cover expenses.
The government faces a choice between two bitter options: borrowing from friends or turning to the World Bank to cover expenses.
5-17-2026
Information/Baghdad…
It appears that the state treasury is no longer full of money, but rather empty and unable to secure the expenses needed by the country with all its facilities and the requirements of its beneficiaries from various segments. This pushes the government towards solutions that may be bitter, by resorting to the World Bank, at a time when the government has the ability to turn to the international community or friendly countries in order to borrow some amounts that may revive the budget, or accept the policy of fait accompli by the World Bank and proceed with borrowing that shackles the country with huge debts that impose on the central bank measures whose tax is paid by the citizen.
Former MP Yasser Al-Husseini told Al-Maalomah that “there is an urgent need for the new government to find solutions to the current financial crisis, given that all the funds that the government used to resort to for borrowing are no longer effective.”
He added that “the government’s financial file represents the biggest challenge at the present stage, which necessitates finding solutions to overcome this issue, in order to ensure the stability of Iraq, especially since there are malicious hands that have tried to tamper with the country’s stability.”
He indicated that “there is a possibility of going towards borrowing from some friendly countries in order to move away from the World Bank in order to get things moving, and the House of Representatives can vote on such a matter to resolve the current situation and push in the right direction.”
For his part, former MP Bassem Al-Gharibawi told Al-Maalouma that “any additional debt will have serious consequences for the country and will make matters worse, as it will be accompanied by additional interest, since resorting to external debt adds new burdens to the state, the effects of which will extend to future generations.”
He added that “the government’s task at the moment is to stop the expansion of debt, reduce public spending, and find real alternatives to oil revenues, especially since the biggest challenge facing the new government is the economic challenge, which requires a clear economic vision to address all financial crises.”
He pointed out that “the financial crisis in the country is not a coincidence or a result of the events in the Strait of Hormuz only, but it is a crisis that has been ongoing for years due to the absence of visions, strategic plans and real solutions,” noting that “the new government program does not include effective solutions to the financial and economic crisis, which puts Iraq on the brink of the abyss, especially if it moves towards raising the dollar exchange rates to address the financial crisis.”
In a related context, economist Nabil Al-Ali explained to Al-Maalouma that “the government is currently relying on printing currency to secure salaries and expenses under the cover of the borrowing law, and the continuation of this mechanism will put the Central Bank in a difficult position and may force it to deplete the central reserve to fill the gaps.”
Al-Ali stressed the necessity for the Central Bank to withdraw the printed currency from circulation as soon as it is no longer needed, and to destroy or store it instead of recycling it. He emphasized that this measure is the only way to maintain exchange rate stability and prevent monetary inflation that threatens citizens’ purchasing power.
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