An economist says increased money printing “threatens financial stability.”
An economist says increased money printing “threatens financial stability.”
6-1-2026
Information / Special:
Economic expert Dirgham Muhammad Ali confirmed on Monday that the reopening of the Strait of Hormuz does not mean Iraq’s immediate return to previous export levels, noting that increasing the printing of currency to cover the financial deficit threatens the economy.
Ali told Al-Maalomah that “crude oil production has declined as a result of the decrease in reservoir pressure in some fields and the shutdown of a number of wells, which requires technical procedures and sufficient time to rehabilitate them and resume work at full capacity,” indicating that “restoring previous export rates will not be achieved directly just by opening the strait.”
On the financial front, Ali warned against “rushing to adopt the option of printing money to address economic pressures,” stressing that “this step needs careful study to assess its potential effects on the national economy.”
He explained that “increasing the money supply without a real economic backing or parallel growth in foreign reserves could put pressure on the value of the Iraqi dinar and exacerbate financial imbalances,” noting that “this option entails significant economic risks.”
Ali pointed out that “resorting to external borrowing is not an easy solution, due to the legal restrictions that regulate borrowing operations and impose specific ceilings on it, as well as the limited availability of financing alternatives at the present time.”
He added that “non-oil revenues are still of limited impact,” explaining that “customs revenues have been affected by the decrease in the volume of imports during the recent period as a result of the implementation of the ASYCUDA system, which has been reflected in the volume of resources collected from customs and levies.”
He explained that “the continued repercussions of the Strait of Hormuz closure are placing additional pressure on the country’s financial situation, given its heavy reliance on oil revenues and the absence of alternative export outlets capable of compensating for the losses, thus making the available economic options for addressing the crisis more complex.”
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