An economist warns against addressing the budget deficit by raising the dollar exchange rate.
An economist warns against addressing the budget deficit by raising the dollar exchange rate.
5-14-2026
Information / Special ..
Economic expert Safaa Al-Shammari expressed his concerns on Thursday about attempts to address the financial deficit by raising the dollar exchange rate, stressing that any such move should be viewed with extreme caution.
Al-Shammari told Al-Maalouma that “linking the treatment of the financial deficit to raising exchange rates represents a step that directly affects the economic and social security of the citizen,” explaining that “raising the price of the dollar against the dinar under the pretext of securing salaries or covering the deficit will lead to the citizen bearing the cost of financial and administrative imbalances, through rising prices, inflation and a decline in purchasing power.”
Al-Shammari added that “Iraq is not facing a foreign currency crisis as much as it is facing a financial management crisis and a rentier economy that depends almost entirely on oil,” stressing that “sustainable solutions lie in controlling unproductive spending, maximizing non-oil revenues, combating waste and corruption, and activating real economic sectors, instead of weakening the dinar.”
Al-Shammari pointed out that “past experiences have proven that adjusting the exchange rate may give the government temporary financial relief,” but it “imposes significant living pressures on citizens and the private sector, and leads to a disruption of confidence in monetary policy and economic stability.”
He stressed that “securing salaries must be based on genuine financial and structural reforms, not on exceptional monetary tools that could turn into a long-term burden on the economy and society.”
Al-Shammari stressed “the necessity of adopting a realistic and transparent economic discourse that reassures markets and citizens, and affirms that monetary stability and protecting the value of the dinar are sovereign and economic priorities that cannot be compromised under the pressure of temporary solutions.”
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