Financial distress and patchwork solutions… Will the borrowing crisis and budget deficit trigger the exposure of inherited corruption files?
Financial distress and patchwork solutions… Will the borrowing crisis and budget deficit trigger the exposure of inherited corruption files?
6-19-2026
Information / Report..
The country’s financial reality faces a major challenge that is the most important and difficult test to assess the success or failure of the Al-Zaidi government, at a time when government solutions have begun to move towards the option of “borrowing”, amid warnings that it is a patchwork solution that does not address the roots of the financial crisis left by the repercussions of the war in the region and the closure of the Strait of Hormuz.
With the accumulation of the financial crisis, another legislative and economic challenge emerges related to drafting the current year’s budget and sending it to Parliament, which observers see as difficult to achieve given the limited time, especially since the government has not yet taken any actual steps towards preparing the budget, amid calls from specialists to rely on immediate solutions by approving a small emergency budget for the remaining months of the year.
In this context, economist Basil al-Ubaidi told Al-Maalomah that “the budget process has already passed. Iraq is now teetering on the brink of collapse at the end of June, and the bureaucratic procedures for approving the budget will inevitably hinder and delay it until next September.” He added that “a budget approved for only three months of a fiscal year that is nearing its end is worthless.”
Al-Ubaidi pointed out that “preparing the budget depends primarily on estimating revenues and expenditures, which is difficult to achieve at the present time, given the significant decline in the country’s revenues as a result of the repercussions of the regional crisis and the disruption of export traffic through the Strait of Hormuz,” indicating that “Iraq needs a period of no less than two months to restore some degree of financial stability.”
For his part, current MP Mukhtar al-Moussawi confirmed in a statement to Al-Maalouma that “the success of the current government depends primarily on the path of combating corruption, which has caused a large financial deficit in recent years that has become evident in recent months.”
He added that “there is pressure to re-evaluate all projects implemented in the previous government, especially given indications of significant price and cost overruns, which raises many questions,” noting that opening a broad investigation into previous projects would be an important step in combating corruption and revealing the truth about the situation.
Discussions have recently intensified in Iraqi circles regarding the current government’s ability to address the legacy of the previous administration and identify the sources of failure and corruption that plunged the country into economic crisis. This is particularly concerning given the absence of clear plans and visions, a deficiency that became even more apparent with recent regional developments and the closure of the Strait of Hormuz. Despite this anxiety, Iraqis see a glimmer of hope for a return to normalcy after months of drought and financial stagnation that have ravaged the markets.
almaalomah.me
