Iraq recorded a fiscal deficit of 12.15 trillion dinars by the end of July, underscoring ongoing economic challenges in the country. The data, provided by Echo Iraq, an economic monitoring center, highlights trends in public finance and the need for structural reforms to stabilize the budget.
According to the report, total public expenditure reached 84.18 trillion dinars by July. Current spending accounted for 62.27 trillion dinars, reflecting salaries, operational costs, and routine government expenses. Under the China-Iraq framework agreement, 321.13 billion dinars were allocated, while 8.53 trillion dinars were spent on oil licensing rounds. Investment expenditures reached 13.06 trillion dinars, supporting infrastructure, development projects, and long-term economic growth.
On the revenue side, Iraq fiscal deficit collected a total of 72.03 trillion dinars. Non-oil revenues contributed 7.07 trillion dinars, representing 10 percent of total income. This marks a significant step toward fiscal diversification, as the government increasingly relies on non-oil sectors. The federal treasury also received 439.34 billion dinars transferred by the Kurdistan Region. Oil revenues amounted to 64.96 trillion dinars, keeping oil as the primary source of public income. Despite this, the shortfall reached 12.15 trillion dinars, reflecting the gap between spending and income.
Analysts pointed out that the deficit results from high current spending combined with heavy dependence on oil revenues. The increase in non-oil revenue, however, signals gradual progress toward a more diversified fiscal structure.
Officials emphasized that addressing the deficit requires balancing expenditures with sustainable income sources. They stressed the importance of expanding non-oil sectors, improving efficiency in public spending, and encouraging foreign investment to strengthen the economy. Such measures aim to reduce fiscal vulnerability and promote long-term financial stability.