Iraq’s top financial advisor has strongly rejected rumors of an upcoming financial crisis. Mudher Muhammad Saleh, advisor to Prime Minister Mohammed Shia Al-Sudani, reassured markets that Iraq avoids financial trouble due to steady policy and strong oil revenues.
Saleh explained that Iraq’s public spending is supported by oil, which funds 90% of the budget. Government spending makes up half of the country’s gross domestic product. This spending drives most of Iraq’s domestic demand, accounting for about 85% of total economic activity.
Despite recent concerns, Iraq avoids financial trouble by coordinating closely between fiscal and monetary authorities. Saleh noted that oil prices may face new downturns due to global tensions. Yet, Iraq has survived many oil shocks since 2014. Strong coordination between institutions has helped the country stay stable.
Saleh added that the government is enforcing stricter control over spending and revenue management. This effort is meant to protect national liquidity and avoid unnecessary deficits. The Central Bank works with fiscal authorities to prevent financial gaps while safeguarding essential services. Iraq avoids financial trouble because of these joint measures and planning.
Earlier, the Parliamentary Finance Committee raised alarms over falling oil prices. They warned that weak monetary activity and low trust in the banking system could trigger future issues. Many experts blamed the Ministry of Finance and Central Bank for slow circulation of funds and a fragile financial network.
Current figures show that Iraq’s money supply stands at 127 trillion dinars. However, 70% of that money remains outside the formal banking sector. This limits lending and investment. Meanwhile, oil revenues reportedly declined by 15% in April, putting more pressure on Iraq’s reserves and spending ability.
Still, Saleh remains confident in Iraq’s stability. He emphasized that the government will continue to manage funds responsibly, protect liquidity, and respond quickly to any financial risks. Iraq’s leadership remains focused on safeguarding its economy during unpredictable global shifts.