INTERNATIONAL WARNING TO IRAQ.. AN EXPERT DISCUSSES THE IMF REPORT: YOU ARE TO BLAME, TOO.
Economic expert Suham Yousef discusses the latest report by the International Monetary Fund (IMF), which included significant warnings to the Iraqi government regarding the continued decline in revenues while increasing public spending, which constitutes a serious structural deficit in the economy’s structure.
The expert’s criticism of the IMF itself stems from the fact that the IMF itself is unaware of the Iraqi political and social context, which makes implementing the “ready-made recipes” it offers extremely difficult.
Its proposals clash with the spread of the deep state’s influence and its obstruction of tax reform aimed at increasing non-oil revenues, for example.
The proposal to rationalize spending also clashes with the fragile social reality and the dependence of millions of Iraqis on government salaries amid a weak private sector and the expansion of the “parallel economy.” This situation places Iraq facing an imbalance with every barrel of oil sold, the continued depletion of financial reserves, the rise of public debt to 62%, and the decline of foreign investment to 0% of GDP.
In its latest report, the International Monetary Fund (IMF) issued a stark warning about worsening financial and economic vulnerabilities, warning that the country is heading toward a widening budget deficit amid declining oil prices, weak non-oil revenues, and ballooning current expenditures, particularly for wages and pensions.
The report presents an accurate but worrying picture of the Iraqi economy and raises fundamental questions about the government’s preparedness to contain the coming crisis.
Despite the government’s attempts to present plans to diversify the economy, the reality tells a different story. Non-oil growth slowed sharply to just 1% in 2024, according to IMF estimates, compared to 13.8% the previous year. This decline reveals that non-oil sectors remain limited in their impact and suffer from weak infrastructure, a lack of real incentives, and an unattractive investment environment.
