Economic collapse vs. constitutional rights: Iraq's oil revenue dilemma
A growing demand for direct pay-outs from Iraq’s oil revenues has sparked lawsuits and warnings from economists, with one expert cautioning that such a move could push the country to the brink of bankruptcy within a year.
The video for my this My FX Buddies Blog is below here:
Economic expert Nabil Al-Marsoumi estimated Iraq’s 2024 oil revenues at $90 billion, while non-oil revenues stand at just $13 billion, barely enough to cover government spending on electricity, gas, and food rations.
He warned that using oil revenues for direct cash payments would deplete central bank reserves, forcing the government to borrow or print money to cover salaries and social benefits, which cost $70 billion annually.
This, he cautioned, would trigger hyperinflation, send the Iraqi dinar into freefall, and push the economy into crisis within a year. Even distributing half of the oil revenues, he argued, would only delay the collapse by two years.
His remarks come as dozens of Iraqis file lawsuits in appellate courts, citing Article 111 of the constitution, which asserts that "oil and gas belong to all the people of Iraq in all regions and governorates."
Legal experts argue that managing national wealth through public services, rather than direct cash pay-outs, is a more common global approach and raises complex legal questions in this case.
Supporters of the lawsuits see them as a response to growing frustration over how successive governments have managed Iraq’s resources. Some are considering joining the legal action if it gains momentum.
Forecasts of global economic variables and their impact on the Iraqi economy (2025-2030)
Samir Al-Nusairi
In light of analyzing the current situation of international economic, political and security variables and the extent of their expected impact on the Iraqi economy. And with a close eye to the challenges and crises that the national economy has gone through, influenced by the economic crises that the major economic countries have suffered from, and the strategic conflicts between America and China, and the bias of some countries towards the American strategy to lead the world economically, and other countries moving towards the strategy of China and some emerging countries to establish a new international economic pole to confront American hegemony.
One of the most prominent consequences of this conflict is the global energy and food crisis, which has lasted for more than a decade and continues to plague countries with weak, poor, and rentier economies, preventing them from making a structural and comprehensive transition to emerging economies capable of withstanding the impacts of global economic conflicts. Since mid-June 2014 and until the first quarter of 2020, the Iraqi economy has faced complex and cumulative challenges due to shifts in the global economy, the slowdown in global economic growth due to the US-China conflict, the COVID-19 pandemic, the fight against terrorism, the decline in global oil prices, which reached rates exceeding 70%, and the economic recession. Most countries around the world have been affected by these repercussions, which have had a profound impact on the Iraqi economy. What concerns us is the outcome of these repercussions and the expectations, impacts, and implications for the current economic reality in Iraq in the coming years and until 2030.
In light of the study and analysis, the following can be expected at the level of the global economic system and its repercussions on Iraq:
Firstly, it is expected that the growth rates of the global economy will decline significantly in the American economy and the economies of the European Union countries, China and Russia, but at varying rates. The economic recession will prevail in most countries of the world and this will be reflected in a slowdown in the growth of the gross domestic product by rates ranging between (4-10%) in the Arab oil-producing and non-oil-producing countries, especially after the countries of the geographical region entered new challenges due to the Zionist aggression on Gaza, the West Bank, Lebanon, Syria and Yemen. This has created a new complex situation that will have negative effects on the national economy.
Secondly, the new global economic order that we expect to emerge in the coming years will inevitably take shape and will be under the clear economic and financial leadership of America and China. The Silk Road will be activated to include the countries through which it was planned to pass to revive their economies and will actually be completed. It is also expected that the development path will be completed and that there will be an important role for Iraq and the countries participating in the project and that this will have positive repercussions on the economy.
Thirdly, the philosophy of economic management will most likely shift from the capitalist market economy to the social market economy currently adopted as a disciplinary ideology, as in China and some other countries around the world. These are just early predictions, and the Arab economy will most likely be subservient to the new, larger and more economically powerful pole.
So what is required of economic decision-makers in Iraq in the face of these developments and changes expected to sweep the world? I see, with a penetrating analytical eye to the current economic reality, that we urgently need radical and comprehensive economic change and reform based on the following key axes:
First: Re-changing the map of national income resources by reducing dependence on oil as the main resource and activating other resources in the coming years to bring them to 30% of the total resources of the general budget.
Second: Radically and comprehensively changing agricultural, industrial, commercial, oil, energy and water policies by relying on local resources to ensure food and water security, encouraging, protecting and supporting local production, and developing programmes and strategies to protect consumers.
Third: Supporting, developing and stimulating the private sector and utilizing its capabilities, potential, capital and investments in building the national economy and involving it in economic decision-making and economic management.
Fourth: Developing clear strategies for coordination between monetary and fiscal policies, formulating clear financial policies, and restoring the foundations for preparing and presenting annual general budgets based on programs rather than items. Reducing the budget deficit to the legally specified percentage of the gross domestic product, as well as reducing domestic borrowing to the lowest possible level and avoiding borrowing from abroad at all.
Fifth: Completing the new methodology adopted by the Central Bank for banking reform and development and digital transformation in all digital fields, with a focus on implementing the Central Bank’s strategy, establishing the financial center, and using artificial intelligence in analyzing, ensuring transparency and accuracy of data for sound economic planning purposes and overcoming the challenges of instability in the financial and monetary systems. This means developing coordinated and balanced plans to overcome the challenges of monetary policy, the challenges of the deficit in non-oil revenue, the deficit in the balance of payments and the trade balance, and the percentage of contribution of the productive sectors (the real economy) to the gross domestic product.
Al-Sudani chairs a meeting to follow up on reform measures for the Rafidain and Rashid banks.
Prime Minister Mohammed Shia al-Sudani chaired a meeting on Sunday to follow up on reform measures at the Rafidain and Rashid banks.
Al-Sudani's office stated in a brief statement received by the Mail that "Prime Minister Mohammed Shia al-Sudani chaired a meeting to follow up on reform measures for the Rafidain and Rashid banks, in the presence of representatives from Ernst & Young."
His office: Al-Sudani directed to expedite the reform process of Rafidain and Rashid banks.
Prime Minister Mohammed Shia al-Sudani's media office stated that the latter "directed the preparation of plans to expedite the reform process of the Rafidain and Rashid banks in accordance with international standards."
This came during a meeting devoted to following up on the reform measures of Rafidain and Rashid banks, attended by representatives of Ernst & Young. The meeting "witnessed a review of the work stages of the banking reform adopted by the government to restructure and develop Rafidain and Rashid banks, and discussed reconsidering their internal regulations in line with international standards and the objectives of banking reforms. It also discussed the issue of the two banks' debts and their repayment mechanisms, and the measures taken to train their working cadres. In this regard, Al-Sudani directed the continuation of the reform process for the two banks, and for their managements to develop strategies that contribute to accelerating the reform process."
The statement said, "The meeting followed up on the procedures for establishing a new bank, Rafidain First Bank, which was approved during the Cabinet session held on January 13th. The bank has a different vision, embracing modern technologies and international standards that will help implement the government's financial and banking reform objectives, which will have a positive impact on the country's economic trajectory and development."
The statement indicated that "Ernst & Young submitted a report in which it reviewed the financial and technical offers for the project to establish the First Rafidain Bank."
For some time now, US attention has been focused on the state-owned Rafidain Bank, with calls for sanctions against it, describing it as a "window for smuggling dollars to Iran." However, politicians and academics view the matter with pessimism, particularly since any impact on the bank would create financial tensions within Iraq, given its status as one of the most important government banks.
Earlier, Kurdistan Democratic Party (KDP) MP Sipan Sherwani spoke about what he described as "serious oversight" of Iraqi financial institutions, noting that Rafidain Bank "has not been audited for nine years."
Outcomes of the Sudanese meeting on reforming the Rafidain and Rashid banks
The meeting reviewed the progress of the banking reform process adopted by the government to restructure and develop Rafidain and Rashid banks, and discussed revising their internal regulations to be in line with international standards and the objectives of banking reforms. It also discussed the debts of the two banks and their repayment mechanisms, as well as the measures taken to train their staff. In this regard, the Prime Minister directed the continuation of the reform process for the two banks, and for their administrations to develop strategies that contribute to accelerating the reform process.
The meeting also followed up on the procedures for establishing a new bank, Rafidain First Bank, which was approved during the Cabinet session held on January 13. The bank's vision is to adopt modern technologies and international standards that will help implement the government's financial and banking reform objectives, which will have a positive impact on the country's economic trajectory and development.
Ernst & Young submitted a report reviewing the financial and technical offers for the project to establish the First Rafidain Bank.
Iranian official: Cash held at home is equivalent to $30 billion
The deputy chairman of the Iranian parliament's energy committee pointed to the challenges facing the energy sector, stressing that contrary to popular belief, Iran does not suffer from a real energy shortage. Rather, the main problem lies in its high consumption.
Speaking to Mehr News Agency, Ramadan Ali Sankadovini explained that Iran produces approximately 900 million cubic meters of gas annually, 80,000 megawatts of electricity, and 120 million liters of petroleum products such as gasoline and diesel.
He emphasized that, “If consumption is rationalized and waste is reduced, this level of production will be sufficient. However, the energy intensity of our country’s consumption is approximately 2.5 times the global average, which means that a portion of energy production is wasted instead of being used for economic development and production.”
The deputy chairman of the Iranian parliament's energy committee added: "To overcome energy challenges, rationalizing energy consumption must be a priority, as we are witnessing illogical consumption in the residential, commercial, industrial, and transportation sectors."
He continued: "Diversifying energy sources is one of the key solutions to rationalizing consumption. We should not rely solely on gas and electricity. The use of renewable energy, such as solar, wind, and geothermal energy, and even waste recycling to produce energy, is expanding around the world. We have great potential in these areas."
"Investment is the key factor in achieving goals in the energy sector," Senkaduini noted, explaining that "investment occurs when capital security is guaranteed, ensuring investors are assured of a reasonable return on their investment." He added, "We must provide an appropriate environment to direct local and foreign investments toward production and the energy sector."
Regarding investment in the energy sector, the Deputy Chairman of the Energy Committee suggested stimulating local investment, saying: "Citizens should be reassured that if they invest their money in production, they will achieve reasonable profits and also contribute to the growth of the national economy."
He stressed the need to provide tax, insurance, and legal incentives to attract local capital, noting the importance of attracting savings in foreign currencies. According to estimates, citizens hold between $25 and $30 billion in foreign currencies. He explained that, "If the government can attract this money and provide it to investors in the form of foreign currency deposits with guaranteed returns, the financial resources needed to develop energy infrastructure and boost production will be secured."
Expert: This is a safe haven from economic volatility and Trump's policies.
Economist Mahmoud Dagher said that turmoil in global markets and concerns about US President Donald Trump's economic policies, including a shift toward economic protectionism, are pushing many to rely on the dollar as a safe haven to protect their wealth.
Dagher added in a statement monitored by Al-Eqtisad News, "These unstable global conditions, including currency exchange rate issues and oil market fluctuations, make the dollar the preferred choice, as it acts as a balancing asset that preserves the value of wealth."
He continued, "The value of the dollar rises and falls with the index and inflation, which provides a kind of financial balance and protects assets from erosion," noting that "this trend is normal under the current circumstances."
Al-Sudani forms a 40-member council to promote the private sector.
The Ministry of Planning announced on Sunday the issuance of a royal decree to form a private sector development council, headed by the Prime Minister. The council's members will be 40.
The ministry said in a statement received by Shafaq News Agency, "A royal order was issued to form the Permanent Private Sector Development Council, headed by Prime Minister Mohammed Shia al-Sudani, and two deputies. The first is Deputy Prime Minister and Minister of Planning Mohammed Ali Tamim, while the second deputy will be a representative of the private sector, elected by the council members."
She added that “the council consists, in addition to the first and second deputies, of (38) members, (10) of whom represent the government agencies related to the private sector development file, while the (28) members represent the various activities under the banner of the private sector, which include industrial and agricultural activities, banking sectors, contracting and public investments, entertainment investments, hotels and restaurants, general trade and commercial agencies, communications and health, private education, residential activity, real estate development and energy.”
She pointed out that "the council includes a group of experts and representatives of youth and entrepreneurship," explaining that "the Permanent Council for Private Sector Development is of great importance, as it is the effective representative of all economic activities in this sector, and will play a fundamental role in formulating economic and investment policy, contributing to achieving a true partnership with the public sector."
PM Barzani Urges Closer KRG-Iraq Ties in Meeting with World Bank
The discussion between PM Barzani and World Bank Regional Director Jean-Christophe Carret underscored the need for closer cooperation with Baghdad on economic reforms, institutional development, and improved public services.
In a diplomatic engagement aimed at strengthening economic cooperation and accelerating public sector reforms, Kurdistan Region’s Prime Minister Masrour Barzani received a delegation from the World Bank on Sunday.
The delegation was led by Jean-Christophe Carret, the World Bank’s Regional Director for the Middle East.
According to a statement from the KRG, the meeting underscored the importance of deepening collaboration between the Kurdistan Region, the federal government of Iraq, and the World Bank, particularly in areas tied to economic modernization, institutional reform, and improvements in public service delivery.
The visit by the World Bank delegation signals renewed international interest in supporting the KRG’s efforts to modernize its economy and governance structures, particularly at a time when regional and global economic pressures demand more effective and transparent institutions. As the KRG continues to navigate complex political and fiscal challenges, its partnership with global financial institutions like the World Bank is seen as crucial to ensuring long-term stability and prosperity.
The World Bank, founded in 1944 and headquartered in Washington, D.C., is one of the world’s leading international financial institutions. It provides loans, grants, and technical expertise to developing countries to reduce poverty and support sustainable economic development. Over the years, it has played an active role in post-conflict reconstruction and institutional reform in Iraq.
Back in 2016, the World Bank entered into discussions with both the Iraqi federal government and the KRG about providing a major loan to support development and service projects across the country.
As part of the KRG’s broader economic strategy, Prime Minister Masrour Barzani has led efforts to expand banking services across the Kurdistan Region. In his address at HITEX24 on September 3, 2024—covered by Kurdistan24—he announced that banking capacity has increased fivefold since the ninth cabinet took office, reflecting a push to modernize the financial system and reduce reliance on cash-based transactions.
Furthermore, the KRG has made notable strides in digital governance. According to the KRG’s official Strategy for Digital Transformation, spearheaded by the Department of Information Technology (DIT), the government aims to become a regional GovTech powerhouse by 2025. The strategy is underpinned by six Core Strategic Activities (CSAs): strengthening digital governance, building digital architecture, investing in human capital, prioritizing user-centered design, improving security and data privacy, and reforming procurement systems.
The strategy emphasizes a citizen- and business-centric approach to public service, supported by agile and transparent IT infrastructure. It also introduces robust digital principles, including interoperability, data-driven decision-making, and accessibility across government platforms. According to the document, over 50 government services have been digitized, with the long-term vision that all residents will be able to access public services 'anywhere, anytime, on any device.'
The Prime Minister’s Decree No. 104 (2020) formally authorized the DIT to lead and regulate the digital transformation of all KRG entities. As stated in the strategy, the transformation is not only technological but also institutional, involving legal reforms, public awareness campaigns, and engagement with private sector and international stakeholders. This holistic vision is seen as essential for reducing bureaucracy, improving transparency, and unlocking economic opportunities across the Kurdistan Region.
At the World Government Summit 2025 in Dubai, PM Barzani reiterated the Kurdistan Region’s strategic vision, emphasizing institutional reform, youth empowerment, and long-term sustainability. He stated that the KRG seeks to be a regional model for effective governance and forward-looking economic planning.
These developments provide crucial context for the World Bank’s deepening engagement with the Kurdistan Region and underscore the international community’s recognition of the KRG’s ongoing efforts to implement structural reforms and strengthen its institutional foundations.
this is the man that comes on tv screaming
The Houthis announced targeting Ben Gurion Airport and the US aircraft carrier Harry S. Truman.
According to a statement issued by the Yemeni Armed Forces, "The missile force targeted Ben Gurion Airport with a Palestine 2 hypersonic ballistic missile, halting air traffic at the airport for more than half an hour."
He added, "In the second operation, Yemeni forces targeted the US aircraft carrier Truman and a number of its accompanying warships in the Red Sea using missiles and drones, noting that the clashes lasted for several hours."
The statement stressed that "the Yemeni armed forces will continue to confront what it described as 'American aggression' by escalating and repelling attacks, in addition to continuing its operations to prevent Israeli navigation in the declared area of operations until the war on Gaza stops and the siege is lifted.
From March 19th
Trump gives Iran two months to negotiate its nuclear program and threatens to target it.
Axios reported on Wednesday, citing informed sources, that "Trump's letter to Iranian Supreme Leader Ali Khamenei included a two-month deadline to reach a new nuclear agreement."
According to the website, "It is not yet clear whether the countdown to the deadline begins from the time the letter is delivered or from the moment negotiations begin, but Iran's rejection of Trump's initiative and refusal to enter into negotiations may increase the likelihood of "American or Israeli military action against Iranian nuclear facilities ."
Two weeks ago, Trump said in an interview with Fox News that he had sent a letter to Iran's Supreme Leader proposing "direct negotiations ."
The next day, he said the United States was "in its final moments with Iran," adding, "They cannot be allowed to possess a nuclear weapon. Something will happen soon." He emphasized, "I would prefer a peace agreement, but the other option will solve the problem."
Informed sources said that Trump's message to Khamenei was "harsh in tone," offering to negotiate a new nuclear agreement but "warning of dire consequences if Iran rejects the offer and continues with its nuclear program."
Sources explained that Trump stressed that he "does not want open-ended negotiations," and set a deadline of "two months to reach an agreement."
POST PRODUCTION
click here here is the link to that video
https://go.screenpal.com/watch/cTe0r6ni0ie
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