Iraq could be facing a serious economic shock, economist Manar Al-Obaidy warned on Saturday. She says decades of neglect and the government’s reliance on quick fixes have left the country vulnerable.
In a Facebook post, Al-Obaidy criticized officials for promoting the idea that Iraq can solve its financial crisis without major reforms. She highlighted that essential services are failing, water and food security are worsening, and financial reserves are shrinking.
She warned that policymakers are likely to try temporary fixes again, like printing more money, borrowing more, or boosting consumption-driven spending, instead of making deep, structural changes.
According to Al-Obaidy, the next government faces a tough choice: either implement hard reforms—cutting operating costs, restructuring subsidies, and rebalancing public spending—or delay action and risk a much worse collapse in the future.
“Reforms will upset people, but delaying them will make the eventual collapse far harsher,” she said, urging leaders to focus on long-term stability over short-term popularity.
Iraq’s economy relies heavily on oil for over 90% of state revenue, leaving it exposed to price swings. A bloated public payroll, costly subsidies, and limited private-sector growth have drained resources without creating sustainable economic development.
