Iraqi economic expert Safwan Qusay says the government is exploring several options to manage expenses and ease financial pressure as lower oil exports continue to affect public revenues.
According to Qusay, the Ministry of Finance is studying proposals aimed at reducing the need for domestic borrowing. One of the main ideas involves using in-kind payments to meet obligations owed to contractors, farmers, and private-sector companies that have financial dealings with the government.
He explained that the government is also looking at ways to recover unpaid taxes and domestic debts owed by companies to the Ministry of Finance. Collecting these funds could provide additional revenue and help reduce reliance on borrowing to cover key expenses, including public-sector salaries.
Qusay stressed that settling outstanding tax obligations and government receivables has become increasingly important as authorities search for alternative funding sources during the current financial challenges.
Another option under consideration involves making use of existing credit portfolios that were previously issued through the Central Bank of Iraq and other financial institutions.
He noted that around 57 trillion Iraqi dinars have been allocated through credit programs supporting the housing sector as well as small and medium-sized businesses. Instead of creating new spending commitments, the government could restructure or transfer parts of these financing arrangements to contractors and farmers who are awaiting payments.
According to Qusay, this approach could help the Ministry of Finance meet some of its obligations while limiting the need for additional borrowing and reducing pressure on public finances.
The proposals come as Iraq faces growing budget challenges linked to fluctuations in oil revenues, which remain the country’s primary source of income. With spending needs continuing to rise, officials are increasingly examining alternative financial tools to manage liquidity and maintain government operations without significantly expanding debt levels.
If implemented, these measures could provide short-term financial relief while helping the government address outstanding obligations to businesses, contractors, and agricultural producers across the country.
