Economic expert Dr. Safwan Qusay said Iraq may adopt an alternative financial approach for 2026 if regional tensions and instability linked to the ongoing U.S.-Iran conflict continue.
Speaking to dinaropinions.com, Qusay explained that the 2026 federal budget could be replaced by a law focused on internal and external borrowing, grants and donations. At the same time, authorities are working on preparing the 2027 budget to establish a clearer framework for government spending and revenue sources.
According to Qusay, several scenarios remain under consideration, with hopes that tensions surrounding the Strait of Hormuz and broader regional disputes will ease before October 15. He noted that Iraq remains heavily dependent on oil exports from its southern ports, which generate approximately 90% of state revenues.
He warned that if the crisis continues and trade routes remain at risk, Iraq may be forced to rely on spending mechanisms governed by existing permanent laws rather than a traditional annual budget. In such a scenario, greater emphasis would be placed on increasing the revenues of government institutions and units, enabling them to finance part of their operations independently instead of relying entirely on allocations from the Ministry of Finance.
Qusay stressed that the outcome will largely depend on regional developments and the security of oil export routes, which remain critical to Iraq’s economic stability and public finances.
