Iraq’s finance ministry denies salary payment delays amid oil price concerns

BAGHDAD — Iraq’s Finance Ministry firmly denied reports of imminent delays in salary payments, insisting to the public on Thursday that all payments will proceed as scheduled.

In a statement, the ministry rejected claims circulating on social media, attributed to Finance Minister Taif Sami, calling them “completely unfounded.” The ministry clarified, “The Minister of Finance has made no statements regarding any delay in salary disbursements.”

The ministry reaffirmed its commitment to ensuring that salaries for government employees, retirees, social welfare recipients, and security forces, including the Popular Mobilization Forces, will be paid “in accordance with existing laws and regulations.”

The statement comes amid heightened public concern following delays in salary payments, particularly within the Ministry of Electricity, which led to protests and work stoppages in recent months. The ministry noted that salaries for employees in the electricity sector are currently being processed, with some payments already under review. “A portion of the salary lists for centrally funded electricity departments have been audited,” the ministry said, explaining that the funds are allocated once the Ministry of Electricity submits the necessary documentation.

Recent concerns over salary delays have been fueled by financial experts’ warnings that falling oil prices—if they dip below $65 per barrel—could impact Iraq’s ability to meet its salary obligations. Iraq relies on oil for around 90% of its state budget, and salary expenses have surged from 40 trillion to 60 trillion Iraqi dinars in just two years.

Jamal Kochar, a member of Iraq’s Parliamentary Finance Committee, dismissed these fears, stating, “The media reports about not securing employee salaries have no basis in truth.” He added, “The Ministry of Finance is not facing any challenges in securing salaries, even if oil prices were to drop. Salaries are pre-funded, and the government holds a significant cash reserve for emergencies.”

Brent crude oil prices have dropped to $70.44 per barrel, the lowest since November 2021, briefly hitting $68.90 on Sept. 10.

Despite this, Mazhar Mohammed Saleh, senior economic adviser to Prime Minister Mohammed Shia Al-Sudani, told Reuters that Iraq could face budget challenges in 2025 due to declining oil prices. “We don’t foresee significant issues in 2024, but stricter financial discipline will be necessary for 2025,” Saleh said.