Borrowing law heads for first reading as ministry starts on 2027 budget

BAGHDAD — Parliament will give a first reading next week to a law on grants and borrowing, a member of the Finance Committee said Friday, as the Finance Ministry begins preparing a 2027 budget after a year in which Iraq has had none.

“The Finance Committee has taken responsibility for legislating the grants and borrowing law, and it was agreed with the government to approve it,” Ikhlas al-Dulaimi told the Iraqi News Agency. The agreement was reached during the committee’s visit to Prime Minister Ali al-Zaidi, along with an understanding on sending the 2027 budget, she said.

The ministry has drafted its budget strategy with the committee, several ministries and representatives of the Kurdistan Region, and will send it to the committee, Dulaimi said. Under the Financial Management Law the budget must reach parliament by Oct. 15, two months from now. “The country’s situation requires a budget so there can be financial stability in which the exchange rate, the price per barrel, export mechanisms and how to proceed are determined,” she said.

Iraq’s last budget law covered 2023, 2024 and 2025 and expired at the end of last year. No budget was passed for 2026, leaving spending governed by the one-twelfth rule, under which the government may spend a twelfth of the previous budget each month. Finance Minister Falih Sari told his budget department this week to speed up work on a program and performance-based budget.

The government confirmed in late July that Iraq is in a financial crisis and that salaries would no longer follow their previous schedule. July pay went out in stages from July 28, with security personnel and Popular Mobilization Forces members covered before civilian ministries, and university staff protested in Basra and Kirkuk over late pay. Iraq exported 32.1 million barrels of crude and condensates in May and June for about $2.34 billion, roughly $1.17 billion a month, against pre-war exports of about 3.3 million barrels a day. Oil provides more than 90% of federal revenue.