Iraq’s 2027 budget draft heads to cabinet

BAGHDAD — The Ministerial Council for Economy approved the draft 2027 federal budget on Sunday and sent it to the cabinet, hours after the Finance Ministry finished it, according to an official document. No spending total, revenue estimate, deficit or oil price assumption has been made public.

The council recommended “referring the draft federal budget law to the Council of Ministers, taking into consideration the observations of council members,” according to the document, dated Sept. 27. It was prepared by the Higher Committee for Budget Preparation under Finance Minister Falih al-Sari, with representatives of federal ministries, the Kurdistan Region and the governorates and financial experts from Iraq and abroad. Sari said the ministry had “fulfilled its obligations to complete the draft budget within the specified timelines.”

The draft “took into account economic and financial changes, spending priorities and the needs of important segments of society, within the limits of available financial resources,” the ministry said, with a focus on non-oil revenue and fiscal discipline. Sari has said it will move toward programme and performance-based budgeting, and that it includes moving contract employees and daily wage workers onto the permanent payroll, though the ministry has not said how many people or at what cost. The bill is due in parliament by Oct. 15.

Iraq has had no budget this year, with parliament skipping 2026 to concentrate on 2027 and spending governed by the one-twelfth rule since the three-year law covering 2023 to 2025 expired. The government acknowledged a fiscal crisis in late July, when salaries went out in stages. Oil provides more than 90% of federal revenue. Exports collapsed from more than 99 million barrels in February to 18.6 million in March and fewer than 10 million in April after shipping through the Strait of Hormuz was disrupted, and have recovered to about 2.6 million barrels a day this month, around three quarters of the 3.3 to 3.5 million exported before.