Who Do We Hold Accountable?
Who Do We Hold Accountable?
The loss and squandering of non-oil revenues in numbers: Billions And Abundant Resources Are Being Swallowed Up By Corruption Networks.
Baghdad Today – Baghdad The issue of non-oil revenues in Iraq is one of the most important issues, revealing the depth of the structural dependence on oil.
The state treasury remains almost entirely tied to oil revenues, while other resources are supposed to be the primary tributary to ensuring financial stability.
Constitutional deliberations indicate that excessive reliance on a single resource weakens the principle of economic justice and disrupts the mechanisms for equitable wealth distribution.
According to Ministry of Finance data, the percentage of non-oil revenues rose from 7 percent in 2023 to 9 percent in 2024, and then to 10 percent by July 2025.
These are official figures, which economist Nabil al-Marsoumi asserts on his Facebook page, monitored by Baghdad Today, are the most accurate and reliable. However, they remain modest when compared to the potential in sectors such as tourism, ports, and border crossings.
Monitoring data indicates that this gap does not reflect a shortage of resources, but rather a crisis in collection mechanisms.
In the religious tourism sector, one of the most prominent potential sources of income, millions of visitors enter Iraq annually, with the Arbaeen pilgrimage exceeding four million foreign visitors. According to preliminary research data, average spending ranges between one and two billion dollars annually, while reports indicate direct and indirect revenues exceeding nine billion dollars in 2023.
However, the treasury's share of these funds is extremely limited due to the vast informal economy and weak tax collection. Constitutional law experts argue that the absence of strict tax legislation on tourism services deprives the state of legitimate entitlements and leaves it hostage to the informal market.
This limits direct revenues to a few tens of millions of dollars, while possible collection through smart mechanisms could reach hundreds of millions.
Field studies indicate that this shortcoming is not related to weak demand, but rather to the absence of institutional tools capable of fair collection.
Border crossings and customs represent a stark example of the discrepancy between reality and potential.
According to various legal estimates, border crossings should constitute the state's second-largest source of revenue after oil, but corruption and fraud consume a significant portion of the revenue.
Official customs revenues in 2025 amounted to approximately 2.7 trillion dinars, with expectations of reaching 3 trillion by the end of the year, equivalent to approximately $2.3 billion.
However, international oversight reports indicate that customs losses could reach as much as 30 percent of revenues. If this loss were eliminated through comprehensive automation and the integration of collection with electronic payment, the proceeds could easily rise to $2.9 billion annually.
Comparative analyses indicate that Iraq is the only regional exception, losing a third of its customs revenues despite its extensive network of border crossings.
Iraqi ports, in turn, present a similar picture. According to critical readings of constitutional jurisprudence, port revenues fall within sovereign resources that are supposed to be centrally managed in accordance with the principle of transparency.
In the first quarter of 2025, ports generated revenues exceeding 314 billion dinars, equivalent to approximately $240 million over three months, meaning annual revenues approach $1 billion.
However, this figure remains below actual potential, as improving handling management, increasing operational efficiency, and linking electronic invoicing with customs could increase revenues to $1.15 billion annually.
Institutional estimates indicate that Iraq is losing a portion of its resources due to the lack of a unified port collection system, which further widens the gap between reality and potential.
When compared to the Gulf states, the magnitude of the difference becomes clear. Research studies indicate that Saudi Arabia, through Vision 2030, has succeeded in increasing the contribution of non-oil revenues to more than 40 percent of the budget by developing tourism, imposing a value-added tax, and developing non-oil industries.
The UAE has transformed its economy into a global hub for aviation, tourism, real estate, and financial services, until the oil contribution declined to less than 30 percent of GDP.
Qatar, on the other hand, has harnessed liquefied natural gas revenues while simultaneously building service and investment sectors that have boosted sustainable revenues.
According to contemporary intellectual approaches, these experiences would not have been possible without stable institutions and accumulated experience in managing public resources.
Iraq, by contrast, has remained stagnant despite possessing similar, and perhaps even broader, assets, such as massive religious tourism, extensive border crossings, and strategic seaports. In-depth legal analyses confirm that structural obstacles have prevented the exploitation of these resources, most notably administrative and financial corruption, which causes significant revenue leakage; the absence of a long-term strategic vision, which renders short-term policies hostage to political consensus; weak infrastructure, a widespread informal economy; and political and security instability, which undermines investor confidence and prevents stable economic policies.
Comparative experience demonstrates that these obstacles are not inevitable, as other countries in the region have overcome them through gradual and cumulative reforms.
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In conclusion, Iraq does not lack resources, but rather the institutional will to transform them into actual revenues for the state treasury. While the official share of non-oil revenues has risen to 10 percent, it remains modest compared to the 40 percent achieved by Saudi Arabia or the 30 percent achieved by the UAE.
If Iraq succeeds in overcoming the obstacles of corruption and red tape and adopts a genuine strategic plan, it could double its non-oil resources to nearly $5 billion annually in the short term, and raise their share to more than 20 percent of total revenues within a few years.
According to intersecting political-economic estimates, this path is contingent on radical reforms that redefine the relationship between the state and the economy and free public finances from the grip of oil rents.
Source: Baghdad Today Monitoring and Follow-up Department https://baghdadtoday.news/284288-.html
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