Iraq Economic News and Points To Ponder Saturday Morning 9-5-26
The Central Bank reassures depositors: No bank failures... and liquidity exceeds 60%
Baghdad Today - Baghdad The Central Bank of Iraq reassured depositors on Saturday (September 5, 2026) about the safety of the banking sector, stressing that “imposing supervisory or guardianship committees on a licensed bank does not mean its bankruptcy, but rather comes within the framework of precautionary and legal supervisory measures aimed at protecting the rights of depositors and ensuring the stability of banking operations.”
The bank stated in a statement received by "Baghdad Today" that "all licensed banks participate in the Deposit Guarantee Company, which is responsible for compensating depositors in the event that the bank fails to meet its obligations, in accordance with applicable laws."
He added that "depositors' funds are protected under laws, regulations and instructions," stressing the need to follow up on bank procedures, particularly those related to ensuring depositors' access to their funds without delay.
He pointed out that "the Iraqi banking system has sufficient liquidity to enable it to manage its operations efficiently in the face of potential pressures," indicating that "the ratio of liquid assets to short-term liabilities exceeds 60%."
It also emphasized the application of the best international banking standards to the banking sector, ensuring its safety and compliance and providing competitive traditional and digital financial services, without compromising the rights of depositors.
https://baghdadtoday.news/305588-60.html
The Government Faces Two Tests: Autonomy And The Economy. Will It Succeed In Overcoming The Political And Administrative Turmoil?
Today 15:34 Information / Special.. Political analyst Majashaa Al-Tamimi confirmed on Saturday that the ambiguous scene in Iraq reflects a structural and chronic governance crisis, which is mainly due to the sectarian and partisan quota system that prioritizes narrow interests over the national interest.
Al-Tamimi told Al-Maalouma that "the absence of sovereign decision-making in Iraq has led to weak administrations that lack strategic vision and rely heavily on a rentier economy based on oil."
Al-Tamimi added that “talking about restricting weapons cannot take place in light of Iraq’s lack of full autonomy and the absence of a serious political will capable of putting an end to foreign interference in all its forms,” stressing that “establishing the authority of the state requires first and foremost an independent sovereign decision and a clear political will.”
He pointed out that "combating corruption and economic reform require moving from patchwork solutions to comprehensive institutional reforms, through automating administration, diversifying sources of income, and strengthening the independence of the judiciary and activating its role in combating corruption."
He continued, "Iraq's future remains suspended between the continuation of the political and administrative chaos and the emergence of a genuine reformist will be capable of transcending the conflicts of power-sharing and spoils and placing the national interest at the forefront of priorities." (End of page 25)
Employee Salaries: Between The Embers Of Economic Skepticism And The Cool Reassurances
Today 13:42 Information/Report... The issue of employee and retiree salaries has returned to the forefront of the Iraqi economic scene, amidst a clear discrepancy between official and parliamentary assurances regarding the availability of the necessary liquidity to secure monthly payments, and warnings against the state's continued reliance on short-term solutions without a comprehensive economic vision to address chronic financial imbalances.
The salary issue holds exceptional importance in Iraq, given its direct impact on millions of employees, retirees, and their families, as well as its repercussions on market activity, consumption, and economic activity in general. This makes any discussion of potential difficulties in funding salaries a matter of widespread concern among the Iraqi public.
Despite the recurring concerns about the state's ability to continue paying salaries, the Parliamentary Finance Committee asserts that the current financial situation does not warrant alarm, and that the relevant government agencies are committed to providing the necessary funds for timely disbursement.
In this context, Jamal Kojar, a member of the Parliamentary Finance Committee, emphasized that the Prime Minister's office and the Ministry of Finance bear direct responsibility for managing the salary file, indicating that official bodies have confirmed their commitment to securing the necessary funds and that there are no obstacles preventing their disbursement.
Kujer told Al-Maalomah News Agency that "the relevant official bodies, foremost among them the Prime Minister's office and the Ministry of Finance, have affirmed their commitment to securing the funds for salaries without any obstacles."
He added that "the country's financial resources have begun to recover significantly, particularly oil revenues, which have recorded better levels compared to previous months," indicating, according to the available data, the government's financial capacity to continue meeting its monthly obligations.
Despite these assurances, concerns about the future of financial stability persist, especially given the Iraqi economy's continued heavy reliance on oil revenues, making it more vulnerable to fluctuations in crude oil prices and global market movements.
Critics of economic policies argue that the continued focus on securing salaries and operational spending does not constitute a genuine solution to the financial problem, but rather postpones crises to later stages, unless this is accompanied by reforms capable of diversifying income sources and increasing the contribution of productive sectors to the national economy.
In this context, MP Abdul Hamza al-Khafaji asserted that the government lacks clear economic solutions to address the financial crises, indicating that its primary focus is on securing employee salaries.
Al-Khafaji told the Al-Maalomah news agency, “The government has no economic solutions beyond securing employee salaries,” explaining that “the Iraqi economy needs a comprehensive vision that goes beyond addressing monthly obligations.”
He pointed out that "relying on oil as the main source of revenue makes the economy vulnerable to fluctuations and crises," calling for the development of concrete plans to diversify income sources and strengthen productive sectors.
Salaries: Between Social Entitlement and Financial Management
Ensuring salaries is a fundamental obligation for the state, but its continued prominence on the list of financial priorities raises questions about the economy's ability to transition from managing monthly obligations to building a more sustainable financial base.
An economy dependent on a single primary resource remains vulnerable to external influences not entirely under government control, most notably fluctuations in oil prices, export volumes, and revenues. This makes financial stability highly dependent on the performance of the oil sector.
Therefore, ensuring regular salary payments does not necessarily guarantee overcoming the economic crisis, but rather reflects the state's ability to meet its basic obligations in the short term. A genuine solution lies in broader reforms encompassing revenues, expenditures, public administration, and productive sectors.
Given these circumstances, calls are growing from both parliamentary and economic circles to reduce dependence on oil by revitalizing the industrial, agricultural, and investment sectors, supporting the private sector, and increasing non-oil revenues.
Al-Khafaji emphasized that addressing the financial crisis requires “economic and administrative reforms, reducing waste and corruption, and improving the management of public resources.” He stressed that "securing salaries should be part of a comprehensive economic plan, not the sole solution to the financial problems."
He also emphasized the need to adopt economic policies capable of creating job opportunities, stimulating the private sector, and increasing non-oil revenues, calling on the government to provide sustainable solutions that guarantee the country's financial and economic stability.
Immediate stability or a sustainable solution?
While assurances regarding the availability of liquidity seem capable of calming concerns about salaries in the short term, the broader debate extends beyond the issue of disbursing monthly payments to the future of public finances and their ability to withstand any potential revenue shocks.
This debate presents the government with a dual dilemma: maintaining the regularity of salaries as a social and economic priority, while simultaneously transitioning to long-term policies that reduce the fragility of public finances and provide the Iraqi economy with more diversified and stable sources of income.
Thus, the salary file remains secure according to current parliamentary and official assurances. However, ensuring its long-term sustainability depends on the state's ability to address the root causes of economic imbalances and transition from managing the financial crisis month by month to building an economy capable of with outstanding oil price fluctuations and achieving sustainable financial stability. End/25