Baghdad: An economist has emphasized the necessity of implementing reforms by the Ministry of Finance and the Iraqi Parliament to tackle the budget deficit by reissuing the dinar in a new form. Economic expert Safwan Qusay highlighted these concerns during a discussion with the Iraqi National News Agency (NINA).

According to National Iraqi News Agency, Qusay pointed out that despite the decline in oil revenues due to ongoing issues in the Strait of Hormuz, the Ministry of Oil remains committed to maintaining oil exports. This is being achieved by continuing oil transportation through the Banias oil field in Syria and the Turkish port of Ceyhan, with a consistent output of 750,000 barrels per day.

Qusay further elaborated on the need to enhance the revenue collection capabilities of federal ministries and to manage self-financing funds and local revenues efficiently. This approach would benefit the Ministry of Finance by reducing its dependence on the Central Bank’s reserves, which are currently only able to cover legally mandated expenses such as salaries, social welfare, pensions, and food supplies until November 30th.

The economist warned of potential inflation and currency devaluation if these reforms are not enacted. He suggested that the government might need to resort to printing money or devaluing the dinar. Additionally, he proposed that the Ministry of Finance, along with Parliament, could pass legislation for internal and external borrowing to create a legal framework for financial borrowing. The possibility of issuing a digital dinar was also mentioned as a means to address the deficit through new currency issuance.