Iraq is facing mounting financial pressure following the disruption of oil sales linked to the closure of the Strait of Hormuz, prompting the government to pursue new revenue measures, including proposed legislation and the sale of state-owned properties, according to a member of parliament.

Oil Sales Disruption Reduces State Revenue

Dilan Ghafoor, spokeswoman for the Patriotic Union of Kurdistan (PUK) in the Iraqi Parliament, said Iraq is in a difficult financial situation as state revenues have declined significantly.

She said the country's main source of income has been affected by the disruption of oil sales and the closure of the Strait of Hormuz. As a result, the government is working to diversify its sources of revenue, a move that parliament supports.

Six Draft Laws Aim to Boost Revenue

Ghafoor said the Ministry of Finance has prepared six draft laws and submitted them to the Finance Committee of the Council of Representatives.

According to her, the proposals are designed to increase state revenue through investment reforms, regulating the use of agricultural land, selling properties owned by the Ministry of Finance, and transferring public-sector employees to the private sector to reduce pressure on the state payroll.

The lawmaker said Iraq is carrying substantial domestic and foreign debt and is seeking ways to repay its financial obligations.

She added that one of the government's main options is to sell part of its state-owned real estate and other assets to generate the funds needed to reduce those debts.

Performance-Based Budget

Ghafoor also said the government plans to change the structure of the 2025 budget from a line-item budget to a performance-based budget.

She said the new system will first be tested at the Ministry of Electricity and in the provinces of Saladin and Diwaniyah as part of efforts to improve expenditure management.