At a Glance

• Iraq projects a 200-trillion-dinar budget for 2027.
• The draft goes to parliament in October.
• The KRG demands its full 14.1% budget share.

The estimated size of Iraq's 2027 budget is projected at 200 trillion dinars, as Parliament Speaker Haibat al-Halbousi and Iraqi Finance Minister Faleh al-Sari are trying to find a mechanism to stabilize salaries and state expenditures before the draft reaches parliament.

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Key Statement and Focus Area

• Speaker Haibat al-Halbousi and Minister Faleh al-Sari met regarding the 2027 budget.
• The Ministry of Finance is expected to complete the draft in September and send it to parliament in October.

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During a meeting on Wednesday, the Parliament Speaker and the Iraqi Finance Minister discussed “a number of topics relating to the ministry's work and the mechanisms for preparing the draft federal general budget for 2027.”

The Iraqi government's 2027 draft budget allocates 150 trillion dinars for salaries and 50 trillion for investment, yet faces a major deficit of nearly 100 trillion dinars.

This fiscal challenge represents a shortfall of nearly half of the total 200-trillion-dinar budget.

Meanwhile, the Kurdistan Region emphasizes receiving its rightful share, which is 14.1% of the total budget and amounts to approximately 25 trillion dinars; the Kurdish side rejects receiving only salaries.

FYI

Iraq's 2027 draft budget faces deep financial pressures due to dropping oil revenues and shipping disruptions in the Strait of Hormuz, forcing the government to shift to an entirely new structural approach. 

In coordination with the World Bank, Iraq is pivoting away from historical line-item spending to a "program-and-performance" model to curb public waste. 

The 2027 draft is calculated based on an expected oil price of $60–$70 per barrel. Due to restricted shipping through Hormuz, financial adviser Mudhar Saleh projected an initial deficit of roughly 64 trillion dinars ($49 billion). 

Prime Minister al-Zaidi confirmed that the government is actively preparing the 2027 budget and will transmit it to the Council of Representatives as a strategic economic roadmap as soon as the final parameters are set 

The KRG has officially transmitted a 29 trillion dinar proposal to Baghdad. Kurdish lawmakers are pushing to increase and lock in a 14.1% share of the national budget to securely cover public salaries and permanent contract allocations. 

Lawmaker Srwa Muhammad told Channel8 that a final agreement must be reached now on oil, domestic revenue, the oil and gas law, employment, and the Kurdistan Region's budget share.

Meanwhile, former Undersecretary of the Iraqi Ministry of Finance Fazil Nabi highlighted that Kurdish representatives must cement the Region's rights within the Iraqi Council of Ministers in the draft budget before it reaches parliament. 

Speaking to Channel8,Ekhlas al-Dulaimi, a Kurdish member of the Iraqi Parliamentary Finance Committee, told Channel8 that political division harms the people of Kurdistan, not the parties, urging “all political forces in Kurdistan to focus their efforts on the budget issue.”

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