Iraq expects its non-oil economy to grow by 4% in 2025 because of a stronger farming sector and more government spending
Iraq’s economy, not including oil, grew by 5% in 2024 and is expected to keep growing in 2025 by about 4%, according to the state-run Iraqi News Agency, which quoted Finance Minister Taif Sami.
Iraq’s Non-Oil Economy
Iraq’s economy is growing steadily, thanks to strong farming activities and continued government spending. This shows that the parts of the economy not related to oil are becoming more important for the country’s overall progress.
Budget Deficit
In 2024, Iraq had a budget deficit of $3.82 billion (5 trillion dinars), which is about 1.5% of its total economy, not counting payments for debts and certain investment and energy projects, according to Finance Minister Sami.
She said the International Monetary Fund (IMF) believes this deficit is still low and doesn’t pose a risk to Iraq’s debt levels.
Talks with the IMF
To discuss Iraq’s latest economic situation, a government team, including the Central Bank Governor Ali Al-Alaq, met with the IMF in Amman, Jordan.
Sami said the Finance Ministry will work with the IMF and hire consulting firms to help the Public Debt Department. They will also bring in skilled people to improve how the government handles debt and analyzes financial data.
She stressed the need to reform government-owned banks so they can better support the government and help the economy grow.
The IMF said it is ready to help Iraq with advice and training, especially in managing public debt, improving the tax system, and making sure tax policies suit Iraq’s economy and society. This help will come through the Middle East Technical Assistance Center (METAC).
Oil Economy
Sami noted that Iraq’s oil income will continue to depend on OPEC+ decisions about oil production and changes in global oil prices.
Credit Rating
In November, Fitch Ratings kept Iraq’s credit rating at B- with a stable outlook. This reflects the country’s strengths and weaknesses, such as its heavy reliance on oil and ongoing political and structural problems.
Published: 6th May 2025
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