## Iraq: Selected Issues

_IMF Staff Country Reports, July 26, 2019_

## Source details

**Canonical URL:** [Iraq: Selected Issues](https://www.imf.org/en/publications/cr/issues/2019/07/25/iraq-selected-issues-48528)

## Other formats

- [Markdown version](/en/publications/cr/issues/2019/07/25/iraq-selected-issues-48528/index.md)
- [Structured JSON version](/en/publications/cr/issues/2019/07/25/iraq-selected-issues-48528/index.json)
- [Bundle manifest](/en/publications/cr/issues/2019/07/25/iraq-selected-issues-48528/bundle-manifest.json)

## Bibliographic details
- Published: July 26, 2019
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781513508917.002

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### Key findings and diagnostics
- A ceiling on current spending is proposed as a fiscal rule that would be simple and easy to monitor.
- Iraq’s heavy dependence on volatile oil revenues creates significant fiscal management challenges.
- The procyclicality of fiscal policy has led to short-term economic volatility and hindered long term development.
- Important fiscal institutions that exist in many resource-rich countries—fiscal rules, stabilization funds, and fiscal responsibility laws—are lacking in Iraq.
- Moving to a risk- and rules-based approach is assessed as timely for Iraq.

### Policy framework proposed
- Anchor fiscal policy on maintaining adequate fiscal buffers.
- Introduce operational fiscal rules designed to:
  - Achieve the target for fiscal buffers.
  - Protect capital expenditure and create space to scale up capital spending.
- A ceiling on current spending is highlighted as a rule that would support efforts to:
  - Scale up capital expenditure.
  - Build fiscal buffers to reduce fiscal policy procyclicality.
  - Help secure debt sustainability.

### Rationale and expected benefits
- Simplicity and ease of monitoring make a current-spending ceiling operationally attractive for Iraq.
- Building fiscal buffers can reduce procyclicality and short-term volatility associated with oil revenue fluctuations.
- Protecting capital expenditure helps advance long-term development objectives while maintaining fiscal sustainability.

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## Content in this bundle

- **Iraq:  Selected Issues; IMF Country Report No. 19/249; July 3, 2019**
  - [Iraq:  Selected Issues; IMF Country Report No. 19/249; July 3, 2019 (Markdown version)](/-/media/files/publications/cr/2019/1irqea2019002.pdf.md){rel="alternate" type="text/markdown"}
  - [Iraq:  Selected Issues; IMF Country Report No. 19/249; July 3, 2019 (PDF)](/-/media/files/publications/cr/2019/1irqea2019002.pdf){rel="external" type="application/pdf"}

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_Source: https://www.imf.org/en/publications/cr/issues/2019/07/25/iraq-selected-issues-48528_