Millions of Iraqis Without Salaries: Hormuz Crisis Hits Families Too

The Iraqi government has admitted difficulty paying July salaries, which are over a week late. Millions of civil servants, pensioners, and welfare recipients are affected by a severe liquidity crisis caused by a sharp drop in oil revenues following the closure of the Strait of Hormuz. Families struggle to meet obligations, traders report a decline in demand, and officials consider foreign loans.

The Iraqi government has admitted difficulty paying July salaries, which are over a week late for state employees. Millions of Iraqis depend on government salaries, and the delay creates a new social reality: families are unable to meet their financial obligations and living needs, and struggle to plan their monthly expenses. Fear grows that the financial crisis will last for an unknown period. The state pays about 8 trillion Iraqi dinars (about $5 billion) monthly to public sector employees, pensioners, and welfare recipients. The sharp drop in oil revenues following the closure of the Strait of Hormuz has led to a severe and unprecedented liquidity crisis, against a backdrop of service crises, foremost among them the electricity crisis. Witnesses testify to difficulties: Bassem Ali, an employee at the Ministry of Environment, said the problem is not the delay of a few days but the inability to know when the salary will be paid. Maha Karim, an employee at the Ministry of Higher Education, said she has been buying only basic groceries for a week. Taha al-Marsoumi, a shop owner, reported a significant drop in demand. Wafaa al-Mahdawi, a social researcher, said many families live in anxiety. The government faces growing financial pressures due to expanding current expenditures and declining oil revenues. Officials and experts warned that it will be difficult to ensure regular payment and raised the possibility of taking foreign loans as a forced solution.