Academic and Political Calls to Shift from Financial Centralization to Contractual Federalism for Sustainable Development

Recent economic reports have highlighted the ongoing dilemma of financial management in Iraq, pointing out that strict centralized policies adopted for decades have hindered sustainable development and equitable wealth distribution. The reports indicated that financial centralization has contributed to resource wastage and weak institutional infrastructure at the expense of the provinces. Experts criticized the continued reliance on central legislation that contradicts the constitutionally mandated federal system, advocating for the adoption of successful regional models of "fiscal federalism." They emphasized the necessity of transforming the relationship between the federal government and regional entities into a fair contractual partnership, based on voluntary contributions to sovereign expenses rather than conditional funding, to ensure a robust and stable state structure.