"Measuring the Impact of Financial Sustainability Indicators and Their Reflection on Poverty as One of the Sustainable Development Indicators in Iraq"

Abstract

This research aims to examine the relationship between financial sustainability indicators in Iraq and their impact on poverty rates as one of the sustainable development indicators. Despite Iraq's possession of substantial financial resources, poverty rates remain high, necessitating an investigation into the influence of fiscal policies on achieving sustainable development goals.Using a quantitative analytical methodology based on annual data, the study incorporates financial sustainability indicators, including the public debt-to-GDP ratio, the tax gap, the budget deficit/surplus-to-GDP ratio, the oil revenue-to-total revenue ratio, and the public revenue-to-public expenditure ratio. The ARDL model was applied to test the relationship between these variables and the poverty rate. The results revealed a statistically significant relationship between financial sustainability indicators and poverty, with each indicator having a varying degree of influence. The findings showed that the budget deficit and public debt ratio have a negative impact on poverty, while sustainable public revenues contribute positively to social well-being. The research also highlighted the Iraqi economy’s sensitivity to fluctuations in oil revenues, underscoring the need for fiscal reforms that promote economic diversification and reduce reliance on oil income.The study concluded that achieving financial sustainability significantly contributes to reducing poverty rates, whereas fiscal deficits and rising public debt diminish social spending and exacerbate poverty.The research recommends the development of balanced fiscal policies that enhance financial sustainability by diversifying public revenues and improving spending efficiency, with a focus on supporting development programs aimed at poverty reduction and sustainable development in Iraq.