Baghdad allocates 615b dinars to address salary crisis in Iraqi Kurdistan

The federal government in Baghdad has disbursed 615 billion dinars (approximately $2 billion) to meet the salary obligations of employees within the Kurdistan Regional Government (KRG).

This decision, endorsed during the Iraqi cabinet’s session on Sunday, comes after extensive deliberations between the President of the Kurdistan region, Nechervan Barzani, and officials in Baghdad, focusing on budgetary matters and employee salaries in Iraqi Kurdistan.

President Barzani’s recent visit to the capital, Baghdad, was marked by discussions centering on key financial issues. The allocated funds constitute a partial release from the region’s budget, signifying a commitment to address the longstanding salary concerns affecting KRG employees. During his stay, Barzani urged political forces and parties to actively contribute to resolving the salary predicament and securing the region’s equitable share of the federal financial budget.

Despite the 2023 approval of Iraq’s general budget law, specifying that the Kurdistan region must remit its revenues to the state, challenges persist in implementing the agreement. This discrepancy has manifested in delays and uncertainties surrounding the disbursement of salaries to KRG employees, adding strain to the existing complexities between Erbil and Baghdad.

The impasse also extends to disagreements on the cost of oil production, where companies operating in Iraqi Kurdistan report a significantly higher figure than those in the rest of the Iraqi governorates.

While the federal general budget law for 2023-2025 sets the cost per barrel at $6.9, data from the Ministry of Natural Resources in the KRG reveals a cost of $32.91 per barrel. The persistence of these financial challenges emphasizes the urgency for comprehensive resolutions to foster financial stability and address the living conditions of Iraqi Kurdistan’s populace.