2023-09-17 18:43:40
BAGHDAD: The federal government in Baghdad agreed on Sunday to increase funding to autonomous Iraqi Kurdistan – vital for paying civil servants’ salaries -, a heated issue often a source of tension between the two parties.
At the beginning of September, several thousand people demonstrated in a town in Kurdistan, in northern Iraq, to protest once morest two months of unpaid salaries, with the regional government blaming the authorities in Baghdad for not having transferred the funds.
On Sunday, Baghdad agreed to pay annually to autonomous Kurdistan three installments of 700 billion dinars (more than 530 million dollars), according to a press release from the services of Prime Minister Mohamed Chia al-Soudani.
These sums will be paid to Kurdistan via loans issued by three public banks, and reimbursed by the Ministry of Finance in Baghdad, according to the same source.
The mechanism aims to provide “liquidity to the regional government of Kurdistan of Iraq and enable it to pay civil servants’ salaries, social subsidies and retirees’ pensions”, underlines the press release.
The competent services in Baghdad and Kurdistan have one month to “verify the number of civil servants, beneficiaries of social subsidies and retirees”, adds the text.
Oil
Iraqi Kurdistan has long accused Baghdad of not sending the funds necessary to pay civil servants.
Previously, the region had, thanks to its oil exports, independent financing to partially pay salaries. But since the end of March it has been deprived of this resource due to a dispute with Turkey and Baghdad.
In principle, Iraqi Kurdistan and Baghdad have agreed that sales of Kurdish oil will now go through the federal authorities. In exchange for which 12.6% of the federal budget is allocated to Iraqi Kurdistan.
At the beginning of September, Baghdad had initially released an envelope of 500 billion dinars (around 380 million dollars). But according to autonomous Kurdistan it would take more than 900 billion dinars each month to pay salaries, according to Erbil.
The head of the regional government in Erbil Masrour Barzani welcomed the “fruitful agreement” finally reached with Baghdad “to guarantee salaries”.
“I thank our fellow citizens for their patience, their determination and their unwavering confidence in their government,” he added in a press release.
He also called Prime Minister Mohamed Chia al-Soudani to thank him for his “support”.
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