Shafaq News/ The Kurdistan Regionneeds 998 billion Iraqi dinars ($748.5 million) to cover the salaries forAugust, amid an ongoing financial crisis caused by delays in the transfer offinancial allocations from the federal government in Baghdad, an informedsource reported on Monday.
The source told Shafaq News Agency,"Baghdad sent 572 billion dinars ($429 million) to the Region yesterday,while 183 billion dinars remain owed from previous months' salaries."
"There is still a shortfall of243 billion dinars ($182.25 million) to fully secure the salaries."
According to the source, the salarycrisis for public sector employees in the Region is one of the most sensitiveissues in the financial relationship between Erbil and Baghdad. Despiteprevious financial agreements aimed at organizing the transfer of the federalbudget to the Region, repeated delays by the central government have led toincreasing financial gaps, significantly affecting the Regional government'sability to distribute salaries on time.
This crisis affects hundreds ofthousands of public sector employees in the Region, who primarily rely on thesesalaries to meet their basic needs.
Salary Delays Impact Lives
In statements to Shafaq Newscorrespondent, several public sector employees in Al-Sulaymaniyah expressedtheir frustration over how the delay in salary payments has affected theirliving conditions.
Delshad Omar, a teacher at a publicschool in Al-Sulaymaniyah, said, "The delay in salaries has directlyimpacted our ability to meet our daily needs. I can no longer cover livingexpenses or pay rent on time, and the economic situation worsens with eachpassing month without receiving our salaries on time."
A health sector employee, whopreferred to remain anonymous, highlighted the significant challenges she faces,"We are forced to borrow from relatives or banks to cover basic needs. Theongoing delay in salary payments has left many of us in a state of instability,as we do not know when we will be able to pay bills or purchasenecessities."
Regarding the impact of salarydelays on market activity, Ibrahim Ahmed, a grocery store owner in thegovernorate, stated, "Since the beginning of the salary crisis, marketactivity has noticeably declined. Many customers used to buy on installments orrequest deferred payments until they received their salaries, but this ongoingdelay has made it difficult for many to repay their debts or make largepurchases."
"Commercial activity has becomeweak, especially during financial crises. People are now buying only theessentials, and even those sales have dropped significantly,” he added. “Astraders, we are suffering just like employees; we also rely on market strength,and if people do not have money, it is natural for everyone to beaffected."
Long-Standing Salary Crisis Persists
The salary crisis began years agowith escalating financial and political tensions between Erbil and Baghdad, asthe Regional government relied on financial transfers from Baghdad in additionto local revenues, particularly from oil. However, these transfers have notbeen regular, leading to the accumulation of financial dues and delays insalary payments, especially with declining oil prices and rising governmentexpenses.
The inconsistency in salary paymentshas intensified pressure on the Kurdistan government, forcing it to implementausterity measures in the past, including salary cuts and deferrals.
With no clear solutions soon, thesalary crisis remains one of the major challenges facing the Regionalgovernment, particularly amid difficult economic conditions and decliningavailable financial resources.