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Disagreement over KRG share prevents Iraq from voting on budget

Disagreement over KRG share prevents Iraq from voting on budget
Disagreement over KRG share prevents Iraq from voting on budget

2019-01-22 00:00:00 - Source: Rudaw

ERBIL, Kurdistan Region —Due to lack of an agreement over the share of the Kurdistan Region’s share of Iraq’s budget for 2019, the parliament in Baghdad won’t vote on the matter on Tuesday.

“Due to lack of an agreement over the share for the Kurdistan Region in the Iraqi federal budget bill in 2019, the parliament today won’t vote on the budget bill,” said Jamal Kochar, a Kurdish member of the parliament’s finance committee.

Kochar revealed that the contentious issue is over tying the salaries of Kurdistan Region’s employees and the Peshmerga budget with the Kurdistan Regional Government (KRG) exporting oil under the auspices of Baghdad.

“The Kurds want the salary of the employees and Peshmerga’s budget not bound to exporting oil by the Kurdistan Region,” he added, saying the KRG might not be able to commit because it has to pay oil companies currently working in its fields.

According to the bill, the Kurdistan Region has to export 250,000 bopd through Iraq’s State Oil Marketing Company (SOMO). In return, the Kurdistan Region will get 9.427 trillion dinars (about $7.9 billion).

The Iraqi government suggests for only the salaries of Kurdistan Region public employees — less the Peshmerga — be sent regardless of KRG oil exports.

Muthana Ameen, a Kurdistan Islamic Union (KIU) MP, revealed that the Shiite parties have offered another option.

They have suggested that if the Kurdistan Region doesn’t hand over 250,000 barrels of oil monthly, then Kurdistan’s share should be cut by an amount corresponding to the 250,000 barrels.

Ameen argues the suggestion doesn’t work mainly because oil prices fluctuate.

“In our proposal, we have designated the share. The share has been insulated from problems between Baghdad and Erbil,” Ameen added.

Article 10 of the budget bill has differentiated between the salaries of the employees, the Peshmerga, and sovereign expenditures. Based on the article, even if the Kurdistan Region doesn’t hand over oil, Baghdad will still send money for those three funds.

Ahmed Haji Rasheed, another Kurdish MP in the finance committee, has revealed that upon the request of the Kurdish MPs, they added another section that specifies four cities of the Kurdistan Region receive some money outside of Kurdistan’s share in the budget.

Halabja and Qaladze each will receive each 2 billion dinars (about $1.68 million), while Duhok and Soran will receive each 1 billion dinars (about $838,000). The funds would be reserved for service and construction projects.

Kurdistan Region’s share of the Iraqi budget was cut in 2014 due to disagreements over independent oil sales by the KRG. Last year, the Kurdistan Region was allocated a 12.67-percent share.

Then Iraqi Prime Minister Haider al-Abadi said he would never allow the Kurdistan Region to receive 17 percent, claiming it exceeds the population.

Iraq has not held a census full census since 1987. Many areas are constitutionally disputed, claimed by Erbil and Baghdad. Iraq has announced plans to hold a census in 2020; however, the KRG is unlikely to agree as Baghdad currently administrates nearly all the disputed or Kurdistani areas. 

Reporting by Falah Najm, Aso Fishagi and Nahro Mohammed

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