Iraqi ministerial committee on Erbil-Baghdad budget issues holds first meeting
President Barzani, Iraq security advisor discuss PKK disarmament, Iran border pact
US urges resolution as Erbil, Baghdad draft proposals to end salary, oil disputes
Iraqi cabinet stalls on KRG salaries, forms committee to address Erbil-Baghdad issues
Erbil-Baghdad oil, salary deal excluded from Iraqi cabinet agenda
A+ A-
ERBIL, Kurdistan Region - Iraq's newly formed ministerial committee tasked with resolving outstanding disputes between Erbil and Baghdad held its first meeting on Wednesday, focusing on key financial and energy issues, including oil exports, domestic consumption, and public sector salaries in the Kurdistan Region.
The meeting, chaired by Deputy Prime Minister and Minister of Planning Mohammed Ali Tamim, brought together federal and Kurdistan Regional Government (KRG) representatives to address stalled budget transfers and oil obligations, according to a planning ministry statement.
'A review of the two papers submitted by the federal government and the [Kurdistan] Region, where both papers addressed a number of vital topics, foremost among them the oil export file and its regulatory mechanisms, the volume of local consumption of oil products, as well as the region's delivery of the federal treasury's share of non-oil revenues, in addition to discussing the localization of Kurdistan Region employees' salaries' were discussed, the statement said.
On Monday, a senior KRG delegation arrived in Baghdad to resume talks with federal officials over the prolonged financial dispute, which has led to repeated salary delays in the Kurdistan Region. The committee was established on Tuesday following the visit, per a directive by Iraqi Prime Minister Mohammed Shia' al-Sudani.
The planning ministry said the committee stressed 'the importance of continuing technical and administrative discussions regarding these files with the aim of reaching quick, fair, and realistic solutions and treatments that guarantee the rights of Kurdistan Region employees, similar to their colleagues in the rest of the Iraqi provinces, within the framework of the state's unified financial policy.'
Tensions between Erbil and Baghdad flared in late May when Iraq's federal finance ministry halted all budget transfers to the KRG, including payments for public employee salaries. The ministry claimed the KRG had exceeded its 12.67 percent share of the 2025 federal budget and failed to deliver its designated share of oil to SOMO.
The situation has been exacerbated by the ongoing suspension of oil exports through the Iraq-Turkey pipeline, which has remained offline since March 2023 following an international arbitration ruling.
The committee is tasked with aligning both sides' demands and drafts to pave the way for a formal agreement.
Hastyar Qadir contributed to this report.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Rudaw Net
an hour ago
- Rudaw Net
US congressman seeks to block Iraq funding over ‘terrorist militias' attacks
A+ A- ERBIL, Kurdistan Region - US Congressman Joe Wilson on Tuesday announced a renewed effort to block American funding to Iraq, accusing Baghdad of financially supporting 'terrorist militias' aligned with Iran - groups he claims are behind recent drone attacks targeting the Kurdistan Region. In a statement on X, Wilson said, 'I will work toward PROHIBITION on funding to Iraq while it funds these terrorist militias' which 'launch more drones today against our appreciated friends in the [Kurdistan Regional Government] KRG, as well as U.S. troops, and work with the head of the snake Iran to destabilize Syria, Iraq, Lebanon and Yemen. 'This cannot be tolerated anymore,' he charged, pledging to push for the 'rightful designation' of these groups 'as TERRORIST organizations.' The Kurdistan Region has endured nearly 20 drone and rocket attacks in recent weeks, including on its energy infrastructure. The latest occurred on Monday, when an explosive-laden drone crashed in Erbil's western Khabat district. No casualties were reported, according to Kurdish counterterrorism forces. The drone strikes have repeatedly targeted oil fields in the Kurdistan Region, prompting production suspensions and causing significant damage to Erbil's oil sector - already weakened by the ongoing closure of the Iraq-Turkey pipeline since March 2023. The KRG's interior ministry previously blamed the Popular Mobilization Forces (PMF) - an umbrella group of Iran-aligned Iraqi armed groups - for the attacks. However, the Iraqi government in Baghdad has dismissed the claims as 'unacceptable.' Meanwhile, International actors, including the United States, United Kingdom, and the United Nations, have strongly condemned the drone strikes on the Kurdistan Region. In an interview published Monday by the Associated Press, Iraqi Prime Minister Mohammed Shia' al-Sudani condemned the drone attacks on the Kurdistan Region as 'terrorist' acts. He said his government is working closely with the KRG and the US-led Global Coalition against the Islamic State (ISIS) to identify and hold those responsible accountable. Also on Monday, Iraqi National Security Advisor Qasim al-Araji visited Erbil and met with senior Kurdish officials. He told Rudaw that a recently-formed joint committee between Erbil and Baghdad is investigating the attacks but has not yet completed its work. "The joint technical committees are continuing their work to gather all evidence and facts regarding the attacks,' Araji said, adding that 'once their work is complete, all members of the joint committee will present their recommendations' to Sudani.
Shafaq News
2 hours ago
- Shafaq News
Drone strikes halt 70% of Kurdistan oil
Shafaq News – Erbil Drone strikes between July 14 and 16 knocked out 70 percent of oil production in the Kurdistan Region of Iraq (KRI), delivering a major blow to an already strained economy. Human Rights Watch reported that five oil fields were targeted by unidentified drones, halting around 220,000 barrels per day and disrupting energy supplies without causing casualties. Kurdistan Region Prime Minister Masrour Barzani's deputy chief of staff accused 'criminal militias on the Iraqi government payroll' of carrying out the attacks, though no group has claimed responsibility. The strikes follow escalating tensions over oil revenue control, as Baghdad has withheld budget transfers since May, leaving the KRI unable to pay public sector wages, including those of teachers and healthcare workers.
Shafaq News
4 hours ago
- Shafaq News
Sales slump across Iraq: Deeper slowdown imminent
Shafaq News – Baghdad Sales across Iraqi markets have fallen by more than half, the Baghdad Chamber of Commerce reported, attributing the decline to weakening construction, investment, and consumer spending. Chamber spokesperson Rashid al-Saadi revealed to Shafaq News that real estate activity has nearly ground to a halt, pulling down sectors such as transportation, building materials, and daily labor—essential pillars of local commerce. Currency exchange offices have also seen a drop in transactions, a trend linked to the dinar's appreciation against the US dollar. He credited the currency's strength to joint measures by the Central Bank of Iraq and international partners, including the US Federal Reserve. Yet the shrinking gap between official and parallel exchange rates has curbed travel and reduced market liquidity, further slowing activity. Economist Ahmed Abedrabbo described the current phase as one of clear economic contraction, driven by eroding purchasing power, limited public expenditure, and lingering inflationary pressures. Although inflation was measured at just 2.2% in the first quarter of 2025, demand remains weak—particularly in non-essential sectors. 'Without swift policy action, this stagnation risks sliding into a deeper recession,' Abedrabbo told Shafaq News, urging structural reforms, targeted incentives, and better fiscal coordination to revive growth. Researcher Ahmed Eid pointed to long-standing systemic flaws—including delayed budgets, inefficient planning, and persistent political interference—as key factors fueling the crisis. 'Corruption and weak institutions have bled public funds and stalled investment,' he said. Eid also warned that Iraq's heavy dependence on consumption, in the absence of strong domestic production, leaves the economy highly vulnerable to external shocks. Offering a monetary perspective, economist Safwan Qusay acknowledged ongoing pressures but emphasized that Iraq still holds over $97B in reserves, enabling the Central Bank to stabilize the exchange rate and support trade. "State-backed housing projects have sustained demand for construction materials and created job opportunities, while Central Bank initiatives continue to assist small businesses and local industry," he added. Despite global inflationary trends, Qusay argued that Iraq's ration card system, food subsidies, and a stable dinar have helped shield domestic prices from broader economic turbulence. "Still, long-term resilience hinges on boosting non-oil revenues, cutting gas flaring, and accelerating investment in power and industry to secure economic self-reliance."
