PM Barzani thanks Iraq after deal struck to loan 2.1 trillion IQD to Kurdistan Region

ERBIL, Kurdistan Region - After the Iraqi Council of Ministers directed the loan of 700 billion Iraqi dinars for three months (total 2.1 trillion) monthly to cover salaries of the Kurdistan Region’s civil servants, the Region’s Prime Minister Masrour Barzani on Sunday thanked top Iraqi and Kurdish officials for the agreement. 

Iraq’s Council of Ministers on Sunday agreed to loan a total of 2.1 trillion Iraqi dinars to the Kurdistan Region to cover the salaries of civil servants for a period of three months. The decision was highly welcomed by PM Barzani. 

“We were able to reach an appropriate agreement with the Iraqi federal Prime Minister, Mr. Mohammed Shia’ al-Sudani, to provide the salaries of citizens,” Barzani said in a statement. 

He also thanked Kurdistan Region President Nechirvan Barzani for “supporting and making the negotiation process with the federal government a success,” while also expressing gratitude to Masoud Barzani, leader of the Kurdistan Democratic Party (KDP), and the Kurdistan Region’s “resilient” citizens for their patience.

Iraq's Justice Minister Khalid Shwani told Rudaw's Halkawt Aziz that the loan will cover the salaries of September, October, and November. The Kurdistan Region's civil servants are yet to receive their salaries for July and August.

The Iraqi government decision came after a high-level delegation from the Kurdistan Regional Government (KRG) led by PM Barzani went to Baghdad on Thursday to meet senior Iraqi officials and campaign for the Kurdistan Region’s financial entitlements.

In the statement, Barzani also thanked Iraqi and Kurdish political parties “for their support,” after he met with parties involved in the State Administration Coalition during his Baghdad visit.

The State Administration Coalition is an alliance of Shiite, Sunni, and Kurdish political parties in Iraq that successfully broke the political deadlock that suffocated the country and left it without a government for over a year. The coalition backed then-prime minister-designate Sudani and voted to elect his cabinet in October of last year.

The Iraqi parliament in June passed its highly-contentious budget bill for the years 2023, 2024, and 2025, of which the Kurdistan Region’s share is 12.6 percent. However, budget issues between both governments have not been resolved as Erbil blames Baghdad for not sending the required funds to pay the Region’s civil servants.

Economic woes in the Kurdistan Region have worsened in recent months after Turkey suspended the flow of Kurdish crude oil through the Iraq-Turkey pipeline to its Ceyhan port in March following a ruling from a Paris arbitration court, causing the KRG billions of dollars in losses.

Several meetings have been held between Iraqi and Turkish delegations since March, aimed at resuming the flow of crude oil from the Kurdistan Region. The meetings, however, have not yielded any results.

The Kurdish government has failed to pay its civil servants on time and in full for nearly a decade due to the financial crisis. The public employees are yet to receive their July salaries.

“We will continue to … not allow futile attempts to disrupt the stability of the Kurdistan Region,” PM Barzani stressed. 

Updated at 5:59PM with Shwani's confirmation