ERBIL, Kurdistan Region - Iraq’s finance ministry on Thursday said it has begun sending the salaries of the Kurdistan Region’s civil servants for the month of March, a day after the Region’s prime minister announced that Erbil and Baghdad have reached an agreement on the issue of sending salaries.
“Based on the directives of the prime minister and the approval of the Minister of Finance Taif Sami … the Ministry of Finance launched salary distributions for the Kurdistan Region’s civil servants … as part of the financial allocations for the month of March 2024,” said a statement from the Iraqi finance ministry.
The ministry said that salary distributions for March will be carried out like previous months “because the mechanism for completing the localization of their [Kurdistan employees] salaries require an additional period of time.
EU Ambassador to Iraq Thomas Seiler commended the move following the federal finance ministry’s statement.
Iraq’s Federal Supreme Court in February ordered the Kurdistan Regional Government (KRG) to submit a breakdown of the monthly budget for the Region’s employees’ salaries to the finance ministry so Baghdad could start paying the Region’s share from the federal budget.The EU Delegation welcomes the agreement made on the allocation of salaries of employees in KRI. We do believe that such agreements contribute to the stability of KRI and Iraq in general. The EU will keep on calling on all actors to find mutually acceptable solutions.
— 🇪🇺 🇮🇶 Thomas Seiler (@EUAmbIraq) April 4, 2024
The ruling mandates the Kurdish government to open accounts for its employees at Iraqi state-owned banks - a process dubbed “localization” by Baghdad.
The KRG has failed to pay the salaries of its civil servants on time and in full for a decade due to a financial crisis which deteriorated when a ruling by a Paris-based arbitration court suspended its export of oil to the international markets a year ago. The Kurdish government now relies on local income and its controversial share from the federal budget. The KRG paid nine salaries of public employees last year and has paid only one salary this year.
On Wednesday, Kurdistan Region Prime Minister Masrour Barzani said an “appropriate” solution was found to the issue of paying salaries of civil servants with the assistance of Iraqi Prime Minister Mohammed Shia’ al-Sudani.
In late March, the KRG decided to pay the February salaries of its civil servants weeks after it refused to receive its share from the federal budget on the grounds that it was not sufficient.
The cash-strapped KRG has repeatedly accused Baghdad of not making regular payments of its share of federal funds. Last June, Iraq passed a three-year budget of which the Kurdistan Region's share is 12.6 percent. Baghdad has claimed it has fully implemented its financial obligations to the KRG, including through loans to assist the Region in paying the salaries of its civil servants.
Over five months last year, Erbil handed over 11.8 million barrels of oil to Baghdad, the KRG Finance Minister Awat Shekh Janab said in March.
