Iraqi government approves federal budget for 2023

ERBIL, Kurdistan Region - The Iraqi council of ministers on Monday approved the federal budget bill for the years 2023, 2024, and 2025, after nearly a year without a new budget highly jeopardized the economic state of the country.

Iraq did not pass a budget in 2022 due to its inability to form a government for a year following the October 2021 elections. The Iraqi parliament adopted the emergency law for food security in June to compensate for the lack of a yearly budget bill in 2022.

“I am absolutely sure that the next steps will contribute to greatly decreasing poverty in Iraq,” Iraqi Prime Minister Mohammed Shia’ al-Sudani said during a press conference, praising the passing of the budget law.

Sudani added that an "all-encompassing" agreement has been reached between Baghdad and Erbil over 

The Kurdistan Region’s share of the new budget bill is 12.6 percent, according to the Iraqi premier.

“A series of meetings and discussions were held between a technical and supervisory delegation from the Kurdistan Regional Government and a delegation formed by the [federal] government, which resulted in this agreement,” Sudani told Rudaw’s Anmar Ghazi.

Atwan al-Atwani, head of the Iraqi parliament’s finance committee, told Iraqi state media that the new budget bill sets the minimum nominal wage at 425,000 dinars ($275), adding that lower grade salaries will increase by 150 percent according to the new scale.

Iraq’s Finance Minister Taif Sami said on Sunday that the bill will prioritize developmental projects and the country’s less fortunate groups.

Hours before the decision from the Iraqi government was issued, the Kurdistan Regional Government’s (KRG) finance and economy ministry announced that 400 billion dinars ($250 million) from the federal government has been added to the ministry’s bank account.

Rebaz Hamlan, current advisor to the Kurdistan Region Prime Minister and former finance minister in the KRG, told Rudaw’s Nazanin Goran that the 400 billion dinars that has been received by the finance ministry account for the months of November and December of last year.

The Iraqi cabinet approved the payment of 400 billion dinars to the Region for the months of November and December last year. However, Iraq’s Federal Supreme Court later ruled against Baghdad's payment of the Kurdistan Region’s financial entitlements, claiming it violates the 2021 Iraqi Budget Law.

The budget has been a point of contention between Erbil and Baghdad for several years, especially after the Kurdistan Region's decision to sell its oil through Turkey, and the emergence of the Islamic State (ISIS) in Iraq in 2014.