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ERBIL, Kurdistan Region — A member of Iraqi parliament’s finance committee is criticizing several Shiite parties for pushing against an article in the 2021 budget bill detailing the terms under which the Kurdistan Region will receive its share of the federal budget, without officially presenting a substitute article.
“There is opposition from different Shiite parties in regards to the Kurdistan Region’s share of the federal budget, however no one has officially suggested an alternative to that section in the budget bill,” Jamal Kochar, a member of the Iraqi parliament’s finance committee told Rudaw’s Mohammed Sheikh Fatih on Monday. “So far it is all talks.”
Budget disputes have been a source of long-standing tension between Erbil and Baghdad. A Kurdistan Regional Government (KRG) delegation, led by Deputy Prime Minister of the Kurdistan Region Qubad Talabani, has visited Baghdad multiple times to come to a deal on the 2021 federal budget, upon which the KRG is dependent on for its funds.
Iraqi lawmakers have criticized the Kurdistan Region’s independent oil sales, with many wanting the federal government to have exclusive control.
Last month, more than 100 Iraqi MPs signed a letter asking that the 2021 budget bill oblige the Kurdistan Region to hand over all its oil to the State Organization for Marketing of Oil (SOMO) in exchange for federal funds.
“At first, all Shiite parties were opposing the Kurdistan Region receiving its share and asked the KRG to hand over all its oil, however, now only Nouri al-Maliki’s factions and a few other Shiite parties are insisting on this,” Kochar told Rudaw English on Monday. “While there could be a majority without these factions, passing the bill would cause instability without their collaboration.”
Kochar outlined three possible outcomes of the talks between Erbil and Baghdad: one would be Kurdistan Regional Government (KRG) sending 250,000 barrels of oil to Baghdad, the second would be the KRG handing over the revenue of 250,000 barrels to Baghdad at the price set by the State Organization for Marketing of Oil (SOMO), and lastly the KRG keep the oil needed for expenses related to the production of oil, as well as domestic consumption, and send whatever is left to Baghdad.
“It is in the KRG’s benefit to send 250,000 barrels of oil rather than the revenue, given that the KRG will have to add more money in the case they send revenue,” Kochar said, pointing out that either of the first two options would serve Iraq equally, since they would either way be selling the oil at the SOMO price.
The KRG has operated an independent oil and gas sector since 2006 and later began exporting its oil to the international market via a pipeline through Turkey in 2013.
Years of tensions over the independent oil sales came to a head in 2014 when then-Prime Minister Maliki suspended the sending of the Kurdistan Region’s share of the federal budget – leaving hundreds of thousands of public sector employees with unpaid salaries.
“A lot of money has gone to companies, a lot of money went to Turkey, and oil was sold cheap, so Kurds have not benefited economically from the selling oil as much as they intended,” Mahmood Othman, a former member of Iraqi parliament, told Rudaw’s Sangar Abdulrahman late January.
Kochar said another complication in the oil for budget dispute is an arbitration case filed against Turkey by Iraq at the International Chamber of Commerce back in 2014. Baghdad asked for $26 billion in compensation from Turkey for facilitating the Kurdistan Region's sale of oil without Iraq’s authorization.
“There is opposition from different Shiite parties in regards to the Kurdistan Region’s share of the federal budget, however no one has officially suggested an alternative to that section in the budget bill,” Jamal Kochar, a member of the Iraqi parliament’s finance committee told Rudaw’s Mohammed Sheikh Fatih on Monday. “So far it is all talks.”
Budget disputes have been a source of long-standing tension between Erbil and Baghdad. A Kurdistan Regional Government (KRG) delegation, led by Deputy Prime Minister of the Kurdistan Region Qubad Talabani, has visited Baghdad multiple times to come to a deal on the 2021 federal budget, upon which the KRG is dependent on for its funds.
Iraqi lawmakers have criticized the Kurdistan Region’s independent oil sales, with many wanting the federal government to have exclusive control.
Last month, more than 100 Iraqi MPs signed a letter asking that the 2021 budget bill oblige the Kurdistan Region to hand over all its oil to the State Organization for Marketing of Oil (SOMO) in exchange for federal funds.
“At first, all Shiite parties were opposing the Kurdistan Region receiving its share and asked the KRG to hand over all its oil, however, now only Nouri al-Maliki’s factions and a few other Shiite parties are insisting on this,” Kochar told Rudaw English on Monday. “While there could be a majority without these factions, passing the bill would cause instability without their collaboration.”
Kochar outlined three possible outcomes of the talks between Erbil and Baghdad: one would be Kurdistan Regional Government (KRG) sending 250,000 barrels of oil to Baghdad, the second would be the KRG handing over the revenue of 250,000 barrels to Baghdad at the price set by the State Organization for Marketing of Oil (SOMO), and lastly the KRG keep the oil needed for expenses related to the production of oil, as well as domestic consumption, and send whatever is left to Baghdad.
“It is in the KRG’s benefit to send 250,000 barrels of oil rather than the revenue, given that the KRG will have to add more money in the case they send revenue,” Kochar said, pointing out that either of the first two options would serve Iraq equally, since they would either way be selling the oil at the SOMO price.
The KRG has operated an independent oil and gas sector since 2006 and later began exporting its oil to the international market via a pipeline through Turkey in 2013.
Years of tensions over the independent oil sales came to a head in 2014 when then-Prime Minister Maliki suspended the sending of the Kurdistan Region’s share of the federal budget – leaving hundreds of thousands of public sector employees with unpaid salaries.
“A lot of money has gone to companies, a lot of money went to Turkey, and oil was sold cheap, so Kurds have not benefited economically from the selling oil as much as they intended,” Mahmood Othman, a former member of Iraqi parliament, told Rudaw’s Sangar Abdulrahman late January.
Kochar said another complication in the oil for budget dispute is an arbitration case filed against Turkey by Iraq at the International Chamber of Commerce back in 2014. Baghdad asked for $26 billion in compensation from Turkey for facilitating the Kurdistan Region's sale of oil without Iraq’s authorization.
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