Tuesday, January 31, 2023

Iraq’s Supreme Court Strikes Down Sending Money To Kurdistan Throwing Wrench Into PM Sudani’s Govt


(Al Jazeera)

 

On January 25 the Federal Supreme Court said that sending money to the Kurdistan Regional Government (KRG) was illegal. The decision was the result of a lawsuit filed by Basra parliamentarian Mustafa Jabar Sanad. He was drawn to action by members of the Coordination Framework who are opponents of the Kurds and objected to the Kazemi and new Sudani governments sending monthly payments to the KRG without a budget agreement.

 

The current and former governments made deals with the Kurds to send money in return for political support. The 2021 budget passed under Prime Minister Mustafa al-Kazemi called for the KRG to export 250,000 barrels a day of oil in return for monthly payments. The Kurds never complied yet the premier sent 200 billion dinars around $138 million each month to ensure Kurdish support for his administration. In December just a month into the new Mohammed Sudani government his cabinet approved sending 400 billion dinars to the KRG. This was part of the political agreement with the Kurdistan Democratic Party (KDP) and Patriotic Union of Kurdistan (PUK) to support Sudani for premier. Members of the Coordination Framework who have been critical of the KRG before and demanded that it follow the budget and end its independent oil policy amongst other issues immediately objected and MP Sanad filed his lawsuit. This has been a long standing dispute between Baghdad and the KRG dating back to the second Maliki administration when the PM cut off money to the Kurds in retaliation for their oil contracts with foreign companies.

 

This will be a thorn in the side of the Sudani government but how big is the question. It took one year to name Sudani PM in part because of the dispute between the KDP and PUK over the presidency. They finally compromised and the Coordination Framework and Sudani promised them wide ranging concessions including over the budget and payments. Now some factions of the Framework have thrown a wrench into that with the court decision. A new budget is also being discussed in parliament right now and this can’t help. On the other hand, the KRG has not complied with budgets for years. It wanted to increase its own exports and didn’t sell oil for Baghdad as a result. These payments led the Kurds to believe that they didn’t need to follow the budget to get money from the central government. They just needed to cut deals with the prime minister. This was one reason why some in the Framework were mad at Kazemi and Sudani and contributed to the lawsuit.

 

SOURCES

 

Al Aalem, “The Framework hawks remain silent about the financial payments to Irbil … Is there a prior agreement?” 12/14/22

 

Abdul-Zahra, Qassim and Sewell, Abby, “Iraq’s Kurdish region warns against ‘unlawful’ stops to funds,” Associated Press, 1/26/23

 

Bas News, “Iraqi Government Committed to Sending KRG’s Monthly Budget: Spokesperson,” 8/2/21

 

Dourian, Kate, Tahir, Rawaz, and Otten, Cathy, “Baghdad releases $138 million to KRG days before Kadhimi’s Washington visit,” Iraq Oil Report, 7/12/21

 

Jangiz, Khazan, “Baghdad sends 200 billion dinars to Erbil: ministry,” Rudaw, 7/11/21

 

Al Mada, “The government sends 400 billion dinars to the Kurdistan region,” 12/13/22

- “The powers of the prime minister and the explosion of the factions from the cities are the most difficult provisions of the political agreement,” 12/15/22

 

NRT, “Baghdad Agrees To Send $137m For KRG Salary Payments,” 11/2/21

- “Iraq’s Federal Court Rules Against Sending Funds To Kurdistan Region,” 1/25/23

- “KRG Sending Data, But Not Money To Baghdad: MP,” 6/15/21

 

Tahir, Rawaz, Hussein, Mohammed, “Baghdad makes second KRG budget transfer,” Iraq News Report, 8/30/21

 

Van Heaven, Ben, “Iraqi court strikes down Kurdistan budget transfers,” Iraq Oil Report, 1/26/23

 

Van Heuvelen, Ben, Tahir, Rawaz, Porter, Lizzie, Hussein, Mohammed and Dourian, Kate, “Despite one payment, Baghdad-Erbil budget stalemate continues,” Iraq Oil Report, 7/30/21

 

 

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