SULAIMANIYAH, Iraq — Iraqi President Barham Salih met separately Sept. 18 with four Kurdistan Regional Government (KRG) leaders — President Nechirvan Barzani, Prime Minister Masrour Barzani, parliament Speaker Rewaz Fayaq and Deputy Prime Minister Qubad Talabani in Erbil, the KRG capital. 

The purpose of Salih’s visit was to warn the KRG about the region’s share in Iraq’s federal budget for 2020, scheduled to be passed by the national parliament by the end of the year. A well-informed source close to the ruing elites in both Baghdad and Erbil told Al-Monitor on condition of anonymity that the Iraqi president — who is Kurdish — cautioned the Kurdish leadership that the federal government in Baghdad will cut the Kurdistan region's share of budget, including salaries of the KRG employees, if Erbil fails to hand over a portion of its oil to the State Organization for Marketing of Oil. The organization is responsible for selling Iraq's oil.

Under the Iraqi budget law for 2019, the KRG agreed to send 250,000 barrels of oil per day to the state oil organization. Although Baghdad continues delivering funds to Erbil as per the 2019 budget law, the KRG has told Baghdad that it cannot hand over its share of oil, claiming it has obligations to pay back debts to international oil companies working in producing and importing the region’s oil. Because the KRG’s oil sector is not transparent, there is no official data available on the KRG’s local and foreign debts. However, some 2018 estimates indicated the loans were about $20 billion.

The head of the national parliament’s finance committee, Haitham al-Jubouri, said Sept. 23 that the Iraqi government has yet to send the draft budget bill to parliament. He said the committee will return the bill to the government if it includes large deficits.