Will new Iraqi government resolve Baghdad-KRG issues?

President Barham Salih on Oct. 27 announced that he has developed a proposal for resolving the dispute over Kirkuk between Baghdad and Erbil. Without going into detail, he said his plan focuses on the ethnic and religious components in determining its fate, ignoring the interests of outside players in discussions about the city's future. The recent agreement by Kurds, Sunnis and Shiites on the formation of a national government — with Salih as president, Adel Abdul Mahdi as prime minister and Mohammed Halbousi as parliament speaker — raised hopes among many Iraqis that the outstanding issues between Baghdad and Erbil might be resolved, but will the new leadership be able to deliver?

After nearly five months of post-election battling and political uncertainty, Iraqis are generally optimistic about the successful, peaceful democratic transition. The new leadership has been positively welcomed by major political parties as well as by Washington and Tehran. Some even see the new leadership as a “sign the country is stabilising after four decades of chaos and division.”

Despite the current optimism, the ongoing issues between Baghdad and Erbil may surprise Iraqis with new, potentially destabilizing conflicts. These issues include easing tensions stemming from the Iraqi Kurdistan independence referendum held in September 2017 that Baghdad opposed, oil policy and revenue sharing, allocation of the federal budget and disputed territories, particularly Kirkuk. On the budget issue, since 2003, the Kurdistan Regional Government (KRG) had received 17% of annual federal budgets, but that amount was reduced to 12.67% in the 2018 budget and the proposed 2019 budget much to the Kurds' displeasure.

If genuine stability is the goal in Iraq, the country's long-standing issues must be tackled. At first glance, there are indeed reasons to be optimistic. The new president is known to be a moderate Kurdish leader who has worked for decades with both Shiite and Sunni Arab politicians. Prime Minister Abdul Mahdi, who has a long history of working and cooperating with Kurds, had previously served as vice president, oil minister and finance minister in Baghdad, while Speaker Salih had served as deputy prime minister in Baghdad and as KRG prime minister from 2009 to 2012. They both enjoy good relations with Washington as well as Tehran and with main political parties in Iraq. On top of that, the two leaders are also good friends, which should enhance their working together and make conciliatory approaches more likely.

Moreover, the new Iraqi prime minister has been an advocate of federalism and was recently described by Massoud Barzani, leader of the Kurdistan Democratic Party (KDP), as a friend of the people of Kurdistan. All of this suggests that the two leaders have the qualities and experience to manage political disputes between Baghdad and Erbil.

It is still too early, however, to tell if Iraq's new leadership is up to the formidable challenges ahead. The initial indications are that serious negotiations over outstanding Baghdad-KRG issues are unlikely to take place as the problems are beyond Salih and Abdul Mahdi’s capacities. This is not simply because Salih's position is largely ceremonial, but also because unlike Former President Jalal Talabani, he lacks his own constituency’s support, he does not control a military force, and he lacks the backing of the KDP. In fact, Barzani vehemently opposes Salih, having said that he would not allow Salih to step foot in Erbil if he became president of Iraq and that he would not care if the Kurdistan region split, requiring two administrations, as a result.

Salih’s victory over the KDP’s preferred candidate for the presidency escalated tensions between the KDP and the Patriotic Union of Kurdistan (PUK), which as reported by Al-Monitor, already disagreed over governance of Iraqi Kurdistan and related socioeconomic issues. In the KDP's eyes, the PUK has ruined Kurdish unity in Baghdad, and the Iraqi president, who is always a Kurd, does not represent the people of Kurdistan. This is the first time since 2005 that the two main Kurdish parties have been fragmented in Baghdad.

Relations between the KDP and PUK are so tense that some observers are wondering whether Iraqi Kurdistan might be on the verge of civil war. Under the circumstances, Salih’s efforts on the Kurdistan issue may be derailed by Barzani. Although Barzani’s influence was reduced by the broadly opposed independence referendum, his party came in first in elections held Sept. 30 and therefore will remain the main ruling party in the Kurdistan region.

Abdul Mahdi also has his own limitations. Like Salih, he lacks his own constituency, and like his predecessors, he is the product of a compromise, which means that in trying to effectively address the problems between Baghdad and the KRG, he is not strong enough to override the parties that selected him. Abdul Mahdi, a political insider since 2003, was nominated to be prime minister mainly because he posed no threat to the major parties, making his selection first and foremost a “vote for continuity.”

Furthermore, resolving the outstanding issues with Erbil does not appear to be among the next government’s priorities. Some more immediate challenges and tasks are likely to take precedence. Among them are rebuilding infrastructure destroyed in the war against the Islamic State and preventing a resurgence of the extremist group, addressing popular grievances over poor public services, balancing between the influence and interests of the United States and Iran and taking meaningful action against endemic corruption. Muqtada al-Sadr, the influential Shiite cleric and the leader of Sairoon bloc, has issued a self-proclaimed one-year deadline for the new government to implement reforms. 

The Kurdish issue is also more likely to be sidelined in the next four years because unlike previously, when the Kurds were kingmakers in Baghdad ahead of government formations, the KRG’s bargaining position has become weakened since the disastrous independence referendum. 

Last but not least, some of the outstanding issues between the KRG and Baghdad are deep-seated structural and constitutional matters that previous governments have failed to tackle. In other words, even if the president and the prime minister are well intentioned and cooperate with each other, they have little room in which to address the issues. Agreement on disputed territories, oil sales and budgets need broad legal and political consensus among the major political parties, something that is beyond the capacity and leverage, and hence control, of the new leaders. Their abilities should, therefore, not be overestimated. They are unlikely to be able to do more than their predecessors in this regard.