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Iraq cuts federal budget from KRG, Kurds defy it as political

The Iraqi federal government cuts funds used for salaries of Kurdistan Regional Government employees; Kurds describe the move as illegal and politically motivated.
Masrour Barzani, incoming Prime Minister of Kurdistan region speaks during an interview with Reuters in Erbil, Iraq July 9, 2019. Picture taken July 9, 2019. REUTERS/Azad Lashkari - RC18551D4450

Adel Abdul Mahdi’s Iraqi caretaker government in Baghdad April 16 has ordered its Finance Ministry in an official document to cut federal budget contributions to the semi-autonomous Kurdistan Regional Government in Erbil, pushing the KRG toward bankruptcy and cutting off the payment of salaries to its civil servants.

Abdul Mahdi’s government said the step was taken due to the international oil decline that has hit Iraq hard as well as Erbil’s failure to submit 250,000 barrels of oil per day to Iraq’s State Organization for Marketing of Oil (SOMO) in return for public funding under Iraq’s 2019 budget law. Iraq continuously sent federal budget appropriations to Erbil throughout 2019, although the KRG has not delivered a single barrel of oil to SOMO. The document also calls for there to be a settlement on long-standing financial issues between Baghdad and Erbil that date to 2004. Erbil says Baghdad’s decision is illegal and a political measure against Kurds.

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