ERBIL, Kurdistan Region - The Kurdistan Regional Government (KRG) on Monday published a financial report highlighting what it said were severe shortfalls in federal budget funding, zero investment allocations, and continued salary delays for civil servants, amid ongoing disputes with Baghdad over revenue-sharing.
According to the report published by the KRG’s Department of Media and Information, the Kurdistan Region received “only 41 percent of entitlements and zero for investment projects,” totaling just over 24.3 trillion Iraqi dinars (around $18.5 billion) out of 58.3 trillion dinars (around $44.4 billion) allocated to the Region over the past three years.
During the same period, Iraq’s total federal budget stood at 622.6 trillion dinars (around $475 billion), of which the Kurdistan Region’s legally allocated share was 58.36 trillion dinars (around $44.5 billion). In practice, only 24.32 trillion dinars (around $18.5 billion) were disbursed, the report said.
The report described the situation as an “investment blockade” and a “massive funding gap.”
It further noted that, despite Baghdad allocating 165 trillion dinars (around $126 billion) for investment expenditures nationwide, the Region's share was “Zero Dinars,” resulting in the “halt of vital infrastructure projects” - a situation the report called “a dangerous precedent.”
The report added that the Region’s actual funding amounted to “a meager 3.9 percent of Iraq's total budget, reflecting a clear injustice against the citizens of the Region.”
In June 2023, Iraq passed its controversial budget law for 2023, 2024 and 2025, setting the Kurdistan Region’s share at 12.6 percent based on earlier population estimates that had been contested.
The 2024 federal budget totaled nearly 212 trillion dinars (around $141 billion), with the Kurdistan Region’s share - based on the 12.6 percent estimate - reaching nearly 21 trillion dinars (around $14 billion), covering both operational and investment expenditures.
Oil exports from the Kurdistan Region resumed on September 27 following a tripartite agreement between the KRG, the federal government in Baghdad, and international oil companies (IOCs) operating in the Region. Exports had been halted since March 2023 after Iraq won an arbitration case against Turkey in a Paris-based court.
The three-month agreement, which allowed exports to international markets, was renewed in late December.
The Monday report noted that the suspension of oil exports caused a $25 billion loss to the Iraqi economy. Since the resumption of exports in late 2025, “the KRG has demonstrated good faith by pumping 19.5 million barrels [of oil]” through Baghdad’s State Organization for Marketing of Oil (SOMO).
Under the three-month agreement, the KRG’s natural resources committed to supplying a minimum of 230,000 barrels per day to SOMO for export, with an additional 50,000 barrels per day allocated for domestic consumption within the Kurdistan Region, Natural Resources Minister Kamal Mohammed told Rudaw in mid-November.
Despite the resumption of oil exports, salaries for November and December remain unpaid for the Region’s civil servants. According to the report, Baghdad has not funded a full year of salaries for the Region in any of the past three years, leaving months of unpaid dues “accumulating as debt.”
For more than a decade, public sector employees in the Kurdistan Region have faced recurring salary delays, partial payments, and deductions due to financial disputes between Erbil and Baghdad. Employees received only 10 months’ pay in 2025, with the final two months still outstanding.
In early November, Kurdistan Region Prime Minister Masrour Barzani accused the federal government of politicizing the salaries of more than one million civil servants in the Region.
The federal government has often attributed the delays to the KRG’s alleged failure to meet its financial obligations - a claim Erbil has consistently denied.
The report noted that the KRG has “shown high financial commitment, transferring 919 billion dinars [around $701 million] in non-oil revenues to the federal treasury during 2025.”
Of note, Iraq’s Housing Minister Bangin Rekani told Rudaw on Thursday that the long-standing salary issue is expected to be resolved in the new year, although disputes between Baghdad and Erbil over internal revenue-sharing may take longer to settle.
According to the report published by the KRG’s Department of Media and Information, the Kurdistan Region received “only 41 percent of entitlements and zero for investment projects,” totaling just over 24.3 trillion Iraqi dinars (around $18.5 billion) out of 58.3 trillion dinars (around $44.4 billion) allocated to the Region over the past three years.
During the same period, Iraq’s total federal budget stood at 622.6 trillion dinars (around $475 billion), of which the Kurdistan Region’s legally allocated share was 58.36 trillion dinars (around $44.5 billion). In practice, only 24.32 trillion dinars (around $18.5 billion) were disbursed, the report said.
The report described the situation as an “investment blockade” and a “massive funding gap.”
It further noted that, despite Baghdad allocating 165 trillion dinars (around $126 billion) for investment expenditures nationwide, the Region's share was “Zero Dinars,” resulting in the “halt of vital infrastructure projects” - a situation the report called “a dangerous precedent.”
The report added that the Region’s actual funding amounted to “a meager 3.9 percent of Iraq's total budget, reflecting a clear injustice against the citizens of the Region.”
In June 2023, Iraq passed its controversial budget law for 2023, 2024 and 2025, setting the Kurdistan Region’s share at 12.6 percent based on earlier population estimates that had been contested.
The 2024 federal budget totaled nearly 212 trillion dinars (around $141 billion), with the Kurdistan Region’s share - based on the 12.6 percent estimate - reaching nearly 21 trillion dinars (around $14 billion), covering both operational and investment expenditures.
Oil exports from the Kurdistan Region resumed on September 27 following a tripartite agreement between the KRG, the federal government in Baghdad, and international oil companies (IOCs) operating in the Region. Exports had been halted since March 2023 after Iraq won an arbitration case against Turkey in a Paris-based court.
The three-month agreement, which allowed exports to international markets, was renewed in late December.
The Monday report noted that the suspension of oil exports caused a $25 billion loss to the Iraqi economy. Since the resumption of exports in late 2025, “the KRG has demonstrated good faith by pumping 19.5 million barrels [of oil]” through Baghdad’s State Organization for Marketing of Oil (SOMO).
Under the three-month agreement, the KRG’s natural resources committed to supplying a minimum of 230,000 barrels per day to SOMO for export, with an additional 50,000 barrels per day allocated for domestic consumption within the Kurdistan Region, Natural Resources Minister Kamal Mohammed told Rudaw in mid-November.
Despite the resumption of oil exports, salaries for November and December remain unpaid for the Region’s civil servants. According to the report, Baghdad has not funded a full year of salaries for the Region in any of the past three years, leaving months of unpaid dues “accumulating as debt.”
For more than a decade, public sector employees in the Kurdistan Region have faced recurring salary delays, partial payments, and deductions due to financial disputes between Erbil and Baghdad. Employees received only 10 months’ pay in 2025, with the final two months still outstanding.
In early November, Kurdistan Region Prime Minister Masrour Barzani accused the federal government of politicizing the salaries of more than one million civil servants in the Region.
The federal government has often attributed the delays to the KRG’s alleged failure to meet its financial obligations - a claim Erbil has consistently denied.
The report noted that the KRG has “shown high financial commitment, transferring 919 billion dinars [around $701 million] in non-oil revenues to the federal treasury during 2025.”
Of note, Iraq’s Housing Minister Bangin Rekani told Rudaw on Thursday that the long-standing salary issue is expected to be resolved in the new year, although disputes between Baghdad and Erbil over internal revenue-sharing may take longer to settle.
Comments
Rudaw moderates all comments submitted on our website. We welcome comments which are relevant to the article and encourage further discussion about the issues that matter to you. We also welcome constructive criticism about Rudaw.
To be approved for publication, however, your comments must meet our community guidelines.
We will not tolerate the following: profanity, threats, personal attacks, vulgarity, abuse (such as sexism, racism, homophobia or xenophobia), or commercial or personal promotion.
Comments that do not meet our guidelines will be rejected. Comments are not edited – they are either approved or rejected.
Post a comment