ERBIL, Kurdistan Region — A Kurdistan Regional Government (KRG) delegation participating in talks with the Iraqi government over budget shares and oil revenue is set to visit Baghdad on Monday, for the second time in three days.
With a new, 2020 budget bill being prepared by the Iraqi federal government, the KRG has stepped up its efforts to reach a deal with Baghdad over securing Erbil’s share of the federal budget and the handover of the Region’s oil revenue to central government.
Over the weekend, a KRG delegation headed by Minister of Finance Awat Shiekh Janab and Regional Minister for Federal Affairs Khalid Shwani visited Baghdad. The delegation met with Iraqi federal officials, including Prime Minister Adil Abdul-Mahdi and Minister of Finance Fuad Hussein.
“The atmosphere of the discussions has so far been very positive, and all steps are heading towards the reaching of an understanding,” KRG federal affairs minister Khalid Shwani told Rudaw.
“We must have a presence in all stages of the [federal] budget preparation, and the agreement we reach must not be changed in the parliament or the government,” added Shwani.
KRG Prime Minister Masrour Barzani, alongside his deputy Qubad Talabani and other ministers, met with the delegation to receive updates concerning the talks on Sunday.
“In the meeting, the Kurdistan Regional Government delegation presented the latest developments in the discussion process with the federal government. The delegation pointed out that talks between the two sides have reached an advanced and important stage, and are proceeding in a positive atmosphere,” the KRG readout of the meeting read.
The “principles” that have been agreed upon “take into consideration the shared interest of both sides and the financial rights and entitlements” of the Kurdistan Region.
Discussions are taking place under the “direct guidance and supervision of Prime Minister Masrour Barzani,” added the readout, before announcing the Monday return of the delegation to Baghdad.
Barzani hailed the “positive meeting” with the KRG delegation via Twitter on Sunday night.
“The KRG has worked to build a constructive relationship with our partners in Baghdad that upholds the rights of the Kurdistan Region. Great to see progress,” read a tweet from the prime minister.
The Kurdish delegation’s visits to Baghdad come as Iraq’s beleaguered prime minister has been forced to navigate two months of turmoil. On October 1, protests in Baghdad and the Shiite-majority south began to rage over corruption, unemployment, and cronyism, among other grievances.
Protests entered a two week long hiatus due to observance of the Shiite religious Arbaeen pilgrimage, before resuming on October 25. Protesters have been met with a lethal security force response, with over 350 people have been killed since protests began.
A series of welfare and employment reforms announced by Abdul-Mahdi in response to protester demands have done little to halt demonstrations.
With the Iraqi prime minister – widely seen as an ally to Kurds - facing calls for his resignation from office, Kurdistan Region officials are moving with increased urgency to seal a deal with Baghdad before a potentially hostile successor takes his place.
Dispute between the KRG and central Iraqi government over Erbil’s independent oil sales culminated in Baghdad cutting the Region’s share of the federal budget in 2014.
The budget share cut came amid testing conditions for the Kurdistan Region, including war with ISIS and the subsequent arrival of Iraqi IDPs and Syrian refugees, sending the Region into a deep financial crisis.
Though Erbil-Baghdad relations have improved since the current Iraqi premier took office, the Kurdistan Region’s oil sales remain a point of contention between the two.
According to Iraq’s 2019 budget bill, the KRG was to hand over 250,000 barrels of oil to Baghdad in return for approximately 12 percent of the Iraqi budget. Though the KRG has received it share of the budget from Baghdad, it has yet to hand over a single barrel of oil.
Erbil has argued that its contractual commitments to oil companies and debts are preventing it from handing over its oil. The KRG has previously proposed that Iraq pay oil companies for their operations in the Region’s oilfields, in return for the Region’s adherence to its budget bill commitments.
