SULAIMANI (ESTA) — The Kurdistan Regional Government (KRG) and the federal government reached an agreement over the federal budget for fiscal year 2021, a source said on Saturday.
A KRG delegation led by Finance and Economy Minister Awat Sheikh Janab visited Baghdad on Thursday night to discuss the Region’s share of the federal budget for 2021.
A source in the KRG Council of Ministers, who spoke under condition of anonymity, said the delegation agreed that the same deal reached with Baghdad last year be added to the federal budget.
The Kurdistan Region’s share of the federal budget would be 12.6%, according to the previous agreement.
“Baghdad’s precondition to transfer the Region’s share is that the KRG hands over 250,000 barrels of oil per day and 50% of revenue from the border crossings to Baghdad, in exchange for 900 billion dinars ($756 million),” the source told Esta Media Network.
The source further said the Kurdish lawmakers in Baghdad should not allow changes in the draft budget law, which will be approved by the Iraqi Council of Ministers on Tuesday.
In April, the federal government, led by former prime minister Adil Abdul Mahdi, cut off all budget transfers to the Kurdistan Region due to the KRG’s failure to export 250,000 barrels of oil per day (bpd) through Baghdad.
In November 2019, Erbil and Baghdad reached a deal to resolve their ongoing disagreement over oil, after Erbil agreed to export 250,000 bpd through Baghdad to Turkey’s Ceyhan port in exchange for the Kurdistan Region’s share of the federal budget.
Relations between Baghdad and Erbil eased after Prime Minister Mustafa al-Kadhimi took office in May. In August, Kadhimi told the KRG prime minister in a telephone call that the federal government would send 320 billion Iraqi dinars to the Kurdistan Region as payment for the Region’s employees until the end of the year.
The federal government has not been able to transfer 320 billion dinars to the Kurdistan Region since the Iraqi Council of Representatives adopted a loan law in November.
The law commits the Kurdistan Region to hand over non-oil revenues and an amount of oil that SOMO indicates to the federal government in exchange for an amount of money as payment for the Region’s public servants.
Kurdish lawmakers walked out of the parliament’s session due to their concern about the Kurdistan Region’s share set in the law.
