KRG Opposes Changes in Iraq Federal Budget

On Friday,  May 26, 2023, Iraq's Kurdistan Regional Government announced its opposition to the Iraqi federal budget draft changes that violated the rights of Kurdish citizens. This response presents a difficulty for Prime Minister Mohammed al-Sudani and his governing coalition, which includes Shia, Sunni, and Kurdish members, as they seek to pass a three-year budget plan that has become one of the cornerstones of his government since it came to power toward the end of last year.

KRG declared that they would only adhere to the terms of the agreement signed between themselves and Sudani's government, seemingly implying their deal connected to Turkey regarding the revival of oil supplies from northern Iraq.

Before Sudani became a leader, he made a pact with the powerful Kurdish Democratic Party (KDP) commanding Erbil, the semi-autonomous region in northern Iraq.

The agreement entailed concluding the discord between budget transportation to Erbil and oil revenue distribution among Kurdistan and central governments as indicated by three Kurdish representatives.

Under the Iraqi constitution, the Kurdish region is entitled to a portion of national funds. This arrangement was damaged in 2014 when Kurdistan started selling crude oil outside of Iraq. 

Baghdad attempted to retake contested territories such as the oil city Kirkuk in 2017 and has made some budget payments since then, but they have been infrequent. The regional government criticized changes made by members of parliament's finance committee to the 2023 draft budget because they did not align with the agreement signed between the region and the federal government. Prime Minister Sudani’s cabinet approved this draft budget of 197.828 trillion Iraqi dinars ($135.6 billion) and sent it to parliament for approval in March.