October 20, 2015
ERBIL-Hewler, Kurdistan region ‘Iraq’,— Iraq’s Kurdistan Regional Government (KRG) said Tuesday it has resumed payments of overdue wages to state employees after more than three months of delays that sparked week-long protests across the region.
Government sources said employees of at least seven ministries will be fully paid by Thursday, while the remaining employees will receive their paychecks by the end of the month.
The KRG Minister of Natural Resources Ashti Hawrami announced in an interview with Rudaw, that oil sales that started in June – largely independent of the Iraqi government- can cover future payments to employees in the Kurdistan region.
“As of this month, the KRG is able to pay the salaries on time based on the oil sales, but we need time to pay the three months of overdue salaries which will be possible when our oil export or revenues increase,” Hawrami told Rudaw.
Hawrami said oil exports from Kurdish-controlled territories in Iraq to the Ceyhan Port in Turkey has provided the KRG with some $700 million a month since June 24 when the KRG started selling Kurdish oil independent of Baghdad.
With over 1 million people on its payroll, the government is the largest employer in the Kurdistan region. The KRG has said some 75 percent of its budget goes to wages and pensions.
Deadly clashes took place in several Kurdish cities earlier this month over the delayed wages. The protests also led to removal of five cabinet members, including the minister of finances.
Iraq’s central government began withholding the KRG’s share of the national budget, estimated at $1 billion a month, in February 2014. A tentative oil agreement between Baghdad and Erbil last December was planned to resolve disputes between the two governments.
“In fact, the current economic crisis is a result of that agreement between Kurdish political parties and Baghdad,” Hawrami said.
“Instead of sending $1 billion to the KRG per month, Baghdad sent us $200 to $300 million, which pushed the KRG to seek heavy loans to pay salaries.”
Hawrami said Kurdistan should have made the decision to sell its oil independently earlier. He said this may have prevented the current financial crisis.
“The Kurdish political leadership did not support the move to sell oil independently, and the Iraqi government did not send us our full budget, and that resulted in the crisis we experienced,” he said.
The KRG is currently exporting over 600,000 barrels per day (bpd) and is expected to increase production to an anticipated 1 million bpd by the end of 2016.
The KRG is now also managing the oil fields near the disputed city of Kirkuk where Kurdish security and Peshmerga forces have been patrolling since last June when the Iraqi army abandoned the city ahead of an ISIS offensive.
Kirkuk holds some 10 percent of Iraq’s total oil reserves, estimated at 140 billion barrels.
Kurdish Prime Minister Nechirvan Barzani said in a televised address last Friday that financial independence is KRG’s priority and asked the public for patience.
“As prime minister, my ultimate objective is the economic independence of the Kurdistan region which gives us self-rule. Some politicians have tried to hinder our journey, but I want to assure you that despite obstacles, we will achieve our objectives,” he said.
Thousands of people including government employees and teachers demonstrated in the past weeks against KRG and KDP in Sulaimani and several other Kurdish cities, demanding payment of their salaries from KRG and that KDP leader Massoud Barzani, whose presidency ended on August 20, to step down. Several local KDP headquarter buildings were set on fire by the protesters.
Barzani has been accused by critics of amassing huge wealth for his family instead of serving the population. Barzani’s son is the Kurdistan region’s intelligence chief and his nephew Nechirvan Barzani is the prime minister.
Many Kurdish politicians and Observers believe that many of the oil industry projects in Iraqi Kurdistan are conducted in a non-transparent way. Some have even described them as secretive.
The Minister of Natural Resources (MNR) Ashti Hawrami routinely accused of corruption by observers, Kurdish officials and Kurdish media.
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