Explainer: Kurdistan vs. Iraq Budget Battle Halts Kurdish Salaries

The finance ministries of Iraq and the Kurdistan Regional Government (KRG) clashed as Baghdad suspended all KRG civil servant salaries, accusing Erbil of overspending its 12.67% federal budget share by $10.34 billion.

Citing a Federal Supreme Court ruling, Baghdad demands the KRG transfer all oil and non-oil revenues immediately, while Kurdish oil exports via the Turkey pipeline remain suspended since March 2023.

The KRG counters that allocations should be based on collected federal revenues and laments ignored offers to hand over non-oil income.

Major Kurdish parties condemned the freeze as unconstitutional collective punishment and warned of possible Kurdish withdrawal unless overdue salaries are released.