Baghdad ups financial support for Iraqi Kurdistan

BAGHDAD: The federal government in Baghdad on Sunday agreed to increase funds allocated to Iraqi Kurdistan that are desperately needed to pay salaries in the northern autonomous region.

The decision came after thousands of people took to the streets of Dohuk, the third-biggest city in the region, in early September over unpaid civil service salaries which they blamed on Baghdad.

On Sunday the federal government said in a statement it would disburse annually to Iraqi Kurdistan two trillion and one hundred billion dinars to be paid in three equal instalments of 700 billion dinars (more than $530 million).

The funds will be loaned by three state-banks and reimbursed by the finance ministry in Baghdad, the statement said. This mechanism aims to “cover employee salaries, social welfare recipients, and retirees”, it added, and the funds will be available from September.

Authorities in Baghdad and in Kurdistan have a month to “conduct an audit of the employee, social welfare recipient, and retiree numbers in the Kurdistan Region of Iraq”, it said. Iraqi Kurdistan has long accused Baghdad of not sending the necessary funds to pay civil servants.