Economy, Middle East

Erbil salaries to be paid but with conditions: Iraqi PM

Baghdad will pay Erbil's civil servant salaries under condition that KRG hands over oil exports to central government

16.02.2016 - Update : 16.02.2016
Erbil salaries to be paid but with conditions: Iraqi PM Iraqi Prime Minister Haider al Abadi/AA

BAGHDAD

Civil servants in Erbil in northern Iraq will receive their salaries provided that all oil exported to Turkey via pipeline by the Kurdish Regional Government (KRG) is delivered to the central government in Baghdad, Iraqi Prime Minister Haider al-Abadi said Monday.

Speaking on a state television program Abadi said, “There are conditions for sending the salaries to Erbil.”

He added that if the Kurdish region hands over all exported oil to Baghdad, the wages will be sent over.

In Dec. 2, 2014, Baghdad and Erbil reached an agreement to export KRG's oil in exchange for a share of the budget from the central government.

Since then, numerous disputes have emerged with Erbil accusing the central government of failing to provide its full share from the national budget, while Baghdad claims the KRG has not delivered the promised amount of crude oil.

As a result, in June 2015, the KRG began to sell its oil directly, and independent of the central government in Baghdad, in order to generate revenues for its civil servants, provide services, cope with its weak economy, support refugees and the ongoing fighting against Daesh.

“We know how much oil is exported to Turkey’s Ceyhan port because we receive daily data on the matter,” Abadi stated but questioned where the oil revenue actually goes.

He argued that revenue derived from oil exports and sales in the Kurdish region is not transparent in the sense that it is unclear where the revenue goes. 

“I do not know what happens to the oil revenue or why the oil income isn't held in one bank,” he said, adding that even the Kurdish Treasury Minister does not know the oil trade's revenue or outcome.

In light of the export data, he also questioned how Erbil cannot meet the salary demands despite the Kurdish region currently exporting 16 percent of Iraq’s total oil. He said that Baghdad manages to pay the civil servants’ salaries from the same oil revenue since 2015.

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