The latest action by the Iraqi parliament to pass the national 2013 budget despite a boycott by Kurdish MPs is just the tip of the ice-berg in Iraq.
Tensions have been brewing to dangerous levels between the Kurdistan Region and Baghdad for some time and the lack of real intent to mend bridges and cool tensions is testament to Iraqi Prime Minister Nouri al-Maliki’s reluctance to enact a government of partnership and to pursue national reconciliation.
Fast approaching a decade since the liberation of Iraq and the fragmented Iraqi horizon, continuously poisoned by common distrust, lack of unity and lack of true compromise, continues to blight Iraqi society in 2013 much in the same way as it did in 2003.
Maliki’s growing authoritarian policies and the latest decision to pass the budget without Kurdish involvement and approval may have severely irked the Kurds, but it’s wrong to focus merely on the Erbil-Baghdad divide as the source of Iraqi troubles.
The majority of MPs from al-Iraqiya had also boycotted the budget vote and the coalition and power sharing agreement in Baghdad has all but evaporated. Tensions with long-time disaffected Sunnis, greatly encouraged by the Syrian Sunni ascendancy to power, is steadily gathering pace and Sunni demonstrations since the back-end of 2012 still run rife in Sunni strongholds with protestor deaths at the hands of predominantly Shiite forces adding fuel to the fire. Even Shiites within the State of Law, including influential cleric Moqtada al-Sadr, have expressed concern.
Finance minister Rafa al-Essawi and agriculture minister Izzeddin al-Dolah are two high-profile Sunni resignations in recent weeks over the current protests.
Kurdish ire
The strong Kurdish reaction to the passing of budget in Baghdad was understandable.
With only 168 out of 325 MPs present due to the boycott, the bill may have been passed due to a “technicality” with a thin majority obtained but not involving the Kurds who are such vital components of the coalition and in the union with Iraq is a dangerous development.
Oil sharing and foreign oil contracts are not new bones of contention between the Kurds and Baghdad. Oil exports in Kurdistan have been very much stop-start for a number of years. The source of discontent in the 2013 budget was the amount set aside to pay oil companies in Kurdistan, with the Kurdistan Regional Government (KRG) insisting it is owed $3.5 billion for costs accumulated by foreign oil companies over the past 3 years whilst Baghdad has allotted only $644.33 million in the latest budget.
This issue was one of the main reasons the 2013 budget was not ratified although the Iraqi cabinet approved the budget in October.
The frequent theme from Baghdad over the past several years is that oil contracts signed by KRG are illegal, in spite of the stipulations afforded in the national constitution. Therefore it is hardly surprising that Baghdad continues a hard-handed approach in dealing with the oil sharing issue. Ironically, passing a national hydrocarbon law gathering dust since 2007 that would end all disputes is not even seen as an immediate priority.
The State of Law had argued that Kurds were not entitled to compensation as they had not contributed their fair share to national exports.
As Kurds have insisted for years, any revenue from oil exports in Kurdistan will go to a central pot where Kurds will take their allotted share. Narrow-minded political goals in Baghdad, has failed to realise that a strong oil industry in Kurdistan is a bonus for all Iraqis. Baghdad may have costs of foreign oil companies to cover but what about the billions of surplus revenue that follows? Anyone would think Baghdad is taking a financial loss in dealing with Kurdish oil.
Budget imbalance
Baghdad has continuously refused to pay Peshmerga costs which are stipulated in the constitution. Yet it has been paying salaries of Sahwa Council Sunni militia for a number of years to appease Sunnis and has even increased their salaries in this year’s budget to try and dampen Sunni demonstrations.
Furthermore, whilst Kurdistan develops at a rapid pace but fails to receive fair share of revenues it needs, the province of Nineveh failed to spend around $6 billion of its $10 billion share in the 2012 budget. There is a similar pattern in other provinces.
Next steps for the Kurds
Undoubtedly, the budget issue will make prospects of reconciliation worse between Erbil and Baghdad. The continued halt of oil exports by Kurdistan may seem logical, but it’s counter-productive as Kurdistan needs to press-ahead with its oil industry and economic growth.
The KRG oil ministry confirmed it will not send any agreed quantities of oil unless Baghdad pays the relevant costs to foreign companies.
Control of oil exports is one remaining noose that Baghdad has around the Kurds. If the Kurds have an independent oil infrastructure and an oil pipeline purely on Kurdish soil, it greatly diminishes Baghdad’s bargaining power.
Kurdistan has greatly flourished in recent years whilst the south continues to lag behind, do the Kurds continue with ties in Baghdad or take unilateral measures in deciding national interests?
It begs the question of whether Baghdad sees the Kurds as true partners and looks to Kurdish achievements as an achievement for all of Iraq or does it want to see Kurdistan undermined, regress and stagnate? The Kurds would say recent disputes over Dijla Operations Command, halting of oil exports and now the national budget answers that question.
Baghdad has been intent on scaring oil companies from working in Kurdistan for a while. Giving the option to oil companies of either “us or them” is anything but the tone of partnership.
Kurdistan needs to break that noose, develop an independent oil pipeline and accumulate revenues directly and pay foreign companies from their own budget.
This stance was also suggested by Iraqi Kurdish MP Muhsin al-Saadoun as a measure against the federal government for side-lining the Kurds.
Naturally, Maliki led coalition hit back by threatening to deduct Kurdistan Region’s share of the federal budget.
Either way, something has to give and inaction by the Kurdish leadership is a non-starter. Kurdistan must ensure the destiny of Kurdish affairs is determined by Kurdish hands.
What real benefit have the Kurds ever received from Iraq’s immense oil wealth since Iraq’s creation? Now Kurdish oil must be the source of Kurdistan’s prosperity and to give back to its long-time suffering people and should not be viewed as somewhat of a curse.
Other issues
The Shiite-government announcement of the formation of a new military force under the name of the “al-Jazeera and Badiya Force” situated in the disputed city of Sinjar, which borders Syria is yet another confrontational step by Maliki. A pro-Assad Baghdad is vying for control of its Syrian borders, possibly due to pressure from Iran, with signs this week that the violence is spilling across the border. Kurds have a far different view of Assad and are unlikely to relinquish border control in their own territories to propel Baghdad’s goals in Syria.
Baghdad decision not to pay foreign companies could well be a punishment for Kurdistan’s growing partnership with Turkey and its anti-Assad stance.
Since Maliki assumed a second term in office, Iraq has been in decline. With Sunni’s growing boldness in standing-up to Shiite dominance, who will be around to broker the next government or mediate between Sunnis and Shiites? It certainly won’t be the Kurds.
A previous statement by Kurdistan President Massoud Barzani summed up current sentiments, “Iraq’s citizens are simply tired of Baghdad’s … language of threat and intimidation, which in the cynical pursuit of narrow political agendas only serves to create division and strife.”