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KRG delegation to return to Erbil without Iraq budget deal: official

The Kurdistan Regional Government (KRG) delegation will return to Erbil empty handed on Wednesday after failing to reach an agreement with Baghdad on the Region’s share of the 2021 federal budget, a senior Kurdish official in the Iraqi capital told Rudaw on Wednesday.

The KRG delegation, led by deputy Prime Minister of the Kurdistan Region Qubad Talabani, returned to Baghdad on Sunday to finalize negotiations with Iraqi political parties represented in the parliament as well as its financial committee, after not reaching a final agreement in their visit last month.

However, a senior Kurdish official in Baghdad told Rudaw’s Sangar Abdulrahman on Wednesday that the delegation’s visit has come to a fruitless end.

According to the official, Shiite parties in Iraq have shown no sign of collaboration, and in their latest demand, they have asked KRG to hand over the full oil dossier, including oil fields, to the federal government’.

Alla Talabani, the head of the Patriotic Union of Kurdistan (PUK) bloc in the Iraqi parliament told Rudaw’s Halkawt Aziz on Wednesday that “there is a sense of disagreement coming from the meetings. However, we are not going to just give up, we will continue our efforts”.
“there are efforts to make the Kurdistan Region section harder on the KRG, but yesterday we once again asked Iraqi parties to make the section fair enough for implementation,” Talabani said.

The Kurdistan Region’s share of the federal budget has attracted great opposition from Shiite MPs in the parliament.

Last month, more than 100 Iraqi MPs, mostly Shiite, signed a letter asking that the 2021 budget bill oblige the Kurdistan Region to hand over all its oil to the State Organization for Marketing of Oil (SOMO) in exchange for federal funds.

“Iraq’s revenue is federal. The oil of Basra, the Kurdistan Region, and any other province shall be under the supervision of the Iraqi government, and the Kurdistan Region should abide by this,” Alaa Rubai, an MP from the Sairoon alliance – the parliament’s biggest political bloc, led by Shiite cleric Muqtada al-Sadr – told Rudaw’s Mustafa Goran last week.

The delegation’s trip to Baghdad should be its “last visit and negotiation”, KRG spokesperson Jotiar Adil told Rudaw’s Sangar Abdulrahman on Tuesday, because the Iraqi parliament is expected to vote on the bill “in the next five days.”

The delegation has “reached an agreement with the Iraqi government”, but the end result depends on the vote of approval on the Kurdistan Region’s entitlements in the bill by Shiite members of parliament, Adil said.

Talabani said that the delegation could possibly return to Baghdad again in the coming days, given that the bill might not be voted on yet until next week.

“The KRG is willing to give 250,000 barrels of oil, they would not mind handing over all oil either, but to give the entire oil dossier and fields is unacceptable by the KRG,” she added.

Other Kurdish politicians have also expressed opposition to any deal that would make the Kurds hand over the whole oil dossier.

“Handing over the oil dossier is unacceptable and unconstitutional”, Kurdistan Democratic Party (KDP) MP Naser Harki told Sangar Abdulrahman on Wednesday.

Control of oil revenues has long been a thorny issue between Erbil and Baghdad. The KRG has operated an independent oil and gas sector since 2006 and later began exporting its oil to the international market via a pipeline through Turkey in 2013.

Years of tensions over the independent oil sales came to a head in 2014 when then-PM Maliki suspended the Kurdistan Region’s share of the federal budget – leaving hundreds of thousands of public sector employees unpaid for months.

The federal budget share dispute worsened in December 2019, when Baghdad agreed to send Erbil a 12.67 percent share of the federal budget in exchange for 250,000 barrels of oil per day, but neither side fully abided by the agreement.

Baghdad failed to pass a budget in 2020 because of political turmoil, record low oil prices, and the coronavirus pandemic. In November, Iraqi lawmakers passed the Fiscal Deficit Coverage Bill approving loans to cover civil servant salaries for the last two months of the year.

The bill passed with a majority vote, despite a walkout staged by Kurdish MPs angered that Erbil is obliged to hand over an unspecified amount of oil in exchange for funds – a clause they said was not in the original bill.

Iraq’s Council of Ministers approved the 2021 budget bill on December 21, 2020. Parliament has met twice to discuss the bill. Source