Baghdad sends 200bn IQD transfer to Erbil for August

A pile of Iraqi dinar banknotes (File)

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SULAIMANI — The federal government sent a monthly cash transfer of 200 billion Iraqi dinar ($137 million) to the Kurdistan Regional Government (KRG) on Sunday (August 29) for the second time since July, a source from the KRG Ministry of Finance told NRT.

Under an agreement with Prime Minister Mustafa al-Kadhimi, the KRG began to receive a monthly stipend of 200 billion dinars per month in July.

The agreement, however, does not resolve major budget disagreements between Erbil and Baghdad, which have prevented the implementation of the 2021 Federal Budget Law. KRG officials are keen to note that the stipend is not the Region’s budget share.

During 2020, the KRG struggled to pay its employees, missing five monthly disbursements entirely and cutting four others by nearly a quarter. Government employees had their pay cut by twenty-one percent during the first six months this year.

Workers were paid in full in July for the first time in more than a year. The KRG began distributing public sector salaries in full on August 25, even before receiving the transfer from Baghdad.

The salary cuts have had a significant effect on the economy of the Kurdistan Region because of the KRG’s role as the Region’s most important employer.

(NRT Digital Media)