The Iraqi Council of Ministers decided to lend the Kurdistan Regional Government (KRG) 2.1 trillion dinars ($1.6 billion) for the current fiscal year in order to provide liquidity to the KRG and enable it to pay the salaries of employees.
A statement issued by the Office of the Iraqi Prime Minister - after a session of the Council held on Sunday - said that the decision came based on the positive understandings between the federal government and the Kurdistan Regional Government of Iraq, and the agreement to proceed with the implementation of constitutional obligations and the content of the federal budget law, in a way that guarantees the rights of all citizens.
The statement pointed out that the amounts will be paid in 3 equal installments starting from this month, provided that the Federal Ministry of Finance repays the loan amounts from the region's allocations in the federal budget for the current fiscal year after settling what it owed.
These amounts will be paid to the region through loans granted by three public banks, and repaid by the Iraqi Ministry of Finance, according to the statement.
In a statement on Sunday, KRG President Masrour Barzani welcomed a "fruitful agreement" with Baghdad to ensure the security of citizens' salaries. "We were able to defend the rights of the people of Kurdistan," he said.
"I thank our citizens for their long patience, steadfastness and firm confidence in their government," Barzani said.
Barzani also had a call with al-Sudani, during which he expressed his "thanks and gratitude for his support in reaching an agreement on the issue of salary recipients in the Kurdistan region."
Salary payment
Earlier this month, thousands demonstrated in a city in the region to protest the delay in paying salaries for two months, while residents and the regional government hold Baghdad responsible for this delay.
It is noteworthy that a dispute between Baghdad and the Kurdistan region, escalated in the recent period, over the export of the region's oil and its share of the public financial budget.
The region accuses the central government of evading the responsibility of paying the salaries of the region's employees, while Iraqi Prime Minister Muhammad Shia al-Sudani explained that "the budget law does not contain funding for the salaries of the region's employees, but rather Kurdistan's share," and that the share will reach Kurdistan after handing over its oil production to Baghdad.
Officials in Baghdad say the Iraqi government has not received money from Kurdistan oil because it stopped exporting it through Turkey to the Turkish port of Ceyhan at the end of March.
The region and Baghdad had reached an agreement to export the region's oil through the central government, and in return for that, 12.6% of the federal budget would be allocated to Iraqi Kurdistan.