Iraqi president, federal court chief urge resolution to KRG budget crisis

ERBIL, Kurdistan Region - Iraqi President Abdul Latif Rashid and Federal Supreme Court head Jassim al-Umairi met Sunday in Baghdad, stressing the need to resolve the Kurdistan Region’s salary crisis in line with the constitution and the law.

“The necessity to find a final solution for discharging the financial dues of the Region and settling this human file in accordance with the Constitution” was discussed during the meeting, according to an Iraqi presidency statement.

Tensions between Erbil and Baghdad have escalated in recent weeks after the Iraqi finance ministry suspended budget transfers to the Kurdistan Regional Government (KRG). Oil Minister Taif Sami accused the KRG of exceeding its 12.67 percent share of the 2025 federal budget by more than 13.5 trillion Iraqi dinars (around $10.34 billion).

The move has left more than 1.2 million public sector employees in the Kurdistan Region without pay, sparking condemnation from Kurdish parties who say the suspension is politically motivated and unconstitutional.

Umairi also underlined “the necessity of finding a solution to the crisis of salaries of the Region’s employees according to the law.”

Hawre Tofiq, head of the Iraqi presidency’s office of relations and international organizations, who was also in the meeting, told Rudaw that the federal court has agreed to convene on the salary lawsuit “as soon as possible.”

Tofiq said that both Rashid and Umairi agreed the salary dispute “should not be affected by political disputes.”

“We think that there is some common ground between the [Kurdistan] Regional Government and the federal government, and all sides need to move towards preparing the oil and gas bill,” he said.

Earlier this month, the KRG’s natural resources ministry blamed Baghdad for delaying progress on the long-stalled oil and gas law, first proposed in 2007. The ministry accused the federal government of “a slowdown and a clear delay” in moving the legislation forward.

The Coordination Framework - a Shiite political alliance that includes Iraqi Prime Minister Mohammed Shia’ al-Sudani and other influential Shiite figures - earlier this month called on parliament to pass the bill, describing it as “the essence of resolving outstanding issues between Baghdad and Erbil.”

While both sides have submitted competing oil and gas law drafts, key disagreements persist over control of contracts, revenue sharing, and decision-making authority. The KRG has continued to operate under its 2007 oil law, while Baghdad maintains that all oil exports and revenues must be centrally managed.

In 2022, Iraq’s Federal Supreme Court ruled the KRG’s oil law unconstitutional. The KRG rejected the decision and continued exports until March 2023, when an arbitration ruling from a Paris-based court halted its oil exports through Turkey’s Ceyhan port.

In March this year, a federal lawmaker said that due to ongoing political disputes, the oil and gas law is unlikely to pass during the current parliamentary term.

Iraqi president, federal court chief urge resolution to KRG budget crisis

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