ERBIL, Kurdistan Region of Iraq – The Kurdistan Regional Government (KRG) on Thursday accused the Iraqi federal government of imposing political, economic, and financial sanctions on the people of the Region for over a decade, despite Erbil fulfilling all its obligations toward Baghdad.

Tensions have been escalating between Erbil and Baghdad in recent weeks after the latter said it would not be financing the Kurdistan Region’s civil servant salaries for the remainder of the year.

Over one million civil servants in the Kurdistan Region rely on monthly salaries for their livelihoods, but the Iraqi finance ministry’s decision would deprive them of their financial entitlements for eight months.

The KRG’s Department of Media and Information said in a statement on Thursday that Baghdad has been applying constant pressure to belittle and weaken the Kurdistan Region for over 11 years.

The statement added that the federal government has repeatedly cut the Kurdistan Region’s salaries and budget share under different pretexts, in violation of rulings from the Federal Supreme Court which oblige Baghdad to finance the Region’s civil servant salaries without interruption.

In late May, the Iraqi finance ministry informed the KRG that Baghdad is “unable to continue funding the Region,” arguing that the Region has already exceeded its 12.67 percent share of the annual budget.

The KRG statement on Thursday said that Baghdad has not sent all 12 salaries to the Kurdistan Region in any year, and has only sent four billion dinars for 2025, while the Region’s annual budget share is over 13 billion.

The Iraqi finance ministry also claimed that from 2023 until April 2025, the Kurdistan Region had handed over only 598.5 billion dinars out of its total combined oil and non-oil revenues of 19.9 trillion dinars.

The Iraqi budget law commits the Kurdistan Region to handing over 400,000 barrels of oil to Iraq’s State Organization for Marketing of Oil (SOMO) to be exported, or used domestically if they are not exported. It also obliges the Kurdistan Region to hand over its non-oil revenues to Baghdad in exchange for disbursing the Region’s monthly financial entitlements.

The Iraqi parliament passed an amendment to the law in early February, which obliges Baghdad to reimburse Erbil for the production and transportation cost of one barrel of oil at the average cost of production and transportation of the federal oil ministry.

“The Region has handed over 11 million barrels of oil to SOMO, but Iraq has not reimbursed the production cost at all. In addition, it [the Region] has handed over 50 percent of non-oil revenues, but Baghdad has for 11 years cut the salaries of Kurdistan which has led to a halt in projects and urban developments,” said the KRG on Thursday.

“In addition to not sending salaries and budget to the Kurdistan Region, Iraq is also creating obstacles to the Region’s export of oil, so that it cannot revive the economy and provide salaries,” the statement added.

Exports of the Kurdistan Region’s oil through the Turkish Ceyhan pipeline were halted in March 2023 after Ankara lost a case against Baghdad in a Paris-based arbitration court. The case accused Ankara of breaching a 1973 agreement by allowing the KRG to start selling oil independent of Baghdad.

The halt in oil exports has cost Iraq and the Kurdistan Region over $25 billion, according to the KRG’s Thursday statement.

“Although the KRG has cut off all excuses from Baghdad in regards to finance and oil, and has shown its readiness to negotiate and work according to constitution and decisions of the Federal Court, Baghdad’s punishing and sanctioning of the people of Kurdistan continue, and the federal government’s intention to oppose the Kurdistan Region and its people has become clear at home and abroad,” the statement concluded.