Iraqi Government Withholds Billions in Petrodollars
ERBIL, Kurdistan Region -- An MP from Kurdistan Parliament reports that the central government has not sent the Kurdistan Region its allocation of billions of dollars of petrodollar money.
Karwan Salih, an MP in Kurdish Parliament, told Rudaw, “In the past three years, Baghdad has not sent any petrodollar money to the Kurdistan Region. The total amount would be US$15 billion USD for three years.”
Salih criticized Kurdish lawmakers in Baghdad for failing to follow up on the issue. “They are representatives of the Kurdish people in Baghdad. I don’t understand why they won’t follow up on this issue,” he said.
Najiba Najib, a member of the parliamentary finance committee, confirmed that the petrodollar budget has not been sent to Kurdistan.
“According to Article 26, which was added to the budget law last year, the Kurdistan Region must receive 17 percent of the total of Iraq’s petrodollar money. The article also applies to the 2012 budget. But it has not been implemented.”
Najib estimated the total amount of Iraq’s petrodollars was as high as 50 trillion Iraqi dinars. She said, “Seventeen percent of this amount belongs to Kurdistan.”
Najib maintained that the KRG has requested its share but Baghdad has ignored the request.
“Last year, a KRG delegation visited Prime Minister Nuri Maliki and handed him a letter which addressed this issue along with others. Maliki promised to resolve the petrodollar issue, but he didn’t follow through.” Najib said.
Rashid Tahir, KRG deputy finance minister, says, “I am not sure whether this 50 trillion dinars exists as it is mentioned or if Iraq has any petrodollar budget.”
Tahir suggests that his ministry would launch an investigation into the matter if anyone has and provides proof of this issue.
Meanwhile, Tahir confirmed that the Kurdistan Region has not received a petrodollar budget for the past three years.
“A specific article in the budget law indicates that, if Iraq’s oil production increases, the ministry of finance must report a specific amount of the increase to parliament. Seventeen percent of the increase must go to the Kurdistan Region.”
According to Tahir, the last time the Kurdistan Region received petrodollar money was in 2008.
A letter from Iraq’s Ministry of Finance to the Council of Ministries, dated October 2011, indicates that 17 percent of the petrodollar money must go to the Kurdistan Region according to Article 14 in the Iraqi budget law.
The letter mentions that petrodollar money was 1 trillion and 227 billion dinars in 2011.
It is said that the Iraqi government has used the money on projects in other parts of Iraq. These include 136 billion dinars for Shia shrines, 700 million dinars for the Ministry of Transportation and 1 trillion 84 billion for projects of the electricity department.
The KRG Ministry of Electricity, says Baghdad has not sent any budget for the region’s electricity last year.
Tahir believes Kurdish representatives in Iraq’s Ministry of Finance have been careless in this regard, saying, “The issue is the negligence of our representatives in Baghdad, especially the representatives in Iraq’s Ministry of Finance. We have discussed this issue with them but they don’t report back to us.”
Fazil Nabi, Iraq’s deputy finance minister says that Iraq’s finance ministry is currently studying this issue. “When they are finished with their investigation, the Kurdistan Region will receive its portion.”
Nabi dismissed claims that Iraq has 50 trillion dinars from petrodollar money.
“We had US$8 billion from petrodollar money in 2011. We used the amount to complete the shortcomings in the 2012 budget,” he said.
According to Ibtisam Omer, a KRG representative in Iraq’s Ministry of Finance, Iraq’s Council of Ministers is the main reason the petrodollar money has not been sent to Kurdistan.
“We informed them of this issue many times but they didn’t even respond to us,” she says.
“The Council of Ministers decided to use the money on other projects,” she says. “We asked them to invest some of this money in the Kurdistan Region projects as well, but they didn’t respond.”
The Iraqi government has decided to give $1 from each barrel of oil to the province where oil is extracted. But Kurdish officials say the Kurdistan Region exported its oil through national oil pipelines from 2011 until April of this year and the revenue went to the Iraqi government.