Dr. Bayad Jamal Ali
The past 2 years have been rather problematic and faced many challenges in Kurdistan from fighting ISIS, issue of liquidity, delays in public employees’ salaries, bankruptcy of many companies, lack of electricity and mismanagement of water which was discussed in ” The Wasted Treasure”, not being able to accuse one official for corruption, drop in oil prices which was discussed in ” The Dilemma of Kurdistan’s Black Gold “, political issues of Tuz Khormato which was discussed in a previous article ” The Players Behind the Curtain “, lack of transparency in Kurdish oil exports and its role in the economy which was discussed in ” Kurdistan’s Dutch Disease “, fragile food security which was discussed in ” Pity The Nation That Eats A Bread It Doesn’t Harvest”, shutting down the parliament and several ministries, thousands of students not able to apply for university which was discussed in “The Vicious Cycle of Kurdistan’s Education”, the loss of lives of thousands of Peshmarga (Kurdish Soldiers) on behalf of the world fight against terrorism, the lack of leadership vision which was discussed in ” Kurdistan’s Leadership Vision for 2021 “, to the immigration of Kurdish youth along with the resources of a successful economy was discussed in “Kurdistan’s Economy and its Shortfalls “.
So the question to ask here is, what is 2016 is going to be like?
First thing to make clear is 2016 Iraqi budget which was just approved in December 2015, and the Kurdish members of Iraqi parliament celebrated that they managed to get the approval of the 17% of Kurdistan’s share. It is important to note that the total Iraqi budget of 2016 is $65 billion US dollars based on the current exchange rate in compare to $150 billion dollars in previous years, and in order to reach that number 20-25 billion dollars will be borrowed, estimating that oil is sold by $45 USD, which will not happen because the current prices is fluctuating between $30-$40 and is expected to drop more because of the surplus in oil market supply which is more than 3 million barrels per day. Moreover, it is clearly written in the approved 2016 budget that Kurdistan should give Baghdad 550,000 barrels per day (which everyone knows that will not happen) and also to send the budget Iraqi Prime minister needs to sign the release, which previously the ministry of finance could transfer the money without that, not forgetting that due to the oil revenue issues Baghdad stopped sending the medical supplies to Kurdistan which was not considered in the 17% but an extra support, and that stopped also of you wonder why there is a lack of drugs in the hospitals. So I wonder what the Kurdish Members of Iraqi Parliament were celebrating for!!
Hence, in 2016 Kurdistan Government is the one in charge in finding revenue to run the government and the economy. Taking into consideration that the Kurdistan Regional Government is owed 21 billion dollars (that we know of), and in light of the oil prices that reached a new low to $34 and all studies show that it will decrease more and would need at least a decade or two to raise back to the old prices, and oil market illustrated above along with the loss of 2 billion dollars in Dana Gas Law suit and being in court now for another 11 billion dollars according to dana gas claims, and with the excess supply in oil from all oil producing countries who will buy the legally problematic Kurdish oil!
The delay in public employees’ salaries will remain, demand will drop and more businesses will go bankrupt, unemployment rate will hike, investment projects will stop, government will decrease salaries and downsize personnel, crime rate may increase, and the economy will shrink severely.
So for 2016 people shouldn’t blame Baghdad government, but actually should hold Kurdistan Regional Government accountable (all political parties included), and do ask where has the money been going all these years, and who are the people that are planning for Kurdistan’s economy that are celebrating and giving hope to the Kurdish citizens on false pretenses? How a country could be ran without clear economic policies, fiscal policies, and monetary policies? Democracy is not just voting, it is transparency, respecting public opinion, being accountable for misconduct, rule of law, social justice, and many more.