KRG signs loan agreement with two Iraqi banks

ERBIL (Kurdistan 24) – According to a statement released by the Iraqi Ministry of Finance on Tuesday, the Rafidain and Rasheed Banks have signed a loan agreement in order to pay the salaries of Kurdistan Region employees.

In accordance with the Council of Ministers, the Iraqi Ministry of Finance insists that all citizens and employees are guaranteed their financial rights per written procedures, and it will thus issue loans to the Kurdistan Regional Government (KRG) for the purpose of paying salaries.

The guidelines  stipulate that representatives of the Kurdistan Region must coordinate with the two banks so that the KRG Minister of Finance and Economy Awat Janab Noori can sign the agreement as decided by the Iraqi government. 

Moreover, the Iraqi Ministry of Finance will implement the measures outlined in Federal General Budget Law No. 13 of 2023, which includes  provisions for financial entitlements.

On Sunday, the Iraqi Council of Ministers decided to send 500 billion Iraqi dinars (over $384 million) in the form of loans to pay salaries to the Kurdistan Region; however, Peshawa Hawramani, spokesperson for the KRG, stated at a press conference on Monday that the federal government had unilaterally made the decision without consulting the KRG.

Meanwhile, KRG Finance Minister Awat Noori stated on Monday that the amount of money the federal government is going to send, with a domestic revenue of about 320 billion Iraqi dinars, is not sufficient to cover all salaries.

According to the Iraqi Federal General Budget Law No. 13 of 2023, Iraq's budget is divided into three parts: the general budget, the development budget, and the emergency budget. The general budget covers the costs of salaries, wages, and allowances, while the development budget is used for public investments and the emergency budget is used in the event of natural or man-made disasters. Additionally, the budget is allocated to various sectors such as health, education, and defense.