US expressed dissatisfaction with Baghdad’s policy toward Kurdistan, KRG official says

ERBIL — The Kurdistan Regional Government’s Foreign Relations Office said Monday that the U.S. State Department has notified Baghdad of its dissatisfaction with federal policies toward the Kurdistan Region.

“The dissatisfaction of the U.S. State Department comes because of the ongoing tensions between Baghdad and Erbil on several sensitive issues, including the distribution of financial revenues and salaries as well as disagreements over oil understandings, which disrupts cooperation between the two sides and negatively affects political and economic stability in Iraq in general and the Kurdistan Region in particular,” said Safeen Dizayee, head of the office.

Disputes over budget allocations intensified in May, when Iraq’s federal Finance Ministry suspended salary transfers to the Kurdistan Region, accusing the KRG of exceeding its 2025 allocation by more than 19 trillion dinars (about $13.6 billion) and failing to provide verified data on oil and non-oil revenues. Oil export disagreements also remain unresolved. Before the March 2023 pipeline shutdown, the Kurdistan Region exported about 450,000 barrels per day, but the halt has cost Iraq an estimated $20 billion in lost revenue. The suspension of budget transfers has left thousands of public employees in the Kurdistan Region without pay. Baghdad has released salaries for May and June.

Dizayee said Erbil is working to expand ties with countries that have advanced industrial and economic expertise, such as Thailand, in hopes of drawing on their experience to develop local sectors.

He also pointed to Erbil’s growing international presence. “The capital of the region, Erbil, is currently hosting more than six forums, conferences and economic meetings organized by consulates and embassies from Europe, the United States and other countries, which reflects the international community’s confidence in the region as a stable investment destination,” he said.