The uncertain future of Kurdish autonomyWhat next for Iraqʹs Kurds?
After several years of relative stability and economic prosperity, the region of Iraqi Kurdistan has suffered major setbacks, largely due to two events that took place in the years 2014 and 2017. In 2014 Nouri al-Maliki, Iraqʹs prime minister at the time, decided – in view of the escalating oil conflict in northern Iraq – to cut its state funding to the KRG, the Kurdistan Regional Government. This decision had devastating political and economic consequences, which also brought social problems to the region.
In this already difficult situation, a referendum on Iraqi Kurdistanʹs independence was then called on 25 September 2017. As a consequence of the referendum result, which according to the electoral commission saw 92 percent of voters in favour of independence, the situation became even worse. Once the result of the ballot was made public on 10 October 2017, Iraqʹs prime minister Haider al-Abadi decided to close Sulaymaniyah and Erbil airports to foreign flights and the central government in Baghdad took back around 50 percent of the territory, including Kirkuk, which had been under Kurdish control after being liberated from "Islamic State" (IS).
The borders with Iran and Turkey were also initially closed following the referendum and trade was severely restricted. Before the vote, Iraqi Kurdistan had produced around 500 to 600 barrels of oil a day for the world market. The price of oil had been on the rise in the lead-up to the referendum, but from then on the region was cut off from the oil market.
The consequences of draconian austerity measures
The 2014 decision by the Iraqi central government in Baghdad had prompted the KRG to introduce wide-ranging austerity measures. Among other things, a savings system was put in place for civil service salaries, under which part of the salary was withheld as a kind of savings deposit for employees, though none of the employees had agreed to this. The measure led to strikes at regular intervals, by groups including teachers. Those working for the interior ministry and the Kurdish military units of the Peshmerga were the only people exempted from the saving scheme.