Luay al Khatteeb

Q: What are the Main Drivers Behind the Kurdistan Regional Government’s Decision to Hold an Independence Referendum on September 25, 2017?

A: Some foreign observers and the younger generation of the Kurdistan Region of Iraq (KRI) would like think it’s all about the “Kurdish dream” of enjoying an independent state, championed by local Kurdish parties. But reality suggests otherwise. The current Kurdistan Regional Government (KRG) is led by and dominated by Erbil’s ruling family of Masoud Barzani, represented by the Kurdish Democratic Party (KDP). Barzani is also supported by Sulaymaniyah’s ruling family of Jalal Talabani, represented by their Patriotic Union of Kurdistan (PUK). The ruling family of Erbil and its supporting ally in Sulaymaniyah have lost a great deal of public support due to uncontrollable corruption, nepotism and authoritarian tendencies, which have sparked violent protests over the years. This has led to a fracture in Kurdish unity, cancelling out the economic vote of confidence that the KRI enjoyed for a  few years post-regime change. Masoud Barzani, who lost his presidential legitimacy in 2015 (technically, his term expired in 2013) is clinging to power and has expelled the democratically elected head of parliament from the Goran Party; he also closed the parliament for over two years and has said that he would only reopen it on his terms. Barzani’s family members hold all top posts, and are in full control of the KRG apparatus, resources and revenues. They are willing to use all necessary measures to crush opposition, as they did in 2015 and before.

The KRG claim that the pretext for this referendum, besides the Kurdish dream, is that the Federal Government of Iraq (FGI) has denied the Kurdish people its rights to public salaries and budget allocations since 2014. The claim is that the Kurds have been treated as second class citizens, but this is simply not true. The KRG has failed to comply with federal budget rules and lack transparency, as they continue to sell oil unconstitutionally and illegally. The FGI has already paid the KRG over $100 billion since 2003, and rewarded the KDP and PUK with key presidential, ministerial and executive roles at federal levels, while non-Kurds work at the KRG, all on the basis of political consensus, not majoritarian democracy. Furthermore, the KRG has continued to enjoy oil sales and custom revenues that amount to 17 percent of Iraq’s total oil sales, up to the present day. Unfortunately, the KDP PR campaign machine has never stopped funding institutions in the US and Europe while influencing local media with misinformation to justify their mission behind the referendum.

In the end, the referendum does not mean a declaration of independence, as the secession process will require very long negotiations over sensitive and complex issues between the KRG and FGI, with full support of the intentional community, including neighboring countries such as Turkey, Iran and Syria, where large Kurdish populations also reside. It is worth noting that the international community have all rejected the KRG’s call for independence, except Israel.

Q: How Will the Referendum’s Result impact Intra-Kurdish Relations Ahead of the Upcoming Local Elections in the KRG?

A: The KDP and PUK know very well that without their call for a referendum to mobilize the masses in the KRI, they will eventually fail to secure the necessary support to win a free and fair election. They are counting more on the support of the young generation in the KRI that hardly know Arabic and the opaque KDP/PUK black-box politics and financial interests. This is not a good strategy, since the main parties increasingly struggle to appeal to the young, based on legacy politics. Young people want jobs.

Either way, the referendum, or just the call for the referendum, helps the image of the Barzanis and Talabanis as true patriots, and will earn the KDP and PUK the necessary votes to sustain a respectable number of seats in parliament and government at federal and regional levels.

However, even if the KDP and PUK secure longer terms in power and revive their lost “legitimacy”, they will continue to face ongoing problems with opposition parties in the KRI, and this will further compromise their security, social unity and the local economy. Moreover, the situation will never be sustainable within the KRI without continuous international and federal support. Sooner or later, that will disappear as the KRG ruling parties become a liability for all those who deal with them, losing value as a regional asset to fight terrorism or improve trade. This could further push Kurdish opposition parties to cut a unilateral deal with Baghdad to form their own regions within Federal Iraq, out of the control of the Kurdish parties that have ruled the KRI since 1992.

Q: How Will Relations Between the KRG and Baghdad be Shaped by the Referendum Result?

A: For a while it will be business as usual, simply because this unconstitutional referendum does not actually represent independence. But it will certainly increase the tension in disputed territories, including the province of Kirkuk, the petrodollar oil sales of which fuel nearly 70 percent of the KRG’s revenues. In fact, legally speaking, nothing in the Iraqi constitution supports the right for self-determination for any province or faction, while Article 1 of the constitution focuses on Iraqi unity. So I would expect that all parties will enter negotiations to explore their options and sustain ongoing relations. Such negotiations could be overseen by the United Nations as an official mediator, while supported by U.N. Security Council members.

Any serious and viable negotiations should consider the following points: a) The acknowledgement of the KRI border as of 2003, which means that the KRG should unconditionally withdraw its Peshmerga from disputed territories seized afterwards; b) Reviewing and auditing all federal and legal accounts with full transparency, to reconcile payments on the basis of revenue-sharing pro-rata to population and in accordance to the constitution and federal budget laws while taking into consideration actual income and spending, not budget forecasts; c) The implementation of Article 140 in the federal constitution and the review of all illegal birth registrations in disputed territories (including Kirkuk) post-2003 that do not correlate to the historic population growth rate; d) Full acknowledgement by all parties that the Iraqi nationality is paramount to all citizens of Iraq, while all ethnic or religious affiliations are secondary to national identity. Failure to carry out these four points could lead to a serious struggle for the Kurds as the international community have categorically rejected their call for an independent state. This has been an almost consistent policy since 1920.

Q: What are the Potential Impacts of the Referendum Result on the KRG’s Ties with Ankara and Tehran?

A: It all depends on “the day after” the referendum and whether the KRG are seriously looking to carry out sensible negotiations with the FGI. Politically, the referendum will invite more Turkish and Iranian interference in Iraqi politics and could eventually cause hostility to the KRI if the Kurdish ruling parties fail to demonstrate pragmatism.

Economically, Turkey will continue to enjoy commercial benefits from the KRI’s disputed resources given the fact that the KRI is a landlocked territory with no access to the Mediterranean except via Turkey. However, Ankara could pursue stronger cooperation with Baghdad to strengthen strategic ties and interests. As for Tehran, scenarios will remain unpredictable given the significant role that Iran plays across the Middle East, but will almost certainly prove to be negative for the KRG.

Q: What are the Geoeconomic Implications of the Referendum Result for the KRG and Middle East at Large?

A: The KRI’s economy is insignificant to the Middle East region, and their oil production is trivial, even compared to many non-MENA producers. However, their geographic location is vital for commercial trade between Iraq and Turkey and for exporting surplus gas (if any) which is not an issue for the foreseeable future given the rising local demand for gas in Iraq, including in the KRI. In fact, any instability will push international oil companies and other foreign investors to farm out their assets and depart the KRI should the situation escalate and businesses declare force majeure.

 BioExecutive Director, Iraq Energy Institute (IEI), Fellow, Center on Global Energy Policy, Columbia University-SIPA 

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