During a meeting of the Kurdistan Regional Government (KRG) Council of Ministers on Wednesday, KRG Prime Minister Masrour Barzani proposed the establishment of a high-level permanent ministerial coordination committee composed of officials from both the KRG and the Iraqi federal government.

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At the Council of Ministers meeting, KRG Prime Minister Barzani briefed ministers on his recent visit to Baghdad following the formation of Iraq’s new government, which was focused on resolving outstanding issues between Erbil and Baghdad and supporting cooperation on energy challenges.

Following discussions on the details and mechanisms for forming the committee, the KRG Council of Ministers approved the proposal and decided to submit it to the federal government for a joint decision by both governments.

KRG Deputy Prime Minister Qubad Talabani also underlined the importance of establishing such a committee, noting that it would institutionalize mechanisms for resolving disputes between the KRG and the federal government and play a positive role in addressing issues between the two sides.

After the discussion, the Council reaffirmed the Kurdistan Region’s support for the new federal government headed by Iraqi Prime Minister Ali al-Zaidi in addressing the financial challenges facing Iraq as a result of recent regional developments. 

To that end, the Council instructed the KRG Ministry of Natural Resources and the negotiating delegation to accelerate efforts to restore oil exports through the Kurdistan Region’s pipeline network to the highest possible levels for global markets, with revenues returning to the federal treasury. It also emphasized continued cooperation to support initiatives and opportunities that would increase federal revenues.

Compared with 2025, revenues have seen a substantial decline, as reflected in monthly review reports, and are currently being audited by joint federal and regional financial oversight teams, the meeting also noted.

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In July 2025, the KRG and Baghdad struck a deal for the KRG to deliver 230,000 barrels of oil daily and 120 billion Iraqi dinars in non-oil revenues in order to resume oil exports that had been halted since 2023 in exchange for Baghdad paying the KRG government salaries on time. KRG salaries have been regularly cut since 2014 as a result of disputes with Baghdad.

The Council requested that the federal government reconsider the allocation of the 120 billion Iraqi dinars designated as the federal treasury’s share, as the Kurdistan Region’s monthly revenues have declined by more than 70% due to the war, regional instability, and the unresolved ASYCUDA file.

Regarding the implementation of the ASYCUDA customs system at the Kurdistan Region’s border crossings, the Council stressed that the Federal Ministerial Council for the Economy should, at the earliest opportunity, approve the preliminary agreement signed in April between the two sides concerning the implementation of the ASYCUDA system at the Kurdistan Region’s border crossings.

Resolving this issue, the Council noted, would increase revenues from border crossings, strengthen and revitalize trade flows, stimulate markets, and ultimately serve the interests of all of Iraq.