ERBIL, Kurdistan Region of Iraq - Kurdistan Region Prime Minister Masrour Barzani said Wednesday that the Erbil-Baghdad financial crisis may “soon” be resolved, and a top delegation from Baghdad will in "a couple of days" visit Erbil towards that end. 

Speaking at a press conference in Erbil, Prime Minister Barzani said Erbil and Baghdad may reach “a very positive resolution” to put an end to the budget suspension. 

“I am sure this crisis is drawing to an end,” PM Barzani said. “Last night I spoke with the president of the supreme judicial council [Faiq Zidan] and I have also spoken with Prime Minister [Mohammed Shia’ al-Sudani] that we must take steps towards resolving this crisis. They very happily announced that they were ready to send a delegation in the very, very near future, in a couple of days, to start genuine talks on this subject.” 

The Iraqi finance ministry in late May suspended funding the Kurdistan Region for the remainder of 2025, claiming that the Region has already exceeded its share of the annual federal budget, and on grounds that from 2023 until April 2025, the Kurdistan Region had handed over only 598.5 billion dinars out of its total oil and non-oil combined revenues of 19.9 trillion dinars.

Barzani described the finance ministry’s decision as “illegal” and “unconstitutional”.

Years of conflict and unresolved issues between Erbil and Baghdad, and economic sanctions and pressure on Erbil by federal authorities, have pushed employees in the Region to live from paycheck to paycheck.

The Iraqi finance ministry’s decision has sparked outrage among Kurdish officials both in Baghdad and Erbil.

Prime Minister Barzani accused some domestic political parties of asking Baghdad to interfere in the salaries of the Kurdistan Region’s civil servants. 

The Kurdish premier made clear that Erbil alone, from its revenues, is unable to cover the salaries of civil servants. 

In parts of his speech, Prime Minister Barzani welcomed the Israel-Iran ceasefire, saying it is "in the interest of the entire region,” while thanking Iraqi Prime Minister Sudani and Foreign Minister Fuad Hussein for preventing Iraq from "being entangled" in the regional conflict.

Updated at 1:03 pm with additional quotes from Kurdistan Region PM Barzani