Using International Financial Aid to Improve Baghdad-KRG Relations
The Kurdistan Regional Government is making a concerted effort to attract financial aid from the United States and other international players, and the logic for providing such aid is strong. The KRG is the vital launchpad for liberating Mosul, and the Kurds are a pro-Western ally of enduring strategic value. Slowly but surely, they are […]Michael Knights writes for The Washington Institute for Near East Policy:
The Kurdistan Regional Government is making a concerted effort to attract financial aid from the United States and other international players, and the logic for providing such aid is strong. The KRG is the vital launchpad for liberating Mosul, and the Kurds are a pro-Western ally of enduring strategic value. Slowly but surely, they are implementing economic reforms and upping their involvement in the war against the Islamic State.
Yet while the United States and its coalition partners are (rightly) beginning to send emergency financial assistance to the near-bankrupt KRG, such cash infusions -- likely totaling less than half a billion dollars in 2016 -- will only postpone Kurdistan's economic collapse by perhaps a year. Washington's aim should not be to keep the KRG afloat until Mosul is liberated; it should be to provide a much larger infusion of financial assistance that continues to help the Kurds well afterward. The International Monetary Fund and other financial institutions are the key to this approach. Involving them in the assistance effort could not only save Kurdistan, but also foster sustainable political and economic relations between the KRG and the Iraqi federal government.
