2023-08-17 09:01 Issue Date_2023-08-19
pdf
Middle East & Africa
Kurdistan’s future
Divided they fall
E RBIL
As the Kurds bicker, Iraq’s federal government is regaining control
or three decades Kurdistan boomed
F while the rest of Iraq sputtered. The re-
gion had the country’s fastest economic
growth. It built modern oil complexes, ho-
tels and motorways. With a vote in favour
of independence in a referendum in 2017,
its future looked bright. Six years on that
dream has faded. The cranes that rotated
above sprawling conurbations are parked
over half-finished estates. And as Iraq’s
capital, Baghdad, rebounds thanks to im-
proved security and oil revenues, its rulers
are chipping away at Kurdistan’s autono-
my. After 30 years of self-government, the
Kurds’ economy, borders, disputed territo-
ries and politics are largely back under
central control. The Kurdish Regional Gov-
ernment (krg) is losing strength, says a
Western diplomat monitoring develop-
ments from Baghdad: “There’s a risk that
the Kurdistan project will fail.”
The Kurds largely have themselves to
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Zone_UKPB Desk_Middle East and
blame. Squabbling between their two feu-
dal families—the Barzanis who rule the
west and the Talabanis in the east—has in-
tensified. Since 2017 their leaders have
transferred power to brasher sons with
clashing personalities. Their parties—the
Barzanis’ Kurdistan Democratic Party
(KDP) and the Talabanis’ Patriotic Union of
Kurdistan (PUK)—fight over diminished
resources. Their ministers often vote
against each in the cabinet in Baghdad.
The puk, the weaker of the two, openly
appeals to Baghdad for backing. “Iraq is
better than Kurdistan,” says the party’s
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45 Ethiopia slides back into conflict
46 Views of climate change
Page_MA1 Rev_.
The Economist August 19th 2023
43
leader, Bafel Talabani. Despite Western
urging, the two parties refuse to unify their
separate forces, known to both sides as the
Peshmerga. Assassinations of each other’s
cadres have resumed.
The last session of the Kurdish parlia-
ment ended in a televised brawl. And as
Kurdish disaffection with the infighting
grows, their leaders are growing more op-
pressive. An election set for last year has
been delayed until February 2024 at the
earliest. Media freedom, once a hallmark
of the Kurdish region, has been restricted.
The Iraqi government in Baghdad is tak-
ing advantage of this rivalry to claw back
the power it lost after the Kurds rose up
against Iraq’s old dictator, Saddam Hus-
sein, in 1991. It has started with money. Ear-
lier this year the Supreme Court used an in-
ternational arbitration ruling in Paris to
outlaw Kurdish oil sales, stripping the
Kurds of revenues they accrued from sell-
ing 450,000 barrels a day. Kurdish salaries
now depend on the monthly allowance
Baghdad pays the regional government.
Kurdish leaders who once shunned Bagh-
dad now troop to the capital to plead for
handouts. In his four years as the KRG’s
president, Nechirvan Barzani has made ten
official visits to Baghdad; his predecessor
and father, Masoud Barzani, made one in 15
years. Under a new national budget passed
 2023-08-17 09:56 Issue Date_2023-08-19
44 Middle East & Africa
in June, any of the krg’s provinces can now
seek direct funding from Baghdad. That
could tempt the Talabanis to break away
from the Barzani-dominated krg and fur-
ther undermine the region’s unity.
The government in Baghdad is also tak-
ing control of the Kurds’ borders. It has sta-
tioned guards at the krg’s crossings and
airports, in effect giving it a veto over who
can get in and out. The Talabanis still pock-
et the revenues from the influx of cars and
from cigarettes smuggled in from Iran—
but not for much longer, says an Iraqi offi-
cial. Turkey’s suspension of oil purchases
from Iraq has also cost the Kurds the tran-
sit fees they used to earn from such tran-
sactions (an international court deemed
that Turkey had been importing oil from
the KRG without Iraq’s consent and award-
ed Iraq around $1.5bn in compensation).
To the south, the Iraqi army and its as-
sociated Shia militias are consolidating
their hold on the disputed territories that
they retook from the Kurds after the refer-
endum in 2017. They have since rejigged
the demography by encouraging Arabs to
settle on land claimed by the Kurds. Were
that referendum held today, the Kurds
might no longer be a majority.
Most damaging, perhaps, is the Iraqi
state’s reassertion of legal supremacy. In
May its Supreme Court declared Kurdis-
tan’s decision to postpone elections un-
constitutional and ordered the replace-
ment of the Kurdish electoral commission
with Iraq’s. Kurdistan is also losing its sta-
tus as a haven for Iraqi activists on the run.
Last year Kurdish security men arrested an
Iraqi researcher working for an American
think-tank and handed him over to Bagh-
dad. Employers in the KRG’s formal sector
now need recruits to get security clearance
from the capital.
Culturally Baghdad’s advances are also
taking a toll. For three decades the Kurds
have promoted their own language and
rolled back the old Baathist programme of
Arabisation. A generation forgot how to
speak Arabic. But it is making a comeback.
A Kurdish leader’s son addressed the audi-
ence at his graduation ceremony at a local
university in Arabic. As ties with Baghdad
tighten, Kurdistan’s private sector now re-
quires new hires to speak it, too. And it is
back on shop fronts in the Kurds’ capital,
Erbil, as an influx of southerners has hoo-
vered up empty property on the cheap. “Ar-
abs are a business opportunity,” says a
Kurdish risk consultant. “But also a threat.”
Things fall apart
While the influence of Iraqi Arabs is in-
creasing in Kurdistan, the Kurds’ leverage
in the capital is weakening. The pro-Irani-
an Shia factions that dominate the central
government are sidelining Kurdish lead-
ers, along with Iraq’s other minorities,
such as Sunni Arabs and Christians. Iraq’s
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The Economist August 19th 2023
waning, too. The Kurds lost their no-fly
Tigris TURKEY zone when America occupied Iraq in 2003.
And although the Americans still keep an
airbase in Kurdistan at Harir, 65km north
100 km
of Erbil, the Kurds complain they offer no
Harir support when Iran’s Shia proxies lob mis-
Mosul IRAN
SYRIA Erbil siles and drones at them. A vast new Amer-
Kirkuk ican consulate in Erbil is behind schedule.
The West’s inertia casts doubt on the alli-
IRAQ
Eu p
Iraqi ance’s strength, worries a Kurdish official.
hra
s Kurdistan The Kurds still have some cards to play.
te
They have been making overtures to the
Chinese, who are set to build dams, a ce-
Areas of control, August 2023 ment plant and a $5bn real-estate develop-
Government Kurdish forces Baghdad ment outside Erbil. The Kurds can also use
Turkish forces the threat of large numbers of refugees to
Source: Janes
rattle the West. A full takeover of Kurdistan
by central Iraq could trigger an exodus to
president, a sinecure for a Kurd, has the Turkey and thence to Europe.
clout of a puppet, say officials in Baghdad. But most Kurds are despondent: “We’ll
Once upon a time the Kurds might have just be another province in Iraq,” says an
looked to the West for salvation. Western analyst in Erbil. The beacon of indepen-
powers created a Kurdish safe haven after dence that shone for some 30m Kurds dis-
the Gulf war of 1991 with a un-approved no- persed across Turkey, Iran and Syria is be-
fly zone. But Western interest has been ginning to fade. 
The Gulf
Zeal estate
DUBAI
Dubai and Riyadh are riding red-hot property booms, at least for now
T IS a villa fit for a Bond villain. Sited in
I Emirates Hills, an opulent Dubai neigh-
bourhood popular with politicians and bil-
$114m. On Jumeirah Bay Island, an artificial
island shaped like a seahorse, someone re-
cently paid $34m for an empty plot of sand.
lionaires, the mansion’s interior is lined Authorities think the city will continue
with 700,000 sheets of gold leaf. It sports a to draw rich buyers from Asia and Russia
24-carat gold jacuzzi, a 16-car garage and a and are eager to build more posh homes. In
coral-reef aquarium in the dining room. May they announced plans to develop
The asking price, when it was listed in Palm Jebel Ali, a bigger version of the city’s
June, was 750m dirhams ($204m). Palm Jumeirah. The development had been
The mansion is one example of a red- on hold since the property-market crash of
hot property market in Dubai, the com-
mercial hub of the United Arab Emirates
(UAE). Prices are also soaring in Riyadh, the
Saudi capital. Both logged double-digit
price increases last year, when much of the
rich world was in a housing slump. Devel-
opers are thrilled. But investors are won-
dering how long the boom can continue.
In Dubai, property investment ac-
counts for around 8% of GDP. It recorded
nearly 122,700 sales last year, a 45% in-
crease from 2021. The value of those tran-
sactions rose by 78%, fuelled in part by
surging sales of luxury homes. In 2022, 219
properties went for over $10m. There were
176 such deals in the first half of 2023 alone.
Brokers are racking up records for the
most expensive residential sale in Dubai.
Last year they closed on villas for $76m and
$82m. In February a penthouse went for
$112m; three months later, another fetched What goes up
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