Hussain Fayli Muneer | Exclusive to Ekurd.net

In order to introduce what I’m going to talk about, I just want to first explain the reasoning behind this piece in which I am about to write. First and foremost in no way shape or form should whatever I state be perceived as an attack on political parties in the KRG or a single one for that matter. However any critique of the KRG I have or a political party will be based upon logical, rational and a degree of open-mindedness. This shouldn’t necessarily be considered a “manifesto” per say, however I won’t contend the fact that it will definitely appear in a manifesto-like manner. Generally this will be focused on the KRG, both relating to the internal and external problems facing the KRG.

Although the application of this can apply to other parts of Kurdistan as a broad template. To understand the KRG, we must understand the problems the KRG is facing; which are numerous. For example within the KRG it faces the problem of corruption, economic dependency, oil dependency, a great polarization of political lines being drawn, a lack of government coordination and efficiency and rising budget deficit in the KRG’s purse. I would like to dissect each and every one of these issues and attempt to offer a pragmatic solution.

Before this however the name of the piece may leave you asking questions about my positions and political-economic stance. I would like to emphasise the point that in no way am I attempting to persuade you to switch over to my political-economic viewpoint, however I would like to generate sympathy for this viewpoint in which I am about to present. Firstly the emphasis on “patriotic” is simply a way of denoting and showing my support for Kurdish movements that support Kurdish independence and I share this stance on seeking an independent Kurdish nation-state. Secondly on that stance of “socialist”, this may be a little more confusing to explain due to the numerous different definitions and understandings of what we call “socialism”. Socialism as I see it should take a democratic route, In that way political questions do not have to arise in relation to the economic policies. For example I am a believer in the government having a hand and nationalising certain major industries.

What we call ‘State Socialism’ or a slightly more Authoritarian approach to Socialism. However on a micro-economic level, the private individual would still have a great degree of economic “freedom” in capitalist terms. Furthermore I’d like to add social welfare delivered by the state is a given in any “democratic socialist” society. That being the state provision of healthcare and it being free. This for example works excellently for Cuba and their healthcare system being highly praised. I have no doubt if the KRG had the political will to do so, they can implement a health care system similar to that of Cuba. Take this extract as evidence, “The Cuban health system is recognized worldwide for its excellence and its efficiency. Despite extremely limited resources… WHO notes that the lack of access to care in the world is by no means a foregone conclusion arising from a lack of resources. It reflects, instead, a lack of political will on the part of leaders to protect their most vulnerable populations.” (Lamrani, 2017)

The first point of contention is with the corruption that is writhe within the KRG. This frankly in my eyes transcends a single political party and crosses for the most part all party lines. One may be able to however claim that a particular party within the KRG is more corrupt than the others. As however we don’t want to nit-pick and get bogged down in certain intrinsic details, we will be talking broadly and generalising. Corruption in the KRG has come in all forms and most recently in the form of attempting to sell off oil fields illegally, along with the recent scandalous actions of KRG officials in not allowing foreign audit firms to see certain financial agreements. This is very problematic and leads me onto the point of a lack of transparency within the KRG which feeds into the corruption. For example in referencing this piece we can see this, “In the KRG, institutions are very weak and politicians depend on oil revenues as a source of living.

This oil-dependent risk has also led to acts of corruption.” (Omer, 2017) The general explanation here allows us to understand that the KRG’s problem in the heavy corruption that it faces. To add to this it gives us insight in how certain elements within the KRG on a senior government level are misappropriating funds generated from oil revenues. A counter-point to this argument I’m presenting can be seen in the light of the KRG’s corruption level is in reality not as good but yet no different to that of local Middle-eastern (MENA) countries. In that regards too much criticism on the KRG isn’t necessarily a fair thing to engage in. “Most Middle East and North African (MENA) countries are considered highly corrupt…The region as a whole fares poorly on the Transparency International’s Corruption Perception Index.” (Ottaway, 2017)

Now my solution to the problem presented above really is a simple one and a common sense typed solution. It comes down to KRG in short being more transparent. This transparency must come from the top down and must be a complete overhaul of the current corrupt practices that are taking a hold of the KRG and a number of its officials. It really should be an internal push but because the KRG officials in any case aren’t going to implement these reforms for transparency; the KRG definitely needs to hire foreigners to do so. For example I’ll insert this extract from ‘Reuters Institute’ to show some of the possible solutions the KRG can implement, “The announcement of more user-friendly government websites, greater access to government data, the extension of freedom of information legislation and broader attempts to involve the public in government decision making.” (Bowles, Hamilton and Levy, 2017) From this we can see that if we democratize certain areas of government from both an institutional level and a human level; it can allow for this transparency to occur.

This in turn will in my view create far more trust between the KRG officials and its population as oppose to the distrust that occurs now. In advance the neglect of using foreign auditors is problematic as well because without it the KRG cannot become transparent. The KRG simply put needs to allow these audit firms to not only check their account balances but publicize them to the KRG’s population. “The Kurdistan Regional Government (KRG) won’t permit the Deloitte and Ernst & Young companies – international audit firms – to see the terms of an energy agreement it has with Turkey, Prime Minister Nechirvan Barzani said. (Nrttv.com, 2017) On the other hand I can sympathize with the point of view that these solutions are too simplistic and even disregarding the simplicity. The KRG on its own cannot implement these reforms because they demand an internal political will to deliver these reforms. Yet the political elites within the KRG haven’t demonstrated this will. Therefore international institutions alone can only do so much in this aspect.

The second point of contention I have is in regards to the Economic dependency we have. This goes hand in hand with the problem of the KRG’s economic structure that is oil dependant. To first start with is the KRG’s economy which for the most part has become dependent upon Turkey and Turkish imports. Not just imports via the commodity route but the imports of services, which is resulting in the domination of the KRG’s economy due to Turkish influence. Referring to this piece from the ‘Turkish Policy’ for example, “Turkish companies rapidly expanded their share of the market and supplied roughly 80 percent of Iraqi Kurdish consumer imports including furniture, food products, and textiles.” (Fidan, 2017) With this there is no doubt in my mind that the dominance of Turkish policies has political implications to the KRG, especially in relation to the KDP which has affiliations to Turkey.

However putting aside the politics for a minute, this is ultimately due to the KRG’s liberalisation of the economy and the Neo-Liberalist outlook to the economy. To sympathize with the other side, I do recognize that the KRG is in a precarious position. This position has meant the KRG’s hands are tied economically for two reasons. The first because the KRG isn’t an independent nation-state, therefore several aspects of the economy the KRG doesn’t have a free hand in. Secondly the KRG from a geo-political position isn’t entirely in the best spot to dictate economic outlooks that are not acceptable or considered radical in a region that is unstable.

This relates to the problematic issue of oil dependency which ties into the previous problem stated of economic dependency. The KRG is unfortunately overwhelmingly dependant on this one commodity called oil. Some contend oil to be a curse and others a blessing. I do not see it in either lights. I see it in the light that it has the capability to do either based upon the actions the government takes. Getting back to the main point, the KRG’s reliance on oil hasn’t helped out the economy. If anything oil it appears isn’t solving the ever growing budget deficit that the KRG faces. Along with the huge debt that the KRG faces. Along with the fact that the KRG’s oil minister Ashti Hawrami has attempted to sell off oil fields to the tune of “$5 billion”.

As the WikiLeaks so crudely puts it, “In January it earned $650 million, then $303 million in February, and then $289.5 million in March. The KRG needs roughly $730 million a month to cover its bills. $424 million is necessary just to pay public workers and the Peshmerga.” (Yazar, 2017) This is just a small extract and piece of evidence showing the difficulties of the KRG’s oil dependent economy and it will hopefully get us onto the solution of a way of dealing with this problem. Taking into account the KRG’s oil dependency problems, we can understand that the KRG was faced with a hard choice. Considering the reason the KRG could not have magically branched out of oil or naturally moved away from a commodity based economy. Considering the circumstances and the fact oil does generate revenue for the KRG, without it the possibility for more economic problems could have arisen.

The solution I propose for a removal of economic dependency specifically relating to Turkey and any other nation for that matter of fact is going to be a simplistically blunt one. This is as follows: The KRG should not adopt Neo-Liberalist economic policies. If anything it should steer away from it and instead adopt Neo-Mercantilist trade policies. In my eyes the “freeing up” of the market is one of the causes of the KRG’s problem. Globalisation can no doubt not be denied but in such a case the KRG needs a wise and logical approach to the problems of globalism. Protectionist trade policies should be implemented, this revolving around an imposition on tariffs on imports. These imports specifically relating to Turkish consumer goods and food imports. On top of the tariffs, an imposition of subsidies upon new or emerging industries need to be implemented.

For example the KRG can hypothetically use the revenue generated from both oil and tariffs to specialize in the manufacturing industry or another industry aside from oil. Take also the successful example here, “A second way of protecting trade is when the government subsidizes local industries with tax credits or even direct payments. This again lowers the price of locally produced goods and services.” (Amadeo, 2017) Therefore what I take from this is that protectionism and what we call “Neo-Mercantilism” does indeed work, however in my view it shouldn’t be taken to the extreme to the point where it drives out investment. This is obviously not something we want but I truly believe these types of protectionist policies, taking into account the ‘infant industry argument’ by Max Weber; this can be a useful tool for the KRG to employ in resistance to the negative effects of globalisation. One has to see that this can be problematic for the KRG as well or at least can cause some problems in employing these types of policies. This mainly being that protectionism can be a two way streak. For example if nation A puts a tariff on nation B, then nation B will do the same. A counter argument to that can be simply put that the world economy isn’t as simple as the hypothetical example I used and therefore it is a weak argument against protectionism.

This extends to the solution in regards to oil dependency and how to deal with oil dependency. In my view there are two main solutions to employ which are interrelated. The first solution being that the oil industry needs to be nationalised. Now understandably nationalisation in the Neo-Liberal outlook of the economy is frowned upon and seen as radical. However nationalisation can be done in a completely sensible way and in an orderly manner. This can be done by allowing for a transitionary period where the TNCs (Trans-National Corporations) who own shares in the KRG’s oil to accept a loss of shares over a period of time, whilst maintaining their engineers and human capital in their remaining shares. Once the KRG has assessed its own capability in regards to the human capital needed in order for the oil sector to be fully nationalised.

That’s when the TNCs would hand over complete control. For example many oil companies are already state-owned as we can see from here, “Multinational oil companies produce just 10% of the world’s oil and gas reserves. State-owned companies now control more than 75% of all crude oil production.” (Bremmer, 2017) This demonstrates to me of both the capabilities of state power and its ability to control its own major industries. This can only in turn mean that the revenue generated is the complete responsibility of the government whose revenue generated in an ideal world would be held to account by the people. Meaning with state generated revenue, the public of the KRG could pressure its representatives to re-invest the oil money into public services such as healthcare and education.

Now this leads me onto the second aspect of the oil dependency solution, being that the KRG needs to diversify its economy. The diversification of the economy can happen over a short period of time and it can be implemented radically. The one specific way of doing this can be done through the substituting of oil as an energy source and transferring to a renewable energy source. It is understandable that investing in the renewable industry is a risky endeavour in the sense it is a fairly new industry. However many governments across the world are taking renewable energy seriously and investing in some serious money. Take for example India here, “By 2022, India aims to power 60 million homes by the sun. It is part of the government’s goal to produce 40 percent of its power from non-fossil fuels by 2030.” (Aljazeera.com, 2017) From this we can stipulate that renewable energy is the future in regards to finding a new energy source.

Considering fossil fuels will eventually become far scarcer and run out. Therefore it is completely logical to invest in solar energy. In relation to what solar energy could do, let us take it step by step. It would roughly cost $20 billion to invest in enough solar energy to power 6 million homes, which is just over the population of the KRG. This is all based upon Al Jazeera’s article. With the powering of 6 million homes, energy prices will no doubt fall dramatically, even to the point of possibly becoming free. This on the surface may appear problematic to the capitalistic mind-set, however I see it in a positive light. This is because solar energy output will likely generate an over-supply of energy, in turn the KRG can sell-off the surplus energy to its neighbours; generating revenue for its fiscal budget. In order to evaluate this solution I have proposed, I have no doubt that there are other means of diversifying in relation to the economy. For example investing in Nuclear Fusion power, which is still in its preliminary stage of development; it however presenting the capability of a potentially close to unlimited energy source. For example the costs as we can see here are entirely feasible costs, “The result was the ITER Fusion Energy Advanced Tokomak (ITER-FEAT) – initially expected to cost $3 billion but still achieve the targets of a self-sustaining reaction and a net energy gain.” (World-nuclear.org, 2017)

Last but not least is the issue relating to the KRG’s political deadlock which seems to have existed for an eternity now. This polarization of politics within the KRG is causing both internal and external problems for the wider Kurdish nation. Before I delve into my main point, I’d like to state I do not support any Kurdish political party within the KRG and any criticism of one particular party is merely me attempting to be “fair”. For starters this problem is due to the power dynamic within the KRG, which is a duopoly by nature. In 20 years since the KRG’s creation nothing much has changed, the PDK and PUK still dominate political life; not to mention they dominate all the ministries. To my eyes this is due to the reason that the two major parties the PDK and the PUK simply do not want to share power or accept being removed from power in free and fair democratic elections. We can see this in their actions and sentiments towards opposition groups, “when Gorran chose to run in opposition and the PUK and KDP formed a government together.

The PUK and KDP have traditionally dominated the government since the establishment of the KRG in 1992.” (Wilgenburg, 2017) We can extract furthermore the two major parties’ difference can easily be put aside when facing an opposition group such as ‘Gorran’. Not only that but the two major parties it appears on the surface are always prepared to give concessions and when the time comes from change, they revert back to back peddling. “A senior party official with the Kurdistan Islamic Union (KIU) told Rudaw on Sunday that “a major breakthrough” has “positively” pushed forward the ongoing talks over a political gridlock that has virtually paralyzed the regional parliament and undermined the government since November last year.” (Rudaw, 2017) It is understandable from this the person reading will view this in a positive light and deem my initial point to be irrelevant. My perspective actually sees this from a different angle and that angle is history repeats itself. These types of “reconciliatory” talks have occurred in the past and to no avail. Here it is not necessarily a problem solely facing the KRG, being leaders back peddling and clinging onto power when it is time to relinquish it.

If there is any single solution here in regards to the polarization, the first I would contend to be is the actual political will to put genuine differences aside and work with the opposition groups. This is more so directed at the PDK and PUK. Inter-linking to this would the need for checks and balances in the KRG to take place, true checks and balances. It cannot revolve around the pretence of a political system that has checks and balance. Since on paper the KRG has this, yet we find In relation to both the Presidency and the Prime Ministership, it is dominated by the Barzani clan. In any transparent, open and free democracy this would never be tolerated. The Barzani clan controls both legislative power and executive power, which in effect means they hold complete power. Repeating my initial point on checks and balances, a practical way of working around this would be employing members of two different political parties’ to the post.

To sum up everything put here, I completely understand that I have not been able to delve into every topic or delve into certain topics in great detail. In reality as seen from everything above the issues facing the KRG and even the solutions are multifaceted by nature. The issues relating to KRG’s corruption and the taking of what is called “side-payments”. The economic dependency of foreign powers, namely in the form of Turkey. The oil dependency issues and a lack of diversification in the KRG’s economy. The political landscape in the KRG and the problem of polarization of the political environment in the KRG. I didn’t even get to touch on issues of politics being drawn on tribal lines, however I will not contend that this is another topic entirely.

The solutions also vary to each and every one of these problems, be that adopting a renewable energy source, developing a manufacturing industry, hiring foreign auditors to maintain a clean account balance, having a true form of checks and balances in the KRG. Onto my opinion I take everything into account and I understand that a lot of these solutions are at the very least manifesto-like in their nature; being broad and general. None the less I think the KRG should take some of these ideas seriously and understand that the Kurdish people deserve justice in all forms of the word. I do however believe the only major setback is the fact the KRG is not an independent nation-state. To truly achieve some of these radical and fundamental reforms, the KRG needs the tools and assets of an independent nation-state to achieve the goals of complete geo-political and economic freedom.

Bibliography:

Lamrani, S. (2017). Cuba’s Health Care System: a Model for the World. [online] The Huffington Post. Available at: http://www.huffingtonpost.com/salim-lamrani/cubas-health-care-system-_b_5649968.html [Accessed 3 Jan. 2017].

Omer, A. (2017). Corruption and the KRG’s oil sector. [online] Nrttv.com. Available at: http://www.nrttv.com/EN/birura-details.aspx?Jimare=2412 [Accessed 3 Jan. 2017].

Ottaway, M. (2017). What Does Corruption Mean in the Middle East, Exactly?. [online] Wilson Center. Available at: https://www.wilsoncenter.org/article/what-does-corruption-mean-the-middle-east-exactly [Accessed 3 Jan. 2017].

Bowles, N., Hamilton, J. and Levy, D. (2017). Transparency in Politics and the Media. [online] Reuters Institute for the study of Journalism. Available at: http://reutersinstitute.politics.ox.ac.uk/publication/transparency-politics-and-media [Accessed 3 Jan. 2017].

Nrttv.com. (2017). NRT English. [online] Available at: http://www.nrttv.com/EN/Details.aspx?Jimare=11728 [Accessed 3 Jan. 2017].

Fidan, c. (2017). Turkish Business in the Kurdistan Region of Iraq – Turkish Policy Quarterly. [online] Turkish Policy Quarterly. Available at: http://turkishpolicy.com/article/790/turkish-business-in-the-kurdistan-region-of-iraq [Accessed 3 Jan. 2017].

Yazar, T. (2017). WikiLeaks – Berat’s Box. [online] Wikileaks.org. Available at: https://wikileaks.org/berats-box/emailid/55149 [Accessed 3 Jan. 2017].

Amadeo, K. (2017). Why Protectionism Feels So Good, But Is So Wrong. [online] The Balance. Available at: https://www.thebalance.com/what-is-trade-protectionism-3305896 [Accessed 3 Jan. 2017].

Bremmer, I. (2017). The Long Shadow of the Visible Hand. [online] WSJ. Available at: http://www.wsj.com/articles/SB10001424052748704852004575258541875590852 [Accessed 3 Jan. 2017].

Aljazeera.com. (2017). India unveils the world’s largest solar power plant. [online] Available at: http://www.aljazeera.com/news/2016/11/india-unveils-world-largest-solar-power-plant-161129101022044.html [Accessed 3 Jan. 2017].

World-nuclear.org. (2017). Nuclear Fusion : WNA – World Nuclear Association. [online] Available at: http://www.world-nuclear.org/information-library/current-and-future-generation/nuclear-fusion-power.aspx [Accessed 3 Jan. 2017].

Wilgenburg, W. (2017). Iraqi Kurds still deadlocked over new government. [online] Al-Monitor. Available at: http://www.al-monitor.com/pulse/fr/originals/2014/04/kurdistan-iraq-regional-government-elections-deadlock.html [Accessed 4 Jan. 2017].

Rudaw. (2017). New deal could break political deadlock in Kurdistan, party official says. [online] Available at: http://rudaw.net/english/kurdistan/180720161 [Accessed 4 Jan. 2017].

Hussain Fayli Muneer, a university student in London studying Politics.

Article 1st published at Ekurd.net

The views expressed in this commentary are solely those of the author.

Copyright © 2017 Ekurd.net. All rights reserved

Comments

Comments