SULAYMANIYAH, Iraq
More than 250 companies have declared bankruptcy in the northern Iraqi city of Sulaymaniyah as the Kurdish Regional Government fails to pay contracts, a business official said.
The number of bankruptcies over the last nine months has led to thousands of private sector workers being laid off, the Sulaymaniyah Tenderer Association said.
Spokesman Kamil Miran added: “More than 250 companies officially declared bankruptcy due to the economic crisis and the government’s failure to pay the tender price."
"Three businessman committed suicide. Thousands of people were laid off.”
The Kurdish regional authority needs $1 billion a month for salaries in the region but squabbling with the federal government over oil revenues has seen Baghdad refuse to release the region’s 17 percent share of the national budget since January.
The authority claims it is spending “millions of dollars” daily to pay for Peshmerga fighters opposing the Islamic State of Iraq and the Levant and the withholding of the budget has caused an economic crisis.
They are also dealing with an influx of 1.4 million displaced people from areas affected by fighting. Experts say reduced cross-border trade has also hit the authority.
This prompted the Kurdish government to raise the price of its gasoline from 43 cents to 75 cents per liter earlier this month.
In a statement, the government said: “If we lower the price of a liter of gasoline, public servants won't be paid and the economic crisis will continue."
“No-one should expect us to lower the price. We are thinking of the well-being of the Kurdish public.”
www.aa.com.tr/en
