Iraqi Kurdistan nears breaking point

The pressure of hosting more than 1 million people displaced by militants from the group calling itself Islamic State (IS) on top of the 225,000 refugees from Syria is taking a devastating economic and social toll on Iraqi Kurdistan and increasing risks for the most vulnerable.

The population of the semi-autonomous region has grown by 28 percent in the space of 12 months, piling pressure on education and health services. Poverty in the region has more than doubled, according to the World Bank. With further military offensives planned against IS, there are fears that yet more people will seek safety in the region.

The scale of the influx has created significant competition for jobs, pushing down wages and household incomes across the board, while demand for water, electricity and waste management is outstripping supply.

Meanwhile, the falling price of oil has hit government revenues and a long-running budget row with the Federal authorities in Baghdad has halted fiscal transfers to the Kurdish capital Erbil – meaning public salaries have gone unpaid for months.

“The Kurdish Regional Government [KRG] does not have enough cash to pay its own staff, so how can it then pay to look after IDPs [internally displaced people] and refugees?” asked Hayder Mustafa, director general of Development and Coordination and Cooperation in Kurdistan’s Ministry of Planning.

Avoidable tragedies

The majority of the displaced in Kurdistan live in grim conditions, without family or friends to host them or money for accommodation. Despite efforts to transfer the displaced into tented camps, many still live in informal settlements and on construction sites.

"We have cut down on security and fire fighters in all IDP and refugee camps to the level where it is hazardous"

The washing lines strung between naked concrete pillars of half-built hotels and shopping malls serve as a poignant reminder of the economic confidence Kurdistan once had.

The Khero family are Yazidis who fled their village of Giruzer near Sinjar, in Nineveh province, when it was seized by IS militants. IS believes members of the minority Yazidi religion are devil worshippers and have singled them out for brutal treatment including killings, slavery and kidnap. 

Seeking refuge in Erbil, they ended up in a shack settlement on a patch of land next to the luxurious five-star Divan Hotel, once popular with the overseas business delegations that used to flood to Kurdistan.

During a rainstorm last December, three-year-old Rana Khero went missing. After a frantic search the police drained a manhole and found her body. Today the little girl’s tiny brightly coloured shoes are still visible at the bottom of the hole. Her mother Zeitoun Hussein, 30, who is pregnant and has four other children, told IRIN: “I am very sad but what can I do?”

“A lot of these places are so dire but we don’t have resources to fix these problems,” sighed Peter Joshi, Senior Emergency Response Advisor at the Erbil Refugee Council (ERC), a government department also responsible for IDPs.

“If we had the money we wouldn’t have people living here: it is an unliveable space,” he said, adding that the government’s financial issues meant services were being reduced across the board.  “We have cut down on security and fire fighters in all IDP and refugee camps in Erbil governorate – to the level where it becomes hazardous.”

“In some camps we have 50 people sharing one latrine, this is not acceptable,” Mustafa said.

The scaling back of refuse collections and water supplies is already having an impact, with a number of camps reporting scabies outbreaks in recent weeks. The cold and snow of winter was hard enough for families, but as the heat of summer looms, so do new threats of water-borne diseases.

Economic collapse

As the pressure on host communities to share dwindling resources grows, there are fears of social unrest and tensions, such as those witnessed in Lebanon and Jordan, which both host hundreds of thousands of Syrian refugees.

A new World Bank report assessing the impact of the influx of Syrian refugees and internally-displaced Iraqis on Kurdistan notes: “The Kurdistan Regional Government (KRG) is facing a multifaceted and complex crisis compounding concurrent and mutually aggravating security, political, economic, and social risks.” 

“The combination of the Islamic State crisis and the budget freeze has had a chilling effect on all investment, which has declined by two thirds so far in 2014,” the report adds, explaining that the once-booming construction sector had been particularly hard hit and that the presence of IS militants along Kurdistan’s borders had affected the country’s ability to be a safe base for and a trade route to the wider Southern Iraq market.

"The Kurdistan Regional Government has been particularly generous in hosting a major proportion of the IDPs," Abdul Haq Amiri, head of office for the UN Office for the Coordination of Humanitarian Affairs (OCHA) in Iraq told IRIN. “(But)…their resources are limited and they cannot shoulder the burden alone. They will need additional international support.”

The UN is struggling to raise money for the Iraq crisis response. Apart from a one-off donation last July of US$500 million from Saudi Arabia, it has received only piecemeal amounts from other donors. In February it announced that unless more cash came through this month up to 60 percent of its programming would be cut or curtailed.

As of 19 March the Strategic Response Plan (SRP) – a document setting out what money is needed for which sector – was only 38 percent funded, leaving a US$1.4bn shortfall.

“Things are really very bad,” explained Jane Pearce, World Food Programme (WFP) representative. “We are looking at how we can cut back to make what we have go further but we have already been operating on a shoestring so it’s not like there is a lot of room for manoeuvre.”

Lise Grande, the deputy special representative of the UN Secretary General and Humanitarian Coordinator for Iraq, told IRIN that with military offensives on IS territory such as Mosul being openly planned, more displacement was likely.

“We need to be ready for it with stocks pre-positioned and in order for us to do that, we need money, and that’s money we don’t have right now,” she said. 

According to Sibel Kulaksiz, a senior country economist for the World Bank in Iraq, there are several scenarios for how the crisis will develop; the worst-case forecasts an influx of 100,000 more Syrian refugees and 500,000 IDPs, for which the KRG will need an additional US$2.5 billion to cope.

“Efforts are needed at the national and international levels to stabilize the situation [in the KRG] by delivering much needed services to the displaced people and host communities.” She told IRIN.

Ahmed Ali, a senior fellow and director of Iraq security and Humanitarian Monitor at US NGO EPIC, said he believed the financial challenges facing Kurdistan - particularly the non-payment of wages - could be as much of a driver of instability in the region as the security situation.

"We have seen some protests in Sulaymaniyah and Erbil due to the lack of salary payment,” he said. “The government already has to deal with security challenges and it will also have to find a way to address public grievance and then you have to take into account refugees and IDPs…. We have seen in Jordan with Syrian refugees, that there were some protests and discontent among populations in the camps, so it is a challenging situation for the government."

 Co/lr