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Significance

Between deepening internal divisions, increased foreign pressure and a stark economic crisis, the semi-autonomy of the Kurdistan Region of Iraq (KRI) is facing its most severe test since its 1991 formation.

Impacts

The KRI’s oil sector is likely to stagnate, given pipeline issues and investor concerns, undermining efforts to revive output.

The regional government will depend on federal fiscal transfers that cover only part of its payroll, in 2023 and likely beyond.

Baghdad will likely involve itself in plans for the upcoming KRI elections, to the detriment of the KDP.

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