On May 2, 2019, senior US officials traveled to the Kurdistan Region of Iraq (KRI) to deliver a message to the leadership to comply with Washington’s sanctions against Iran.
The Kurdistan region’s rival political factions disagree over the extent to which the KRI should support Iran at a time when Tehran is facing tough US sanctions. Iran enjoys influence in the KRI and has helped mediate frequent political and armed disputes between its two main factions, the Patriotic Union of Kurdistan (PUK) and the Kurdistan Democratic Party (KDP). The PUK is closer to Iran than the KDP.
The division of power between the PUK and the KDP means that Washington must work with both parties to ensure that the KRI’s trade with Iran slows down under sanctions. US officials made it clear to the KRI’s leaders that evading US sanctions would result in the Iraqi Kurdish region’s economy being punished. Both the PUK and the KDP must work together to enforce US sanctions against Iran, however, it is the ruling KDP that must ensure compliance with the sanctions. The difficulty for the PUK is that the regions that it dominates such as Soleimanieh and Halabja are close to Iran’s borders and more likely to engage in cross-border trade despite the sanctions.
Taking sides with the United States against Iran carries unpredictable risks for the ruling KDP party as well, making it vulnerable to Iran withdrawing potential investments and trade options at a time when the KRI needs economic support to rebuild the region after the defeat of the Islamic State (IS).
Iran recognizes the wide appeal that the KDP has among Iraqi Kurds, and the need to work with it. The Barzani family controls the KRI capital, Erbil, and holds 45 out of the 111 local parliamentary seats. The attacks carried out by IS in the KRI since 2014, and Iran’s help since 2017 to defeat the group revealed the extent to which Iran was prepared to extend its security umbrella to ensure the KRI’s security.
The KDP has responded threefold to recent US-Iran tensions. First, it has not forgiven Iran for condemning the KDP-led Kurdish referendum for independence on September 25, 2017. Second, Iran played a central role in restoring Baghdad’s authority over Kirkuk after the defeat of IS on October 16, 2017, which led to the weakening of Barzani’s stronghold over the oil-rich region. On a third level, the KDP has so far avoided choosing sides between the United States and Iran because it is a risky game.
The United States itself did not support the KDP referendum and sided with Baghdad over the issue, which forced the KDP leader Masoud Barzani to step down from power. Even so, the KDP leaders cannot remain passive or impartial about the escalating tensions between Washington and Tehran. The United States will perceive such impartiality as an indication of the KDP being supportive of Iran.
Iran exploits the KDP’s ambivalence on the issue, by turning a blind eye to KDP provocations while offering an olive branch to its leaders. Iran suspects that the August attacks on its proxies in Iraq, the Hashd al-Shaabi, carried out by Israel, happened with help from the KDP. But Tehran continues to cultivate friendly relations with the University of Tehran-educated Nechirvan Barzani, the new president of the KRI and its former prime minister. Iran’s ambassador in Iraq, Iraj Masjedi, recently met with the KRI president in Erbil on October 22, and Barzani sent a message to the Rumi conference in Tehran in which he stressed that Iran brought pride to Iraq.
As the KRI’s prime minister for eight years, Nechirvan Barzani observed the expanding cross-border trade between Iran and Iraq’s Kurdish region. Trade cannot be easily stopped between the two sides due to the easy flow of goods and cargo over land, and the existence of black market commercial activities. After the United States resumed sanctions against Iran in 2018, the KRI was an easily accessible market for Iranians who were anxious to get their hands on vital goods that were scarce in the Iranian market due to sanctions. Iran traded some $1 billion worth of goods with the KRI and expects the figure to increase to $15 billion.
US sanctions can only be effective if the KRI takes concrete steps to stop the cross-border exchange of goods and commodities between Iran and the KRI. But if US-Iran tensions increase, it is not clear if the KRI will allow trade with Iran to carry on.
In Iran, there is no clear verdict on whether the KRI will shift toward Washington on the issue of trade with Tehran. Iran-based political analysts view the Barzanis as pragmatists who will not completely ignore Tehran’s role in ensuring the KRI’s security.
Iran is also confident that the Kurds will not allow Erbil to be used as an operational base by US or Israeli forces to endanger Iran’s security. To ensure this, Iran and Iraq are holding joint security talks to expand military cooperation. The talks include discussions over the KRI’s ability to coordinate its security needs with Baghdad. As a result, Tehran is confident that Baghdad will help Iran retain some degree of influence over the KRI.
Even so, if tensions between the United States and Iran escalate, the Barzanis would not risk being punished economically by Washington as the KRI has far wider strategic relations with the United States than with Iran.
For now, the KRI is far too divided to be able to take a strong stance against Iran. The political fallout in the KRI stemming from the failed Kurdish referendum, political rivalries between the KDP and the PUK, as well as ongoing intra-party tensions within the ruling KDP, are factors for Iran to keep exploiting in order to maintain its influence in the KRI.
More importantly, the latest US decision to withdraw more forces from Syria and withhold protection from its Syrian Kurdish allies means that the Iraqi Kurds cannot fully trust a US alliance at the expense of completely destroying all KRI bridges with Iran. As a result, while the KRI may be forced to comply with US sanctions, it remains to be seen whether it will ignore its political relations with Iran entirely.