The September 25 statehood referendum in the Kurdistan Region of Iraq passed overwhelmingly, with 92.7 percent of voters choosing “yes.” Although the outcome does not trigger any administrative changes and is explicitly not a declaration of independence, the central government and parliament in Baghdad have reacted fiercely, while neighboring states such as Turkey and Iran are coordinating punitive measures with Iraqi officials. Some of the suggested punishments could damage U.S. interests and hand more influence to Iran, where Turkish president Recep Tayyip Erdogan will visit on October 4. Before that trip, the United States needs to act quickly to shape Turkish and Iraqi calculations on post-referendum policy, preferably with backing from the UN Assistance Mission in Iraq and the coalition fighting the Islamic State (IS)

ACTIONS BEING CONSIDERED AGAINST KURDISTAN

In Baghdad, the volatile parliament issued a thirteen-point resolution in response to the vote. Although the resolution is not a full law because it did not originate in the cabinet, it includes a host of dire steps: taking military action against Kurdish-held disputed areas such as Kirkuk, sacking Kurdish federal government employees who voted in the referendum, removing Kirkuk governor Najmaldin Karim “by force,” closing the borders of the Kurdistan Regional Government with the help of neighboring states, cutting off its oil exports, closing foreign consulates inside the KRG, taking legal action against KRG president Masoud Barzani, and making preparations to remove the ethnically Kurdish president of federal Iraq, Fuad Masum.

Prime Minister Haider al-Abadi is unlikely to follow through on the request for military escalation, but he has signaled that “economic measures” will be taken, and demanded that the KRG hand over all border entry points, airports, and oil exports. The Iraqi Civil Aviation Authority has indicated that Kurdish airspace will be closed to international flights beginning 6 p.m. local time on September 29, and airlines worldwide are likely to suspend flights to and from the KRG.

For their part, Turkey and Iran seem ready to back Abadi’s handover demand. Baghdad is already working with Tehran and Ankara to establish shadow customs facilities inside Turkey that would collect fees before the KRG can levy them. These posts would also comply with Iraqi and Turkish wishes to prevent KRG leaders from leaving the area without permission from Baghdad. Meanwhile, Turkish road trade with federal Iraq is being redirected via Iran, and Baghdad may begin metering KRG-administered oil exports inside Turkey. In the latter case, Ankara may transfer custodianship and marketing rights over KRG oil to Iraq’s State Oil Marketing Organization; in exchange, Baghdad would offer payments to KRG public employees.

A WIN FOR THE ISLAMIC STATE AND IRAN?

If the KRG is subjected to a de facto economic blockade, the negative impact on U.S. interests could be severe. The campaign against IS would suffer, including the ongoing Hawija operation, which aims to reduce the group’s largest and most dangerous pocket in northern Iraq. Coalition artillery, intelligence, and logistical efforts based in the KRG could be halted if the Kurds react badly to the blockade. Unless the potential losses in oil and customs revenue were rapidly replaced by Baghdad, they would bankrupt the KRG within weeks or months, resulting in instability, protests, and factional fighting. The Peshmerga units that hold long stretches of frontline against IS would immediately lose their pay, and many would be compelled to leave in order to support their families.

In addition to giving IS space to regroup, a blockade would hand more influence to Tehran, which seeks to punish the KRG severely for holding a referendum that could stir up Iranian Kurds. Many officials in the U.S.-led coalition resent the added complications wrought by the referendum, but they should not acquiesce to any such snuffing out of the KRG’s capacity for independent action, which may prove vital if Iranian proxies gain ascendancy in Iraq following the April 2018 national elections. The KRG will always be America’s “Plan B” in Iraq should Baghdad slip fully into the Iranian orbit, and the Kurds are the only local actors who have stood up to Qasem Soleimani, commander of Iran’s Islamic Revolutionary Guard Corps-Qods Force. Although Washington must be mindful of protecting the bigger prize — relations with Baghdad — the KRG backup plan remains valuable to U.S. interests, and potentially to Turkey as well if its own sudden infatuation with Baghdad falters. The Trump administration should therefore take immediate action to preserve international confidence in and connections to the KRG.

U.S. POLICY RECOMMENDATIONS

The Iraqi Kurds now face a new reality: they have created distance between themselves and their closest allies, the U.S.-led coalition and Turkey, whether temporarily or not. They chose to take that risk by holding the referendum and must now accept the consequences. But the threatened punitive campaign against them poses severe dangers to U.S. and coalition interests in Iraq.

Going forward, Washington should not play the role of Kurdistan’s lawyer in Baghdad. Instead, the focus of U.S. mediation should be in Ankara, since Turkey’s next steps will be decisive for the KRG’s continuing functionality. Erdogan met with Russian president Vladimir Putin in Ankara on September 28 and will visit Tehran on October 4. Following these consultations, he will presumably decide how many of the threatened punitive measures to implement immediately, perhaps by the end of next week. It is decidedly not in America’s interest to allow Russia and Iran to dominate Turkish views on this crisis, especially since neither actor has a stake in the counter-IS campaign succeeding, and both seek to reduce U.S. influence in the region.

The Trump administration’s most urgent step is to dispatch a civilian envoy to resolve the crisis, one who has no negative background with the Turks, Kurds, or Baghdad. This envoy should focus on the following steps:

• Acknowledge domestic political drivers. U.S. mediation needs to identify measures that satisfy the real domestic political concerns expressed by Erdogan, Abadi, and Barzani. Each of these leaders took strong positions for or against the referendum primarily to satisfy political constituencies at home, and these reasons remain valid. The crisis was not defused before the vote because key actors failed to correctly read each other’s domestic political drivers; the new U.S. envoy should not repeat that mistake.
• Take immediate de-escalation measures. Erdogan and Abadi need to show their publics that the referendum will not trigger short-term Kurdish moves toward full independence or permanent annexation of disputed areas. Accordingly, the United States should push Kurdish leaders to quickly and publicly reaffirm that they will not take such steps. They may only get one shot at placating Erdogan, so the message must be clear. The Trump administration also needs to discourage any steps that could further aggravate Erdogan, such as statements of support for Kurdish independence issued in Congress or by Israel. In addition, Washington should work to keep the Syrian Kurds quiet at this time.
• Establish a negotiating committee. Viewed constructively, the demands levied by Baghdad center on the same concerns voiced by the KRG: namely, reaching a permanent settlement on airspace control, energy exports, administration of disputed areas, and Kurdish access to international security assistance. Washington’s envoy should therefore form a U.S.-Iraq-KRG negotiating committee to focus on immediate crisis management regarding potential punitive measures that could disrupt the war against IS and other American interests. In time, as tempers cool and normal politics resume, the committee could evolve into a mechanism for negotiating the core issues of the Baghdad-KRG dispute. Such a process has been sorely needed for years, and its absence allowed moderate disagreements to fester into the current crisis. By taking action right away, the parties can still turn Iraq’s lemons into lemonade, in the process keeping the counter-IS campaign on track and maintaining the coalition’s relevance in the face of Iranian and Russian challenges.

Michael Knights, a Lafer Fellow with The Washington Institute, has worked in all of Iraq’s provinces and spent time embedded with the country’s security forces.

Originally Posted on September 29, 2017

©2017 The Washington Institute for Near East Policy. Reprinted with permission.