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Kurds Bemoan Soaring Cost of Living

Residents say low salaries and runaway inflation means that they can barely make ends meet.
By Zanko Ahmed
Sarbast Mohammed finishes his civil service job at 4 pm, grabs a quick bite to eat and hops into his taxi. He will cruise around for several hours, seeking passengers whose fares help boost his income.



Mohammed, 27, works seven days a week to pay his bills and support he and his wife. He makes 180 US dollars a month from his government job and about 300 dollars from his work as a cab driver.



The double income plus some minimal revenue from his wife's small loofah-making business barely covers Mohammed's rent and utilities, which amount to about 400 dollars a month. The problem is that the newlyweds rarely see one another. While some couples in the northeastern city of Sulaimaniyah enjoy peaceful weekends at the park, Mohammed is in his taxi until 2am.



"I shouldn't be doing this work, but I have to," he said. "If I don't do this, we can't survive."



While no official statistics are available, housing, fuel and consumer costs have jumped sharply in Sulaimaniyah, a largely safe and growing city, say observers.



The American Kurdish Society, an organisation that monitors economic growth in Iraqi Kurdistan, recently named Sulaimaniyah the most expensive city in the northern region. Residents complain that they can barely make ends meet, blaming the regional government for paying low salaries and not monitoring inflation in local markets.



Sulaimaniyah's costs are fueled by its prosperity and growth - but its inflation woes echo those in the rest of Iraq, where prices of everything from food to fuel to rents and transportation have soared in the past year.



According to the International Monetary Fund, IMF, Iraq's inflation had jumped 65 per cent by the end of 2006, a hike it attributes to shortages of fuel and other key commodities. While the Iraqi government brought down record inflation levels in the first half of 2007, prices are still 35 to 40 per cent higher than they were a year ago, according to several economic reports.



Officials and economists in semi-autonomous Iraqi Kurdistan do not have inflation figures for the entity but acknowledge that it is a significant problem for residents there. The Kurdistan Regional Government estimates that up to a quarter of the four million people in the region work for the government, but salaries are as low as 75 dollars per month.



"The inflation rate increases every day, and prices vary from one city to another," said Rebeen Rasul, head of the American Kurdish Society. "In fall and winter, the inflation rates increase because transportation is more difficult, while in the past few months prices have gone up because fuel was more expensive."



The fuel shortage forces most Iraqis to buy on the black market, driving up costs for consumers. But other prices are rising too - fares for private busses have increased from 25 to 35 cents, and a kilogramme of lamb has risen from about 5.50 to 7.50 dollars over the last three months.



Mohammad Kareem, an economic professor at the University of Sulaimaniyah, said the government needs to monitor businesses to ensure they are not price-gouging, charging above-market prices. He said the lack of oversight by the Kurdish authorities is hindering the region economically.



"The government is not transparent and they don't give the [inflation] data to experts so that they can solve the problem," said Kareem.



Officials in Sulaimaniyah have shut down dozens of shops in an effort to curb price-gouging, but the cost of living is still too high, residents complain.



"Last year, we protested so that people's living conditions would improve, but this year, it only got worse," said 29-year-old Hadi Ali, who was arrested in 2006 during a demonstration calling for basic services and a better cost of living.



Mayor of Sulaimaniyah Zana Hama-Salih said inflation is a serious concern for which he blames Iraq's free trade policies. He said the government, not private companies, should import products to ensure that goods are available to consumers at lower costs.



Dler Ismail, head of the Kurdistan parliament's economic committee, said members of parliament are considering Hama-Salih's proposal. Ismail also said Kurdistan's new investment law, introduced last year, will exempt businesses from paying taxes for five years, which he believes will help lower prices.



But the authorities will need to prove to a sceptical public that they are serious about tackling inflation.



"The government doesn't care what will happen with this situation," said Star Omar, 43.



He sells clothing in a small shop in downtown Erbil and says his rent has jumped from 400 to 650 dollars in just one year.



"One day, people will lose their patience," he said.



Zanko Ahmed is an IWPR trainee in Sulaimaniyah.

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