Kurdish Ambitions Generate Backlash

On January 13, a coalition of 10 Shi'ite and Sunni political blocs announced the formation of a new broad-based alliance called the National Understanding Project that intends to do away with the sectarian quota system and support national reconciliation.

Among the blocs included were the Sunni-led Iraqi National Dialogue Council, the Iraqi Front for National Dialogue, and independent members of the Iraqi Accordance Front (Al-Tawafuq); the Shi'a-led Islamic Al-Da'wah Party, Islamic Al-Da'wah Party-Iraq Organization, and followers of radical cleric Muqtada al-Sadr; and the secular-leaning Iraqi National List.

The formation of the alliance was announced as an attempt to work for the benefit of Iraq, but more importantly to check Kurdish motives, which the group believes are dividing the country.

The alliance is the latest move in a growing chorus of voices from both Sunni and Shi'ite parties warning against growing Kurdish assurance and moves toward autonomy. Their attempts to set their own oil policy, as well as their increasing boldness in pursuing their interests inside a federal Iraq, have ruffled feathers among other Iraqi interest groups, as well as in neighboring Turkey.

In a January 14 interview with the Iraq News Agency, Muhammad Uthman, a parliament deputy and member of the Kurdish Alliance, condemned the new coalition, describing it as a direct threat to Kurdish aspirations. "Surely, the Kurdish Alliance will adopt a position toward this new alliance, because it basically targets the achievements made by the Kurdish people," he said. "This bloc seeks to push the Kurdish issue many steps back."

Kurds' Oil Deals Raise Hackles

Soon after the formation of the new alliance, the pan-Arab daily "Al-Hayat" reported on January 15 that approximately 150 Iraqi lawmakers from both Sunni and Shi'ite parties signed a statement criticizing moves by Iraq's Kurds as overreaching and overly ambitious.

Among the moves that have particularly disturbed the signatories were the Kurdistan regional government's (KRG) continued insistence on signing oil deals with foreign firms without the consent of the Baghdad government. Since the Kurds passed their own oil law in August 2007, they have signed 15 production-sharing contracts with some 20 foreign firms.

Iraqi Oil Minster Husayn al-Shahristani has repeatedly said that only the ministry had the legal authority to sign contracts, and described the Kurds' deals as "illegal." In November, he took the unprecedented step of warning foreign firms that singed deals with the KRG that they would be barred from seeking future contracts with the federal government.

The Kurds see the vast oil reserves in their semi-autonomous region as rightfully theirs, and while they believe the oil contracts are legitimate and within their rights, some non-Kurdish lawmakers see the deals as a direct threat to Iraq's unity. Complicating the situation further are similar aspirations by the Supreme Islamic Iraqi Council (SIIC) to form a semi-autonomous Shi'ite region comprising eight governorates in the south. This scenario, the signatories fear, would essentially lead to the disintegration of Iraq.

At a news conference after the statement was signed, Usama al-Nujayfi of the secular-leaning Iraqi National List claimed that the Kurds' oil deals were setting a dangerous precedent. "There must be a formula for maintaining the unity of Iraq and the distribution of its wealth," he said. "Oil and gas are a national wealth and we are concerned about those who want to go it alone when it comes to signing deals."

Kurdish Demands Stall Budget

The passing of the Accountability and Justice Law on January 12, which paved the way for some former Ba'athists to return to their government and military positions, was seen as a rare display of unity within the Council of Ministers. However, that unity was short-lived as a new row erupted on January 22 when several political blocs refused to ratify Iraq's $48 billion budget for 2008, citing excessive demands by the Kurds.

According to several lawmakers, the dispute centered on a demand by the Kurds that 17 percent of the national budget be allocated to their region, a figure based on population estimates. In addition, the Kurds also wanted funds from the national defense budget to be used to pay for their regional security force, the peshmerga.

Many non-Kurdish lawmakers balked at the request. Al-Nujayfi of the Iraqi National List described the Kurds' demands as unacceptable, AFP reported. "Kurdistan's share of 17 percent is not fair and the peshmerga allocations should rather be taken from Kurdistan's allocations, not from the Defense Ministry," he said.

Hasan al-Shimmari, a member of the Shi'a-led Al-Fadhila (Virtue) Party, said his party rejected the "unjustifiable allocations" of the budget, which did "not meet the needs of the Iraqi people."

Parliament speaker Mahmud al-Mashhadani postponed voting on the budget until at least January 24 and it remains unclear whether a resolution can be reached.

Kirkuk Issue Still Contentious

The status of Kirkuk was to be resolved under Article 140 of the Iraqi Constitution. The resolution calls for a three-step process of "normalization," which seeks to reverse the Arabization policies of the former Ba'athist regime when thousands of Kurds and non-Arabs were forcibly evicted from Kirkuk and replaced with Arabs from central and southern Iraq. Normalization is then to be followed by a census, and finally a referendum to determine whether the governorate will be annexed into the Kurdish region.

However, there has been fierce opposition to Article 140 on multiple fronts. The sizable Arab and Turkoman populations in the governorate adamantly oppose it, fearing that if the Kurds end up controlling Kirkuk, they may be forced out. Turkey also rejects the plan, voicing concern that if Iraqi Kurds control Kirkuk and its oil resources, their increased wealth and power could in turn fuel Kurdish separatism in Turkey.

The referendum was scheduled to take place by the end of 2007, but logistical issues prevented it and the Kurds reluctantly agreed to a UN-sponsored deal that postponed the vote by six months. Now, the National Understanding Project has said that since the constitutional deadline has passed, Article 140 should be annulled and instead the future of Kirkuk determined through a negotiated settlement.

Kurds say this is out of the question, stressing that the Iraqi Constitution mandates that Article 140 be fully implemented. In the past, some Kurds indicated that Kirkuk was "the red line" and any attempt to derail Article 140 could lead to violence.

However, as recent events point out, the Kurds are under increasing pressure to reach a compromise on some of their ambitions. If the 150 signatories to the statement are any indication, continued intransigence by the Kurds could lead them to be increasingly isolated in a region that has been historically hostile toward Kurdish ambitions.

Parliament Approves New Flag, But Only Temporarily

It's being hailed as a key step toward Iraqi reconciliation.

In a rare moment of unity, Iraq's parliament on January 22 voted to adopt a temporary national flag. The move represents a symbolic break with the recent past, as a previous attempt to change the flag was rejected by Iraqis in 2004.

The new flag will fly for one year, with lawmakers pledged to come up with a permanent banner in that time. It is still red, white, and black, but some of the key signs on it from the Saddam Hussein era have been removed.

The debate over a new flag had become more urgent in recent days, partly because of a planned pan-Arab meeting of politicians in Iraq's Kurdish region on March 10. Kurdish officials refused to fly the old flag, which they saw as a symbol of Hussein's tyranny. They now say they will fly the new banner at the meeting in Irbil, believed to be the first major pan-Arab gathering in Iraq since the 2003 invasion.

The new flag, while largely similar to the old one, contains important changes. "The three stars have been removed because they symbolize [the Ba'ath Party ideological principles of] unity, freedom, and socialism," parliament speaker Mahmud al-Mashhadani told lawmakers. "So we do not need them."

The phrase "Allahu akbar" (God is great), added in green Arabic script on Hussein's orders during the 1991 Gulf War, remains on the new flag. The script -- originally in Hussein's own handwriting -- had already been changed unofficially in 2004 to Kufic, a prestigious early form of Arabic calligraphy that originated in Iraq.

Reports say the Kurds had wanted the color of the script changed to yellow to symbolize the Kurdish nation. But this was deemed too difficult to read on a white background.

There was no serious opposition from the Shi'ite, Sunni Arab, or Kurdish blocs in parliament to the new flag, as 110 of the 165 members present voted for the change.

But because the flag is so similar to the old one, the 30 lawmakers loyal to radical Shi'ite cleric Muqtada al-Sadr voted against the proposal. They argued that the existing flag should be kept until a permanent one is chosen.

Lawmakers now face a tough debate over a permanent flag. Whether they manage to agree on one in the coming year will provide as good an indication as any of Iraqi progress toward national reconciliation.

(RFE/RL's Iraqi Service contributed to this report.)