The Daily Digest

Kata'ib Hezbollah has attached conditions to any handover of weapons before Iraq's September 30 deadline, demanding the dissolution of the Peshmerga and a Turkish withdrawal from Iraqi territory — terms the Services Alliance, a bloc in parliament, rejected on 19 August. Nouri al-Maliki, the State of Law leader and former prime minister, told the US chargé d'affaires that the Coordination Framework has formed its own committee to ensure weapons are held by the state and would begin work on state weapons control. Hadi al-Amiri, head of the Badr Organisation, urged restraint and said weapons decisions must be Iraqi, calling arms control an exclusively Iraqi national issue and warning against foreign influence in the disarmament file. What is being contested is control of the process, not the principle: Kurdistan24 reports the handover has hit a wall under a civil-war warning, Amwaj asks whether the campaign is about who controls it, and The New Region describes the ruling Shiite bloc taking over the battle from the security services.

Saudi Arabia called the drone strike on Kurdistan Regional Government Prime Minister Masrour Barzani's office in Erbil a clear violation of Iraqi sovereignty, Bahrain condemned it as an Iranian strike, Jordan backed the Kurdistan Region, and former prime minister Ayad Allawi condemned the attack, which Amwaj reports has sparked a wave of condemnation in Iraq and the region. Iran's parliament speaker Mohammad Bagher Qalibaf arrived in Baghdad on 19 August for talks, a visit Kurdistan24 places at the arms dispute's critical phase — days after Baghdad demanded clarification from Tehran.

On the economy, the Finance Ministry recorded a $16 billion budget deficit in the first half of 2026, with oil's share of revenue slipping to 79% as spending outpaced income and one MP flagging more than $20 billion in unpaid dues owed by state entities. Prime Minister al-Zaidi named new chiefs at the Trade Bank of Iraq and the Iraq Development Fund, with Ali Alwan taking the bank's chairmanship, and the cabinet approved a mechanism to diversify crude export routes at a session whose decisions the government published; the oil ministry spokesman says the Kurdistan pipeline still carries only 20% of exports. Officials have also revived the argument over removing three zeros from the dinar, a redenomination debate returning while the parallel rate sits at 154,600 dinars per $100 in Baghdad.

A guest on Al-Ahad TV (AAH — official) said late on 18 August that the factions hold drones and long-range ballistic missiles that America fears could reach Israel, both segments aired under an on-screen banner reading "Weapons ban — a deadline for handover and conditions that are refused", as today's militia digest sets out. No faction is named as holding the weapons, no target or timetable is given, and no attack was claimed alongside either segment.

On the domestic front, Kurdistan Region security forces arrested seven wanted ISIS members in Sulaimani, Basra police detained three people over 2,000 pills and five more after a shooting, and the authorities reported human-trafficking cases down 20%. Across the northern border, Turkish President Recep Tayyip Erdogan signed a law offering a conditional pardon to thousands of PKK fighters, the Associated Press reported, while Amnesty International pressed Baghdad to deliver on its human rights commitments.

THINGS TO WATCH

Qalibaf's Baghdad talks yield a stated Iranian position on the Erbil drone strikemedium likelihoodhigh impactBaghdad has demanded clarification from Tehran over the strike on Barzani's office and Iran's parliament speaker arrived in the capital on 19 August, so either his delegation addresses it publicly or it visibly does not.

Parliament convenes the emergency session in Erbil that Iraqi MPs have called forlow likelihoodmedium impactMPs publicly called for an emergency session in Erbil over the attacks, and a convening date or a speakership refusal would settle it.

The Coordination Framework's weapons committee names its members or publishes a work planmedium likelihoodhigh impactAl-Maliki told the US chargé d'affaires the Framework had formed a committee to ensure weapons are held by the state, but no composition or schedule has been announced.

The prime minister's office answers Kata'ib Hezbollah's Peshmerga and Turkish-withdrawal conditionsmedium likelihoodhigh impactThe Services Alliance rejected the conditions, but the government that owns the September 30 deadline has issued no response to them.

The Central Bank or Finance Ministry states a position on dropping three zeros from the dinarmedium likelihoodmedium impactThe redenomination argument has been revived in public, and officials asked about it typically confirm or deny within weeks.