ISIL's financial ills erode its battle readiness

The battlefield effectiveness of the "Islamic State of Iraq and the Levant" (ISIL) has dropped in the face of a steep decline in the group's revenue, experts tell Diyaruna.

The group's financial crisis has affected the salaries of fighters and blood money payouts to the families of its dead, they said. This has stirred resentment and anger among the rank and file and has affected their performance as fighters.

The group used to pay its fighters between $400 and $1,200 per month, but now, “it cannot even secure a steady stream of income”, said Ninawa provincial council member Khalaf al-Hadidi.

“The battle for Mosul is almost over," he told Diyaruna. "The group has declared defeat from the centre of its 'caliphate', and this means we clawed away the last of its strongholds, which provided it with a significant source of funding."

Since it overran Mosul in June 2014, the group has relied primarily on crude oil from al-Qayyara oil fields to fund its operations, with its smuggling operations garnering millions of dollars every month, al-Hadidi said.

The trade in stolen artefacts from Ninawa province also provided a key source of revenue, he said, as did levies ISIL imposed on the transportation and trade of other goods between areas under its control in Iraq and Syria.

At its peak, this provided considerable revenue, he said.

Dwindling salaries, lower morale

Dwindling salaries have made ISIL fighters resentful and angry, al-Hadidi said, noting that their economic woes have affected their fighting morale.

Some fighters have resorted to looting private homes in western Mosul, "trying to steal anything they can find, such as food and personal belongings, under the pretext that the group is in a state of war and needs support", he said.

In an attempt to urge on its fighters, the group’s preachers have tried to justify the salary decreases, he added, promoting the idea that “money is not the purpose behind fighting" and they need to prepare for “even worse to come”.

ISIL used to be generous with its fighters, a ploy that drew many low-income Iraqis into its ranks, Iraqi MP Ammar Tumah told Diyaruna.

But since its sources of funding have dried up, it no longer has the power to maintain complete control over its fighters, he said, which will ultimately threaten its survival on the ground.

According to a February 17th report by the London-based International Centre for the Study of Radicalisation (ICSR), ISIL’s revenues from taxes, plundering and selling oil on the black market have halved, compared with 2014.

The report reveals that the group has lost control over a large swath of territory in Iraq over the past few months, bringing its revenues down to $870 million at the start of 2016, compared with a previous $1.9 billion.

The study’s estimates made use of ISIL documents and data provided by government authorities, reports prepared by journalists and research centres, and interviews with government representatives and experts.

Leaders jump ship with money

The international air campaign targeting the group’s oil and artefact smuggling operations has played a major role in weakening its defences and lowering morale, Tumah noted.

“With the start of the military campaign in Mosul, we have heard of senior commanders abandoning the group and escaping with large amounts of money," he said.

"This, in turn, constituted a violent psychological blow to the rest of ISIL, whose members found themselves alone on the battlefield, without a leadership that guides and looks after them and their families," he said.

Successive losses have revealed the true face of ISIL “as a gang that thrives on murder and plundering”, said al-Mustansiriya University political science teacher Issam al-Fayli.

“This group has been unscrupulous in raising money and today, it is robbing itself," he told Diyaruna. "The group’s leaders are jumping ship and taking the money with them, leaving their followers to their fate."