Dibaga Camp, Northern Iraq - In a stifling hot office with more flies than oxygen, Rzgar Abed does not hesitate when asked about the biggest challenge in managing the camp for Iraq's internally displaced people (IDPs).
"Space ... we're at 31,000 and that is our capacity. Thirty-one thousand," said Abed, who works for the Barzani Charity Foundation, whicg oversees a number of camps, populated by Iraqis displaced people fleeing fighters belonging to the Islamic State of Iraq and the Levant (ISIL) group in the Kurdish region.
That number is set to increase rapidly with an additional 1.5 million people expected to flee when the operation to take back Mosul from ISIL starts in mid-October.
As it is, conditions in the Dibaga camp are already cramped - each tent can only hold up to six people.
|There are 18,750 children among the internally displaced in Dibaga camp [D. Parvaz/Al Jazeera]
Families fled from their villages under the control of ISIL, also known as ISIS, and have kept on leaving, even though some of those villages have since been recaptured.
Most are only within 10km to 50km of their homes.
More than half of the camp's population are children. They flow through the camps, running between tents and climbing anything they can.
Intisar Mohamed Suleiman came here from Makuk with her husband and nine children - between one and 12 years in age.
In April, Kurdish and Iraqi forces supported by the US took out ISIL targets near her village with air strikes.
"It was very difficult - we walked five hours to get here," said Suleiman, 34, who has been at Dibaga for six months. She was part of the last wave of people who headed towards Erbil.
"We did not think we would stay long when we came here," she said, still hopeful that a return would be imminent.
While she is anxious to go back, like many here she is unsure of what she has to go back to.
"Most people have no idea what we are dealing with here," said Vian Rasheed, who heads the Erbil Refugee Council which reports to the governor's office.
"They have a few thousand refugees show up in Europe and they start to worry. When fighting broke out in Mosul in 2014, we had 100,000 people show up in one night at checkpoints," said Rasheed.
Rasheed said they expect at least 420,000 people would flee to Erbil and Duhok. About 250,000, she said, will end up in Erbil governorate alone.
Neither Erbil nor Duhok, roughly 155km northwest of the capital of Iraqi Kurdistan, are ready for such numbers.
The Kurdistan Regional Government (KRG) has prepared a contingency plan for Mosul, which would cost $284m for six months, Rasheed said.
| Iraq's Kurdish region struggles to accommodate displaced people
"With our economic crisis, nobody can have this money - we are now looking for donors and at UN agencies for intervention," he said.
But according to the UN's refugee agency UNHCR, funding has fallen short, with 63 percent of IDP shelter needs unmet.
Still, everyone is racing to build what they can in the next couple of weeks.
In Hassan Sham, about 60km from Dibaga, the UNHCR plans to build 2,000 tents, while Iraq's Ministry of Migration and Displacement is funding an additional 10,000 tents to be built by the Erbil governorate.
That is nothing close to the 30,000 tents Erbil will need to deal with the upcoming influx of refugees, Rasheed said.
Caroline Gluck, UNHCR's senior public information officer in Baghdad, told Al Jazeera that the expected influx represents an "enormous displacement" in a country that already has 3.3 million internally displaced people.
Negotiating for land, whether with the government or individuals, is time consuming, something agencies can ill afford at this make-or-break moment. And that is just part of the challenge.
"For Mosul, half of the IDPs will not be in camps," said Gluck. Some, she said, will have "emergency shelter kits" for the short term.
For aid agencies, it is a matter of trying to stay a step ahead of total disaster.
"It’s not like the agencies hadn’t been busy before this ... we were already overstretched," said Gluck.
Broke, but welcoming
International funding is crucial in this crisis because the Kurdish government is essentially broke. It has been unable to pay salaries for public sector employees, who have been protesting regularly.
"I believe we are in a massive crisis, a real crisis," said Dindar Zebari, deputy minister and head of Kurdish regional government's foreign-relations department.
"KRG, by itself, will not be able to fully accommodate the IDPs."
The KRG has been strapped for cash since Baghdad cut its budget and the drop in oil prices took a bite out of its exports.
WATCH: Kurdish region's economy struggles with falling oil prices
Zebari also said he is worried that there will be ISIL members and sleeper cells coming in with this massive wave of displaced people.
"We've already had some and we've arrested them, but we are scared. We need to accommodate them somewhere outside [the cities] because at least there are a lot of checkpoints," he said, adding that this is a greater worry now than in the past.
"Now we are facing the dangerous people," said Zebari.
Still, unlike some officials in the European Union and US, who feel that any potential security threat is enough to justify barring all refugees from countries such as Syria and Iraq, Zebari said the Kurdish regional government will not turn away the displaced people.
"We are different ... we have never had that strategy," he said.
"I must assure you, KRG will continue to, with open arms, receive those in need."
Source: Al Jazeera