Duhok, Northern Iraq - It can be hard to breathe in the Domiz refugee camp, 20km southeast of the city, with a mix of burning rubbish and raw sewage hanging heavy in the air at times.

Even so, the residents of this sprawling refugee camp of roughly 30,000 seem to be settling in for the long haul.

Mohammed Al Aafo is not worried about his future in Iraq [D. Parvaz/Al Jazeera]

Mohammed Al Aafou, 42, took a morning tea break with the men helping him to rebuild his house in the camp. Although like everyone else he said there are no jobs to be had, after more than four years at Domiz he continues to plan for the future. 

"It was falling apart," he said of his old house, "so we're rebuilding it, totally."

Because it can't possibly be worse than the war he and his family ran from, Al Aafou said he is not worried about what's to come: An anticipated influx of internally displaced people (IDPs) fleeing the impending fighting in Mosul - set to start this month.

But others are worried that the worsening economic situation in Iraq's Kurdish region (IKR), coupled with the IDP crisis, will make an already bad situation worse.

"We worry about not getting jobs and not getting the same support we've been given," said Wajika Dorsen, 30, from Hasaka.  "We are thankful for those who support us and this is so much better than Syria," she said, "But we worry."

READ MORE: 'Massive crisis' as 1.5 million expected to flee Iraq's Mosul

According to Ramziya Zana, director of the Gender Studies and Information Organisation, an NGO that offers support and job training to IDP and refugee women, the Kurdish regional government will come under pressure to take care of the IDPs.

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"Even UN support and funds are very slow to arrive. We are not getting the support we need from them," Zana told Al Jazeera.

There are roughly 239,000 Syrian refugees registered in Iraq's Kurdish region, and the population is expected to increase with the Mosul operation. Even if the flow of Syrian refugees to the region were to slow, the number of those in the IKR will continue to grow. 

At the Domiz camp, the largest Syrian refugee camp in Iraqi Kurdistan, there are 563 pregnant women, according to the official camp census, with entire families starting and expanding since the start of the protracted conflict in Syria in 2011.

But the trend is similar in smaller camps.

In Kawergosk camp, 15km south of Erbil, Zeinab Mahmoud Sheikho, 29, is in the market with her two-and-a-half-year-old daughter, Haif. The youngest of three, Haif was born in a refugee camp, and much to her mother's dismay, knows only the rambling tent community housing nearly 10,000 as her home. "I told her that in 15 days, I will go to Syria," said Sheikho, who periodically goes home to visit her ill mother.

"And my daughter, she looked at me and said, ‘What is Syria?’ She thought maybe it was a food or a drink," said Sheikho.

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Iraq's Kurdish regions hosts 97 percent of Syrian refugees in Iraq and funding remains well short of what it should be, according to data from the UNHCR.

The total funding requirement for Syrian refugees in Iraq, Lebanon, Turkey and Jordan for the year was just over $4.5bn, but only 40 percent of those funds had been met as of the end of September.

The massive funding gap for refugees was a hot topic at the United Nations General Assembly in September, with US President Barack Obama calling a Leaders' Summit of Refugees to increase funding and hosting commitment to the crisis from member states.

With 3.3 million IDPs in Iraqi Kurdistan region and more to come as a result of the Mosul operation, it's not surprising that humanitarian funding is currently focused on them rather than the Syrian refugees, said Dan Collison, programmes director of UK-based NGO War Child. 

"[The War Child programme] did close a Syria refugee project in Domiz camp and is now working with IDPs only," said Collison. "It was a one-year programme with UNICEF for 2014-15 -  that provided child friendly spaces and child protection services," he told Al Jazeera.

With that programme coming to an end, Collison said several other actors, including Save the Children and Doctors Without Borders, have stepped into the breach to meet the needs of Syrian refugees.
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This is crucial, because the Kurdish regional government [KRG] does not have the means to help refugee children. "Please hear this now: The KRG does not have a penny to spend on this. Not one penny," said Dindar Zebari, deputy minister and head of the Kurdish regional government's foreign relations department.

"We cannot even pay our own teachers at this time," he added.

Lawk Ahmad, country director for Qandil, a Swedish NGO based in Erbil, said the funding challenge is twofold: Convincing donors to give funds, and then trying to get the money fast enough.

"It's more complicated at the moment [in Iraq] - it's more competitive," said Ahmad, "At the moment, funders are speaking about priorities … this will have an impact on the ground."

He said he worries about funding turning away from the refugees and focusing solely on IDPs, even though, said Ahmad, "both are forms of homelessness - whether they are IDPs or refugees, are sourced from the cause" - the cycle of violence and instability in the region.

But while there is a plan to liberate Mosul from the Islamic State (ISIL, also known as ISIS), Ahmad said: "In Syria, it's going to take longer, because no political deal has been reached."

Source: Al Jazeera