Iran Now Iraq's Main Trading Partner

By Hazem al-Jumaili, Azzaman. Posted September 8, 2008.

Bilateral trade between Iraq and Iran has boomed since the U.S.-led
invasion in 2003.

Iraqis snap up Iranian goods because they are cheaper than imported
counterparts, Baghdad traders said.

They said Iran has flooded Iraqi markets with cheap commodities,
which, despite their low quality in comparison to imports from western
countries, meet basic needs of unsophisticated Iraqi customers.

Iranian goods even rival those from China, a country known for its
considerably cheap exports.

"Almost all Iraqi traders have now shifted their attention to Iran,"
said Mohammed Abbas, a Baghdad trader.

He said Iran, rather than China, has become the source of household
utensils sold in Iraq.

Iran has several border points with Iraq. There are good paved roads
linking the countries and traders, businessmen and industrialists from
both sides can travel without restrictions.

Iranian air conditioners and coolers are sold at prices within reach
of Iraqi civil servants, the country's middle class.

For example, an Iranian-made small power generator could be fetched at
about $100 while those from South East Asia may hit more than $300.

It is not clear whether Iran subsidies goods destined for Iraq. But
what is clear is that bilateral trade has mushroomed to billions of
dollars from almost a trickle before the 2003 U.S. invasion.

Alaa Hussain said it was wrong to say Iranian goods were all of a low
quality. "When comparing the price with the service you get, they are
worth buying," he said.

He said Iran has recently been exporting low-voltage household
utensils bearing in mind the scarcity of electricity in the country.

Taleb Mohammed said Iranian industrialists seem to have properly
analyzed the Iraqi market. "The electrical goods they ship now can be
operated by small power generators which are also Iranian and have
almost invaded the market," he said.

Iran is now Iraq's top trading partner. Iranian firms execute
multi-million dollar projects mainly in the northern and southern
parts of Iraq.

Iranian contractors are involved in infrastructure projects like
power, health and housing.