September 4, 2006
Iraq, Iran set up free-trade zone
The southern Province of Basra now has a free-trade zone with neighboring Iran, signaling yet another boost in commercial ties.
The zone was officially opened on Sunday and was hailed as a milestone in the province’s relations with Iran.
The provincial council in Basra has separate trade agreements with Iran. Provincial delegations travel to Iran and sign deals. They only notify the Baghdad government about their moves.
Shops in Basra and other southern cities are crammed with Iranian goods.
Iran wants to use the zone, straddling the borders at the Shalmja border post, as a major warehouse to stockpile goods destined for Iraqi markets.
Exact trade figures are hard to obtain in Iraq, but Iran is believed to have become the country’s top trade partner.
Iran hopes the warehouses at the new zone, the first between the two countries, will reduce transport costs for Iraqi traders.
To assist the transport of its goods, Iran is constructing a highway linking the new zone to the provincial center, the city of Basra.
It is also repairing al-Tanoma Bridge on the Shatt al-Arab Waterway.
Trade exchange between the countries is now estimated at nearly $3 billion.
Iranian exports to Iraq include food stuffs, household utensils, clothes, agricultural implements and electrical appliances.
Iraqi exports to Iran include dates and hides.