Australia supports Iraq WTO membership

An Iraqi ministry has said that Australia supports its quest for World Trade Organisation membership, according to NINA.

WTO membership will significantly boost investment in Iraq as well as increasing its access to goods and services due to fewer restrictions from WTO member countries.

WTO membership takes almost as long to attain as agreement at a UN meeting. Iraq submitted its application to join in 2004, and it met with the WTO’s working party for Iraq for the first time to discuss the application in 2007. It took Saudi Arabia ten years before its application was granted finally in 2005.

It’s not all bureaucracy that makes the process so slow, by any means. To gain WTO membership there are hundreds of pieces of legislation that a country needs to pass and put into practice, so that it conforms to the standards that make international business easier and more trustworthy.

As Australia and Iraq sign memoranda of understanding to improve trade and investment, the Iraq Ministry of Commerce said: “The meetings included research…in order to activate the memoranda of understanding and urged Australian companies to take advantage of employment opportunities and the huge investment available in Iraq.”

“The Australian side expressed its readiness to support Iraq in building human capacity through intensive training courses. Australia’s support for Iraq in the process of joining the World Trade Organization also showed its great support in the ideas the Iraqi side.”

(Source: NINA, Department of Commerce)

AAIB View

A spokesperson at A.A.I.B. Insurance Brokers, a company specialising in Iraq commented; the support of Australia for Iraq’s intention to join the W.T.O. is to be applauded as membership should provide clear to Iraq as it strives to diversify and deepen its economy.

However the W.T.O. has been criticised in some quarters. Allegations have been made that the W.T.O generally favours the interests of the rich, industrialised counties at the expense of the less developed countries, that its workings and decision making processes are not transparent enough and that it puts commercial interests above environmental considerations and human rights. Also policies to protect the positions of small, emerging domestic industries are restricted.

Most countries however believe that the benefits of membership of the W.T.O. far outweigh such concerns. W.T.O. members trade with lower trade barriers, including tariffs and quotas and the avoidance of excessive regulations. W.T.O. principles include; non-discrimination, transparency and increased certainty about trading rules and conditions. Overall these factors make trading easier, cut unnecessary costs and increasing confidence in the commercial and contractual environment.

All these things ultimately facilitate more investment in productive capacity and job creation opportunities and can result in a wider choice of lower priced goods and services being available to consumers. Importantly, governments are better placed to defend themselves against lobbying from narrow interest groups; the W.T.O. system encourages good governance and reduces opportunities for corruption.

As regards Iraq, various studies and news articles have identified obstacles (real or perceived) to raising investment and deepening commercial involvement within the country. Such obstacles have included the problems of widespread corruption, overly complex bureaucracy, limited infrastructure and power supplies and lack of contract certainty.

The potential benefits of W.T.O. membership to Iraq are many. For the country to meet the membership acceptance criteria structural changes to the economy and labour market will be needed along with development of the legislative landscape. Ultimately senior and sustained political effort will be needed to bring Iraq into the W.T.O. fold.

54 Responses to Australia supports Iraq WTO membership

  1. Stew December 7, 2010 at 11:02 am #

    Also… note this Lou. They are saying they will reduce from 20 some trillion down to 15 trillion. A 3 zero lop will only reduce 20 some trillion to 20 some billion. They seem to be stating that they don’t expect to exchange about 5 trillion dinars. They will simply become worthless.
    Where do you think those 5 trillion dinars are that they don’t plan on exchanging?

  2. mark December 7, 2010 at 11:10 am #

    Stew, From what the articles are saying you’re 100% right on the money. They all refer to removing the zeros from the currency – not the exchange rate. I’d like to think that there will be a way to exchange old for new and that the currency might appreciate in value over time once it gets internationally recognized. Worst case scenario I guess I end up with some very expensive wallpaper or I can always use it as funny money for Thursday night Texas Hold ‘Em.

  3. dinarmommy December 28, 2010 at 11:05 am #

    I bet stew went out and purchased some dinar! The zero’s! Not gonna happen!

  4. Kak'a June 15, 2011 at 12:11 am #

    Stew…reluctantly (couse of my own to take this invest) i must admit that your conclusion makes more sense than the dinar pumpers, although currently there is little change in Iraq, and i still hope you are wrong becouse if you are right it would be very difficult for me exchange them back in my country, thanks for the information.
    And Stew, if the redenomination already a legal decision from the government of Iraq, do you think they will announce it widely to the world? Can i exchange it in my country banks? how long do you think the period between the announcement and the withdrawals? I’m from Indonesia, what advice you recommend consider condition of Iraq today? TQ.