In Jamila, the main wholesale market in Baghdad, merchants complain about how the deteriorating security situation has caused them vast financial losses.
Hajj Yasser Hali, who sells dairy products, said, “Costly transportation fees have forced us to raise prices.” Hali now must take a longer road to transport his products to Baghdad, doubling the transport fees for each car, from $2,500 to $5,000. His vehicles still cross at Ibrahim Khalil, but they go through Iraqi Kurdistan and the Badra district bordering Iran. Hali said, “The security crisis is harming trade activity and forcing merchants to raise prices.”
For years, the Iraqi wholesale markets have been known to work under an exclusive corporate agency system. Hali said, “I cannot export merchandise from Iran. The Iranian companies have agents here.”
The Iranian corporate agencies in the Jamila region are filled with merchandise, since the transportation of their goods is unaffected. These types of companies have increased in volume since the import of merchandise from other countries has become more difficult. Moreover, some groups in these provinces have issued boycotts against Turkish and Saudi merchandise, due to allegations that these two states support terrorism in Iraq.
Abdul-Zahra al-Hindawi, spokesman for the Iraqi Ministry of Planning, told Al-Monitor, “The demand on Iranian goods certainly increased after the Mosul crisis. … The increase in demand and the [increase in volume] of goods pushed Iraq to open new border crossings with Iran.”
However, according to Hindawi, the Ministry of Planning has no statistics on the volume of trade between the two countries. “Iran has become the most important commercial source for Iraq after the worsening security crisis in Anbar, which affected the transportation of goods between Iraq, Syria and Jordan,” he said.
Trade volume between Iraq and Iran in 2013 reached about $12 billion. This year, trade is expected to exceed $15 billion. If the local government in Baghdad follows in the footsteps of the southern provinces and boycotts the import of goods from Saudi Arabia and Turkey, the level of trade between Iraq and Iran may jump to new, unexpected highs.
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