Marketing in Iraq Market
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Geography, culture, and language of Iraq
Iraq, officially known as the Republic of Iraq (Arabic: جُمْهُوريَّة العِرَاق, Kurdish: كۆماری فدریلی عێراق, Syriac: ܥܝܪܐܩ) is a country in the Middle East and Southwest Asia. The Iraqi capital is Baghdad. Iraq is bordered by Saudi Arabia and Kuwait to the south, Jordan and Syria to the west, Turkey to the north, and Iran to the east.
In its southern part, Iraq has a small water border with the Persian Gulf and two famous rivers, the Tigris and the Euphrates, which are the beginning of the ancient civilizations of Mesopotamia, including the Assyrians and Chaldeans throughout the region's ancient history. It enters Iraq from Turkey and flows south to it, joining the Karun River, forming the Arvand River, and flowing into the Persian Gulf.
Iraq covers an area of 437,072 square kilometers (58th country in term of area, nearly a quarter of Iran). Most of Iraq is lowland and tropical. The west of Iraq is a desert and the east is a fertile plain, but part of Iraqi Kurdistan (northeast) is mountainous and cold. Iraq is also one of the largest oil-rich countries. The country has 143 billion barrels of proven oil reserves.
Iraq, with a population of about 40 million, is the 36th most populous country in the world. The language of people is Arabic and Kurdish are the official languages of Iraq. The literacy rate is between 60% and 70%. In addition to Arabic and Kurdish, Turkish, Azerbaijani, Chaldean, Armenian, Assyrian, and other languages are spoken in Iraq.
Religion of Iraqi people
The Muslim population is 69% -64% Shiite and 34% -29% Sunni, as well as several followers of Yazidi, Christian, and Jewish religions live in this country.
Culture of Iraq
The country hosts various Islamic occasions such as Ramadan and Eid al-Adha, and the Tasua, Ashura, and Arbaeen Husseini religious ceremonies are held among Iraqi Shiites, who make up more than half of the country's Muslims.
The land now called Iraq has historically been part of the territory of ancient Iranian empires such as the Medes, Achaemenids, Parthians, and Sassanids. 160] and was also part of Iran in some post-Islamic Iranian states until the Safavid period; during the Safavid Empire, this land was traded between Iran and the Ottomans; In some parts of Iraq, Iranian festivals such as Nowruz, Shab-e Cheleh, Chaharshanbeh Soori and held every year.
How is shipment to Iraq and transport goods?
Relying on experience and benefiting from the presence of active representatives, some International Transport Group is one of the leading transport companies that has been specialized in transporting goods to Iraq for many years.
Among the services of these groups is the transportation of goods, export, and import in Iraq so that the goods are done from the door of the place of loading and export by this company and transported to the destination and finally its import is done and delivered to the owner of the goods.
Various methods of sending cargo to Iraq
Today, the most practical method of transportation is loading in the country of origin and sending directly to Iraq by standard trucks, which in addition to customer satisfaction, product security, accelerates the shipping process, and improves loading. Other methods of sending cargo include loading in the country of origin and sending to Iranian border customs terminals.
In this method, cargo is loaded from anywhere in Iran and sent to the customs borders of Iran and Iraq, including the Tamerchin border, Somar border, Bashmaq border, Khosravi border, and Mehran border, and from there it is loaded by Iraqi trucks and then moves to the destination.
Sea Shipment to Iraq
Cargo to Iraq is transported by sea through the southern ports of the Persian Gulf to the port of Umm al-Qasr or others.
Airfreight from any cities and countries such as Iran from Mashhad, Tehran, and Iran's international airports to Najaf, Baghdad, and Basra takes place in the shortest possible time.
Freight services to Iraq
International Transport Groups provides a variety of transportation, unloading, loading, and clearance services in the country of origin and Iraq and the possibility of transporting cargo to all places, including cargo to Sulaymaniyah, Iraq, cargo attack to Erbil, Iraq, cargo to Basra, Iraq, carries cargo to Samarra, cargo to Baghdad and cargo to Najaf and Karbala. Transportation to Kurdistan also includes Sulaymaniyah, Erbil, Mosul, and Zakho.
This company performs all the necessary steps for transportation from all cities of Iran to all cities of Iraq directly and indirectly with the lowest cost.
Our western neighbor suffers from a lack of industrial and service growth due to ongoing sanctions during Saddam's time and two bloody wars with the United States and ISIS. Therefore, exporting to Iraq can be a benefit for Iranian traders.
In addition to exporting agricultural and industrial products; the benefits of exporting to Iraq will usually be much more attractive in some new areas, such as health tourism and the provision of technical and engineering services.
What we need to know before exporting to Iraq
Iraq is a country that has the longest land border with Iran. In a way that covers from the northwest of the country to the southern regions. This is the most important reason for the attractiveness of exports to Iraq for Iranian traders and producers.
Iran-Iraq relations have seen many ups and downs in the last hundred years, but it can be argued that they currently have the best political, trade, economic and cultural relations with each other.
To prove this claim, it is enough to know that our country exports the most to this western neighbor. This shows the high advantage of export profits to Iraq.
In this article, we intend to mention zero to one hundred exports to Iraq. But first, we need to get a little familiar with the political, social, and economic structure of this country.
Iraqi politics, population, and economy of Iraq
Iraq is a very diverse country socially and culturally. Knowing the demographic and cultural characteristics is an important issue regarding exports to this country that you need to have enough information about.
A mix of different ethnicities and religious groups make up the Iraqi population. The Kurds, Sunni Arabs, and Shiite Arabs form the three main demographic compositions of Iraq. The country's political power also stems more from these three demographic groups.
The government in Iraq is federal and has a central government in Baghdad and a local government in the Kurdistan Region in Erbil. At the same time, provincial councils have considerable power and authority.
The Iraqi economy relies heavily on oil and other natural resources. Iraq is currently a major member of the APEC Group, which exports about 5 million barrels.
It also receives various facilities from international organizations, including the International Monetary Fund and the United Nations. In addition, countries in the region and Western countries, including the United States, also provide financial assistance.
Knowing the economic variables of this country will give our businessmen and merchants a better view of exports to Iraq.
How is Iraq trade with the world?
To export to Iraq, you need to be well acquainted with the amount and manner of its trade with different countries of the world. Among the various countries in the world that trade with Iraq, the names of some countries such as China, India, and Turkey are more common.
The important point in this regard is related to Iraq's trade with Iran, about which there is fewer data in global statistics. The reason for this can be seen in the informal trade between the two countries, as well as some issues related to sanctions. However, Iran and Iraq are certainly two very important trading partners.
Which countries have the most Iraqi exports?
Iraq's most important export is oil. Countries such as China and India have the highest oil purchases from this country.
Official data from international organizations show that in 2018, the highest number of Iraqi exports to China (26.25%), India (36.24%), South Korea (8.8%), USA (7.98%), Italy (5.89%), Singapore (4.35%) and some other countries.
About exports to Iraq which countries are the most important destinations for Iraqi exports?
Which countries are the most imports to Iraq?
In the discussion of exports to Iraq, Iranian businessmen and traders must know more about their competitors in the Iraqi market.
Currently, according to global data, Iraq has the highest imports from various countries, including China (28.64%), Turkey (24.27%), India (6%), South Korea (5.88%), and the United States (4 percent), Germany (3 percent), Saudi Arabia, Brazil, and Italy (2 percent).
Profits of exports to Iraq
Since 2003, Iraq has been one of main trading partners since the fall of Saddam Hussein. Official customs statistics show that the dollar value of Iran's non-oil exports to Iraq in 1998 was more than $ 9 billion, which is a significant figure. But for many, the question is what the best way to export to Iraq is. Most experts in this field suggest that for small to medium-sized companies, the best way to export to this country is to export indirectly and through intermediaries.
Otherwise, direct export will be a good solution. For example, from Iran, most of the exports to the western neighbor are usually from Khosravi, Mehran, West Tehran, Bashmaq, Kermanshah, and Piranshahr customs, which usually have food, minerals, and industrial parts at the top of export items.
In the field of agricultural production, products such as potatoes, cucumbers, tomatoes, oranges, watermelons, and vegetables are at the top.
But among home appliances, water coolers and kitchen appliances have also been important items for export to Iraq. Mineral tiles and stones, iron and steel rods, and building stones are among the important mineral and industrial items that have been exported to this country.
Health tourism and the provision of technical and engineering services are also among the areas that have grown significantly in recent years.
In the field of health tourism, a large number of Iraqis travel to various cities in Iran each year for treatment. Religious tourism is another type of tourism that has grown significantly between Iran and Iraq in recent years.
What is the best manner to export the products to Iraq?
To export a product, it is necessary to obtain the necessary licenses and standards by the laws of each country. In some country, for example, the Trade Development Organization has banned the export of goods to Iraq without affixing a Latin or Arabic label. The Iraqi Standardization Institute has also enacted the same law for sending Iranian goods to this country, like Iran, so that all goods with two Latin and Arabic labels can be exported to this country.
It should be noted that if the exported goods meet the above conditions and are not accepted by the Iraqi customs, the relevant authorities will prevent them from entering the country, which could cause irreparable damage to exporters and producers.
Iran's border with Iraq has several formal and informal gates through which most exports take place. However, part of the exports to this country also come from informal sources as well as informal markets and passages. Some of the country's customs are for the Kurdistan region and others are better for export to central or southern Iraq. Among the important customs in trade with Iraq are the following:
- Bashmaq Customs in Marivan
- Parviz Khan Customs in Qasr Shirin
- Mehran Customs in Ilam
- Arvandkenar Customs
- Tamerchin customs in Piranshahr
- Commercial Customs
- Khosravi Customs in Qasr Shirin
- Shalamcheh Customs
Arabic and Kurdish are the official languages of Iraq, with Kurdish spoken in the north and Arabic in the central and southern regions. Trade with this country requires mastery of one of these two official languages. Eastern neighbor has different subcultures, religions, and denominations. Therefore, raising public information and familiarity with its political, social, and cultural conditions is necessary for Iranian businessmen.
What are the problems of exporting to Iraq?
Although trade with Iraq has always had a significant profit margin for foreign traders, its special circumstances, including instability, ethnic and religious diversity, and special geographical conditions, require it to take steps with a little caution.
In the last fifty years Iraq has been one of the most adversely affected countries in the Middle East from political and economic difficulties. All problems occurred in this period, including several wars causing many confusions based on religion, ethnicity and tribes which become obstacles for sustainable development of the country.
Although Iraq tries to build itself from scratch nowadays and wants to integrate in the world by the help of rich resources, political problems and terror are still crucial problems of the country. Iraq is the second largest export market of Turkey and Turkish construction companies have a proactive role in the reconstruction of Iraq. Moreover both countries have mutually beneficial cooperation on energy for delivering Iraq's rich oil and natural gas resources to world markets.
By the end of the Iran-Iraq war in 1988, Iraqi army attacked Kurdish society in Northern Iraq that supported Iran during the war. The cooperation between Saddam Hussein and PKK (Kurdistan Workers' Party) against other Kurdish parties such as Kurdistan Democratic Party and Patriotic Union of Kurdistan, the protection of Kurdish refugees by Turkey, refusal of Turkey the hot pursuit Iraqi Kurdish militants agreement with Baghdad and the “water problem” of Euphrates and Tigris rivers between two countries were major political problems in 1988. Meanwhile, after the Iran-Iraq war, the general economic situation of Iraq was not good.
The foreign debt was over $80 billion by 1988, foreign reserves were drained, development projects were abandoned, more than 20 percent of the labor force of Iraq was working for the army, oil revenue was at minimum level and all valuable things in the country such as large factories in construction materials and mineral extraction, food processing and light manufacturing and agricultural lands were sold in a frenzy of privatization and the revenue was spent for the needs of the army (Parker and Moore, 2007). Thus; based on all these political and economic problems, 1988 was the break-down year of Turkey and Iraq trade relations.
What are the customs clearance and customs procedures of Iraq?
For example, because Iraq's political system is federal and the provinces have special powers, it is sometimes observed that commercial law is enforced in one province but operated differently in other provinces.
Moreover, in many cases, the laws of the central government of this country are different from the local government of the Kurdistan Region and operate in two different ways. Such restrictions will only be lifted if you consult someone who knows the way and the well at the beginning of the journey.
In general, the problems of exporting to Iraq can be summarized in several general areas:
- The laws and the difference in their implementation in the provinces
- Businessmen are not familiar with the cultural and political context
- Security problems in certain areas
- Differences in trade regulations in Iraq and the ethnics
What are the documents required for export to Iraq?
Trade with any country requires some legal documents and licenses, of which exports to Iraq are no exception. On the other hand, the documents required for export to Iraq may change over time due to changes in the laws of this country.
However, in general, you usually need to prepare some documents and permits, including:
- Business card
- Having environmental standards
- Licensed by the Iraqi Standards Organization
- Obtaining a health certificate for food products
- Obtaining the necessary permits from the Customs and the Ministry of Silence
- Having a certificate of origin and sales invoice in Arabic and English
Foreign currency commitment
Having a list of goods and their specifications. Regarding the necessary documents for export to Iraq, there may be other cases and options that will vary depending on each product or product.
Important information on exports to Iraq
In Iraq, as well as in Iran, there are institutions, individuals, and organizations that can help you with exports and trade. In the table below, we have mentioned the list of these individuals and institutions. Export advise to Iraq
There are many trade problems with this neighboring country that have led many exporters and various companies to use business consulting in recent years.
In this regard, in addition to private consulting companies, one of the official institutions related to trade with this country is the Joint Chamber of Commerce, Industries, Mines, and Agriculture of Iran and Iraq.
It has several commissions in the fields of energy, information technology, food industry, technical and engineering services, and the construction industry, tourism, and trade and commerce, and their meetings are held from time to time.
However, access to these institutions and obtaining export advice to Iraq from them is associated with a certain complexity and bureaucracy, and most people are inclined to try other ways. And the cost of consulting them is usually very high.
We offer you in-person and telephone advice on exporting to Iraq through the Business platform, which you can use at any time and place with the least cost and time with the services of expert consultants in this field.
How is economic conditions of Iraq?
The Iraqi economy is heavily dependent on oil, in other words, it is based on the oil economy. About 95% of Iraq's total oil revenues come from the sale of Iraqi oil. Numerous wars in Iraq and long-term international sanctions have left the Iraqi economy behind.
The economic structure of Iraq, like all the countries of the Persian Gulf, is based on the production and sale of oil. Iraq is the third-largest oil producer in the world, and the cost of producing oil in that country is the lowest cost of producing oil in the world. During the year, revenues from crude oil exports accounted for the percentage of GDP and the percentage of government revenues. This year, Iraq became the 15th largest oil producer in the world due to the war and the blows caused by the occupation, as well as the consequences of international sanctions and the wars of the Ba'athist regime.
The Iraqi oil sector is facing technical challenges in the production, transportation, and storage of crude oil and petroleum products, according to Special Observers for Iraq Reconstruction. It also faces problems such as managing prices and imports, combating smuggling and corruption, improving budget allocation and implementation, and maintaining oil operations. Oil production in Iraq has not yet reached pre-US levels.
The Iraqi economy has been severely weakened by more than a decade of economic sanctions and war and needs investment and modernization. According to reports, the long-term and major reconstruction of Iraq will cost more than a few billion dollars, of which at least a third will be allocated to the oil, gas, and electricity sectors.
In the current situation, the Iraqi people are in a very bad economic situation, and the Iraqi government is not able to meet their basic needs and create jobs for them, and now the unemployment rate in Iraq is official / percent. At the same time, the Iraqi Minister of Commerce has announced that the national unemployment rate and the low unemployment rate in this country are between up to one percent, and the Iraqi Minister of Labor and Social Affairs announces this figure as more than one percent. The conditions of war and sectarian strife have displaced more than four million Iraqis, making the economic situation more critical.
Iraqi Investment Laws and Regulations
The Iraqi Investment Law was approved by the Iraqi parliament at its October 10, 2006 session, which was published in the official media after the president approved it. The conditions and process of local and foreign investment are described in this law. The purpose of this law includes the following:
- Encourage investment and transfer of new technology for economic development and diversified production
- Encourage the Iraqi private sector and foreign investors to invest in Iraq
- Finding a job and creating employment
- Protecting the rights and property of investors
- Expanding the export of goods and increasing the volume of Iraq's foreign trade
About housing and construction projects, the Iraqi and foreign investors have the right to maintain the project lands only for the construction of housing units equal to the tariff determined with the approval of the Council of Ministers.
Benefits and incentives for foreign investors include:
- Ensuring national and foreign-invested projects by Iraqi insurance companies or foreign insurance companies
- Possibility of investing and participating in the stock exchange sector
- Lease of land required for projects can be renewed for a period not exceeding 50 years.
- Opening a bank account in Iraqi dinars, foreign currency, or both in Iraqi banks or banks outside Iraq
- Provide residence permits and other facilities to investors who have entered Iraq and intend to live in this country.
- Declaring invested projects inadmissible
- The possibility of transferring the salaries and benefits of non-Iraqi workers abroad
- Exemption from payment of various duties and taxes for 10 years from the date of commencement of projects, which can be extended.
- Also, the equipment and assets required for the development and updating of companies will be exempt from taxes and duties.
Liabilities of depositors
Obligations of foreign investors include the following:
- Announce the exact start time of the project
- Proper presentation of company account books to an authorized lawyer for auditing
- Provide design studies and research and technical and economic feasibility studies related to the project
- Record and maintain information on imported raw materials, environmental protection, and quality control system requirements
- Comply with Iraqi law and act according to plans and procedures developed for investors.
Areas of investment
The Iraqi Investment Law authorizes Iraqis and foreigners to invest in all areas except the following:
- Investment in oil and gas extraction and production fields
- Investing in banking and insurance companies
- Investing in land acquisition (except for housing projects); These lands can only be owned by Iraqi nationals, and foreign nationals can only use these lands for 50 years (this period can be extended).