RIYADH, 17 May — Saudi businessmen have been allowed to re-export non-Saudi products to Iraq in a bid to boost trade between the two Arab states, according to the chairman of the Saudi Export Development Center.
The decision, taken by Commerce Minister Osama Faqeeh, will benefit Saudi importers and the Iraqi market, Abdulrahman Al-Zamil said.
Zamil made the announcement after meeting on Wednesday with Iraqi Minister of Industry and Minerals Muyasser Shallah, who visited Riyadh to attend a conference of Arab industry ministers.
Baghdad will post customs officers at the Iraqi side of the Arar border crossing with the Kingdom in preparation for opening the post, closed since Iraq’s 1990 invasion of Kuwait, Zamil quoted Shallah as saying during the meeting.
Saudi customs have no objections to exports going through the Arar post, a step expected to save Saudi businessmen between eight and 10 percent of the cost of exporting to Iraq via Jordan, Zamil added.
The two countries have stepped up preparations on both sides of the border post as a prelude to reopening it. During the past few years, it has been used only for the entry of Iraqi pilgrims into the Kingdom.
Shallah met in Riyadh on Wednesday with some 25 Saudi investors and industrialists with the aim of boosting trade volume and investments between the two countries.
The Iraqi minister has also held talks with Saudi officials over a request by Baghdad to establish a free trade zone between the two countries.
Zamil said he had written to the ministries of foreign affairs, finance and commerce urging them to speed up this issue because Iraq is “willing to give Saudi imports priority.”
Iraq has awarded Saudi firms trade contracts worth about SR243 million ($64.7 million) since the start of the year under the United Nations oil-for-food program, with about SR183.7 million ($49 million) of the contracts going to Saudi private firms in the past two weeks, trade sources here have been quoted as saying.
Iraqi Trade Minister Mohammad Mahdi Saleh said last Friday that Baghdad had imported more than $1 billion worth of goods from Saudi Arabia within the framework of the UN program, in force since December 1996. The sharp increase in the number of trade deals to Saudi companies followed an improvement in relations between the two Arab neighbors.
Zamil expected the amount to double if obstacles facing Saudi businessmen were eliminated, including not allowing them to make direct international calls to Iraq.
In Baghdad, Finance Minister Hikmat Ibrahim Al-Ezzawi was quoted yesterday as saying that Iraq intended to establish a free trade zone with Saudi Arabia.
“Iraq seeks to open new avenues of cooperation with sisterly Saudi Arabia and build bridges to boost economic ties, including through the establishment of a free trade zone,” he said, cited by the weekly Al-Zawraa.
Despite the absence of diplomatic ties between the two countries since the 1991 Gulf war, Saudi firms do business with Iraq as part of the oil-for-food arrangement, which allows Baghdad to sell crude under UN supervision to meet the humanitarian needs of its sanctions-stricken population.
The Kingdom and Iraq initiated a thaw in relations during an Arab summit held in Beirut in late March.
