By Fehim Tastekin for Al Monitor. Any opinions expressed here are those of the author and do not necessarily reflect the views of Iraq Business News.

While Turkey was eagerly anticipating a new government in Baghdad to sort out many problems with Iraq, a last minute decision by the outgoing prime minister has added a fresh item to the list of ongoing disagreements between the two countries.

Haider al-Abadi unexpectedly signed a decree to set up three new checkpoints in government-controlled areas in northern Iraq that will effectively slash Turkey’s trade with it.

The trucks that enter the country normally pass through the sole border crossing that is controlled by the Kurdistan Regional Government (KRG) and will now also have to pass at least one of these additional checkpoints.

Click here to read the full story.

By John Lee.

A new 30-percent customs tariff in Iraq is reported to be slowing business at the port of Umm Qasr (pictured), which handles 80 percent of the country’s imports, choking the port with thousands of uncollected cargo containers.

But according to the report from Reuters, the new rate does not apply in Iraqi Kurdistan, which charges just 5 percent.

Anmar al-Safi, spokesman for the General Company for Ports of Iraq, said the new tariff, which was approved by the Council of Ministers, impacts all imported goods, including foodstuff, and criticised the government for not applying the law to the Kurdish region.

(Source: Reuters)

By John Lee.

The Iraqi government has been undertaking “a series of policy twists to restrict the exports of poultry products from Turkey.

The chairman of the Turkish Poultry Promotion Group, Müjdat Sezer, part of the country’s Ministry of Economy, told GlobalMeatNews:

Iraq decided to stop all imports of full chickens from Turkey. We don’t know the reason yet, but we’re currently investigating the situation with the Iraqi ministry.

“It’s likely that Iraq is trying to preserve its domestic production of poultry. I think this problem will be solved, but it will take a little time.

“The Iraqi market is very changeable and doesn’t make long-term decisions in the usual way of most countries. I’m optimistic about the outcome.

Iraq repealed a recent major increase in import tariffs, from $35 to $295 per tonne, only to halt all full chicken imports from Turkey from 8th April, but continues to allow the import of chicken pieces.

UN data showed that last year Turkish producers exported around 227,000 tonnes of poultry to Iraq, generating around $443 million in receipts.

(Source: GlobalMeatNews)

(Poultry image via Shutterstock)

This article was originally published by Niqash. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.

Missing Millions? The Mystery of Iraqi Kurdistan’s Border Taxes

Money collected at Iraqi Kurdistan’s borders with Iran and Turkey should amount to hundreds of millions of dollars for the cash-strapped region. Yet nobody knows where all the cash is going. Critics say politicians are collecting it and an investigation is underway.

Revenues collected at the borders of Iraqi Kurdistan have been a major source of income for the the semi-autonomous, northern region in the past. And with the current financial squeeze inside the region, thanks to, firstly disputes over oil revenues and the federal budget with Baghdad, and secondly, Baghdad’s own economic problems, there’s been more emphasis on these revenues recently. After all, they might have some potential to help relieve Iraqi Kurdistan’s current financial crisis.

The problem is, although the revenues are clearly being collected at the borders between the region and neighbouring Iran and Turkey, nobody knows where they are going to.

As one senior Iraqi Kurdish official admitted around three weeks ago: “What happens to the revenues collected at the region’s borders is a mystery”.

On March 12, Iraqi Kurdistan’s Minister of Finance and Economy, Rebaz Mohammad Hamalan, expressed concern about the fact that although a large number of trucks and tankers cross the borders into Iraqi Kurdistan daily, the amount of revenue the government collects from this seems minimal.

The money collected at the borders is mostly in the form of customs and duties and a lot of it comes from land transport, like the trucks. Even out-of-date figures suggest there should be a lot of money collected at borders.

For example, one 2003 book, titled Iraqi Kurdistan: Political Development and Emergent Democracy, noted that 50 trucks per day carrying cigarettes were coming through the border at just one of the region’s major crossings – each truck was taxed US$17,500. And that was in 1999.

Another book on the region – Kurdish Quasi-State: Development and Dependency In Post-Gulf War Iraq – wrote that in 2002, revenues at the Turkish border totalled around US$750 million but, the author says, a lot of this went to politicians.

Further estimates can be found in US Embassy cables from 2007 where, based on a duty tax of 5 percent on all goods entering the country and Turkish export figures, the diplomats who wrote the cable thought that Turkish border revenues should be closer to US$100 million – and that’s from just one border crossing.

By John Lee.

New taxes in force since the beginning of last week mean that Turkish producers exporting into Iraq now need to pay US$290 per ton of exported chicken meat, rather than $35 previously.

As a result, the Turkish poultry sector, which has the fourth largest share in the world’s poultry market, risks losing its biggest market, Iraq.

The Poultry Site quotes the head of the Turkish poultry meat producers and breeders association, Sait Koca, as saying:

“Turkish producers exported around 227,000 tons of poultry to Iraq in 2014 for around $443 million. Unless the new custom taxes are revoked, we are likely to lose our biggest export market to Brazilian exporters.”

Turkish exporters use the Habur Border Gate to enter the Iraqi market; Koca said they can also use the Iranian border gates but the Iranian side demands $100 from each truck.

Ömer Görener, chairman of Turkish poultry producer Banvit, told Hurryiat Daily News:

“Iraq asks for only $35 per ton at other border gates for poultry imports coming from Brazil or Iran. With the new taxes, our poultry’s price is $255 higher than others per ton, damaging our competitiveness.”

The Iraqi side has also begun implementing the same rise in taxes on egg imports from Turkey, which had been sending more than 250 trucks full of eggs to Iraq until recently, making over $410 million of contributions to exports to the Turkish economy annually. Around 90 per cent of Turkey”s egg exports are to Iraq.

(Source: The Poultry Site)

(Poultry image via Shutterstock)