Escalating events in Syria “confuse” Iraqi markets

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[size=52]Escalating events in Syria “confuse” Iraqi markets[/size]

[size=45]For several days, Iraqi markets have been facing a state of confusion due to the closure of the Iraqi-Syrian border against the backdrop of the rapid developments witnessed in the Syrian provinces and the continuous advance of the opposition forces and their control over large areas.
Iraq used to receive dozens of trucks loaded with Syrian export products daily, most notably agricultural products, in addition to household products, textiles, various food industries, oils, detergents and clothing, which now cover part of the needs of the Iraqi market. The
Baghdad government announced last Sunday the complete closure of the western international border adjacent to the Syrian side, considering Iraq's security to be one of the most important priorities, and any threat that could affect the country's territory and sovereignty will be confronted.
Prime Minister Mohammed Shia al-Sudani stressed, during an emergency meeting of the Iraqi National Security Ministerial Council, the importance of tightening the measures taken to secure the international border with Syria.
In turn, Deputy Commander of Joint Operations Qais al-Muhammadawi said in press statements that the Iraqi border is completely closed, noting that the Iraqi forces are committed to the Prime Minister's orders regarding protecting the security and safety of the country's borders.
This caused confusion in the Iraqi local market, which relies on Syrian agricultural and industrial products for many of its imports.
Traders and businessmen demanded the reopening of border crossings for shipments to enter or exit between the two countries, stressing the importance of controlling and securing official border crossings and allowing the entry and exit of goods to avoid the economic damage that this closure will cause.
Economic researcher Ali Al-Amiri said that closing the border could result in tangible economic damage to the Iraqi economy, because economic relations between the two countries depend largely on the exchange of goods and products, especially daily consumer goods, and the cessation of this exchange leads to direct and indirect effects.
Al-Amiri added that Iraq imports a variety of goods from Syria, including agricultural products, such as vegetables and fruits, industrial products and food, and closing the border will lead to a shortage of these products in Iraqi markets, which may raise their prices and increase inflation.
He stated that the border roads between the two countries represent a major land transport corridor, and the movement of trucks will be disrupted, which will negatively affect the transport sector and push shipping companies to look for alternative routes at higher costs, especially since 70% of Syrian exports are agricultural products, the quantities of which exported to Iraq, according to the latest data, amounted to about 350 thousand tons annually.
The economic researcher explained that Syrian products are cheaper compared to their counterparts imported from other countries, and therefore their absence will lead to increased reliance on more expensive imports from other countries, which will worsen the living conditions of the Iraqi citizen.
Al-Amiri pointed out that these effects will consequently be reflected in cash flow and the rise in the value of the dollar against the dinar, due to the increased demand for the dollar and the increased need for foreign currencies to cover imports. He
stressed that the increased need for foreign currencies increases pressure on the exchange rate of the dinar against the dollar, in addition to the increase in transportation costs, as traders are forced to look for alternatives through other ports or land routes, which raises import costs that are usually paid in dollars.
For his part, Majid Muzan, a member of the Federation of Iraqi Chambers of Commerce, said that trade exchange between Iraq and Syria includes various goods, most notably food and semi-finished goods, stressing that Iraq's trade with its surroundings is in the interest of neighboring countries due to the weakness of local industry.
Muzan added that the events taking place in Syria have negatively affected the Iraqi market, and their results have become negative for the local Iraqi economy, because Syria is considered a vital country in the region and possesses the industrial raw materials that Iraq needs.
According to the member of the Federation of Iraqi Chambers of Commerce, Aleppo is considered the capital of trade and industry in the region and a center for the most important manufacturing, paper, craft and plastic industries, stressing that the continuation of events in Syria will push traders to head to alternative markets in neighboring countries represented by Turkey and Iran.
Muzan criticized the weakness of local production and complete reliance on imports from outside Iraq, stressing the importance of developing and supporting local industries and opening industrial projects represented by manufacturing and plastic industries in order to protect the Iraqi economy from being affected by any regional events.
According to an official source in the Syrian regime government earlier, the volume of Syrian exports exceeded the 500 million euro barrier in the first six months of 2024, noting that most of the exports to Iraq are food commodities. Baghdad relies on imports from various countries around the world to meet the needs of local markets.
Iraq ranked first as the largest destination for Syrian exports in 2020, and subsequent data in 2021 showed a significant increase in Syrian exports to Iraq, as the value of exports exceeded 79 million euros in the first seven months of the same year.[/size]
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