Money and business Economy News - Follow-up Iraq announced the resumption of negotiations to join the World Trade Organization for the first time since 2008, a step that may benefit the Iraqi economy but will take a long time.
Al-Monitor reported in a report translated by "Al-Eqtisad News" that "the Iraqi negotiating teams began "preparatory meetings" at the headquarters of the World Trade Organization in Geneva, and the Iraqi delegation included officials from ministries in the federal government and the Kurdistan Regional Government, while another meeting will be held at an unspecified date to review Iraq's accession to the World Trade Organization."
The World Trade Organization is an intergovernmental organization that aims to promote international trade. It provides a platform for governments to negotiate trade rules and disputes among themselves. Member states make key decisions. The WTO has 164 members who say they are responsible for 98% of world trade.
Iraq first applied to join the WTO in 2004, the year after the U.S. invasion that toppled dictator Saddam Hussein. A “working group” was then set up, but there has been little progress since then. The group last met formally in 2008. An informal meeting was held in 2017, according to the WTO’s website.
The process has gained significant momentum recently. In January, a WTO delegation visited Baghdad “to mobilize political support for the resumption of Iraq’s WTO accession process.” The discussion focused on Iraq’s economic reforms and was led by Saqr bin Abdullah Al-Muqbil, Saudi Arabia’s ambassador to the WTO and chair of the Iraq Accession Working Group, the organization said in a statement at the time.
A basic requirement for WTO accession is consistent trade policies across the country, including tariff rates and customs procedures. Thus, differences in the tariff structure between the federal government and the Kurdistan Regional Government have been an obstacle to Iraq’s efforts to join the WTO.
The UN team for Iraq said in a statement that Iraq decided to unify the two customs systems in 2019, and the Federal Ministry of Finance finally approved the unified customs tariff framework in February of this year.
Joining the WTO could benefit Iraq. According to a report issued by the Council on Foreign Relations in April 2023, the WTO has been largely successful in expanding free trade.
The Council noted that the dollar value of international trade has quadrupled since the establishment of the World Trade Organization in 1995, and that average tariffs do not exceed 3%.
According to the Council on Foreign Relations, there are also negative aspects to the WTO.
The council noted in the report that "globalization and free trade have their drawbacks. These include the potential for economic inequality and job loss."
The WTO has been particularly criticized for its application of rules toward China.
“The WTO is also struggling to perform its third function – enforcing the rules – particularly with China. Since joining the WTO in 2001, China has violated global trade rules by providing extensive subsidies to its domestic industries and stealing technology and other intellectual property. China has faced few, if any, consequences for its actions,” the council said.
China has a growing presence in Iraq, and there have been significant Chinese investments in Iraqi oil and infrastructure in recent years.
The WTO says it has helped facilitate poverty alleviation in developing economies by promoting trade.
In September 2023, WTO Director-General Ngozi Okonjo-Iweala told the Center for Strategic and International Studies: “Over the past generation, market-oriented reforms in places like Eastern Europe, India, and China, together with the open global economy anchored in the GATT/WTO system, have boosted growth and trade and helped lift more than a billion people out of extreme poverty.”
GATT stands for General Agreement on Tariffs and Trade, the predecessor to the World Trade Organization.
Iraq's trade is dominated by oil. Crude oil accounted for 90% of Iraq's $123 billion in exports in 2022. Iraq imported $67.1 billion that year, with the main imports being refined petroleum, broadcasting equipment, and cars.
These figures gave Iraq a trade surplus of more than $50 billion in 2022, according to the Observatory of Economic Complexity.
Iraq may have a long wait before joining the WTO. East Timor joined in February after seven years of negotiations. Comoros joined at the same time — a process that took 17 years, Arabian Gulf Business Insight reported at the time.Views 63 07/20/2024 - https://economy-news.net/content.php?id=45390