After March 19, 2003: Iraqi Trade with Iran Increases Substantially

Trade between Iraq and Iran grows at an estimated annual rate of 30 percent after the US and British invasion. “The economies of Iraq and Iran, the largest Shiite-majority countries in the world, are becoming closely integrated, with Iranian goods flooding Iraqi markets and Iraqi cities looking to Iran for basic services,” the New York Times will report in early 2007. After the invasion, Iraq begins importing electricity and a wide variety of consumer items like Peugeot sedans, carpets, construction materials, fish, and spices. Iraqis are also going to Iran to obtain medical services. Trade between the two nations grows the fastest in the Shiite-dominated south. By 2007, Basra is importing $45 million worth of goods from Iran each year with some 100 to 150 commercial trucks crossing into Iraq from Iran each day. The trend causes concern in the White House, which accuses Iran of having a nuclear weapons program and claims that the Iranians are fueling the insurgency. According to Asaad Abu Galal, the governor of Najaf, “the Americans don’t want to bring Iranians to Najaf. The Americans want to control the sky.” Iranians are also vying for a market in the financial sector, with at least one bank applying for a license to open a branch in Baghdad. [New York Times, 3/17/2007]