Baghdad speeds up reform in WTO bid

20 March 2008
Baghdad is pushing through a raft of legislation this year to accelerate Iraq's bid to join the World Trade Organisation (WTO).

Iraq is preparing for its second meeting with WTO officials on 2 April to discuss its accession process, and the government is spending late March reviewing its programme of legislative reform ahead of that.

Its 15-strong WTO negotiation committee is led by Trade Minister Abdul Falah al-Sudani.

Baghdad submitted an action plan to the organisation in January, outlining all the legislative and regulatory reform the government will undertake to meet its WTO obligations.

Among the most important pieces of legislation to be pushed through this year will be the Investment Law, which defines the rules for foreign companies seeking to invest in the country. It is viewed as critical to the country's redevelopment alongside the Hydrocarbons Law, which has become bogged down by political bickering over the division of the nation's oil revenues and seems unlikely to move forward in 2008.

By the end of the year, the government also plans to have laws in place covering intellectual property (IP), customs and tariffs, sanitation standards on manufactured products, and barriers to trade.

Bringing these systems into line with international standards is essential to WTO accession.

“The draft IP law is under review by a committee at the Justice Ministry, and the government has told the WTO it hopes to pass this by the end of 2008” says Savitri Singh, trade counsel and WTO adviser at the US Agency for International Development (USAid), which is assisting Baghdad in the accession process. “The barriers to trade and sanitation laws are also being reviewed to ensure they are WTO-compliant.

“This is not all new legislation. Iraq has versions of many of the laws. It is a question of reforming them to make them consistent with WTO standards.”

The customs system requires a full overhaul of the current approach. Iraq will introduce a full portfolio of individually priced import tariffs across all products, replacing the flat 5 per cent reconstruction levy put in place by the Coalition Provisional Authority in 2003.

Local producers are struggling to compete with the influx of cheap foreign goods into the country, particularly Iranian agricultural produce. The tariffs will protect the Iraqi market from being flooded with cheap imports, and will be married to a transparent customs system to facilitate trade.

Singh says although it is early in the process, Iraq is moving rapidly on the reforms.

“When you consider that Iraq applied for WTO membership in September 2004, to be having its second meeting is great progress,” she says.

No formal date has been set for Iraq's likely accession to the WTO, but the process is often a long one.

Saudi Arabia became the latest country from the Middle East to join the WTO in December 2005. Yemen is also hoping to join the organisation by next year.

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