Saudi investors await for opening embassy to enter Iraqi market

VOI - [10/24/2007]


Saudi investors are awaiting the opening of the Saudi embassy in Baghdad in the upcoming stage to enter the Iraqi market and increase their share, while Saudi business sector is planning to open contacts with Saudi authorities to open a new border crossing with Iraq in Hafr al-Baten region, as well as reopening of Jadida Araar crossing.
"The reopening of the Saudi embassy in Baghdad and organizing border crossings between the two countries will contribute in increasing trade volume and raise Saudi exports to Iraq," Saudi officials from the Saudi business sector told the independent news agency Voices of Iraq (VOI).
They said they can make big Saudi investments in Iraq but only within a stable security condition.
Chairman of the Saudi Chambers of Commerce Council Abdul Rahman al-Rashed said "the council will take an official step within the next days to address the ministries of finance, interior, and foreign affairs to reconsider the opening of two crossings: the first in Hafr al-Baten region and the second the Jadida Araar crossing to export goods to Iraqi markets."
"The council's plan aims at increasing goods exported to Iraq," he added, noting that the reopening of Jadida Araar crossing will help exporting Saudi products to Iraq directly without passing through Kuwait or Jordan, currently used as a transit for Saudi products heading for Iraq.
Saudi Foreign Minister Prince Saud al-Faisal, during a press conference on August 1, 2007 with visiting U.S. Secretary of State Condoleezza Rice and Secretary of Defense Robert Gates, had said the kingdom was planning to send a diplomatic envoy to Iraq "soon" to prepare for the re-opening of its embassy in Baghdad and enhance bilateral relations.
Diplomatic relations were re-established between Iraq and Saudi Arabia in 2004 after the fall of the former regime, but an embassy was not opened due to deteriorating security conditions.
Iraq, however, re-opened its embassy in Riyadh in February 2007 for the first time since 1990, when it was closed after the outbreak of the 1st Gulf war.
For his part, the Secretary General of Saudi Chambers of Commerce Dr. Fahd al-Sultan explained the mechanism to be adopted after the reopening of Saudi embassy by maintaining contacts with the Saudi ambassador and then coordinating with Iraqi chambers of commerce.
Al-Sultan said that the council is in permanent contact with Kuwait chamber of commerce and industry and Kuwaiti customs authorities to facilitate the passing of Saudi products through the Arab gulf country.
Regarding the reopening of border crossings with Iraq, he said that "Saudi Interior Minister Prince Nayef Bin Abdul Aziz gave instructions to prepare a mechanism to organize the reopening of the border crossing of Jadida Araar, but he did not set a date."
"The minister did not rule out the possibility of opening a large free-trade area between the two countries, noting that it is possible to turn al-Eidaa region in Jadida Araar into a large trade area in the future according to Saudi policies and laws and security and stability in Iraq," he also said.
The four border crossings, currently closed, between Iraq and the kingdom are Rafhaam al-Uwayiqieliya, Hafr al-Baten, and Jadida Araar, the last one was reopened to export Saudi products to Iraq directly within the U.N. Food-for-Oil Program, before closing it prior to the U.S.-led invasion.
Dr. Fahd al-Sultan voiced belief that his country is qualified to top the list of Iraq's exporting countries with products valued at no less than USD 5.2 billion annually.
Deputy Chairman of the Chamber of Commerce and Industry in Riyadh Abdul Aziz al-Azl warned Saudi investors of accelerating the process of investments in Iraq without having enough security guarantees from the Iraqi government and other international organizations, i.e. the U.N.
Saudi non-oil exports to the war-torn country in 2004 hit USD 8.1 billion, according to unofficial statistics.