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Iraqi Kurdistan-Iran 'trade' booms
12.6.2007
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Delshad Abdul-Rahman Mohammed, the official in
charge of oil products in the regional Kurdistan
government, blames the central government in Baghdad
for the flourishing black market in fuel.
June
12, 2007
Marzi Choman, Iraqi Kurdistan border with
Iran, -- The trucks line up at the border each
morning, waiting their turn to cross the small
Choman river into Iraq and unload their cargos of
jerry cans filled with gasoline. Trade across the
Iraqi Kurdistan-Iran border is flourishing in this
remote corner of northeast Iraq (Kurdistan), a
rugged mountain area where the lure of making a
quick profit dwarfs what little government authority
exists. Gasoline is an important part of that.
The trade in gasoline gained new attention recently
when Iran hiked the price of the subsidized gasoline
it sells its people and began looking to ration
subsidized gas - all as a way to lower consumption.
Most of Iran's problem stems from the fact that it
has too little refinery capacity. But Iranian
officials also have bemoaned the illicit selling of
subsidized gas to neighboring countries, including
Iraq, saying that hurts its economy.
Some of the trade at this border spot is clearly
illegal smuggling, outlawed and often strongly
opposed by Iranian officials trying to keep out
banned goods like whiskey or beer. But other trade,
while still technically illegal, is openly tolerated
by local Iraqi authorities, anxious to ease
shortages - especially of gasoline - inside Iraq.
Marzi Choman is one of five places on the
Iraqi-Iranian border in the Iraqi Kurdistan region
where cross-border trade takes place. The places are
called "Marez" - a Kurdish word that means an
illegal free trade zone. "The government is aware of
all trading in fuel in this Marze," said Iraqi
border police Capt. Mohammed Mohiedeen, who is in
charge of the border stretch near Marzi Choman.
"What is happening here is considered legal trade,"
he said.
Smuggling across the Iran-Iraq frontier has for
decades been a key activity in the economies of
border communities, but the volume of business is
thought to have multiplied since Saddam's ouster.
Official figures compiled by the Iranian
government's counter-smuggling division show that
Iraq was the recipient of $1 billion worth of
Iranian goods smuggled across the border in 2006,
mainly oil products, cheap electrical appliances and
food.
There are no figures available for the value of
goods smuggled the other way - from Iraq into Iran.
Those goods are usually cases of beer and whiskey,
cigarettes or satellite dishes, TV sets and other
domestic appliances - items that are significantly
cheaper in Iraq than Iran. Items destined for Iran
are stored in huts that dot the landscape in
Shabadeen district, nestling close to a narrow dirt
track that's only a few hundred meters away from the
border. Often, men and boys with donkeys carry the
alcohol and other goods into Iran.
But it is the fuel trade into Iraq - both gasoline
for autos and gas for cooking - that is the most
lucrative and busiest here.
Iraq has the world's third-largest proven oil
reserves - about 115 billion barrels - but shortages
of gasoline and other oil products are chronic
because of insurgent attacks on oil installations,
plus corruption and black marketeering. From here,
the smugglers of both gasoline and gas canisters
sell their goods both nearby and in the Kurdish city
of Sulaimaniyah, and from there to other cities
across the country.
Delshad Abdul-Rahman Mohammed, the official in
charge of oil products in the regional Kurdistan
government, blames the central government in Baghdad
for the flourishing black market in fuel, arguing
that Kurdish provinces are not getting their fair
share of the country's available gasoline supplies.
Like others, Mohammed credits the "Marez" - the
illegal free trade zones - for helping Iraqis cope
with the shortages. Ironically, he notes, the Marez
played a similar role during nearly 13 years of UN
sanctions slapped on Iraq in 1990.
Near the border one day - not far from the post of
police Capt Mohiedeen, a 30-year-old Iraqi, Mustafa
Rasoul, was busy loading his Korean-made truck with
gas cylinders - an item that, along with oil
products, has been in short supply in Iraq for most
of the past four years of war and disruption. The
gas cylinders, used for cooking in homes across
Iraq, had just arrived across the border from Iran,
where they had been filled. Rasoul sells the filled
containers in Iraq for $14 apiece, making a $5
profit on each. "I am not sabotaging anyone's
economy," said Rasoul. "I am helping Iraq and
Iraqis."
AP
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