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US, Iraq move to enhance private sector ties amid new US tariffs hike
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ERBIL, Kurdistan Region - Baghdad's Chamber of Commerce said on Wednesday that the global repercussions of Washington's new tariffs, particularly the resulting drop in oil prices, could significantly undermine Iraq's budget, which for 2025 is based on an assumed oil price of $60 per barrel.
'Every $1 decrease in oil prices costs the Iraqi government around $1 billion annually,' Rashid al-Saadi, the spokesperson of Baghdad's Chamber of Commerce, told Rudaw.
US President Donald Trump earlier this month announced a series of 'reciprocal tariffs' on approximately 60 countries, including Iraq, which has been subjected to a 39 percent tariff rate.
The announcement triggered a sharp decline in global crude oil demand, with Brent prices falling below $60 per barrel—down from around $75 at the beginning of April.
Although oil and gas exports are exempt from the US-imposed tariffs, the overall economic impact remains significant.
Saadi noted that annual trade between Iraq and the United States stands at approximately $1 billion, a figure he described as 'not significant.' He stated that Iraq primarily imports foodstuffs, pesticides, fertilizers, and electronic goods from the US.
He also revealed that a high-level US delegation, comprising 'leading business figures representing 60 American companies,' is currently visiting Iraq in the wake of the tariffs.
'The delegation is meeting with senior Iraqi officials to boost bilateral trade and strengthen commercial ties between Iraq and the US,' Saadi said.
Iraqi Prime Minister Mohammed Shia al-Sudani convened a meeting on Saturday to discuss the new US trade measures. Following the meeting, he issued four directives aimed at strengthening bilateral trade through commercial agencies and sectoral partnerships, as well as renegotiating trade frameworks to ensure mutual benefit.
Saadi emphasized that agreements were signed during the US delegation's visit, aimed at 'increasing trade volume and improving facilitation on both sides.'
'These agreements are expected to be implemented gradually,' he added.
He also highlighted the strong interest of US companies in investing in Iraq, citing the country's 'geographic, strategic, and geopolitical importance for US policy,' noting that Washington places significant political emphasis on Iraq, which is reflected in its economic engagement.
Saadi stressed that 'decisions taken by the federal government certainly apply to the Kurdistan Region and other parts of Iraq,' adding, 'Kurdistan is an integral part of Iraq, so any agreement made with other countries also applies to Kurdistan.'
According to Kamaran Bajgr, deputy chair of Erbil's Chamber of Commerce, the new tariffs will affect the Kurdistan Region's exports of tomato paste—its only export to the United States.
'Businessmen in the Kurdistan Region must now seek alternative markets to replace the US,' Bajgr told Rudaw on Saturday.
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