Iraqi border outlets, loose economic wealth in the hands of the corrupt

Iraqi border outlets, loose economic wealth in the hands of the corrupt

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Researcher Shatha Khalil *

Translated by : mudhaffar al-kusairi

One of the most prominent files of corruption suffered by Iraq after 2003 is the corruption of border outlets as a result of the control of militias and influential parties, which are linked to financial and administrative corruption and the weakness of the state.
Iraq has border outlets along its borders with the six countries surrounding it, and the number of these portd (22) land and sea ports, in addition to the air ports represented by airports, including licensed, and unlicensed, making it a gate of corruption and forgery of goods entering and smuggled to the country lacking to scrutinize with the original origin, levy the country’s revenue into the pockets of corrupt.
Since the process of productive industry and development in Iraq is almost stopped after 2003, the country becomes an importer of the worst consumer goods with excellence, as the goods entering Iraq are estimated at millions of dollars, while wasting money in absurd projects that provide nothing to the Iraqi economy, only more corruption and deterioration in services, thus Iraq is losing billions of dinars a month.

Goods across the border ports do not match the certificate of origin:
It is not possible to determine the size of consumer goods of different types whose specifications do not match the certificate of the country of origin. Most goods enter with a certificate of forged origin and do not meet the specifications, It also includes the passage of illegal goods, or change the type to exempt or reduce fees and manipulate the bad quantities and qualities entering the country, and there are goods under the name of a US or European industry, but in fact Chinese goods… Why this fraud and cheat the citizen?
The head of the Iraqi border outlets, Kazem al-Oqabi, said earlier that “Iraq is losing billions per month because of the corruption of ports, especially the port of Umm Qasr,” noting that “since the port authority took office in the middle of last year, port revenues have doubled compared to the years before the formation of Commission”.
An Iraqi official, who declined to be named, revealed a joint report from the Commission on Integrity and the Office of Financial Supervision to the Baghdad government, confirming the country suffered heavy losses due to corruption in the border ports, with the four neighboring countries: Iran, Turkey, Kuwait and Jordan, at a time when the border is still closed to trade with both Syria and Saudi Arabia, which is expected to witness the opening of its first land crossings with Iraq during the coming period for trade and export purposes.
The security committee in the Iraqi parliament called for the removal of militias from those outlets, member of the Committee Mohammed Reza said `, that “there is a large corruption and control of the militia on the border outlets, and in all outlets of Iraq from Basra to Kurdistan, adding that” there are ports from which goods enter without a visa, stressing that `he has information about a port in Diyala where cars enter illegally from a neighboring country without a stamp, without a visa or even without examination, as confirmed by one of the officers present in the port, and the same is true in other ports.
Observers said that the parties and militias intervene in the affairs of border outlets, but each party and armed faction has a role and functions different from the rest, parties involved in the smuggling and sale of oil abroad, and others related to the smuggling of drugs from Iran, and activities related to obtaining royalties from vegetable dealers, and the monopoly of food products and ways of its distribution in the southern provinces It is not much different in the northern border outlets in the Kurdistan region of Iraq.
Corruption has worsened in the country amid weak oversight, and according to estimates issued by the Finance Committee in parliament, the size of Iraq’s losses due to corruption in the past twelve years amounted to about (450) billion dollars, including (360) billion dollars during the first and second era of Nuri al-Maliki governments (2006-2014), and the Integrity Commission announced last year 2018, that the money allocated and returned to the state during 2017 amounted to (938) billion Iraqi dinars ($ 800 million), without mentioning what Iraq lost due to crimes of financial corruption and damage to public money.

Border ports in Ba`sra Governorate:
Basra is the main economic artery of the country, as it has significant economic resources, such as oil fields and large industrial companies, as well as nine border ports.
However, these ports are under the control of armed groups belonging to influential political parties, threatening and killing all those who reveal their corruption .The sources revealed that foreign companies charged with examining imported goods in one port were threatened, forcing them to leave the port, and this contributed to the entry of goods randomly.
Shalamcheh and Safwan are the vital arteries of the province, because of their role in reviving the commercial and economic reality of Basra and Iraq.
Some members of the provincial council repeatedly demanded the right of imports of border ports over the past years, which are estimated in hundreds of billions according to Law No. (21) for the provinces according to Article (45), which is the allocation of (50%) of the revenues of border ports to support the budget of Basra in the establishment of infrastructure projects in the areas of Basra and the development of border outlets.
However, the central government and the Ministry of Finance argue about the financial crisis and the current situation, but by studying one outlet, for example, the port of Safwan, has achieved revenues from the beginning of this year until the month of last August (146) billion dinars.
The head of the Border Ports Authority, Kazem Al-Oqabi, said that the delay is obvious in the construction and development of the ports with regard to the implementers of Shalamcheh with Iran and Safwan port with Kuwait and the reason is the spread of corruption in all joints of this sector and the obvious things existed in the contracts that were referred to contractors who did not meet the deadlines . He pointed out that the completion rate for the development of Shalamcheh port is still (0%), although the contractor has received the operating advance, while the percentage of completion in the port of Safwan (17%).

Northern Border Ports:
The Kurdistan Region has 6 main land trade outlets with both Turkey and Iran, responsible for the supply of about 50% of the needs of Iraqi Kurdistan for food, construction and other materials such as auto spare parts, medicines and furniture, as well as many goods imported by Iraq in general from the northern and eastern neighbors.
The most prominent outlets of the Kurdistan Region with Iran include Haji Omran, Bashmakh, Parvez Khan, and Kermak, in addition to other small outlets used for the movement of passengers and simple goods such as “Kelly”, “Shoshmi”, “Tawila” and “Sheikh Saleh” ”And“ Bishta ”.
With Turkey, two outlets, the first Ibrahim Khalil, the main trade, and the value of trade exchange last year amounted about (5) billion dollars, and the second port Szeriri, Iraq also has another outlet with Syria and is located within the Kurdistan region known as “Simalka”, but it has been closed since the outbreak of the Syrian revolution.
The file of Iraq’s land ports with Iran and Turkey, within the borders of the Kurdistan region (northern), and portends a new crisis between Baghdad and Erbil, where the federal government accuses officials in the region not to deliver the revenues of the ports, in addition to corruption in the introduction of corrupt and poor goods to markets, where it was monitored major irregularities in the outlets of the region, flooding the market with imported eggs, and the resulting heavy losses for Iraqi traders and poultry farmers, and led to the layoffs of many low-income workers.
Government sources said that “political courtesies behind Baghdad incurred significant losses at the expense of financial benefits and gains to the government of Erbil, which represents injustice to other cities such as Basra, Baghdad, Mosul and Kirkuk.”
The accusations continue between the Center and the region, because of the delay in the delivery of the proceeds of the sale of (250) thousand barrels of oil per day to Baghdad, despite the agreement in the budget in 2019, which requires that the Kurdistan government to deliver these revenues, to be included in Iraq’s annual imports, provided that Baghdad to pay the dues of the region within the general budget like the rest of the provinces of the state.
The volume of trade in the ports is between 12 and 16 billion dollars annually, and the majority of goods go to Baghdad and other cities south, central and west of the country.
We conclude from the above that the Iraqi government needs to defend the quality and safety of goods entering the Iraqi citizen, and to conform to the certificate of origin and specifications, and stop the forgery to preserve the lives of citizens first, and on the other hand to maintain its revenues in the ports such as defending oil pipelines from terrorist attacks.
This comes at a time when corruption is rampant in all parts of the state, while the institutions concerned with corruption, such as the Anti-Corruption Council, the Integrity Commission and the offices of general inspectors, and parliament were unable to reduce the size of this corruption, which is supported by parties with great influence.
“The government’s lack of control over the outlets is a fraction of the will of the state, and that its resources feed militias and associated political forces, and there was no clear government position on it.” and the strength of state is the basis for any state and to stop any interference to its work , to be able to countable the corrupts in order to build a strong independent state capable of controlling its borders and security of its economy to support the budget and achieve optimal investment for all sectors.


Economic Studies Unit
Rawabet Center for Research and Strategic Studies