President Pezeshkian departed for Baghdad, the capital of Iraq, on Wednesday, September 11, on his first foreign trip, at the official invitation of Iraqi Prime Minister Shia’ al-Sudani. Pezeshkian was accompanied by high-ranking political and economic delegations. He met with the prime minister, president, parliamentary leaders, and judiciary officials, and sign joint cooperation agreements. Other key programs on his agenda included meeting with businessmen and Iranians living in Iraq, visiting the shrines of Imam Ali (PBUH) and Imam Hussein(PBUH), and touring Iranian companies' projects in Basra and Kurdistan.
The choice of Baghdad as the president's first destination, under current circumstances, highlights the importance of Iran's western neighbor and indicates the existence of both opportunities and challenges in bilateral relations.
Why is Iraq important?
Iran's presence in West Asia and its 15 neighboring countries, with whom it shares thousands of kilometers of borders, necessitates attention to relations with them, planning, reform, and consolidation of these relations.
This is particularly true for Iran's western neighbor, Iraq, with whom it shares 1,400 kilometers of borders and countless religious and cultural ties. Iraq has maintained strong relations with Iran for centuries, despite all the ups and downs. Pezeshkian's trip to Iraq is a reiteration of the need to further strengthen these relations. Tehran and Baghdad can play a significant role in ensuring regional security and each other's political and economic development, despite all the external interference.
However, it should be noted that Iran-Iraq relations, like all bilateral relations, have their ups and downs, challenges, and opportunities. A thorough examination of these conditions can pave the way for future opportunities. On the other hand, the start of the new Iranian president's foreign trips from a neighboring country sends a message that Tehran still prioritizes good neighborly relations and expanding ties with neighboring countries, considering them strategic priorities with great opportunities.
Challenges in Tehran-Baghdad relations
Despite good relations between Iran and Iraq, examining the challenges ahead and engaging in serious cooperation and interaction can pave the way for further development of bilateral ties. The most significant challenges include:
A) Iraq has been the primary destination and trade partner for many Iranian merchants and state-owned companies for years. The volume of economic exchanges and interactions between the two countries can reach $20 billion by 2028, according to Abdulamir Rabihavi, director general of the West Asia Office at the Trade Promotion Organization of Iran (TPOI).
Rabihavi said Iraq has had the highest economic growth in the region in 2022 and 2023, and considering that $10 billion of Iran's annual exports to Iraq are value-added goods, Iraq is Iran's top trade partner. The significant figures can bring stability and development to both sides of the border, but they are hindered by some solvable problems, all of which stem from the US's illegal sanctions against Iran.
Currently, around $11 billion of Iran's assets, in the form of Iraqi dinars, are frozen and unusable in Iraqi banks, according to Aqil Mousavi, deputy head of the Iraqi Chamber of Commerce. This has become one of the most significant economic challenges facing the two countries. The funds, resulting from Iran's exports, electricity, and gas supplies to Iraq, have a low chance of being returned due to the US sanctions against Iran.
B) The long land and sea borders between the two countries make cross-border travel and communication increasingly important. That's why the issue of transit routes, particularly the so-called "Peace Corridor," can be considered a challenging file between the two nations. The Peace Corridor aims to connect Turkey to the Persian Gulf through Iraq. Some experts interpret Iran's absence from this corridor as a way to bypass Tehran. This takes on added significance given the slow progress of the Iran-Iraq railway project, which would link Iran's rail network to southern Iraq and, via Sanandaj and Kermanshah, to Iraq's Kurdistan region.
C) Some negative developments in the water sector, such as dam construction on the Tigris and Euphrates rivers and the resulting environmental changes, especially in the environmental sphere, as well as differing views on shared gas fields and how to exploit them in the energy sector, could deepen into more significant challenges if not properly addressed and resolved. The issue of dredging the Arvand River is also a point of contention between the two countries that needs to be examined by experts in the relevant documents and signed agreements to find an acceptable solution.
D) Security at Iran's borders, considered the Islamic Republic's red line, has always been respected and considered important by its western neighbor. However, the presence of extra-regional forces and terrorist groups in the country creates insecurity that can affect bilateral relations. Given these circumstances, Iran expects increased cooperation and partnership from Baghdad, particularly in the implementation of the security agreement between the two countries.
Boosting relations: Solutions to overcome challenges
In prioritizing issues between the two countries, economic ties and security top the list, making solutions to enhance these areas key to developing relations. The issue of Iran's frozen funds in Iraqi banks has been addressed by the government's opening of letter of credit (LC) lines and using them for importing Iraqi goods. It appears that during this trip, the Iranian embassy in Iraq will define a specific task for itself to provide maximum support to Iranian merchants and traders.
Emphasis on pursuing and completing new transit routes through Iraq, such as the Iran-Iraq-Syria railway project, will also facilitate access to the Mediterranean Sea for both countries, as well as for countries like China and India, reducing the risk of being bypassed in transit routes.
Tehran and Baghdad need maximum cooperation and vigilance to achieve stability and security within their borders, and the signing of a security agreement between the two capitals is a step in this direction. Iran needs to feel secure about its security from its western neighbor and, in that shadow, be able to expand bilateral relations. The reality is that the Islamic Republic of Iran has paid a high price over the past decade to secure its borders with Iraq and even inside Iraq, and on this basis, Baghdad should provide Iran with the necessary trust in combating terrorist groups and the withdrawal of US troops from the country.
On the other hand, the Gaza war and Israel's recent adventures have doubled the need for the two countries to work together to create regional security without the presence and interference of extra-regional forces. Undoubtedly, Tehran-Baghdad cooperation in this strategic and security sphere can provide a suitable foundation for the growing relations between the two countries in other areas, opening up a bright horizon for them.
NOURNEWS