Iraq and Saudi Arabia Cooperate To Boost The Dinar
Saudi Arabia officially left Iraq in 1990 when it closed its embassy in Baghdad in order to protest Saddam Hussein’s invasion of Kuwait. Of course, that was followed by a multitude of sanctions and international outrage against the Iraqi regime.
Obviously, the international sanctions against Iraq had a negative effect on Iraq’s economy for the next several years. Worst of all, many of Iraq’s long-time regional friends and allies were forced to abandon the country while Saddam remained in power.
Once Saudi Arabia had closed its embassy, Saudi Arabia didn’t appoint a non-resident ambassador to Iraq until 2012. Recently, Saudi Arabia’s Prince Saud Faisal announced plans to reopen its embassy.
Nowadays, Iraqi-Saudi business relationships are flourishing once again. We’ll explore how this new rebirth of cooperation between Iraq and Saudi Arabia will increase foreign investment and boost the Dinar Investment value going forward.
Developing stronger trade ties
The Iraqi-Saudi economic relationship will continue to improve, since both countries agree there is a need to work cooperatively. Historically, trade between the two countries was often a one-way street in which Iraq imported goods from Saudi Arabia, especially under the oil-for-food programs during the sanctions era.
Even as early as 2002, Saudi Arabia was at the forefront of normalizing trade with Iraq, according to the United Nations’ oil-for-food programs that allowed Iraq to sell its oil to purchase food, medicine and other important supplies.
It was reported that about $300 million worth of food and other products were exported to Iraq by Saudi Arabia businesses at the onset of the program.
A comprehensive breakdown of trade transactions shows that Saudi firms signed contracts worth $298 million for the export of miscellaneous goods to Iraq after their offers were approved by the United Nations. Of that amount, $117 million was for food exports, $104 million for machinery and spare parts, and $77 million for medical supplies.
Then-Trade Minister Muhammad Mahdi Saleh indicated that Saudi companies have exported goods worth more than $1 billion to Iraq since the start of the oil-for-food program.
Benefits of better trade relations