“Made in Iraq”… What’s hindering its return to the local market?

“Made in Iraq”… What’s hindering its return to the local market?

2025-04-13 03:07

Shafaq News/ With imported goods of all kinds dominating local markets, the phrase “Made in Iraq” on products has become extremely rare, despite having reached the global market decades ago.

For decades, Iraq has been experiencing a state of stagnation and complete paralysis in both the public and private industrial sectors, with the exception of a few timid attempts that have failed to transform it into an industrial nation despite the availability of raw materials, expertise, and infrastructure suitable for various industries.

According to Ministry of Industry and Minerals spokesperson, Dhuha al-Jubouri, “The General Company for Electrical and Electronic Industries, a division of the ministry, continues its work and offers its products for sale through a number of marketing outlets in cooperation with the private sector.”

Al-Jubouri confirmed to Shafaq News Agency, “The General Company for Electrical and Electronic Industries specializes in the manufacture of electrical appliances such as cooling devices, which include network air conditioners of various capacities, contour cooling devices, and wall-mounted air conditioners of both the regular and economic types, in addition to the manufacture of water coolers of all types, ceiling, table and vertical fans, and protection devices.”

Al-Jubouri points out that “the company produces water heaters of various capacities, in addition to producing air coolers and water pumps. It also has an integrated factory affiliated with the company that specializes in producing modern, energy-saving lamps and lighting materials, as lamps are produced in various sizes and colors.”

She noted that “the company has marketing outlets in the provinces of Baghdad, Diyala, Babil, Wasit, and Kirkuk, and there is tangible cooperation in this regard between the company and the private sector.”

Prime Minister Mohammed Shia al-Sudani announced on May 2, 2023, during the Mineral Investment Conference held in Baghdad, that “Iraq is capable of producing a national industry comparable to that produced in Arab countries… We will not remain spectators while Iraq remains a consumer market. Rather, there will be national production.”

It’s worth noting that Iraq has official companies that are still active and productive, such as textile and electrical industries, whose products bear the names “Ishtar” and “Al-Qithara,” as well as food products such as dairy products.

For his part, economic expert Munir al-Abidi told Shafaq News Agency, “Reinstating the ‘Made in Iraq’ slogan requires a set of factors and components to produce local industries capable of competing with foreign products.”

He added, “These factors primarily involve restoring confidence in Iraqi products, and this confidence can only be achieved by offering solid, durable products that are appropriate for the income of the Iraqi individual.”

He points out that “there is a need for a set of important factors to activate the national industry related to the cost mechanism, as the costs of any local product are high compared to the financial costs in neighboring countries such as Turkey and Iran or other countries such as China.”

He stresses the importance of “reconsidering customs tariffs on imported goods in order to create a competitive edge for Iraqi products, even though this will lead to a rise in the prices of some goods on the local market and will impact the ability of Iraqi citizens.”

He noted, “We need a clear strategy based on trust, providing the basic elements for local products, and reducing financial costs so that national products can compete with foreign goods.”

It’s worth noting that Industry Minister Khaled Battal al-Najm acknowledged on Saturday the difficulty of local products competing with imported goods from neighboring countries, including China, due to the country’s low production costs and its high costs in Iraq.

This came during his hosting of the launch of the Iraqi Business Summit (IBS) , held in the capital, Baghdad, with the participation of local and international economic institutions and investment companies. He said, “We are surrounded by countries with economic problems,” stressing that “most of Iraq’s imports come from Iran, Turkey, and China.”

He added, “The Iranian currency is virtually collapsed, and the cost of production there is much lower than that of Iraq. For example, the operational energy cost of running any industrial project in the country is approximately 30 percent of the cost of production.”

Al-Najm also pointed out that the economic blockade imposed on Iran has led to a drop in its production costs, similar to the situation in Iraq during the blockade in the 1990s. Turkey is also witnessing a decline in its local currency, and Syria will join these two countries if the situation there stabilizes, and we return to dealing with it before the events, and Syrian products enter the Iraqi market.

Iraq’s industrial sector, in general, has been facing a significant decline since 2003, with most factories shutting down and a reliance on imports. Years ago, the Federation of Iraqi Industries estimated the number of stalled projects at 40,000. Successive government programs have consistently included the goal of stimulating the economy and local industry, but without any realization. Instead, trade with regional countries continues, while local industry is neglected.

In addition, economic expert Ali Daadoush points out that “it is very difficult for local industry to return to normal given the open-door import policy, weak border controls, and the presence of unofficial outlets.”

He explained to Shafaq News Agency, “The trend among traders and investors is towards making quick profits through imports, which has turned Iraq into a country that imports everything in every sense of the word.”

He stressed that “imported goods are cheap, which has negatively impacted local industry, especially since local manufacturing requires high financial costs.” He pointed out that “if Iraq wants to return to a policy of local manufacturing, it must review the laws related to border crossings and not grant exemptions for the gradual import of goods and services. This means activating trade policy tools in conjunction with establishing a lending policy for local investors who want to work and manufacture goods and services domestically, while suspending the collection of taxes for the first two years of the project’s launch.”

He added, “Taking these bold steps will revitalize the local industry and bring it back to the forefront.”

Business and retail owners are reluctant to import locally manufactured electrical and household goods into their businesses and stores for reasons related to quality and cost, which prevent them from generating substantial profits, as well as citizens’ reluctance to purchase them.

In this regard, Abbas Adnan, owner of a company that imports electrical and household goods, confirms that “the lack of Iraqi-made products in our company is due to several factors, most notably the fact that imported goods are cheaper than local products.”

He explained to Shafaq News Agency, “For example, frozen food arrives at the company through customs at a price of 200,000 dinars, while locally made frozen food is sold to the company at a price of 275,000 dinars. If we add profits of 50,000 dinars or more, then its price becomes double the price of imported frozen food or close to that, which makes marketing it extremely difficult.”

Atwan points out that “citizens have lost confidence in local products, and so they prefer imported goods over local ones. These goods are constantly being promoted and marketed, which encourages merchants and business owners to import them.” He explains that “the government must intervene as a supporter of national products by granting financial discounts to merchants, rather than acting as a competitor and setting exorbitant prices that many social groups cannot afford.”

Many citizens’ disinterest in local electrical and household industries is due to the inefficiency of locally produced appliances, as well as their high prices, they say. Sanaa Hamzawi (39 years old) from the Zafaraniya area says, “There is no comparison between the Iraqi electrical industries that were produced in the seventies and eighties and the electrical products that are produced today.”

Hamzawi told Shafaq News Agency, “My grandfather had acquired an Iraqi ‘Ishtar’ freezer that had stood the test of time for nearly 40 years without ever being repaired. This type of refrigerator and freezer is not used for more than a year, which is a stark contrast to the local industry.”

The price of imported goods may not be the only factor driving consumers’ preferences. Durability, quality workmanship, and rapid response to repair emergency appliance failures are also important factors in choosing between local and imported electrical appliances.

Ali Alwan Al-Khafaji (34 years old) from Al-Dora district explained to Shafaq News Agency, “The high price is not important for good merchandise, because purchasing solid devices at a slightly high price is better than purchasing devices that are not durable and are constantly subject to malfunction.”

He added, “It is strange that local electrical products are expensive despite their simple manufacture, while imported electrical appliances, despite their solidity and durability, are cheap.”

He asserts, “This strange paradox prompts many people to purchase imported devices, without it offending their national sentiment.”

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