TPO pushing for balanced trade with Iraq via joint agri-value chains
A senior official with the Trade Promotion Organization (TPO) announced on Saturday that the Islamic Republic is seeking to rebalance its trade relationship with Iraq by moving beyond a largely one-way export model toward joint agricultural production, shared value chains, and more balanced commerce.
Speaking at the first joint conference on Khuzestan’s agricultural capabilities — from production to exports — Abdolamir Rabihavi, the director general of the TPO’s West Asia Bureau, described Iraq as the country’s top non-oil export destination and “first strategic partner,” ISNA reported.
While Iranian exports to Iraq have grown dramatically — from a few hundred million dollars in the early 2000s to around $12 billion last year — the trade flow remains heavily tilted in Iran’s favor, Rabihavi noted. He said both governments now aim to gradually narrow the gap.
“Iraq is Iran’s most important non-oil export partner and ‘first strategic partner,’” Rabihavi said. “Given our 1,500-kilometer shared border, adjacency between five Iranian and seven Iraqi provinces, and 12 official border crossings, the geographic and logistical framework already exists for a win-win trade model.”
He emphasized that the path to a durable partnership lies in shifting Iraq’s role from a passive consumer to an active co-producer. “The sustainable solution is to build joint value-added chains and increase targeted imports from Iraq,” he said.
Rabihavi pointed to Iraq’s significant agricultural potential — fertile land, abundant groundwater resources, and the capacity for self-sufficiency or even export — as a foundation for correcting the trade imbalance. In the first seven months of the current Iranian year (which began March 21, 2025), Iran exported approximately $2.6 billion in agricultural goods, nearly one-third of which went to Iraq.
Dates offer a strategic example, he said, adding, “Iraq produces hundreds of thousands of tons of dates annually but exports much of it unprocessed and without added value.” He highlighted opportunities for Iranian companies, particularly in Khuzestan, to collaborate on processing, packaging, and international marketing.
Rabihavi welcomed the existence of Iraq’s specialized date company under its Ministry of Agriculture as “a suitable point of connection for joint procurement, collection, and professional export operations.”
He added that Iran has already exported more than 200 types of agricultural products to Iraq — many of which are suitable for repackaging, further processing, and re-export to third markets such as Syria, Lebanon, Saudi Arabia, and other countries via Mediterranean routes. “This model can lead to joint branding and mutual value creation,” he said.
At the core of Iran’s updated economic approach, Rabihavi said, is “joint investment and production in Iraq.” By establishing agro-processing and complementary industrial units on Iraqi soil, both countries could jointly access new markets.
He also invited Iraqi investors to explore opportunities in Khuzestan’s protein sector — especially in fish and poultry farming — describing the province as a prime location with free-trade-zone advantages that could host partnerships with neighboring Iraqi provinces.
Rabihavi stressed that a lasting trade relationship requires reciprocity. “As long as Iran is only an exporter and Iraq only an importer, the relationship will remain vulnerable to volatility,” he said. “If Iran’s exports to Iraq stand at around $12 billion, imports from Iraq must gradually rise toward a comparable level.”
He concluded that targeted cooperation in agriculture, agro-industry, and complementary investments in Iraq would help stabilize trade and reduce risk for economic actors on both sides.
Iran’s push for deeper economic integration comes as bilateral trade faces headwinds. Data shows that trade between the two countries totaled approximately $3.57 billion in the first five months of this Iranian year, an 18% decline compared to the same period last year, driven largely by an 18% drop in Iranian exports to Iraq.
The downturn reflects a confluence of factors, including new Iraqi trade policies, domestic energy and infrastructure constraints in Iran, and external pressures on Iranian exports. Given Iraq’s critical importance as a market for Iran’s consumer goods, metals, petrochemicals, and agricultural products, officials say a strategic reassessment of trade policies and a more proactive approach are essential to prevent losing market share to regional and extra-regional competitors.