Iran faces rising pressure to protect its Iraq market share. Officials warn that outdated commercial systems and weak planning threaten long-term trade growth. Experts say Iran must modernize its economic approach to maintain influence in Iraq.
Yahya Al-e-Eshaq, head of the Iran-Iraq Joint Chamber of Commerce, outlined the stakes. He said formal trade reached $12 billion last year. Informal trade brought the total close to $15 billion. He added that Iran could hit $20 billion with improved systems, preserving its Iraq market share.
Iran sells a wide range of goods to Iraq. These include construction materials, food products, detergents, engineering support, agricultural supplies, and medical and leisure tourism services. Iran currently controls about 20 percent of Iraq’s consumer market. Officials warn that bureaucracy, rigid customs rules, inconsistent standards, slow transit systems, and visa hurdles slow trade flows.
Economic analysts believe these barriers weaken Iran’s position. Regional competitors are expanding, increasing the urgency for reform. Seyed Taha Hossein Madani, head of the Smart Governance Think Tank, said Iran still has untapped export potential in Iraq.
Dairy exports reached 660,000 tons valued over $1 billion in 2024, and more than half went to Iraq. Potato exports brought in $15 million, while construction materials remain a major opportunity. However, Iran has lost ground in cement and related sectors.
Iraq also leads as the largest buyer of Iranian iron and steel. Exports hit $1.4 billion last year. Madani said weak commercial planning continues to limit deeper growth.
Analysts note that Iraq’s economic environment is changing fast. Leaders there prefer partners with stronger logistics and reliable quality standards. This trend puts pressure on Iran to invest in technology, streamline regulations, and speed cross-border trade.
Officials plan technical meetings with Iraqi partners to improve coordination. They also aim to reduce border delays and speed up approvals. Economists say these reforms could help Iran stabilize its position and protect its Iraq market share.
The coming year will test Iran’s ability to modernize its trade strategy. Swift action may determine whether Iran strengthens its foothold or loses additional Iraq market share to competitors.
