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Iraq Halts Licenses for Foreign Companies, Caglayan Says

13 Sep 2012

Iraq has temporarily stopped issuing operating licenses for all foreign companies and not just Turkish firms, in order to create a new registry system, Turkey’s economy minister said today.

Zafer Caglayan said in an e-mailed statement that Iraq said the decision applies to all companies making new applications to operate in Iraq. Turkish companies are a majority of the foreign firms operating in Iraq. Currently, 366 Turkish firms are registered with Iraq’s Trade Ministry and aren’t affected by the decision, Caglayan said.

Fawziyeh Hameed, a Trade Ministry spokeswoman in Baghdad, said earlier that the ministry “has stopped the registration of Turkish companies for regulatory and scrutiny purposes.”

Ties between the neighbors have been strained becauseTurkey is sheltering Iraqi Vice President Tariq al-Hashimi, who was sentenced to death in his homeland on Sept. 9 on charges of running death squads. Hashimi, from Iraq’s Sunni minority, says the verdict was politically motivated. Turkey, a mostly Sunni nation, has said he won’t be extradited.

Turkish exports to Iraq increased 37 percent to $5.97 billion in the first seven months of this year, making the country the third-biggest market after Iran and Germany, according to government statistics.

Relations also have been strained by Turkey’s growing trade ties with the Kurdish region of northern Iraq, including the purchase of crude oil under a deal without approval from Baghdad.