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IdentifierCreatedClassificationOrigin
09BAGHDAD636 2009-03-11 12:07:00 CONFIDENTIAL Embassy Baghdad
Cable title:  

IRAQ WANTS A JUNE WTO WORKING PARTY BUT

Tags:   ETRD ECON PGOV EINV IZ 
pdf how-to read a cable
VZCZCXRO6333
RR RUEHAG RUEHBZ RUEHMR RUEHPA RUEHPB
DE RUEHGB #0636/01 0701207
ZNY CCCCC ZZH
R 111207Z MAR 09
FM AMEMBASSY BAGHDAD
TO RUEHC/SECSTATE WASHDC 2106
INFO RUCNWTO/WORLD TRADE ORGANIZATION COLLECTIVE
RUEHGV/USMISSION GENEVA 0291
					  C O N F I D E N T I A L SECTION 01 OF 02 BAGHDAD 000636 

SIPDIS

STATE PASS USTR

E.O. 12958: DECL: 03/06/2019
TAGS: ETRD ECON PGOV EINV IZ
SUBJECT: IRAQ WANTS A JUNE WTO WORKING PARTY BUT
ACKNOWLEDGES IT MAY NOT GET THERE

REF: A. BAGHDAD 285

B. THOME-SHACKLEFORD TELCON 09 FEB 2009

C. USTR-EMBASSY-TIJARA DVC FEB 2009

D. 08 BAGHDAD 3807

E. 08 BAGHDAD 3134

Classified By: A/EMIN Michael dodman, reasons 1.4 (b,d).



1. (C) SUMMARY: The Iraqi Ministry of Trade is eager to hold
its Third WTO Working Party (WP) in June. However, Trade
Minister al-Sudani and WTO Unit officials acknowledge that if
they do not make substantial progress in several areas by
April, a June WP would not be justified. They appear to be
making progress on the agriculture accession document (ACC4)
and the initial services offer (ACC5), but exactly how much
they can accomplish by April remains unclear. More
problematic is Iraq's initial goods offer, which remains
stalled. Meanwhile, the Ministry of Finance (MOF) has
removed the Customs Director General (DG) -- a move WTO Unit
officials hope will resolve the standoff over an MOF-drafted
Customs Tariff (CT) bill which the MOT says is not
WTO-compatible. The GOI also hopes to inform the WTO of its
preference regarding the new WP Chair within the next 2-3
weeks. END SUMMARY.

Trade Minister Presses for June WTO Working Party


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--------------------------




2. (U) ECON, USAID and USAID-funded contractors Tijara met
with Iraqi Minister of Trade Abdul-Falah Hassan Al-Sudani
March 4 for a detailed discussion of the current status of
Iraq's WTO accession bid. Al-Sudani was accompanied by MOT
DG for Trade Tharwat Akram Salman, WTO Unit Coordinator Sami
Khairallah, and Deputy Trade Minister Abdulhadi K. Al-Hamiri.
The Minister thanked the USG for its political and financial
support for Iraq's accession and commended Tijara for the
hard work and technical expertise it has provided to the WTO
Unit. He made it clear that he is eager for the WTO to host
Iraq's Third Working Party (WP) in June, but also
acknowledged that WTO and USG officials believe (Refs B,C)
that a June WP will only be productive if the GOI can make
substantial progress in several areas by the end of April at
the very latest.

Lots of Progress -- But How Much by April?


--------------------------




3. (SBU) Al-Sudani and Khairallah highlighted several areas
in which the GOI has made progress. WTO-compatible sanitary
and phyto-sanitary (SPS) and intellectual property rights
(IPR) legislation are nearly ready to be submitted to the
Council of Representatives (Ref A). The Health and
Agriculture Ministries (MOH, MOA) are working directly with
Tijara and have agreed to several of the WTO's suggestions on
the SPS draft, and "the differences between the Iraqis'
current IPR bill and the ideal WTO law are very minor,"
Khairallah said. The MOT is in the final stages of
negotiating GOI's agriculture document (ACC4) with the MOA
and the Ministry of Finance (MOF). The Iraqis hope to submit
the ACC4 by April, but Kairallah admitted that the GOI
interagency has not yet resolved the issue of domestic price
supports. Iraq's Initial Services Offer will not be ready by
April, but is moving forward; the tourism section is done and
the financial services portion is nearing completion, with
telecommunications and transportation to follow. The USG
side welcomed these updates and commended the MOT for its
progress, but all acknowledged that the potential June WP
will still depend not only on progress, but on how much can
be demonstrated by April.

Personnel Shuffle Might Help Customs/Tariff Draft


--------------------------



--------------------------


Q

--------------------------



--------------------------




4. (SBU) While much progress is indeed being made, Al-Sudani
and his team continued to express intense frustration with
the MOF over the Initial Goods Offer, which remains stalled,
and the associated harmonized tariff schedule and
implementing Customs Tariff (CT) legislation. As Customs DG
Ahmed Jassim Al-Itiya had suggested to us earlier (Ref A),
the MOF submitted to the Shura Council (akin to a
Constitutional Court) a CT draft that, Khairallah now
confirmed, was incompatible with WTO standards, particularly
in the areas of independent dispute resolution and the
unilateral authorities of the Finance Minister in regards to
the tariff schedule. The fact that the MOF moved this
version of the bill forward is very problematic, because the
MOT now needs to convince the MOF's Customs
Directorate-General to petition the Shura to withdraw the
draft and then modify it.



5. (C) Al-Sudani told us that he planned to meet with Finance
Minister Bayan Jabr "this month" to ask him to pull the draft

BAGHDAD 00000636 002 OF 002


back from the Shura, but admitted that, even if Jabr agrees,
speedy production of a new draft still remains unlikely.
"Frankly speaking," Khairallah said, "the Ministry of Finance
holds the keys. If they are not going to be pro-active, we
cannot get it done." That said, MOT officials did sound one
note of optimism -- namely, that the MOF has reassigned
Customs DG Jassim to other duties within the Ministry. Both
the WTO Unit and Tijara had viewed Jassim as perhaps the
biggest obstacle to a WTO-compatible CT law and, Khairallah
reported, the new acting Customs DG has already signaled that
he may be more willing to work with the WTO Unit to produce a
better bill.

Looking Forward


--------------------------




6. (SBU) The MOT's WTO Unit has made steady progress toward
WTO accession in several areas. As Reftel A notes, however,
we leave it to the WTO and the interested Washington agencies
to determine if that progress is sufficient to suggest that
holding a Third WP in June would be productive. On the
Baghad level, we will continue make the WTO accession process
one of the focal points of our engagement with the GOI, both
through Tijara's assistance and within the Stragegic
Framework Agreement's (SFA) Working Group on Trade and
Investment (which Deputy Minister al-Hamiri and Econcouns
co-chair.) On a separate track, Al-Sudani noted that the GOI
is working with the WTO to identify a new WP Chairperson. He
would not tip his hand as to which candidate the Iraqis
prefer, but strongly suggested that it should be a candidate
"from the region." He said he would make the GOI's
preference known in Geneva in the next 2-3 weeks.
BUTENIS