ERBIL, Kurdistan Region - The Iraqi government announced on Monday a new agreement with the Kurdistan Regional Government (KRG) to implement the UN-backed Automated System for Customs Data (ASYCUDA) across the Region’s borders. The initiative aims to unify customs procedures and modernize trade infrastructure between Erbil and Baghdad.
"The Council also discussed the mechanisms and means to implement the ASYCUDA system at the region's border crossings and agreed to unify customs policy, including tariffs and policies for protecting domestic products, in a way that serves the public interest and enhances transparency in the application of these policies,” said the federal Ministerial Council for the Economy said in a statement.
Developed by the United Nations Conference on Trade and Development (UNCTAD), ASYCUDA is a digital platform that automates customs processes. By replacing manual paperwork with centralized electronic filing, the system increases transparency, eliminates human error, and maximizes government revenue collection at major commercial crossings like Ibrahim Khalil.
This modernization arrives at a critical time as Iraq’s economy faces mounting pressure following the outbreak of regional conflict on February 28 - when the US and Israel launched an aerial campaign against Iran. To mitigate supply chain disruptions, the agreement introduces a pre-arrival information system specifically for essential imports like food and medicine. Under this mechanism, merchants importing through the Kurdistan Region who pay federal taxes in advance can access the official Central Bank of Iraq exchange rate of 1,320 dinars per US dollar. This provides a vital lifeline away from the volatile parallel market, where the dinar was trading at approximately 1,546 dinars early Monday.
Samer Qasim Dawood, head of Iraq’s General Customs Authority, previously emphasized that the initiative is designed to resolve technical gaps between Baghdad and Erbil. By providing a streamlined path for Kurdish traders to access official currency, authorities hope to stabilize the dinar and curb the rising cost of living exacerbated by the conflict. While currently limited to essential goods, officials noted that full integration of the KRG’s borders into the ASYCUDA network remains the long-term objective for total trade synchronization.