Government's Decision Threatens Iraqi Automotive Industry
The Iraqi government recently issued a decision imposing heavy registration fees on those who purchase new cars, a move that could destroy the country’s automotive trade, writes Omar al-Shaher.
A sudden government decision has caused confusion among the car market in Iraq and resulted in a significant rise in prices.
Earlier this year, the Iraqi government decided to repeal an exception granted to the state-owned General Automotive Co. that exempted the company from having to cancel the license plate for an old car each time they sold a new car.
Since 2006, Iraq has employed a system of phasing out old cars in exchange for new ones, creating a black market for license plates. A Baghdad license plate costs nearly $5,000, while prices for plates from other provinces range between $3,000 to $4,000. The only exception are plates from the three provinces of Iraqi Kurdistan, in which plates are sold directly to the buyer without the condition of phasing out an old registration. In these provinces, license plates do not exceed $1,000.
Because of this, thousands of private cars in Baghdad have license plates registered in Kurdistan.
