Iraq rolls out new customs system at Ibrahim Khalil border crossing

ERBIL, Kurdistan Region - Iraqi customs authorities will begin implementing a new pre-arrival system for key imports at the Ibrahim Khalil border crossing with Turkey later this week, in a move aimed at streamlining procedures and stabilizing the national currency.

Samer Qasim Dawood, head of Iraq's General Customs Authority told Rudaw on Wednesday that “starting from April 3, the implementation of the pre-arrival customs information system for the entry of food items, medicine, and medical supplies will begin at the Ibrahim Khalil border crossing."

He also added that the step comes after years of discussions and coordination between the federal government and the Kurdistan Regional Government (KRG) to unify customs procedures.

The move comes amid ongoing disputes between Baghdad and Erbil over Iraq’s new Automatic System for Customs Data (ASYCUDA), which prevents Kurdish traders from accessing official-rate US dollars unless they pay federal taxes in advance through a platform not yet fully integrated with the KRG’s system.

The electronic automation ASYCUDA system was developed by the United Nations Conference on Trade and Development (UNCTAD) in the early 1980s and now covers all 22 of Iraq’s federal border crossings, including key ports in southern Iraq.

The system, which is used to standardize and digitize customs processes, has been introduced in Iraq as part of broader reforms aimed at increasing transparency and improving revenue collection.

Dawood said the pre-arrival system initiative introduces a new mechanism designed to facilitate imports of essential goods.

“This follows requests from many merchants for facilitation of financial transfers and to benefit from receiving US dollars at the official exchange rate, which will have an impact on strengthening the value of the dinar against the dollar,” he explained.

One US dollar is officially exchanged at 1,320 Iraqi dinars, but on the black market it was trading at around 1,546 dinars on Wednesday.

Under the new system, traders importing through the Kurdistan Region will have access to official exchange rates for dollar transactions. “Merchants now have the option that if they wish to import goods through the Kurdistan Region, they can visit us in Baghdad, and we will transfer dollars to them at the official rate in accordance with the regulations,” Dawood said.

He noted that the move also addresses long-standing technical gaps between federal and regional customs systems. “The border crossings of the Kurdistan Region have not yet been linked to the ASYCUDA system; therefore, this step is primarily to resolve the issues of merchants in the Kurdistan Region specifically, and Iraqi merchants in general,” he said.

The newly-introduced pre-arrival system currently applies only to essential goods, with broader coverage dependent on further system integration. “This procedure only covers food and medicine, not all other goods. However, if the ASYCUDA system is implemented at the Kurdistan Region’s crossings, it will then cover all imported goods,” Dawood added.

He stated that the measure will lead to the strengthening of the dinar against the dollar in the market after the Central Bank provides dollars at the official rate to merchants. Dawood stressed that compliance with the new system is essential for accessing official currency rates.

“Without pre-arrival customs information, it is impossible to provide dollars to merchants at the official rate,” he added.

Nahro Mohammed contributed to this report.