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The numbers are up, and so is the array of U.S. products going into Iraq. In 2001, the U.S. exported fewer than 20 product categories to Iraq. In 2007, more than 112 product categories will be traded. Not surprisingly, dominant import categories are infrastructure rebuilding goods such as telecom equipment, trucks, generators, and drilling equipment. Sales of security and defense-related equipment are also expected to increase. The Government of Iraq recently ordered 600 Humvees, 300 armored personnel carriers, and UH-2 advanced helicopters in a $1.5 billion military equipment purchase.

The engine of Iraq’s economy, petroleum production, is experiencing a gradual comeback as firms work to put production back on line. Iraq’s current refining capacity is estimated at 644,000 barrels per day (bbl/d), yet energy rich Iraq remains a net importer of petroleum products. The oil ministry is seeking assistance from overseas to build five additional refineries at a cost of $1 billion, in addition to upgrading existing refineries. The recent resumption of 10,000 bbl/d in pipeline petroleum exports to Jordan may signal a turning point in Iraq’s efforts to increase production and sales. Production Sharing Agreement contracts under consideration in the Iraqi parliament would allow 30-year production rights with 75 percent of net revenues to repay foreign producers willing to invest.

Iraq – 2007 Forecast Top Ten Manufactured U.S. Imports ($ Billion)

(SOURCE: IRmep)

Niche exporters may be surprised to find that recreational items, including sporting goods and musical gear, are growing at three- and four-digit annual rates. Medical equipment and testing and control materials are undergoing similar geometric growth.

Kuwait

In October 2006, in a move that was both strategic and symbolic, United Airlines launched non-stop service from Washington Dulles Airport to Kuwait. As such, United is the first U.S. commercial airline to fly directly from the United States to the Arabian Gulf.

Noted John Tague, United’s Executive Vice President, “The Kuwait City service provides our customers with direct access to the Middle East, where petroleum, energy, and shipping industries have created an increased demand for air cargo and passenger service.”

To commemorate this important milestone and to highlight the new “Open Skies” Agreement between the two nations, Kuwait’s Minister of Communications and Transportation flew to the United States in late 2006. At a reception co-hosted by United Airlines and NUSACC, Her Excellency Dr. Masouma Al-Mubarak noted, “With Kuwait being chosen as a window to the region, this will definitely help to broaden areas of trade and economy between the United States and the rest of the region.”

The Open Skies agreement significantly modernizes U.S.-Kuwait aviation relations by allowing airlines to make commercial decisions with minimal government intervention. It provides for open routes, capacity, frequencies, designations, and pricing, as well as opportunities for cooperative marketing arrangements, including code-sharing.

Air travel is important, but Kuwait’s economy still hinges on petroleum production. In recent months, Kuwait has unveiled more than $60 billion worth of capital development and energy expansion projects, including plans to construct one of the largest refineries in the world with an initial capacity of nearly 600,000 bbl/d. Kuwait’s development initiatives are spurring the importation of U.S. vehicles, oilfield equipment, telecom equipment, and industrial machines.

U.S. exporters for niche sporting goods products have experienced four digit growth in the past four years. Excavating machinery and measuring & testing instruments have achieved three-digit growth.

Kuwait – 2007 Forecast Top Ten Manufactured U.S. Imports ($ Billion)

(SOURCE: IRmep)

When it comes to strategic allies in the region, few nations play as important a role as Kuwait, which was recognized by the United »