US embassy cable - 05BAGHDAD3132

UNCLAS BAGHDAD 003132 
 
SIPDIS 
 
SENSITIVE 
 
PLEASE PASS TO EB WAYNE, NEA: GODEC AND NEA/I SILVERMAN; 
COMMERCE FOR PETER HALE; JUSTICE FOR GENERAL COUNSEL'S 
OFFICE 
 
E.O. 12958: N/A 
TAGS: ETRD, EINV, IZ, BEXP, BTIO, ECON Development 
SUBJECT: IRAQ TRADE MINISTER DECIDES NOT TO REQUIRE ARAB 
LEAGUE BOYCOTT DECLARATION FOR FOREIGN INVESTORS 
 
 1. (SBU) On July 28, acting ECON Counselor, accompanied by 
IRMO senior consultant and IRMO technical management 
consultant, expressed USG concerns over the Ministry of 
Trade's imposition of an Arab League Boycott declaration on 
foreign investors in Iraq.  GOI Minister of Trade Abdel 
Basset Karim told us that in fact he had instructed all the 
Director Generals in the Ministry of Trade not/not to ask any 
company interested in doing business in Iraq whether or not 
they dealt with Israel.  He acknowledged that as recently as 
one and half months ago his Ministry had asked for this 
information but that is no longer the case. 
 
2. (SBU) When pressed, Karim stressed that he had decided--as 
Embassy has underscored with the ITG--that Iraq has no law 
that requires the Ministry of Trade to enforce the Arab 
League Boycott (ALB).  He emphasized the businesses would not 
be required to make a boycott declaration and he welcomed 
foreign investors to come to Iraq.  Karim told us that he 
understood the importance of this issue for the US and he 
acknowledged WTO membership implications for Iraq if they 
enforce the Arab League Boycott. 
 
3. (SBU) We briefed Pepsico VP for International Government 
Affairs, Elizabeth Avery (based at Pepsico HQ in NY). She 
said that this was good news indeed. We discussed Pepsi's 
other problems in Iraq -- difficulties of trademark 
protection and the fact that nearly half of the Pepsi product 
sold in Iraq is counterfeit. Embassy will continue to press 
with Ministry of Industry steps on trademark registration and 
protection. 
 
4. (SBU) Comment:  Corrective action by the Minister of Trade 
on boycott enforcement is a major step. We will stay in close 
contact with Pepsico and other US companies to ensure that 
the boycott issue is, in fact, resolved. End Comment 
Khalilzad