Top officials, including Iraqi interior minister and the Saudi ambassador to Iraq, travelled from Baghdad to formally open Arar, where a line of cargo trucks had been waiting since Wednesday morning.
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A delegation from Riyadh was to open the Saudi Arabian side of the border crossing, which will be open to both goods and people, according to the statement.
Ties remained rocky since the 1990s and did not improve after Saddam’s toppling in the 2003 US-led invasion, as Riyadh looked at the new Shia-dominated political class with suspicion due to their ties to its regional rival Iran.
A thaw began in 2017 when then Saudi foreign minister Adel al-Jubeir travelled to Baghdad – the first such visit in decades – followed by a Riyadh trip by then-Iraqi Prime Minister Haider al-Abadi.
The first commercial flights resumed between the two countries and officials began discussing Arar, with high-profile US diplomat Brett McGurk even visiting the crossing in 2017 to support its reopening.
But those plans were repeatedly delayed, with Arar only open on rare occasions to allow Iraqi religious pilgrims on their way to Mecca for Hajj.
The current Iraqi Prime Minister Mustafa al-Kadhimi is said to have a close relationship with de facto Saudi ruler, Crown Prince Mohammed bin Salman.
In May this year, al-Kadhimi was to travel to Saudi Arabia in his first foreign trip as prime minister, but the visit was cancelled at the last minute after Saudi King Salman was hospitalised.
He has yet to make the trip, although Iraqi ministers have visited Riyadh to meet their counterparts. A top-level Saudi delegation travelled to Baghdad last week.
Baghdad sees Arar as a potential alternative to its crossings with eastern neighbour Iran, through which Iraq brings in a large share of its imports.
But pro-Iran factions in Iraq have stood firmly against closer ties with Saudi Arabia.
Ahead of Arar’s opening, one such group, identifying itself as Ashab al-Kahf, published a statement announcing its “rejection of the Saudi project in Iraq”.
“The intelligence cadres of the Islamic Resistance are following all the details of the Saudi enemy’s activities on the Iraqi border,” it warned.
Speaking to reporters on Tuesday evening, al-Kadhimi fired back against those describing the rapprochement as Saudi “colonialism”.
“This is a lie. It’s shameful,” he said. “Let them invest. Welcome to Iraq.”
Al-Kadhimi added that the Saudi investment could bring in a flood of new jobs to Iraq where more than one-third of youth are unemployed.
Iraq is the second-largest producer in the OPEC oil organisation, outranked only by Saudi Arabia.
Its oil, gas and electricity infrastructure is severely outdated and inefficient but low oil prices this year have stymied efforts to revamp it.
International firms and foreign countries have also complained of rampant corruption, thereby making investment difficult.
Al-Kadhimi’s government has sought to fast-track foreign investment, including Saudi support for energy and agriculture.
On his trip to Washington earlier this year, he agreed to a half-dozen projects that would use Saudi funding to finance the US energy firms.
Last year, Iraq signed a deal to plug into the Gulf Cooperation Council’s power grid and add up to 500 MW of electricity to its dilapidated electricity sector.
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