ASEAN hints at forming trade pact with Gulf Cooperation Council
Jakarta Globe - 19 July 2024
ASEAN hints at forming trade pact with Gulf Cooperation Council
By Jayanty Nada Shofa
ASEAN recently dropped another hint that they might try to strike a trade pact with the Gulf Cooperation Council (GCC) as the former tries to boost its trade with partners outside the region.
The GCC encompasses Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates (UAE). According to ASEAN’s Secretary-General Kao Kim Hourn, a free trade agreement (FTA) between the two blocs is likely.
“There is a request from the GCC to have a FTA with us. I think they are confident in wanting to cooperate with ASEAN, and this is a positive development,” Kao told reporters in Jakarta.
Kao did not say when the actual negotiations would start. The secretary-general only said that the interest in a GCC-ASEAN trade pact came at a time when the Southeast Asian grouping was negotiating a FTA with Canada.
ASEAN and the GCC have agreed on a framework document that laid out the ways they could bolster their cooperation over the coming years. According to the document, both sides are eyeing to conduct further consultations, among others, on developing a “framework arrangement” on economic cooperation.
Last year, ASEAN and GCC held its maiden summit in Riyadh. President Joko “Jokowi” Widodo at the time pushed for this trade framework to take shape. Malaysian Prime Minister Anwar Ibrahim also told the summit that the two blocs should form a free trade agreement.
Aside from an entirely new free trade pact, Indonesia earlier this year proposed GCC countries to join the already existing trade deal: the Regional Comprehensive Economic Partnership (RCEP) agreement. This is the world’s largest trade deal covering 30 percent of the global gross domestic product (GDP). Aside from the 10 ASEAN members, the RCEP members include China, Japan, South Korea, Australia, and New Zealand. Saudi’s state-owned news agency Al Arabiya reported last October that the ASEAN-GCC trade volume exceeded $110 billion.
