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Bahrein: FTA faces delay

Gulf Daily news | Manama | 13 October 2004

FTA faces delay


A FREE Trade Agreement (FTA) between Bahrain and the US may not come into effect until early next year, it was revealed yesterday.

The document was signed last month, but will not kick in until it has been ratified by the US Congress.

However, Congress went into recess last week ahead of next month’s presidential elections.

New US Ambassador William Monroe said Congress might ratify the FTA in a "lame duck" session due to take place after the elections.

"Without getting into it, there will be a lame duck session after the election and there is a chance it may be ratified in that period," he said

"It may be ratified early next year."

In the meantime, Mr Monroe said it is vital to look at how companies will benefit from the agreement.

He also warned against being over-optimistic and stressed that the real work must be done by the private sector.

"I am a little worried because it seems like expectations are extremely high here - that the FTA will be a salvation to Bahrain, that everything will just happen, that things will be wonderful, business will flow here and Bahrain will be prosperous ever after," he said.

"It may happen like that, but it will take lots of hard work.

"It won’t be the US government or the Bahrain government making it happen - it depends on business.

"The private sector has to start thinking about how it will benefit. The onus is on industry, but I have pledged to work as hard as I can on anything the US government can do to push it forward."

Mr Monroe made his comments in a speech to the American Association of Bahrain, which held its annual general meeting (AGM) at the Regency Inter-Continental Hotel yesterday.

He said he was delighted to be appointed ambassador to Bahrain in June, but added that his arrival coincided with a difficult period.

"I was delighted to be made ambassador and very excited about coming to Bahrain," he said.

"I thought it is a very exciting time to be here - there is a lot happening, especially with the FTA coming soon and lots of exciting things going on concerning the law.

"But we got hit with various things over the summer - the evacuation of Navy dependents, the travel advisory and the potential closure of Bahrain School.

"All of this could smack into the support for what we want to do in terms of the FTA and business.

"I spent a lot of time talking to people about these issues, among other things."

Bahrain School is a joint venture between the US Department of Defence and the Bahrain community.

However, the number of pupils at the school almost halved this year after nearly 1,000 American military dependents were evacuated back to the US.

It reopened at the end of August for the new term with just over 400 pupils, compared to more than 700 last year.

Mr Monroe was due to meet members of the school board yesterday to discuss its future, which is still in doubt.

However, he said it plays an important role in Bahrain and pledged to help ensure that it remains here in some form - whether as an independent school or under the umbrella of the DoD.

"It is essentially a practical issue," he said. "If you are going to have an FTA and try to encourage US companies to do business here - I have been around long enough to know if you don’t have a good strong American school then you will have problems.

"We thought that, at a minimum, we had to keep the school open this year.

"The Defence Department committed initially to provide some level of support for this year."

A high-profile DoD delegation, headed by Defence Secretary Donald Rumsfeld, was in Bahrain earlier this week on its way to Iraq.

Mr Monroe said the future of the school was one of the issues discussed during their meetings.

"You have a commitment from the ambassador - it is a commitment I have made to several senior defence officials in the last few days," he said.

"They understand the importance of the school on many levels.

"I am confident we will have a Bahrain School as we go on, but how it looks I can’t say.

"Like it is now or some kind of hybrid or full-blown international school - which can be very good.

"Bahrain School is not a normal DoD school. There is no DoD school like it.

"There are a large number of Bahrainis and non-Navy people.

"There are six or seven DoD students there at the school. It really is a policy decision to keep the school going as it is."

Meanwhile, the ambassador stressed the importance of maintaining security in Bahrain - especially with the FTA on the horizon.

"Another issue is the security threats that got people worried back in Washington DC," he said.

"It has started to be dealt with in a fashion. Potentially things are looking pretty good right now.

"That is not to say that businesses will set up no problem. Clearly security is obviously a core issue for both Bahrain and US companies here.

"I think the Bahrain government is committed to keeping the country secure.

"But I think if that falls through all bets are off. Bahrain’s ability to become a free trade hub will be called into question.

"We will work on the security aspect, which is extremely important."

A new American Association of Bahrain board was elected at yesterday’s AGM.

However, their positions on the board are expected to be decided in the next week.

 source: Gulf Daily News