GCC-EU FTA plan gets a fillip
29 October 2008
(MENAFN - Bahrain Tribune) Bahrain yesterday exuded confidence that its current talks with Germany would expedite the signing of the much-delayed Free Trade Agreement (FTA) between the six-nation Gulf Cooperation nations and the 27-nation European Union that has eluded them for close to 20 years.
Negotiations for the FTA between the two of the world’s powerful regional economic blocs started way back in 1989.
The Kingdom’s Industry and Commerce Minister, Dr Hassan Abdulla Fakhro, currently on a visit to Germany along with His Majesty the King, Hamad bin Isa Al Khalifa, referred to the GCC EU FTA while addressing a joint Bahraini German economic and commercial forum in Berlin yesterday attended by his German counterpart and industry representatives of both the countries.
He said the dialogue between the leaderships of both Bahrain and Germany was bound to give a fillip to the negotiations for the GCC EU FTA, which were in the final stages, and eventually signing of the free trade pact, the official news agency BNA reported.
The FTA could boost bilateral trade between the two regions in a big way. The Minister showcased the Free Trade Agreement signed by Bahrain with the United States, saying the scale of bilateral trade had expanded with an upgraded trade structure and significant progress was made in the economic and trade cooperation between both the nations in the last few years.
Bahrain, he said, was the first country in the Gulf region to sign such an agreement, thanks to its economic openness and legal reforms.
The bilateral investment accord signed between Bahrain and Germany in February last reaped rich dividends for both the nations with trade volume touching the $500 million mark last year itself. "The agreement eased operating foreign investments in Bahrain and Germany, facilitating big time two-way trade."
Similarly, the GCC and European Union, which were strategic partners and neighbours, could benefit once the much-delayed FTA was realised.
The European Union Ambassador to Saudi Arabia, Bernard Savage told Bahrain Tribune recently that the two blocs were never so close to signing the agreement, as they were now.
He, however, refused to give a date for the signing. "It is not about a few sessions and a signing ceremony. It has been an extremely complex and difficult exercise with 33 countries and a myriad issues thrown in from time to time. But, this will undoubtedly be a pioneering trade agreement that ensures a win-win situation for both the parties. And that is primarily the essence of the FTA," he said. In late 2007, the Sweden’s Minister for Foreign Trade, Ewa Bjoerling said the FTA would be signed in the spring of 2008.
Both sides had committed to enter into negotiations on the FTA based on the1989 EU-GCC Co-operation Agreement. The negotiations were initiated in 1990 but relegated to the backburner till 1999 when the GCC announced its decision to create a Customs Union by March 2005. It was later advanced to 2003 at the GCC Summit held in Muscat in December 2001. "It is only after this that negotiations moved into top gear and a much more serious tone," he said.
"The GCC common market ushered in early this year is a big positive for the FTA. The FTA, in turn, will further contribute to this vital economic integration of the GCC States," he said.
A foolproof framework for investments, public contracts, goods and services was vital to the GCC EU FTA. While big players from the European Union were already present here, it was the Small and Medium Enterprises that were bound to be the growth engines of the FTA, generating not only mutual investments and revenue but also becoming the main source of employment in the Gulf region.