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UAE to resist US pressure to open telecoms sector: minister

Agence France Presse | May 11, 2006

UAE to resist US pressure to open telecoms sector: minister

DUBAI (AFP) - The United Arab Emirates will resist pressure in free trade talks with the United States to open its telecommunications sector to foreign investors.

The UAE will not allow foreign investment in its telecoms sector before 2010, Sultan bin Said al-Mansuri, public sector development minister, was quoted as saying in the Arab daily Al-Hayat.

"The entry of foreign companies to the sector is one of the main stumbling points in the negotiations," he said Thursday.

In remarks about the same issue published in the Dubai-based Arab language paper Emarat al-Yom on Wednesday, Mansuri said: "This is rejected, we will not give up one of our rights."

"We must give the current operators the chance to develop before we allow new ones in."

State-owned Etisalat has a monopoly on fixed and mobile telephony and Internet services. Authorities announced last year plans for a second operator which they said in December would be 50- percent owned by the government.

Etisalat sealed a deal in April to buy Pakistan’s largest telecom company for 2.6 billion dollars.

Mansuri also said that the United States and Australia with whom the UAE is also discussing a free trade agreement (FTA) have demanded entry into several other sectors besides telecoms.

The fifth round of US-UAE talks, which opened Tuesday in Abu Dhabi, ended early Wednesday, one day ahead of schedule. At the close of the talks, the UAE’s deputy economy minister Abdullah Ahmed al-Saleh said the discussions focused on investments and described the meetings as "positive".

No date was given for the next round of talks, which were launched in March 2005 and are aimed at eliminating tariffs and barriers and expanding commercial ties between the United States and UAE.

Mansuri’s hardline position on protecting certain economic sectors comes two months after government-controlled Dubai Ports World was forced to relinquish the rights to operate six US ports as part of it 6.9-billion-dollar acquisition of British shipping giant P and O due to US security concerns.

Besides concessions on investments, the UAE faces increasing pressure in its talks with the United States to reform its labour laws following violent riots in March and April by migrant Asian construction workers over pay and poor living conditions.

FTA agreements signed by the United States with Bahrain and Oman at the start of the year each included a major section on labour rights.

Unions are banned in the UAE and a minimum wage requirement exists only for nationals who make up only a small fraction of the workforce.