Intern’l Trade Reporter | July 8, 2004
U.S., Oman Sign Framework Trade Pact, Agree to Begin Free Trade Negotiations
By Gary G. Yerkey
The United States and the Gulf state of Oman July 7 signed an agreement aimed at promoting bilateral trade and investment and agreed to begin free trade negotiations later this year.
Signing the accord—known as a Trade and Investment Framework Agreement (TIFA)—were U.S. Trade Representative Robert B. Zoellick and Omani Minister of Commerce and Industry Maqbool Ali Sultan.
It was the final TIFA to be signed between the United States and members of the six-nation Gulf Cooperation Council (GCC), which, in addition to Oman, includes Bahrain, Kuwait, Qatar, Saudi Arabia, and the United Arab Emirates.
"Today’s agreement will provide a vehicle for strengthening our trade and investment relationship with Oman," Zoellick said. "The United States supports the significant changes and reforms that Oman has already undertaken and its continued efforts to promote economic diversification and trade liberalization."
Agreement on Process for Conducting Talks
The Omani commerce minister told reporters that the two sides also had agreed on a process for conducting FTA negotiations, although no firm date has been set yet for formally launching the talks.
"We believe in expanded, unrestricted trade," he said. "Oman is committed to open markets based on free competition."
Sultan made his remarks at a luncheon in his honor hosted by the National Foreign Trade Council (NFTC), the National U.S.-Arab Chamber of Commerce (NUSACC), and the Business Council for International Understanding (BCIU).
U.S. trade officials have said that they will use TIFAs as launching pads for free trade talks with GCC members and other countries, creating a "Gulf-wide" FTA that would become part of President Bush’s vision outlined a year ago to establish a U.S.-Middle East Free Trade Area by 2013.
An FTA has already been concluded with Bahrain, and preliminary talks have already been held with Qatar with the aim of wrapping up the negotiations by the end of the year.
The chief U.S. negotiator in the talks—Catherine A. Novelli, assistant U.S. Trade Representative for Europe and the Mediterranean—said at the NFTC-NUACC-BCIU luncheon July 7 that Oman appears to be well-prepared to begin free trade talks with the United States, noting that Omani officials have already been carefully studying the U.S.-Bahrain FTA as a possible model for its free trade pact.
Separate Negotiations Planned
Zoellick told reporters at the conclusion of the U.S.-Bahrain FTA talks May 27 that the U.S. objective will be to "draw [other individual GCC countries] up" to the level of the state-of-the-art Bahrain agreement, rather than to negotiate with the GCC as a group.
USTR said that the TIFA signed with Oman July 7 will establish a U.S.-Oman Council on Trade and Investment, where high-level officials from both countries will meet to advance trade and investment issues.
U.S. goods exports to Oman in 2003, according to USTR, totaled $323 million, including machinery, aircraft, vehicles, and electrical machinery.
Agricultural exports to Oman were worth $13 million, including sugars, sweeteners and beverage bases, and vegetable oils.
Goods imports from Oman in 2003 totaled 695 million, USTR said, including mineral fuel, woven apparel, repaired products, precious stones, and knit apparel.
U.S. agricultural imports from Oman were worth about $2 million, according to USTR.