Wisdom ultimately prevails on Gulf states’ FTAs with US
Gulf News, June 26, 2005 (via Zawya.com)
Wisdom ultimately prevails on Gulf states’ FTAs with US
The wise decision adopted by the GCC Finance and Economy Ministers to exclude the Free Trade Agreements (FTA) signed or expected to be signed with the United States from the Gulf agreement concerning unified customs tariffs is considered a prudent decision that serves the interest of enhancing Gulf economic co-operation and integration.
The decision has come to reaffirm the preservation of the spirit of co-operation, co-ordination and flexibility that characterised the GCC activities during the last two decades. It is also a reflection of a proper understanding of the current international developments and changes at the present time.
The dispute over the unilateral signature by certain member states of FTAs with the United States was about to have devastating effects on the economic achievements of the GCC countries and push them backwards for many years. This could have exposed their economies to numerous difficulties and challenges that have resulted in enormous and unjustifiable losses.
Overcoming this dispute has opened the doors wide open for forging ahead with collective negotiations between the Gulf group of nations and several economically influential blocks and major countries with the aim of setting up free trade zones and furthering economic and trade co-operation. Such moves could have yielded considerable benefits to all the GCC member states.
In addition to the United States, Europe, China and Turkey, there are important economic groups that are looking forward to sign free trade agreements such as South American countries that include such important and influential states as Brazil and Argentina.
Meanwhile, this new decision allows us once again to look at the Gulf economic agenda and not to delay it nor postpone it because of the agreements signed with the United States. The people of the Gulf still look in anticipation to the development of Gulf joint economic activities in order to achieve a Gulf common market by the year 2007, as scheduled. The people of the Gulf look forward to see their unified national currency in circulation in early 2010. =In support of this policy trend, the movement of capital, citizens and residents in the GCC states will become much easier and will help support development activities through the flow of goods, services, tourists and family visits.
This will become possible after facilitating immigration and customs formalities and currency exchanges. Instead of having to carry several currencies when traveling between the GCC states, as it is the case at the moment, citizens or residents in the GCC states will not have to go around exchange houses and ATM machines for changing currencies by the year 2010. A unified Gulf currency will certainly promote investment and travel between Gulf countries.
In the same policy line, several GCC states are considering the adoption of a unified entry visa for businessmen and citizens of a group of countries as the first phase of a Schengen Gulf visa on the same lines of the unified European visa called the "European Schengen Visa". In case of introducing this new system, it will be considered as another qualitative shift towards attracting more business and capital to all the GCC states that will be viewed as a stable and growing economic block.
As in the case of all groupings including the European Union, there are certain difficulties that arise in practical application as in the recent case of the voting on the EU Constitution or the differences over the Gulf Free Trade Agreements. However, such occurrences usually help strengthen such blocks when they are settled with a spirit of co-operation and flexible understanding of the common interests of the parties constituting the economic union or block.
The wise decision that we have already talked about gives us reason to feel optimistic that our Gulf countries are pursuing the right direction and any retraction from any achievement however insignificant is out of the question. The rapid developments push the world forward and towards further co-operation and integration. There is no other group of nations in the world have more ingredients and fundamentals of co-operation than these available to the GCC states.
The writer is a UAE economic expert.
Article originally published by Gulf News 26-Jun-05
