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GCC Suspends FTA Talks with EU

The decision to halt more than two decades of hard negotiations between the two regional economic blocs to sign the world’s first region-to-region free trade agreement came a week ahead of a crucial summit by GCC leaders in Muscat.

GCC’s Secretary General Abdurrahman bin Hamad Al Attiyah was quoted by AFP as saying that the European side had been informed of the move to suspend talks on the long-awaited free-trade accord.

“We are suspending the negotiations until the European side agrees to sign the (most recent) draft accord. We have made “many concessions and responded favourably to the EU’s many demands.”

In October, Al Attiyah laid the responsibility on the EU for obstructing the conclusion of the FTA between the two sides which was signed in 1988 despite the developed economic and cultural bilateral relations during the last two centuries.

He had noted that the trade balance between the two sides was largely in favour of Europeans because of the obstacles the EU imposed on the GCC exports.

He had blamed the EU for imposing high taxes on the GCC exports and criticised the EU determination to connect between the free trade agreement and unrelated political issues such as human rights and counter terrorism.

According to Al Attiyah, enhancing the economic and trading relations between the GCC states and the European Union, Gulf’s largest trading partner, needed more attention in the strategic domains like energy, investment and mutual trade between the GCC states and the European Union, as well as the cooperation between the two sides to boost regional security in the GCC region and the Middle East through resolving the region’s crisis by peaceful means.

Last week, Qatar also warned that the six-nation GCC would suspend talks on a free trade deal with the European Union if an impasse in the 20-year-old negotiations continued.

“Some day in the near future the GCC states will decide to suspend the talks which have so far had no result,” Qatar’s Prime Minister Shaikh Hamad bin Jassem Al Thani said.”

The negotiations with Europe have gone on for too long, and our European partner must know that the talks cannot last indefinitely,” Shaikh Hamad said.

The EU-GCC framework was initiated in 1988 and it came into effect in 1990, and thereafter followed a decade of dormancy. The negotiations restarted in 2003 following the implementation of GCC custom union in 2003.

Since then free trade dialogues have accelerated with the visit by European Union Trade Commissioner Peter Mandelson to the GCC in late February 2007.

· issacjohn@khaleejtimes.com