In May 2003, George W. Bush set out his vision of a Middle East Free Trade Agreement (MEFTA). This was an idea born on the politically oriented basis of “those who trade together stay together” rather than from any US economic standpoint.

Bush hopes that the MEFTA — perceived by some critics as a political tool in the “war on terror” or, alternatively, designed to further US global hegemony — will encompass some 20 regional countries, including Israel, and be fully consolidated by 2013.

In the meantime, the US administration is pushing for bilateral Free Trade Agreements (FTAs) with various Arab states, including members of the Gulf Cooperation Council (GCC).

This is causing concern throughout the region among those who are suspicious of the Bush administration’s motives. Why, they ask, is the US so keen to sign up to bilateral agreements when it could more easily negotiate an FTA with the GCC as a single entity, and “why are such FTAs being offered mainly to smaller countries”?

Ahmad Humaid Al-Tayer, a former UAE minister of communications, recently expressed his own doubts concerning the divisive trend in the Gulf News: “Instead of walking the path toward becoming a heavyweight economic bloc on the international stage, the GCC may end up with fragmented and small satellite economies without any leverage against world giants...”

The third Arab country and the first GCC member to commit to an American FTA was Bahrain. The agreement signed in September 2004 permits duty-free trade between Bahrain and the US with the exception of textiles. The government believes the deal will give a boost to Bahraini economy and attract investors. However, its neighbor Saudi Arabia is not amused.

Said Prince Saud Al-Faisal, the Saudi foreign minister: “It is alarming to see some members of the GCC enter into separate bilateral agreements with international powers... They diminish the collective bargaining power and weaken not only the solidarity of the GCC as a whole, but also each of its members.”

Aside from the political ramifications of Bahrain going it alone, other Gulf nations fear a flood of duty-free US-manufactured goods circulating throughout the GCC via the Bahraini gateway.

In January 2003, a joint customs union was formed by the GCC. Whereas goods traded intra-Gulf are now duty-free, duty of 5 percent has been imposed on goods imported from outside the union.

There is no doubt that Saudi Arabia feels a greater requirement to protect its market than other GCC countries since it is the only one, which is not a member of the World Trade Organization (WTO) and has no plans to negotiate a US FTA.

The 2001 GCC Economic Agreement — the precursor to the GCC joint customs union — clearly states: “Member states shall draw their policies and economic relations in a collective manner vis-à-vis other countries, blocs and regional groupings, as well as other regional and international organizations...” If individual states unilaterally renege on this provision, then mutual trust between GCC members will consequently be eroded.

Businessmen in the region have their own worries concerning US FTAs. They fear the area may be swamped with subsidized US agricultural produce, including genetically modified (GM) grain. Additionally, they are concerned about changes in local labor and sponsorship regulations required under the terms of the FTAs as well as the parity with local investors to be enjoyed by American companies, perhaps, to the detriment of other foreign financiers.

Outside the GCC, both Jordan and Morocco have signed on the dotted line.

Jordan finalized it own FTA in 2000, representing the first between the US and a Muslim country. Although Jordan, which also benefits from its membership of the WTO, has since witnessed a hefty growth in its economy, Elie Yachui, an economics professor at St. Joseph’s University in Beirut, maintains Jordan’s FTA is a poor model for the rest of the Arab world because it mainly benefits that country’s elite and was bestowed on Jordan as a reward for political loyalty.

Morocco joined the US club in June last year — the first African nation and the second Arab country to do so. Encouraged by Jordan’s apparent success, there is no doubt that Morocco hopes the FTA will trigger an economic revival. However, the US has made it clear there is much more at stake.

Said US Trade Representative Robert B. Zoellick at the signing ceremony in Washington: “Piece by piece, the administration is building a mosaic of modernizers with a plan that offers trade and openness as tools for Muslim leaders looking forward to the rebirth of an optimistic and tolerant Islam.

“Muslims are striving to reclaim a tolerant and renewed Islam, but religious extremism, militants and economic disorders are continuous setbacks,” said Zoellick, adding, “trade leads to tolerance.”

It was this theme, which provided the basis for Egypt being offered a US QIZ (Qualified Industrial Zones) agreement, which it signed in December. QIZ removes customs duties on Egyptian-made garments and other goods exported to the US with one major caveat: Those items must contain at least 11.7 percent Israeli content, likely to consist of packaging and hangers.

Egypt’s signing caused an outcry among university students, who staged sit-ins, as well as among intellectuals, columnists and pan-Arab nationalists, but there were many others who took a more pragmatic view. The bottom line is Egypt must come up with 10,000 new jobs each year and is eager to grow its manufacturing industry and increase exports. It is envisaged that successful implementation of QIZ will result in Egypt being proffered a US FTA as Jordan was following its own QIZ agreements.

The region is, therefore, right to be wary of the superpower’s motives. The US already wields a mighty military stick throughout the Arab world, is currently occupying an Arab country, while verbally aggressing another, and gives its unconditional moral and financial support to its fellow occupier Israel.

US FTAs may or may not bring financial rewards for those states prepared to step up to the plate, but at what cost in terms of political, economic, cultural and even religious independence?

Now is the time for a regional rethink before the prosperity of some of its nations are inextricably linked with a less than benign Uncle Sam, while others are left out on a lonely limb.

— Linda S. Heard is a specialist writer on Middle East affairs. She welcomes feedback.