RIYADH, 24 February — Foreign ministers of the Gulf Cooperation Council countries and the European Union will meet in Bahrain on April 23-24 in a renewed bid to promote trade and investment relations. The two sides will also examine the possibility of endorsing a free trade agreement.
The ministers will decide the mode and time for signing the free trade accord, the GCC General Secretariat said in a statement here yesterday.
The accord between the two blocs was kept in abeyance as the GCC is still seeking to forge a common market and set up a single customs union. The six Gulf states, which sit on 45 percent of the world’s proven oil reserves and account for 20 percent of output, are also considering an exchange rate mechanism in order to facilitate trade. The EU states are the largest trading partners of the GCC with the annual trade amounting to over $35 billion.
The ministerial meeting will focus on cooperation in oil, natural gas and power sectors, said the statement.
Referring to the agenda of the meeting, the secretariat said that the talks between the two sides have not yielded desired results mainly because of the fact that the EU has refused to open its markets and remove the customs and tax barriers for oil, petrochemicals and aluminium besides several other products of the Gulf countries.
On industrial front, these economic blocs will have to forge closer cooperation for rapid development. The Gulf states will need SR41 billion annually to sustain growth rate of the industrial sector, according to the Gulf Organization for Industrial Consulting (GOIC). The GOIC said that the GCC countries would require a cumulative capital of SR577 billion until 2010 to set up various industrial projects.
The foreign direct investments (FDIs) flows to the GCC countries including Saudi Arabia during 1990-97 have been marginal compared to those received by many countries like China and Malaysia. Hence, it has been suggested that by improving their investment climate, the Gulf states can attract more FDIs and encourage the repatriation of over SR750 billion GCC capital invested in the US and the Europe.
