RIYADH, 10 October — Finance ministers of Gulf Cooperation Council (GCC) states will meet here on Saturday to review steps taken for the launch of their customs union in January next year, GCC secretary-general said yesterday.

The ministers will study recommendations made by the GCC customs chiefs’ meeting held in Riyadh on Tuesday which concluded that all the alliance’s member states were prepared to launch the union on time, Secretary- General Abdulrahman Al-Atiya said in a statement.

The Gulf states have already moved closer to an agreement on tariffs following the completion of classification of more than 2000 items, which is another forward step toward establishing the union.

The Gulf states have agreed to distribute customs revenues on the basis of the final destination of imports, thus clearing a major obstacle on the way to the formation of their customs union, said the statement. Agreement has also been reached by member states on tax ceilings and imports have been divided into those that are tax-exempt, essential items to be lightly taxed and luxuries. All these steps indicate the commitment on the part of the member states that they are now ready to establish the union.

"It is important note here that the GCC states have been engaged in talks on unifying their customs tariffs for the last several years, but substantial agreements are coming up now only," said the statement. The unification of tariffs is stipulated in the 1982 GCC economic agreement, which also provides for alignment of currencies and removal of custom barriers within the group as a prelude to creating a common Gulf market.

The finance ministers’ meeting will also review procedures for monetary union planned for 2005 and a single currency in 2010. GCC central bank governors decided here on Tuesday to ask the European Central Bank to study requirements for the union.

The GCC leaders endorsed the steps at their summit in Muscat last year and also approved the US dollar as a yardstick for a common currency. The GCC is a major consumer bloc with more than $80 billion in annual imports. The Gulf’s total population exceeds 31 million, reporting a four percent annual population growth rate. GCC states also hold about 45 percent of the world’s total oil reserves and 15 percent of gas reserves.