JEDDAH, 26 March 2004 — Saudi Arabia is expected to hasten the process of joining the World Trade Organization, according to a visiting team of British corporate and trade consultants. The team, comprising Christopher Roberts, senior trade analyst at London-based Covington & Burling, Julian Arkell, international trade and service policy of Spain, and Mark Hatcher, corporate and public affairs counsel of London, gave presentations at the chambers of commerce and industry in Riyadh, Jeddah and Dammam earlier this week.
The team highlighted the delay on the part of the Kingdom to become part of the world trade body and suggested that the Council of Saudi Chambers of Commerce and Industry could help speed up the process, said Roberts who gave a presentation at the Jeddah Chamber of Commerce & Industry on Tuesday.
The team, which returned to London yesterday, emphasized that the Kingdom had already lost some benefits from its delayed membership of the WTO. The Kingdom is taking time to join the WTO maybe due to the reservations it has over cultural and social aspects, Arkell said. “You don’t have to compromise on cultural and social aspects and yet be part of the world trade body,” Arkell said.
The team, accompanied by Barry Lowen, deputy head of mission at the British Embassy in Riyadh, also underlined the importance of small and medium enterprises in shaping the economy and stressed training programs in boosting IT and business related skills could help generate employment among young Saudi university students.
Their visit followed the interest European Union is taking in support of the Kingdom’s drive to join the WTO. The GCC countries had urged the EU to support the Kingdom’s entry into the WTO. The Kingdom has significant economic importance and huge investment capacity that can strengthen the global economy. “China took 15 years to be part of the WTO. The Kingdom should lose no more time in doing so. It has already lost some benefits and will lose some more if it delays further,” Arkell said.
The Kingdom has blamed delayed entry on “unclear and inflexible” WTO trade rules. The WTO has been demanding that the Kingdom should undertake substantial legal reforms before it can join the world body. The Kingdom, on the contrary, has taken a stand that it has already taken several steps toward liberalizing its economy, including the issuance of a new investment law that allows foreigners for the first time to own projects and related property and cut tariffs on some imported goods to five percent from 12 percent.
Analysts have pointed out that some other sectors are still effectively subsidized with preferential tax rates for Saudi firms and 20 percent tariffs on imports of many products that are manufactured in the Kingdom.
Another problem mentioned is that important areas like telecommunications, health, pharmaceuticals, oil, aviation and banking are still not open to foreign ownership. WTO negotiators have pointed out that the Kingdom also has to approve insurance regulations, copyright laws and abide by international tribunals for trade disputes.
“We are from the private sector and have come here as consultants following a brief received from the British government,” said Hatcher.