JEDDAH, 24 April 2005 — Saudi Arabia and the United States were close to a crucial bilateral agreement yesterday on tariff cuts, clearing the last major hurdle for the Kingdom to join the World Trade Organization, according to information reaching here from Washington.
“We are close to finalizing our agreement on tariffs with Saudi Arabia, and we are increasingly more comfortable that the multilateral issues will be addressed satisfactorily,” acting US Trade Representative Peter Allgeier said in a recent letter to Sen. Blanche Lincoln, an Arkansas Democrat.
Omani Commerce and Industry Minister Makboul ibn Ali ibn Sultan, who is visiting the US, confirmed on Friday that Washington and Riyadh appeared close to a bilateral deal. “From my discussions with the people here in Washington, I think they will finish and reach an agreement soon,” Makboul said, adding he did not know if that would happen by tomorrow when Crown Prince Abdullah meets with President George W. Bush at the his ranch in Crawford, Texas.
A bilateral deal with the US would “pave the way for Saudi Arabia to sign the WTO (entry) agreement in Hong Kong at the end of the year,” Makboul said, referring to the WTO’s upcoming ministerial meeting in December.
In the lead-up to tomorrow’s meeting, Saudi and US trade negotiators have been working around the clock to try to finalize a bilateral deal on the terms of Riyadh’s entry into the WTO, an industry official told Reuters.
“I think they would like to be able to make an announcement in Crawford. But whether or not they are going to narrow the final gap by then is really up in the air,” the official said
To gain entry into the WTO, Saudi Arabia must negotiate a bilateral market access deal with any of the 148 WTO members that requests one. It also must negotiate a multilateral agreement with all WTO members to bring its trade regime into line with international rules. The United States is the only WTO member that has not finished a bilateral deal with Saudi Arabia, Allgeier said. Saudi Arabia is one of relatively few countries still not a member of the WTO.
“There is still work remaining, particularly in services, but I remain hopeful that the accession process will reinforce reforms that are now under way in the Kingdom,” he said.
“We’ve made a lot of progress, but more work is needed, especially in services,” Richard Mills, a Bush administration spokesman on trade issues said after a meeting earlier between Allgeier and Saudi Commerce and Industry Minister Hashem Yamani.
Saudi Arabia’s chief WTO accession negotiator, Fawaz Al-Alamy, has been in Washington since late March for extensive talks on Riyadh’s long-time bid to join the Geneva-based WTO. The increased activity has raised US industry hopes that an agreement could be in the offing. “I think they’re close,” an industry official, who asked not to be identified, told Reuters before the meeting between Allgeier and Yamani.
Many of Saudi Arabia’s neighbors are already members of the WTO. The United States concluded a free trade pact with Bahrain last year and is expected to wrap up similar deals with the UAE and Oman in coming months. Global goods trade increased in volume by nine percent last year but will probably grow by only 6.5 percent at best this year, the WTO said earlier this month.