JEDDAH, 8 October 2005 — Saudi Arabia and the European Union have reached an agreement on gas prices, paving the way for Riyadh’s accession to the World Trade Organization by the end of this year, press reports said.
The two sides reached a deal after high-level talks between Commerce and Industry Minister Dr. Hashem Yamani and Ambassador Bernard Savage, chief of the delegation of the European Commission in Saudi Arabia.
The Saudi-EU agreement allows WTO’s working team to prepare a final report on the Kingdom’s accession to the body in order to present it to the WTO General Council, the organization’s highest executive body, which is scheduled to meet on Oct. 19-20 in Geneva.
“Once the report is approved by the council, a formal announcement of the Kingdom’s WTO accession will be made at the organization’s ministerial conference in Hong Kong on Dec. 13-18,” Al-Watan Arabic daily said quoting informed sources.
There were differences between Saudi Arabia and the European Union on the pricing of natural gas supplies to petrochemical companies.
They reached an agreement after extensive discussions on both sides.
Last month, Saudi Arabia and the United States signed a landmark trade accord. “Saudi Arabia will now be able to attend the WTO ministerial gathering in Hong Kong in December as the 149th member of the organization,” said Yamani after the agreement with Washington.
Saudi Arabia still needs to complete talks with other WTO members but the deal with Washington removes one of the biggest obstacles that stood in the way of its membership. The Kingdom has so far signed WTO accords with 38 countries.
Saudi Arabia’s decade-old bid to join the WTO received a major boost in April when Custodian of the Two Holy Mosques King Abdullah (he was then crown prince) and US President George W. Bush agreed to work together to get the Kingdom into the body before the end of this year.
Yamani said Saudi Arabia had recently introduced 42 new regulations concerning investments in the commercial, financial and economic sectors, facilitating the process of gaining WTO entry.
Under WTO rules, a country wishing to join the organization must agree with its main trading partners on market access and cutting customs duties, which will subsequently be widened to all other WTO members.
Economists said the accession to the WTO would encourage foreign investment. It will also benefit US manufacturing and service industries, agriculture and American workers by providing increased access to the Kingdom’s growing markets.
The bilateral pact requires Saudi Arabia to open its markets to imports of more US farm and manufactured goods, as well as service companies in sectors including banking, telecommunications, energy, express delivery, transportation and hotel and restaurant management.