JEDDAH, 28 April 2005 — The first round of negotiations relating to establishing a free trade zone between the Gulf Cooperation Council (GCC) and China concluded with success earlier this week in Riyadh. The two sides agreed to continue with the negotiation rounds for a year, meeting every three months. Dr. Abdul Malik Al-Hinai, economic affairs undersecretary at the Omani National Economic Ministry and deputy head of the GCC negotiation teams, said that the negotiations will continue for a year but the liberalization of commodities and services will begin gradually when the negotiations end by the end of 2006 and he expects the establishment of a free trade zone between the GCC and China within ten years. He pointed out that GCC are united in their position over the basic issues especially removing customs fees. China agreed to liberalize many of its products and welcomed the building of strategic oil reserves and refineries through partnerships and cooperation between the two sides.
Al-Hinai told Oman News Agency that establishing a free trade zone with China will enhance relations between the two sides and help increase mutual investments in various economic fields. According to statistics, the rate of commercial trade between GCC and China has increased by 40 percent since 1999 until 2004. Saudi Arabia takes first place among the Gulf countries in the size of commercial trade with China followed by UAE. The GCC ministers of finance and economy signed during a visit to China in July 2004 a framework agreement for economic, investment and technical cooperation between the council states and China. The number of investment projects by GCC in China reached 487, at a total cost of $719 million, last year and during the same period Chinese investments in the Gulf reached $79 million. For China, this free trade agreement is an important move to take part in regional economic cooperation, said a spokesperson for China’s Ministry of Commerce.
