THE guiding principle behind the World Trade Organization, of which the Kingdom is now a full member, is that wherever possible, free trade should be encouraged because by its mechanisms, the world becomes more prosperous and therefore safer. Both Saudi Arabia and the UAE are also members of the Gulf Cooperation Council, the ultimate goal of which is the creation of a powerful trading bloc in the region along the economic lines of the European Union.
It is therefore with considerable sadness that Saudis find themselves at serious odds with the UAE authorities over the export of Saudi dates. For three months, Saudi growers have been unable to send their annual harvest to processors in the UAE because of new measures taken unilaterally by the UAE Ministry of Agriculture. Considerable efforts have been made behind the scenes to break the impasse that now threatens Saudi producers with considerable financial loss. However when clearly no progress was being made privately, it was decided to go public with the problem.
It is reported that a UAE official has said that the three customs requirements — that Saudi growers should have written UAE permission to export their dates; that they should only export value-added and not unprocessed dates and that they also obtain UAE health certificates — have long been in existence. Were that so, it really is extraordinary that Saudi exporters knew nothing about them. However, even if the regulations do exist but have perhaps lain forgotten and unused for years, there is a way to go about re-introducing them and that way is by a process of consultation and negotiation.
The Kingdom is the world’s largest date exporter and 80 percent of its harvest is bought by UAE processors. Those merchants are clearly also suffering because in a sudden and arbitrary fashion, a major source of their raw material has been cut off. Already three months of their production has been lost in the key season before the holy month of Ramadan. This knock-on effect is not unusual. The history of trade disputes around the world shows they generally have far wider repercussions than expected or foreseen.
Whatever the real issue that is bothering the UAE authorities, it needs to be addressed by dialogue — not through uncompromising unilateral action which could damage the warm relations that exist between the two countries and jeopardize the total of SR19 billion worth of trade flowing both ways. In recent years both the UAE and the Kingdom have been at the forefront of efforts among GCC members to increase the organization’s achievements. This in itself makes the unexpected and unwelcome restraint of trade so puzzling.
If a quick resolution cannot be found between Riyadh and Abu Dhabi, the slow way to work it out will be to turn to the WTO for arbitration. This will however be of no comfort to those involved in the date business here and in the UAE, who will no doubt be looking for compensation if their complaints are upheld.
