All talk: Why a GCC union does not matter for Arab countries' economies
The recent controversy over transforming the GCC into a fully-fledged union has gained an exaggerated momentum, especially after the issue turned into a war of words and insults over social networking sites done by those who do not wish well for the Gulf states.
Their intention is to exploit the issue to fuel differences that occur between members of any bloc.
The shift, if it takes place, will be a routine transformation process that will not change much the nature of the co-operation or affect the sovereignty of any country. It is evidenced by the experience of the European Union (EU) where all member states have the right to veto and cannot pass any decisions without collective consent, which ensures sovereignty.
In addition, the agendas of the European and Gulf blocs are in the main economy and security dominated, even though co-operation in the political space has increased in the EU and with the consent of all.
In the Gulf bloc, economic co-operation has moved forward slowly, with the customs union expected to be implemented fully a year from now, in January 2015. The move on single currency has been postponed until further notice.
Meanwhile, unification of economic policies will need more time and understanding from all member states, which means that if the GCC transforms into a full union, no significant change will happen to the nature of inter-GCC co-operation and relations between member states. However, it would give the GCC a significant boost and strength its negotiations with other countries and blocs. It will also enhance the ability of the GCC to deal with serious challenges, including threats posed by neighbouring countries.
Oman, as any other Gulf country, has the right not to accept the formal transition process for the time being, as it enjoys special relations with regional powers such as Iran, which had earlier threatened the GCC states and warned them against the proposed union, on the grounds that such a move would prevent the implementation of certain agendas.
But, what has displeased some is the tough statement by Oman’s minister of state for foreign affairs, who threatened to withdraw from the GCC. This has surprised those who are following Gulf affairs and who have never been used to such a way of expression. More so as Oman has always been known for its quiet diplomacy. Indeed, the minister could have better expressed his country’s stand without resorting to tough language.
Yet, the Kuwait Summit could still come up with two significant decisions — the creation of a GCC joint military command and the establishment of the Gulf Academy for Strategic and Security Studies, based in the UAE.
In the area of economic cooperation, the summit only emphasised the need to follow previous agreements as well as pursue vital projects, such as the water and gas linkages, which would contribute effectively to connecting the interests of all GCC countries.
Two months ago, Oman signed a 25-year deal worth $60 billion with Iran for supplies of Iranian gas through a pipeline between the two countries. Oman is keen to ensure the supply for its development needs in view of the absence of a natural gas network within the Gulf.
It is vital for the GCC to tackle any loopholes in economic co-operation before moving towards a union.
The more GCC countries rely on each other, the closer their economic interests. It also helps provide guarantees needed for trust building and ensure the development needs of all member states.
By Mohammad Al Asoomi
- Long-term economic plan should primarily serve interests of citizens — King of Jordan
- Dubai's economy could have an optimistic future with a 5.6 percent growth this year
- Ups and downs: Jordan's public debt is up and ratio to GDP is down
- Potential for investment in Africa? Dubai is looking into it!
- Literally depressing: economic hardship pushing lebanese towards depression