Gulf Cooperation Council summit to set customs union in motion
Bahrain's emir opened the 21st Gulf Cooperation Council (GCC) summit in Manama on Saturday with a call for increased cooperation in the region's economy and defense. The two-day summit of the Gulf Arab monarchies ¯ Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates ¯ will also debate Iraq, Abu Dhabi's claims to three Gulf islands controlled by Iran and the Palestinian issue.
"We hope that an agreement opening the way for the creation of a single currency for Gulf countries will be signed during the summit," Sheikh Hamad bin Issa Al-Khalifa said during the opening of a summit. The emir called on Gulf countries to "continue to take the economic rapprochement on both official and popular levels, notably by facilitating economic activities for citizens".
Bahrain's Information Minister Mohammad Ibrahim Al-Mutawa had said Friday the GCC wanted to bring forward the launch of their customs union by two years to 2003. The countries of the GCC, which account for 45 percent of the world's oil reserves and provide around 20 percent of the world's crude, have been trying since 1983 to agree on a customs union, an essential prerequisite for setting up a common market in the Gulf.
"The summit could decide to set up the launch of a customs union to be operational in 2003" instead of 2005, Mohamed Ibrahim Al-Mutawa told a news conference. Mutawa also said the GCC is expected to decide on "setting up a common market" of the six member states.
But the agreement on a customs union has been held back by different import tax levels, ranging from four percent in the UAE to 20 percent in Saudi Arabia. A customs union will have the direct effect of setting up an economic bloc representing annual imports of more than $50 billion.
The establishment of such a union among the Gulf monarchies is a requirement of the European Union before it will sign a free trade agreement, which the GCC wants to gain access to the European market for its powerful petrochemical and aluminum industries. The EU is the main trade partner of the GCC. Council Secretary General Jamil Hujailan recently said the volume of trade between the two regional blocs stood at around $34 billion in 1999.
Sheikh Hamad also called for the "development of cooperation in defense issues, which is a guarantee for the security and stability of GCC countries and their peoples. That could be realized through the sealing of a common defense agreement," he said.
The GCC has approved a $70 million telecommunications project to link the military headquarters of all six countries but has yet to implement the plan, and is also examining a radar network project worth $88 million.
The countries do have a joint defense force called Peninsula Shield, which chiefs of staff considered raising the size of from 5,000 to 22,000 troops last month. The force, created in 1986, is headquartered at Hafez Al-Baten, in northeastern Saudi Arabia, but it did not intervene when Iraq overran Kuwait in a few hours in 1990.
Sheikh Hamad also called for the GCC consultative committee to be activated: "This mechanism reflects the unity of the popular base between the GCC countries and must be more involved in dealing with issues of common interest," he said.
In Baghdad, the official Iraqi newspaper Al-Jumhuriya urged GCC leaders Saturday to back the lifting of the decade-old embargo imposed on Iraq as well as the resumption of full air links with the country.
This followed a warning by Bahrain's Foreign Minister Sheikh Mohammad bin Mubarak Al-Khalifa on Friday that "Iraq's respect for the UN Security Council resolutions is a constant demand of the GCC and the whole world".
Baghdad's ties with the region have vastly improved this year, but Iraq remains at loggerheads with Saudi Arabia and Kuwait, the emirate that Iraqi forces occupied between August 1990 and February 1991.
The paper questioned the summit's ability to pass any meaningful decisions on the Palestinian issue and also doubted whether there would be any announcement that US and British forces were to withdraw from Gulf countries and territorial waters. ¯ (AFP, Manama)
© Agence France Presse 2000
© 2000 Mena Report (www.menareport.com)