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GCC Signs FTA with Singapore

DUBAI - The Gulf Cooperation Council (GCC) signed a free trade agreement (FTA) with Singapore on Monday in Doha, according the Singapore’s Ministry of Trade and Industry press release.

The agreement was signed by Singapore Prime Minister Lee Hsien Loong and his GCC counterparts, President-in-Office of the GCC Ministerial Council and Qatar Prime Minister Shaikh Hamad bin Jassim Al Thani, and GCC Secretary-General Abdurrahman bin Hamad Al Attiyah.

The trade deal is the first-ever signed by the six-member nation bloc and second for Singapore in the Middle East. The deal is expected to accelerate the growing bilateral trade between the Gulf countries and Singapore. GCC-Singapore bilateral trade is expected to be over $40 billion in 2008 compared to just $22 billion in 2004. The GCC exports to the island-state were about $23 billion in 2007.

Bilateral trade between the UAE and the Singapore alone stood at $12 billion in 2007, non-oil trade constituting nearly 40 per cent of the total.

Under the agreement, Singapore will give tariff-free access to all the goods originating from the GCC. The GCC members will give duty-free access to about 99 per cent of goods exported from the Southeast Asian city-state. The service sector firms are expected to be the main beneficiaries of this agreement as they stand to have enhanced access into each other’s market.

Speaking to Khaleej Times in September in Dubai, Singapore’s Senior Minister of State for Foreign Affairs, Dr. Balaji Sadasivan had said that the industries such as banking, insurance, port management and communications would benefit from the agreement as both parties had very low trade barriers for goods.

The negotiations on the trade pact started in January 2007 and were completed earlier this year after 4 rounds of talks. In recent years, there has been a growing trend of GCC companies teaming up with the Singaporean counterparts to exploit business opportunities in other countries. In early 2008, the Qatar Investment Authority bought a stake in Singapore’s eco-city project which is being built in China and Singtel — the government controlled telecom operator — bought 30 per cent of Abu Dhabi-based Warid Telecom’s Pakistan operation in 2007.

· aruna@khaleejtimes.com