Arab ministers agree to establish free trade area to boost economy

GMT 06:06 2015 Thursday ,26 March

Arab Today, arab today Arab ministers agree to establish free trade area to boost economy

Free trade area
Sharm al-Sheikh - XINHUA

Arab ministers of trade and economy have made decisions Wednesday to establish an Arab free trade area, Egyptian trade minister and head of the Economic and Social Council of the Arab League (AL) Mounir Fakhry Abdel Nour said.
Fakhry's comments came after the council's preparatory meeting for the Arab League's Summit to be held on March 28-29 in the Egyptian Red Sea resort city of Sharm el-Shiekh.
"Having an Arab free trade area has been a dream for decades," the minister said. "Today, Arab ministers of trade and economy have decided to start establishing this trade area for the prosperity of our peoples."
One of Wednesday's decisions was taking the necessary procedures to end negotiations over the technical issues on the rules and certificates which are the pillars for trade of goods, he added.
The agreement for the facilitation and promotion of intra-Arab trade, signed in 1981, included the establishment of a Free Trade Area through a gradual liberalization of trade in order to achieve a Customs Union.
In February 1997, the Arab League decided to create an Arab Free Trade Area, also known as the Greater Arab Free Trade Area (GAFTA) or the Pan-Arab Free Trade Area, by 2008.
For this purpose, 18 of the 22 members of the Arab League signed a treaty aiming at the elimination of all trade barriers by gradually lowering by 10 percent each year the customs duties and gradually removing trade barriers in a process which started in February 1998.
In March 2001, it was decided to speed up the liberalization process, and in January 2005, the elimination of most tariffs among the GAFTA members was enforced.
Despite the willingness of many Arab countries to establish the Arab trade area, the initiative had a very limited effect since it was signed due to many political, geopolitical and economic constraints in the Arab countries.
But it seems the move towards the long-term objective of creating a strong Arab economic bloc is getting closer amid Arab persistence to achieve this long-awaited goal.
Abdel Nour said concrete steps will be taken soon to bring this project to life.
He explained that establishing a trade area passes through stages including removing tax barriers, establishing a tax union, and establishing a trade zone.
The Egyptian minister also said that many other issues have been discussed during the meeting such as the use of renewable energy, regional environmental problems as well as illiteracy programs for the elderly.
Meanwhile, Palestinian Minister of Economy Mohammed Mustafa said that many Arab countries have been dreaming of establishing such a trade area to boost the economies of the member countries in several ways.
"Reviving the idea of having a trade area and a joint tax system is an important issue for the Arab economy," he told Xinhua.
Observers believe that once the Arab trade area is established, the Arab economy would be one of the strongest competitive world economies, as most of the Arab states enjoy rich natural resources such as oil, gas and renewable energy.

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