EU seeks free-trade deal with Gulf states

After 17 years of negotiations the EU hopes to reach a free trade agreement (FTA) with the Middle East’s most vibrant economies in May.

The EU has been negotiating with countries of the Gulf Co-Operation Council (GCC) - Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates - since 1990. Another round of negotiations is expected to take place in Riyadh in April, before foreign ministers meet in the city on 8 May in the hope of reaching a deal.

The two meetings will discuss EU demands for greater access to Gulf markets and revised ownership rules allowing more rights for EU firms.

Sources indicate that important demands from the GCC countries for a reduction in EU tariffs on aluminium and petrochemical imports have been met. The EU has agreed to reduce the tariffs on these goods to zero, but EU trade diplomats stress that "nothing is agreed until everything is agreed".

During a visit to Saudi Arabia in late February, Peter Mandelson, the European commissioner for trade, tried to garner political support to create what he described as the "first ever region-to-region FTA".

Despite that visit, trade diplomats at the time expressed caution about the prospects for the Riyadh meetings. "Most of the deadlines [in these negotiations] have been missed along the way," said one diplomat.

After years of stagnation talks were relaunched in 2002 once it became clear that the GCC would meet EU demands to establish a customs union.

"Hopefully we will be in the final throes [of talks] at the meetings in Riyadh," said one official.

After 17 years of negotiations the EU hopes to reach a free trade agreement (FTA) with the Middle East’s most vibrant economies in May.

• Primary Source