Gulf states need to get their focus back on a combined GCC economic agenda

Last week’s column explained facets about the GCC’s plan to introduce a Schengen-style unified tourism visa. If it happens, these can be used to strengthen the economic base of the Gulf states further.

The proposed ‘Gulf Schengen’ plan was welcomed by GCC citizens and even by non-GCC nationals, because it clearly demonstrated that any transient crises facing the Gulf states will not affect it but only makes the bloc stronger and more cohesive. Any passing crises will boost the determination of the GCC populace to further develop the bloc, since it is the guarantor of their countries’ stability and future.

These facts gleaned from the various reactions to the proposed unified Gulf visa prompt us to reconsider the reasons behind the GCC technical committees’ inactivity over the past 10 years.

These reasons eventually led to the halting of the Gulf’s economic integration a decade ago, at a time when additional conditions were in place to help push economic cooperation. Particularly, decisions issued by the GCC Supreme Council during successive annual sessions. The decisions were never implemented, resulting in delaying joint actions and missing out on major development opportunities.

Let’s consider some measures that have yet to be implemented despite the passing of 20 years after the deadline for their completion. The GCC Customs Union, scheduled for implementation in 2003, is still not complete and the application process suffers from complex procedures.

Single entry

The single point of entry for foreign goods has yet to be put in place due to subsequent measures, which constrained this important trade incentive with often impossible rules and unattainable requirements.

This delay contributed to the postponement of an agreement on the unification of Gulf economic regulations and legislation, and the absence hinders investments, creation of new competencies, and free flow of goods among GCC countries. At the same time, it severely limits the exchange of interests and the implementation of joint projects in the private and public sectors.

Due to the failure to complete these two steps, the Gulf Common Market could not be established. If completed, it would turn the GCC markets into a single Gulf market free of barriers, with limitless opportunities for the development of many sectors, particularly the industrial and those in the high-technology space.

This is because the GCC common market entails a vast marketplace for all Gulf nations’ products, as well as the integration of Gulf capital, which will be treated in all GCC countries in the same way as a local investment.

A breakthrough on the railways

There is also a significant slowdown in logistic connectivity, which plays a crucial role in facilitating integration of Gulf economies, such as the GCC Railway that was scheduled to be completed in 2017.

The completion was limited to only two countries, the UAE and Saudi Arabia, while practical measures have recently been taken by the UAE and Oman after they developed an actionable programme for the completion of the project in Oman and linking it to the UAE’s network. This can be used to guide the completion of the remaining parts of this vital project in other GCC countries.

These are just examples of the interdependence of the highest level of cooperation within a chain, where the interruption of one of its fragments results in the stoppage of the implementation of other aspects.

Without a doubt, the aspect of time is extremely crucial, as regional and global developments are accelerating - and dangerously so – on some fronts that cannot be dealt with in a slow manner.

No conceivable reason for delays

Delaying implementation by 20 years cannot be compensated for. Nor can the missed development opportunities be made up for due to the delay process.

With government support, as shown in the UAE-Oman cooperation on railways, as well as with the peoples’ welcome and support for all aspects of such cooperation, this makes it clear the delays are mainly linked to routine administrative procedures related to economic management.

The economic management can be improved at the local and collective levels within the framework of common institutions to complete the fundamentals of an integrated Gulf economy. It will enhance the gains, stability and future of sustainable development in the GCC.

Mohammed Al Asoomi - The writer is a specialist in energy and Gulf economic affairs.