Forward Planning: GCC has much more to do to achieve full integration

I have been looking at some statistics about the Gulf Cooperation Council which were published in 2000, and found interesting information that I want to share with you.

Since its establishment in the early 1980s, the GCC has struggled and achieved a few goals and objectives as well as a form of integration which still falls short of the early wishes and dreams of the member countries and their people.

Citizens of the six countries under the umbrella of the council have moved between countries to either establish businesses or simply to buy real estate (homes, villas, lands, residential buildings or apartments).

In 1989 there were 5,775 GCC citizens owning property (real estate) in states other than their own, a number that increased to 9,543 in 1995 and reached 15,083 in 1998.

The number tripled in nine years with the lion's share going to 9,366 Kuwaitis, followed by 3,532 Saudis, 603 UAE nationals, 562 Bahrainis, 536 Omanis and 484 Qataris.

Bahrain seems to be the favourite choice to own property with 6,438 property units, followed by the UAE with 4,895, the Kingdom of Saudi Arabia 1,523, Kuwait 1,431, Sultanate of Oman 467 and, finally, Qatar with 329.

With Dubai's booming real estate these numbers may witness a substantial increase.

Full ownership

GCC citizens are also looking forward to the establishment of businesses in all sectors becoming free, with full ownership and no local sponsorship requirement.

Other plans include one unified passport for all six states' citizens and one unified currency. Yemen has expressed its desire to become a full-fledged member of the GCC.

The dream of many GCC citizens is to travel, settle and trade without restrictions within the member states. The number of licences granted to GCC citizens to practise economic activities in other member states reached 5,770 in 1998 with the UAE granting the majority of 3,384, followed by Saudi Arabia 936, Kuwait 770, Qatar 261, Bahrain 260 and Oman with 159 licences.

The UAE seems to be the best place for citizens of other GCC states to start and operate a business.

The UAE also grants licences in all economic activities which is not always the case in other states. By 2000 the total number of loans granted to GCC citizens for industrial projects established in other member states reached 116 with a total value of $ 1.38 billion of which Saudi Arabia had 102 loans for a value of $1,360 million, the UAE 7 loans for $ 18.1 million, Oman 6 loans for $ 8.8 million and Kuwait one loan for $ 0.5 million.

The number of stock companies permitted for GCC citizens to trade and own was 277 by the end of 1998 of which 79 were located in Saudi Arabia, 71 in Oman, 47 in the UAE, 40 in Kuwait, 37 in Bahrain and 3 in Qatar.

Although the above mentioned statistics provide proof of some type of integration, what is needed now to strengthen local economies is a much more aggressive approach and attitude toward serious economic, social and political integration.

The GCC states are now encouraging foreign investment but it will keep back under the prevailing conditions.

New acts and laws must be adopted to create the proper business environment and to protect consumers, investors, other businesses and the country itself. Planned reforms must proceed, while restrictions and red tape must disappear.

By regulating the agency law big businesses must leave room for middle and small businesses for the benefit of the majority and not only of just a few. The role of women in the economy must be recognised, supported and encouraged.

GCC citizens as well as residents must be allowed to travel more freely among the member states with only an identity card so that they can be more active for the benefit of all. Only then may the dreams of the GCC founders will really come true.

The writer is a UAE-based insurance consultant and director of Gulf Insurance Consulting