China is moving close to talks with the Gulf Co-operation Council (GCC) over the establishment of a free trade agreement (FTA), which is expected to strengthen the economic ties between the two sides, according to a Kuwaiti diplomat.
Faisal Al-Ghais, Kuwait's ambassador to China and current chairman of the Council of GCC Ambassadors in Beijing, told China Daily that a delegation, headed by the minister of finance of Kuwait, Mahmoud Al-Nouri, is visiting China from yesterday to Wednesday.
The delegation will be made up of finance ministers and other senior officials from the six GCC nations, namely the United Arab Emirates, Bahrain, Kuwait, Oman, Qatar and Saudi Arabia, plus a high-level team from the GCC Secretariat headed by GCC secretary-general Abdulrahman Al-Atiyyah. Kuwait currently chairs the council.
The Kuwaiti Prime Minister Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah will pay a state visit to China from today to next Monday.
"It will be a historic visit, which will surely comprehensively promote bilateral trade and economic relations ," Al-Ghais said.
The GCC delegation will meet officials of the Chinese Ministry of Commerce and Ministry of Finance.
China and the GCC will sign a comprehensive trade and economic co-operation framework agreement during the visit, Al-Ghais said.
And the two sides will start to negotiate a free trade pact, he said.
The pact will include tariff reductions and simplification for flows of goods and facilitation of mutual investments.
The FTA, if established, will lead to better economic integration between China and the 23-year-old Gulf bloc.
The ambassador said he is confident that the GCC-China FTA will be established, although he is uncertain about the exact timetable.
"Both sides are practical. They have realized the importance of each other," he said. "I don't see any reason for the negotiations not to proceed very well and smoothly. We have already concluded such FTA arrangements with other regions and are in process of negotiating with others."
The move might give birth to China's second FTA with a regional group after it inked a framework free trade accord with the Association of South East Asian Nations last year.
China is now active in talks with neighbours and major economic powers on FTAs. Other possible FTA partners include New Zealand, Australia, Chile and South Africa.
The European Union and the United States are also talking with the GCC about FTAs.
Al-Ghais also said that the Gulf regional organization wants to widen its economic relations with China to all possible scopes of economic co-operation.
"We are not simply importers and exporters from each other," he said.
For example, China and the GCC could strengthen their co-operation in oil exploration and investments, which is in the interest of both sides.
"The GCC possesses 45 per cent of world oil reserves and accounts for 20 per cent of all oil production in the world. It is a secure and steady supplier," he said.
China is now talking with a number of global oil suppliers to diversify its oil sources to feed a booming economy.
"We are prepared to provide China with its energy needs," the ambassador said.
Sino-GCC trade volume jumped to US$17 billion in 2003, an increase of 46 per cent year on year.
But official statistics show that China's share of the Gulf market is less than 5 per cent of the region's trade volume.
"China is a newcomer to the Gulf market," Al-Ghais said, "But there is more room for bilateral economic ties to grow in the coming years."
(China Daily 07/05/2004 page9)
