Not the Gulf Confrontational Council (page 1 of 4)

If Gulf Cooperation Council moves towards greater intraregional economic integration were to be assessed the way a high school pupil's performance is, then the verdict would be something like: "Making slow progress - more effort needed."

But, to give credit where it is due, some positive steps have been taken in recent times. In February, for example, Muhammad al-Zarah, chief executive of the GCC Interconnection Authority, announced that tendering for the first phase of a $1.2 billion project to establish a power grid linking the states of the union would start later this year, with initial contracts awarded in 2005.

The first phase of the project will link Kuwait, Saudi Arabia, Bahrain and Qatar. Phase two will integrate the power systems of the UAE and Oman, using the UAE's grid to link the GCC North System through Tarif, and the UAE to Oman through Al-Ain.

A little earlier, at the GCC summit in Kuwait last December, the heads of state approved a unified law, with effect from the beginning of 2004, to combat dumping and provide measures for compensation and protection. GCC transport ministers were asked to prepare an economic study on the possibility of building a railway network to link the six member states. The summit also reviewed progress towards the establishment of a joint GCC market by 2007 and the introduction of monetary union and a unified currency by 2010.

At a summit two years earlier, the GCC had agreed to unify regional customs tariffs at five percent - compared to the existing four to 15 percent and broadly in line with World Trade Organization (WTO) requirements - as of January 1, 2003.

The customs arrangement provides for "the procedural steps to be taken as regards the establishment of GCC Customs Union," moving forward its enforcement date and lowering customs tariffs on all imported, non-customs union foreign commodities to five percent unless exempted in accordance with the Council's decision taken at the 20th summit conference.

It should be pointed out that there is already free intraregional trade for goods with 40 percent of their value added from GCC sources. The agreement also allows for the waiving of all fees on industrial machinery and raw material destined for industrial establishments in GCC member states.

With regards to the introduction of a single currency, the Committee of Monetary and Economic Cooperation and the Committee of Governors have been told to coordinate "within a period not to exceed 2005, the necessary economic performance standards essential to the success of the Monetary Union."

The GCC has also pledged to formalize standards and procedures such as agricultural quarantine systems and veterinary services, and decided to set up a new independent authority on standards and measurements.

A common market is expected to facilitate the conclusion of a trade agreement with the European Union (EU), which has thus far been impeded by the EU's tariff conditionality and, some argue, its protectionist stance in certain sectors.