Iraqi Oil Speculators' Ball
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C M Y K 6 SATURDAY, MARCH 26, 2005 OPINION HE ongoing free trade nego- tiations between the US and T certain Arab Gulf states are a cause for alarm in certain quarters. Arab perspective It is no secret that the Free Trade Accord signed between the US and Bahrain has fuelled a dispute By Ismail Montasser between the Saudi Kingdom and Bahrain that has spread throughout the Gulf Co-operation Council, especially as the summit recently held in the Bahraini capital, Washington cashing in on Manama, deferred a debate on the accord. This could jeopardise a ten- tative project to boost co-operation among GCC states. In January 2003, the six Gulf states first applied their free trade accords in the Gulf Customs Federation Accord, according to which the member Bahrain, the poorest state in the 2 per cent each. states would slap a 5 per cent tax on Gulf region, defends the accord. As for imports, the UAE came top Experts fear that the lack of agree- commodities being imported from The controversial accord offers of the pack, receiving 30 per cent of ment might stymie the whole pro- countries outside the Council. the American service institutions inter-Gulf imports, followed by ject, while it seems that the The six countries are supposed to such as banks all the privileges of Oman on 21 per cent, Bahrain on 18 Bahraini-Saudi dispute has cast a announce a joint common market by local institutions in Bahrain, the per cent, Saudi Arabia on 17 per shadow on the future of Gulf eco- the end of 2007, as well as minting advantages the other Gulf compa- cent, Kuwait on 11 per cent and nomic co-operation as the signing of a unified currency in January 2010. nies don’t enjoy in Bahrain. Qatar on 5 per cent. bilateral accords with non-Gulf The experts say that Saudi Arabia Before the launching of the states by some countries will appear SNAP SHOTS Saudi objections is also worried about the predicted Customs Accord, the GCC states to be rebellious. flooding of large quantities of agreed to delay enforcing some of The GCC is often slow to act, The heads of the GCC states con- American commodities into the its articles for three years with the while countries such as Bahrain and Technical reasons evaporate faster than petrol cluded their 25th Summit without country via Bahrain. It would be aim of ironing out certain political Oman can’t wait a hundred years for settling the Saudi-Bahraini dispute illegal to impose the 5 per cent tax problems resulting from it. solutions to their problems, espe- It was the economic stagnation that induced local petrol stations to stop over the Free Trade Accord the lat- on these goods, which would be a cially unemployment and lack of selling Gasoline 90 and replacing it with the more expensive Gasoline 92. ter signed with Washington, which blow to the Kingdom’s Treasury, as Disagreeing on the details capital. But now they have started selling Gasoline 90 again. Why? To overcome would seem to suggest that these well as local industries and agricul- The GCC Secretary-General, the economic stagnation! countries have not achieved the eco- ture. However, if the tax were Although the accord stipulates the Abdel-Rahman el-Attiya, underesti- We remember Minister of Petroleum Sameh Fahmi saying that petrol sta- nomic integration they seek. imposed, the Customs Federation imposition of 5 per cent duty on all mates the Saudi-Bahraini differ- tions had stopped selling Gasoline 90 ’for technical reasons’. He denied The Summit’s communiqu didn’t would be a total waste of time. foreign imports as mentioned above, ences, which could damage the there was a secret plan to increase the price of fuel. refer to the Council’s plans for But the US insists on signing free the member states failed to agree on existing regional accord. Saudi Anyway, I’m curious to know more about the ’technical reasons’! announcing a monetary union next trade accords with the member the nature of the joint custom cen- Foreign Minister Saud al-Faisal ********** year or the intention of the member states of the Gulf Cooperation tres needed to facilitate the move- stated during the recent GCC minis- states to take certain steps to clear Council, one by one. ment of commodities. Nor could terial meeting that, if the problems the way for the Customs Accord, The GCC’s General Secretariat they agree on the customs protec- with Bahrain are not sorted out, his Dangerous demolitions which the leaders signed two years recently issued a report on inter- tion arrangements for a list of country will throw the whole idea of ago. Gulf trade from 1993 to 2003, i.e. national commodities from each Gulf economic integration out of the Prime Minister Dr Ahmed Nazif is currently holding a series of meetings The dispute broke out as a result before and after the Customs country. window. with economic and the social reform groups. The purpose is to find a way of Saudi objections to the signing of Federation Accord. According to The GCC also failed to reach a But the US seems determined to to demolish the governmental subsidies on a number of basic commodities. the Free Trade Accord between the report, inter-Gulf trade rose final formula on sharing customs sign free trade accords with the One suggestion is to increase the annual social allowance given to civil Bahrain and the US in September from US$11.1 billion in 1993 to revenues and the wording of a draft GCC member states individually, in servants, adding it to their basic salaries. 2004, because Riyadh considered it US$18 billion in 2003, an increase law to prevent dumping in the mar- order to get its hands on as much Around 90 per cent of Egyptians deserve to benefit from the subsidies. If as an obstacle to free trade among of 63 per cent. kets. cash as possible. So the differences they were demolished, only 5.7 million would benefit - the nation’s civil the GCC states. Addressing a meeting of the and divisions amongst the GCC servants, who would get the bumped-up social allowance. However, Bahrain noted that it Growing inter-Gulf trade Kuwaiti National Council, the member states are working to the would not adversely affect the pro- Chairman of the GCC’s Financial USA’s advantage, as it happily ********** posed free trade. The year 2003 was particularly Committee noted that the economies strives to exploit the region eco- Washington recently announced successful, with a rise of 19.5 per of the Gulf states are competitive in nomically. A different sort of misconduct its intention of holding talks with cent in trade between the GCC terms of commodities and services, Oman and the United Arab countries. The report added that rather than integrated, resulting in Meanwhile, Bahrain argues that Many people are angry at the improper behaviour of Ibrahim Said, the Emirates, with the aim of signing Saudi trade with the other Gulf inter-Gulf trade falling to 10 per the bilateral accord it signed with famous football star, who recently appeared before the Sports Tribunal, similar accords, dropping customs states accounted for 36 per cent of cent of the total trade of each state. the States does not adversely affect because of his misconduct on the field. duty on American commodities, the total inter-Gulf trade. The UAE Therefore, the GCC countries’ the Customs Federation Accord. They also want his club, Zamalek, to punish him severely. In fact, they which would see these commodities came next with 28 per cent, Oman economic and taxation policies need Instead, Bahraini officials claim, it want him booted out of the Zamalek team, in a bid to safeguard public flooding into the Gulf. third with 16 per cent, Bahrain to be streamlined. In fact, the mem- will boost economic relations morals. A total waste of time fourth with 10 per cent, then Kuwait ber states have agreed in principle between the countries of the region. But certain members of Zamalek Club’s administration have also been with 6 per cent and Qatar with just 4 on the size of the budget deficit, They also urge the other countries in accused of ’certain infringements’, in their desire to do well in the forth- Some specialists note that, per cent. public debt, inflation, interest rates the region to hurry up and sign sim- coming club elections - a different sort of misconduct, one might say. although Saudi Arabia possesses the Saudi exports in 2003 accounted and other things. But they haven’t ilar accords with Washington! strongest economy in the region, it for 53 per cent of inter-Gulf exports, signed any specific accords on this, is less liberal than the others. Saudi followed by the UAE with 36 per although they have agreed to create Arabia is afraid of the flow of the cent, Oman with 12 per cent and a Gulf Central Bank. US tax-exempted commodities into Bahrain with 4 per cent, while Qatar Bahrain via its territory. However, and Kuwait brought up the rear with Stymieing the project Iraqi oil speculators’ ball: Palast the prospector hits the mother lode bility and soaring oil prices . (Please see Clash of stalled the sell-off scheme. He even made it clear to Paul But the pathos in all this bickering over vested interests By Emad El-Din Aysha, PhD in International Studies Civilization, or Capital Accumulation? , News From Within, Bremer that: There was to be no privatization of Iraqi oil — the banality of evil, as Hannah Ardent would put it — lies Vol.