The EFTA States and GCC sign Free Trade Agreement

Published 22-06-2009
Hamar – Ministers from the Member States of the European Free Trade Association (EFTA) – Iceland, Liechtenstein, Norway and Switzerland – and the Cooperation Council for the Arab States of the Gulf (GCC) signed a Free Trade Agreement today. The Agreement will further enhance the important economic ties between the EFTA and GCC States.

The signing of the EFTA-GCC Free Trade Agreement took place on the occasion of the EFTA Summer Ministerial Meeting in Hamar, Norway.

Free trade negotiations between EFTA and GCC (comprising Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates) were launched in February 2006 and concluded in April 2008. The basis for closer trade relations had been laid by a Joint Declaration on Co-operation agreed by both sides in 2000.

The Free Trade Agreement covers a broad range of areas including trade in goods, trade in services, competition and government procurement. Additional agreements on agricultural products between each EFTA State and GCC form part of the instruments establishing the free-trade area. A Joint Committee will supervise the functioning of the Agreement, which will enter into force after ratification by the Parties.

In 2008, total merchandise trade between the EFTA States and GCC amounted to 7.2 billion USD. Trade has grown consistently over recent years, recording an average annual growth rate of 25% between 2003 and 2008.

The GCC was EFTA's sixth largest export destination in 2008 , with total merchandise exports reaching 6.1 billion USD. Exports from the EFTA States consisted mainly of clocks and watches, precious stones, electrical machinery and pharmaceutical products, while the main products imported from the GCC into the EFTA States were precious stones, iron and steel products, clocks and watches, and organic chemicals.

With a combined population of around 12 million, the EFTA States are the world’s ninth largest merchandise trader as well as significant actors in the areas of trade in services and foreign direct investment. As a group, the EFTA States have concluded 18 Free Trade Agreements with a total of 27 partner countries outside the EU. Of EFTA’s total merchandise trade, 80% is now covered by preferential trade agreements (EFTA-4, EU-27, 27 non-EU free trade partner countries).