Free trade agreement (FTA) negotiations between the Gulf Cooperation Council (GCC) and China are on fast track and expected to be completed before the end of 2006, the Times of Oman daily reported on Saturday.
Abdul Malik Al Hinai, undersecretary for economic affairs at Oman's Ministry of National Economy, said an FTA would be signed after the completion of successful talks.
The GCC and China signed a framework agreement on economic, trade, investment, and technological cooperation in Beijing in July 2004.
Al Hinai said the two sides have made an excellent start, and negotiations will focus first on goods and then on services, investments and other areas.
They are now discussing various methods and means for trade expansion and promotion of trade liberalization, said Al Hinai.
Liberalization would be visible soon after an agreement comes into force. However, a complete GCC-China FTA would only become a reality by the end of the tenth year after the agreement.
It would considerably reduce tariffs, simplify the flow of goods and facilitate mutual investments.
The GCC has more than US$1.5 trillion overseas investments and enormous demand for Chinese garments, fabrics, electronic and telecommunications products, while the region's oil, natural gas, petrochemical and other chemical products will continue to attract Chinese markets.
China, the second largest oil-consuming country in the world, and the GCC, which possesses nearly 50 percent of world oil reserves and 20 percent of world oil production, aim for bilateral trade of US$100 billion by 2010.
The value of trade between China and the GCC soared 46 percent in 2004 to US$24 billion.
(Xinhua News Agency May 8, 2005)
