A Free Trade Agreement (FTA) between China and GCC is a “game-changer” that would boost the region and “galvanise Middle Eastern economic transformation”, according to a former Lebanese minister.
Although the deal is yet to be signed, there is a strong indication it will be finalised after China’s Foreign Minister Qin Gang requested for it to be done “as soon as possible” following a telephone call with Saudi Arabia’s Foreign Minister Prince Faisal bin Farhan earlier this year.
Writing exclusively for Arabian Gulf Business Insight (AGBI), a next-generation business news platform, Dr Nasser Saidi, who served as Lebanon’s Minister of Economy and Industry, believes the landmark agreement can open many opportunities, benefitting both China and countries such as the UAE and Saudi Arabia.
Largest export market
Today, China accounts for one-fifth of the GCC’s total trade and is the largest export market for the region.
With energy a key focus, he believes an FTA that removes “trade barriers would boost trade investment linkages” and is likely to have a positive impact on a wide range of sectors such as direct investment, technology, climate, and the environment.
“Laws and regulations would be modernised to accommodate the provisions of the FTA, thereby accelerating domestic economic reforms in the GCC,” he said.
Higher incomes
“These gains from trade, investment, and technology transfer would generate higher incomes and growth rates for the GCC and, through spill-over effects, raise growth rates in the wider Mena region.”
The energy sector would be at the core of the agreement. He said: “China is a world leader in renewable energy technology, becoming the strategic partner for the GCC as it diversifies its energy mix through investment in renewables and climate tech.”
Dr Nasser added: “FTA would also lead to a rapid expansion of trade and investment in digital trade and financial services, hi-tech, renewable energies and climate tech, AI, automation and robotics.”
A fundamental sector that would reap the rewards from an FTA would be tourism. Other countries in the region would be added to China’s “approved list” – joining the UAE while collaboration between the governments and China can help enhance infrastructure, transport networks, and logistic operations.
GCC investors would also have “privileged access to Chinese opportunities, free of exchange and capital controls” while the “symbiotic relationship” between Chinese and GCC sovereign wealth funds – the largest in the world, will not only be deepened but also strengthen their global financial market power.-- TradeArabia News Service
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