News From : DagangHalal.com (04 Jul 2009)
Last week’s meeting of foreign ministers of Gulf Cooperation Council (GCC) with their counterparts at the Association of South East Asian Nations (Asean) in Bahrain proved uniquely successful. The gathering brought together officials from the two regional groupings of Asia for the first face to face in the continent.
Normally, foreign ministers of GCC and Asean meet on the sidelines of the United Nations conferences to discuss critical issues facing the world.
Set up in 1967, Asean comprises Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam. Certainly, it makes sense for GCC countries to consolidate commercial ties with Asean, as the two sides share significant cultural matters and commercial interests. In fact, several Asean members are majority-Muslim countries.
The meeting in Manama focused primarily on economic cooperation rather than political challenges. Strangely enough, the gathering occurred in Bahrain rather than Oman though the sultanate currently heads the GCC. Yet it emerged that Bahrain, with co-operation from Thailand stood behind the initiative. Not surprisingly, Thailand took full advantage of the event by showcasing its potential as a supplier of food products characterised as halal or complying with teachings of Islam.
To their credit, the ministers agreed to set up two separate teams to explore the prospects for singing a free trade agreement (FTA) between the two blocs. Certainly, it makes sense for Asean to sign such an accord with the GCC if only to bridge the trade imbalance.
According to statistics published by Bahrain’s foreign ministry, the two-way trade amounted to $99 billion (Dh363 billion) in 2008, with the GCC enjoying a hefty $51 billion surplus. The bulk of GCC exports of $75 billion consist of oil, petroleum products, gas and petrochemicals. In comparison, trade between the two blocs amounted to merely $18 billion in 1999. Clearly, the two sides could strengthen their business dealings through a comprehensive trade accord.
Another part of the final communiqué calls for developing a comprehensive economic framework dealing with energy, food, transportation and commercial entities. Some Asean members, notably Thailand and the Philippines, are particularly interested in promoting halal food in the GCC. This is particularly true of Thailand, which held a seminar about halal food on the sidelines of the Bahrain meeting.
Also, Asean delegations correctly focused on the need to protect the interest and rights of local merchants and workers on farmlands owned by GCC investors. Private sector investors from several GCC countries own farmlands in places like Thailand and the Philippines to meet home demand. The course of owning farmlands in Asean members has intensified since 2007 on the back of the rise in food prices together with restrictions imposed on exports by producing countries.
The GCC’s food import bill amounts to more $12 billion annually. Needless to say, home-grown solution is not viable due to some hard facts, namely scarcity of fertile land and a water shortage. By one account, only 10 per cent of land in GCC countries is arable, primarily located in Saudi Arabia. Nevertheless, according to the Dubai-based Gulf Research Centre, production of a tonne of barley requires some 1,212 cubic metres of ground water reserves in Saudi Arabia. Certainly, this is not wise use of a scarce resource.
At any rate, June 2009 proved to be extraordinarily triumphant month for GCC countries. In particular, the month witnessed signing of an FTA involving GCC with the four-nation European Free Trade Association (EFTA). By month-end, the UAE won the status of home of the headquarters of the International Renewable Energy Agency (Irena). The Irena headquarters will be located in Masdar City, in turn the world’s first carbon-neutral, zero-waste city completely powered by renewable energy.
By Jasim Ali, Special to Gulf News
– The writer is a Member of Parliament in Bahrain.
Link: http://www.gulfnews.com/business/Comment_and_Analysis/10328516.html