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Arab League Free Trade Agreement

08 Apr Posted by in Uncategorized | Comments
Arab League Free Trade Agreement

The Agreement on the Arab Free Trade Area (“GAFTA”) was first conceived in 1982 at the Arab League summit, but made very little progress until its formal creation in 1998 and was signed by 17 Member States. Although GAFTA has waived most tariffs on Arab products between Member States since 2005, it does not enjoy benefits in terms of cross-border investment and effective dispute resolution mechanisms. Indeed, Arab states have more structured agreements that offer more advantages with foreign Western countries than with other Arab countries. For example, Jordan, Egypt, Bahrain and the Sultanate of Oman have free trade agreements with the United States. Other Arab countries, such as Morocco, have a limited agreement with the European Union that offers better investment opportunities and better trade than GAFTA. The agreement aims to create a free trade area between The Member States, in addition to the increase in internal trade on the one hand, and the European Union on the other. In addition, industrial integration between the countries of the Arab Mediterranean will be improved by the implementation of the pan-Euro-Mediterranean rules of origin and by the application of the principle of origin. This will increase Member States` export capacity to the EU market and increase the attractiveness of foreign and European direct investment. The Arab League has a long history of trying to promote trade and economic cooperation between its member states, with several initiatives taken in the 1950s and 1960s. In February 1997, the League decided to create, by 2008, an Arab free trade area, also known as the Arab Arabia Free Trade Area or the Pan-Arab Free Trade Area.

This would be achieved through a 10% annual reduction in tariffs and the phasing out of trade barriers. 18 of the 22 Arab League states signed the agreement, which came into force on 1 January 1998. In 1981, an agreement was signed to facilitate and promote inter-arabian trade, but it had little effect. Achieving a strong Arab economic alliance was also a long-term goal of the Arab League. Although the Arab League was established a few years before the United Nations, attempts to overcome trade barriers between Arab states have made only limited progress, perhaps because most of the established initiatives were political in nature, at a time when Arab countries had different political systems and were oriented towards different foreign powers. There was no political will to implement free trade agreements and Arab countries were in fact socially, politically and economically divided. The Council of Arab Economic Unity (CAEU) was established on 30 May 1964 by Egypt, Iraq, Jordan, Kuwait, Libya, Mauritania, Palestine, Palestine, Saudi Arabia, Sudan, Tunisia, Syria, the United Arab Emirates and Yemen. [1] While the difference between Arab states has so far been seen as an obstacle to progress, I think it must now be seen as an advantage.

 

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