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Dialogue proposed to boost ties

(China Daily)
Updated: 2009-02-12 07:23

RIYADH: President Hu Jintao Wednesday proposed to establish a strategic dialogue mechanism between China and the Gulf Cooperation Council (GCC).

He also proposed to push forward the free trade area (FTA) negotiations, boosting investment and cooperation in the financial sector, and increasing cultural and educational exchanges.

He said so during his meeting with GCC Secretary-General Abdulrahman bin Hamad al-Attiyah in the Saudi Arabian capital, Riyadh.

Al-Attiyah voiced support for Hu's proposals, adding that he was "glad to see trade between China and the GCC grow at a brisk pace".

Trade volume maintained an annual increase of 35 percent from 2002 to 2007. The trade value reached $58 billion in 2007, and increased as much as 60 percent during the first half of 2008, Ministry of Commerce statistics showed.

The GCC groups six Middle Eastern countries, namely Saudi Arabia, Kuwait, Oman, Qatar, Bahrain and United Arab Emirates.

The gulf region is a major producer and exporter of oil, with 45 percent of the world's total oil reserve.

The current global economic downturn may bring new opportunities for China-GCC trade, according to Wu Fang, a researcher with the commerce ministry.

Wu said Chinese products have great potential in GCC member countries with their competitive prices and good quality, especially during the financial crisis.

In addition, GCC member countries have launched economic stimulus plans to spend heavily on infrastructure construction, while China has competitive companies specializing in foreign contract projects.

"With Hu's visit, the bilateral trade talks may achieve some breakthroughs this time," Wu said before the president's arrival in Saudi Arabia.

The GCC and China signed a framework agreement on economic, trade, investment, and technological cooperation in Beijing in July 2004 and started the FTA negotiations, which took a break after four rounds of talks.

In April 2008, the two sides agreed to resume talks.

The two sides have reached common understanding in most of the fields in goods trade, and already started the negotiations in service trade, according to the commerce ministry.

A major goal for the FTA negotiation is to help bilateral oil trade. Oil accounts for over 80 percent of the total exports of GCC members. The FTA will remove tariffs, help increase the oil export to China and be helpful for the sales of other Chinese products in the gulf area, he said.

The GCC is the second trade bloc having agreed to launch FTA talks with China. In 2001, China and ASEAN signed to launch free trade negotiations aimed at establishing the world's largest FTA in 2010.

China has reached FTAs with countries and regions including New Zealand, Singapore and ASEAN, and is negotiating with countries such as Australia, Iceland and Peru.

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