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At the beginning of the Common GCC Market agreement a few years ago, some experts expressed their concern at the achievement of this goal.
Their main concern was that GCC countries do not have the production base necessary to carry out commercial exchange, which hinders the establishment of a comprehensive economic bloc.
They compared the GCC market to the European Union, where 80 per cent of foreign trade is done between EU countries, while this exchange did not exceed 6 per cent between GCC countries in 2003, when the Customs Union between these countries was launched.
This point of view was not accurate for many factors. For three decades, GCC states focussed on establishing the infrastructure necessary to develop production sectors in some fields, and the absence of a unified customs tariff blocked the development of commercial exchanged between these countries.
The developments that followed the implementation of the Customs Union and the announcement of the Common GCC Market confirmed that commercial exchanged between GCC countries could be developed.
The industrial sector also witnessed important developments, especially in the field of building material, foodstuff, electronics and household needs.
This caused the commercial exchanged between GCC countries to increase from 6 per cent in 2003 to 12 per cent last year, while it is expected to increase to 15 per cent in 2010, 20 per cent in 2015 and 25 per cent in 2020.
Commodity variety is important for the common market and is under discussion, since there are big similarities between GCC economies.
The progress achieved by GCC countries in the past five years proves that this issue can only be solved through coordination.
What currently blocks commercial exchange between GCC countries is not just lack of commodities, but other equally important barriers, such as administrative customs and cross-border movement, which are still unsolved. Hundreds of loaded trucks still have to wait in long lines to cross the borders between GCC countries. As a result, many commodities are damaged.
This causes losses for producers and merchants, and subsequently blocks inter-GCC commercial exchange, keeping in mind that customs inspection procedures and accuracy are almost identical in all GCC countries, which are all keen to protect the common market from any commercial or security violations.
The lines of trucks have huge economic consequences and negatively affect the common market, since some of the basic components of this market include the free movement of commodities and services between member states.
Customs centres in GCC countries do not reflect this important point. For example, if a vehicle is travelling from Kuwait to Oman, it needs to pass through four border points.
The same procedures will be implemented at each entry point, the same forms must be filled and the same questions must be answered. This could be overcome by simply linking the computers of these border points.
Is it possible to unify these procedures by benefiting from the EU experience in this field? A truck travelling for hundreds of kilometres between Spain at the south of Europe and Finland at the north does not have to stop once, while a truck travelling between Saudi Arabia and Bahrain must spend a long time at customs- almost five times the time need to travel the 25 kilometres between the two countries.
The Customs Union and Joint Market are important achievements that GCC countries have the right to be proud of, since no other Arab or non-Arab group in the developing world succeeded in achieving a similar goal.
These achievements are typical of advanced countries, such as the EU, as they need a flexible and wise mentality shown by GCC countries, especially with their keen efforts to issue the unified currency.
The components of these agreements must be completed and all facilities must be offered to implement them in a way that serves the development of GCC economy.
All procedures for commodities that come from outside GCC countries can be completed at a single entry point, which is one of the terms of the Customs Union agreements.
Commodities produced in GCC countries must have no customs obstacles since they would be moving within a single market, which is not only possible, but is bound to happen.
However, accelerating it will serve the development of production in all GCC states, which will step up inter-GCC commercial increase and make the common market a success.
Dr. Mohammad Al Asoomi is a UAE Economic Expert
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