EU-GCC relations have developed gradually and at first largely on a mutual basis. The relationship between European Union (EU) and Gulf Cooperation Council (GCC) can be traced back to the late 1980s when they signed a cooperation treaty, though relations between Europe and the Gulf States based on historical and colonial ties stretch back to over 200 years. However, the cooperation between the two regional blocks is slightly more than two decades old. This thesis will focus on the relations between the EU and GCC since 1988 when they first signed a cooperation agreement to date. The Gulf region has experienced numerous changes over the last two decades. Concerning these changes, the relations between the EU and GCC have considerably transformed from low-level trade to bilateral agreements on different sectors of the economy. The study will use a chronological approach, qualitative technique to research the relations between the EU and GCC since 1988. This approach is very suitable for carrying out historical studies.
The relationship between European Union (EU) and Gulf Cooperation Council (GCC) can be traced back to the late 1980s when they signed a cooperation treaty, though relations between Europe and the Gulf States based on historical and colonial ties stretch back to over 200 years. However, the cooperation between the two regional blocks is less than three decades old. Up to that time, there was no much indication of global presence in the region and its member states (Nonneman, 2006, p. 8). The contact between the EU and GCC had been of very low intensity despite the historical ties between member states from both sides of the divide (Nonneman, 2006, p. 8).
Contact between the EU and Gulf region began less than three years after the creation of GCC in 1981 (Ismael, 2012, p. 2). The creation of the GCC was triggered by political instability in the region, especially the war between Iran and Iraq in 1980 (Ayadi & Gadi, 2012, p. 1). GCC is regarded as one of the riches regional blocks comprising of the UAE, Saudi Arabia, Kuwait, Qatar, Oman, and Bahrain. The cooperation agreement signed between the two sides in the late 80s in Luxemburg provided an institutional framework through which GCC and EU could cooperate effectively in common fields of interests. The common fields of interest were long-established sectors of the economy such as trade, energy, science and technology, investment, and the environment (Ayadi & Gadi, 2012, p. 2).
The objective of the treaty was to enhance economic relations between the two sides, increased trade and investment, enhance global cooperation, and open political discourse. The cooperation agreement was also aimed at encouraging regional
Integration among the Gulf States strengthens the region’s stability, safeguard petroleum supplies to European and promote economic growth and development in the region through diversification (Ayadi & Gadi, 2012, p. 2). Even though the EU-GCC treaty was signed in the late 80s, it started to be effected in 1990 when the first joint assembly was held in Oman. Under the EU-GCC framework, the Joint Council Committee (JCC) was mandated to hold regular talks on the issues affecting the two regional blocks or member countries (Escribano, 2013, p. 7).
However, this changed in 1991when the EU delegation failed to turn up for the meeting aimed at addressing the Persian Gulf crisis. By the mid-90s, the relations between the two regional blocks began to slump. At the back of the 9/11 terrorist attack on the US, the global war on terrorism, and the current US foreign policies, the EU and GCC member states have become more interested in strengthening their relations. In other words, divisions among the EU member states regarding the US foreign policies in the Middle East, especially in the Gulf region have contributed to the increased ties between GCC and EU. Besides, the ever-increasing domestic protest to the over-reliance on US military power by the Gulf States has also led to the inclination towards the EU (Antkiewicz & Momani, 2009, p. 218).
This thesis will focus on the relations between the EU and GCC since 1988 when they first signed a cooperation agreement to date. The Gulf region has experienced numerous changes over the last two decades. Concerning these changes, the relations between the EU and GCC have considerably transformed from low-level trade to bilateral agreements on different sectors of the economy. This thesis provides a broad overview of the relations between the EU and GCC and the development of these relations over the last two decades.
Two main research questions are to be answered in this thesis. The first question is how the relations between the EU and GCC have changed since 1990 when they signed the Free Trade Agreement (FTA) and whether this treaty will ever come into force. This question will be answered with the help of the following sub-questions:
- What factors have directly or indirectly affected the implementation of the FTA treaty?
- What are the strong and weak elements of the EU-GCC cooperation?
The second question is how the EU deals with security and where GCC could fit in.
To answer the above research questions, the thesis is organized as follows. Chapter II explores the history of EU-GCC cooperation. Chapter III studies how the EU deals with security and where GCC fits in. Chapter IV explores the unfulfilled potential of EU-GCC relations. Chapter v is the most significant chapter of this thesis: it looks at the future of EU-GCC relations. Last but not least, Chapter IV presents a conclusion and predictions.
Academic and Practical Relevance
This master’s thesis presents a historical synopsis of the relations between the European Union and Gulf Cooperation Council (GCC) from the signing of the cooperation agreement in 1988 to date. This thesis presents information that would be useful for researchers, historians, journalists, and any other individuals interested in the history of the EU’s relations with GCC and vice versa. Numerous articles and reports have been published on the same; however, no academic research has been carried out on the subject, Therefore, this thesis will be the first academic research that studies the relation between EU and GCC since the signing of the cooperation agreement in 1988.
- The future of the enlarged EU and its environs. This is a dialogue paper written by Prof. Werner Weidenfeld in 2004. The paper was submitted to the Gulf Research Centre which is based in Dubai, UAE. Prof. Weidenfeld emphasized the importance of cooperation between the EU and GCC due to their geographical proximity and their common interest of peace and stability in the region.
- Dynamics, patterns, and perspectives of EU-GCC Relations. This is also a discussion paper written by Gerd Nonneman. The original paper was submitted to the Gulf Research Centre based in Dubai, UAE. However, this is an amended version prepared for the conference held on November 26, 2005, in Rome, Italy. The paper is about EU-Gulf Relations, especially on how to enhance economic, political, and security cooperation.
The study will use a chronological approach, qualitative technique to research the relations between the EU and GCC since 1991. In general, this approach is very suitable for carrying out historical studies (Ismael, 2012, p. 7). According to the experts, six stages should be taken into account when carrying out a historical study to achieve reliable results. The first step is to identify a historical problem or recognize the importance of particular historical facts. The second step is to gather as much information as possible regarding the problem (Ismael, 2012, p. 8).
The third step is coming up with a hypothesis that describes relations between different historical elements. The fourth step is collecting and organizing the information gathered. This step also includes verification of the credibility and reliability of the information gathered and its source. The fifth step is selecting, organizing, and analyzing the most relevant evidence collected and using them to conclude. The sixth and the last step are recording the conclusion and predictions in a significant manner (Ismael, 2012, p. 8). This study was carried out taking into account the above-mentioned stages in classifying and handling primary sources. Secondary information of the EU-GCC relations was also used in the study.
Sources of Information
Two different categories of information sources were used in this study. The first and most important category is the primary sources. Primary sources include empirical information materials as regards EU-GCC relations. These materials consist of signed agreements, official statements, press releases, and letters from EU and GCC websites. The primary sources are sorted out under the above-mentioned steps of conducting historical research to achieve a suitable outcome. The second categories are secondary sources. Secondary sources include books, journals, and online articles published by different authors on EU-GCC and the history of their relations to promote a better understanding of their past ties.
The theory is very important for studies aimed at getting reliable results. According to experts, researchers must be very careful when choosing theories for a given study. Since the study is about the relations between the EU and GCC, the most suitable theory for the study would be the International Relations (IR) theory. International Relations (IR) theory has numerous traditions. These traditions include realism, global society, liberalism, and the global political economy. IR traditions are further subdivided but due to limitations in the page numbers, the study will not dwell on detailed information regarding these traditions. Themes of different traditions have been applied to the body of this study.
EU-GCC History of cooperation (Structure of EU & GCC)
EU-GCC relations have developed gradually and at first largely on a mutual basis. Their relations between Europe and the Gulf states have a long history and can be traced to almost two centuries. However, cooperation between the EU and Gulf regions as a block started a couple of decades ago. Some experts argue that the first significant contact between Europe and the Arab Gulf states started when the Euro-Arab dialogue was officially launched in 1974 (Nonneman, 2006, p. 8).
However, the Euro-Arab dialogue broke down in the late 80s, and had, even before that, attained almost nothing. The dialogue had received massive opposition from both sides of the divide, with the Arab States calling for political dialogue, whereas the Europeans were calling for economic and technical dialogue (Nonneman, 2006, p. 8). All the same, it is important to remember that from the European point of view the Arab States, as major producers of fossil fuel, were the main players in the dialogue. The attention of the EU states towards the Arab world was awoken by the Arab oil embargo following the Israeli-Arab war in 1973. The embargo threatened EU energy security (Nonneman, 2006, p. 9).
Whatever the case may be, therefore, the materialization, significance, and characteristics of the EU-GCC relations can be attributed to the wider development of the Euro-Arab relations. Although it had been the energy policies among the Arab States that had brought the Euro- Arab contact, apparent weaknesses and gaps in the wider EU policies towards the Middles East and the Mediterranean played a major role in bringing the two regional blocks together (Nonneman, 2006, p. 9). Just about a year before the commencement of the Euro-Arab dialogue, European Commission (EC) had already developed a policy towards the MENA (the Middle East and North Africa) and several bilateral agreements with the Mediterranean states (also known as global Mediterranean policy). However, the policy and the agreement excluded the Gulf States (Nonneman, 2006, p. 9).
With the collapse of the Euro-Arab dialogue, the entire region was not represented in any collective policy framework of the European Union and European Commission. It was until 1988 when a framework agreement between the region and the EC/EU was signed. But even after the signing of the agreement, it took a great deal of time before any tangible outcome could be felt (Nonneman, 2006, p. 9). Below, we explain how the relationship between the two regional blocks has evolved since the early 90s to date.
Explaining the relationships between EU and GCC to date
As already been mentioned, the contact between the EU and GCC started when they signed the cooperation agreement in 1988. The cooperation agreement provided a framework for cooperation between the two regional blocks (Colombo & Committeri, 2013, p. 1). Even though the cooperation agreement provides a broad list of unclear objectives, EU-GCC relations have been restricted to business and economic matters for so long. One of the key objectives of the cooperation agreement was the setting up of the Free Trade Area. Earlier enthusiasm on the positive outcome of the cooperation slowly lost momentum as time passed. The negotiations between the EU and GCC went through numerous challenges and the scope and directive kept changing to give room to new priorities from both sides of the divide (Colombo & Committeri, 2013, p. 2).
The cooperation agreement framework was meant to provide for a continuous and mutual liberalization of trade between the EU and GCC. The framework also covers business rules and procedures for resolving business disputes (Antkiewicz & Momani, 2009, p. 226). Even though negotiations on Free Trade Area began two years after the signing of the agreement, its prospect became sensible in 2003, when the Gulf Cooperation Council was transformed into a customs union (Colombo & Committeri, 2013, p. 4).
The speed of negotiation increased in 2007 and there were high hopes that an agreement would be reached before the end of the year. However, this did not take place because GCC suspended the negotiations. GCC felt it was putting too much concession without any return from the EU. Since then, GCC and EU only upheld formal contacts through annual general meetings and numerous official communiqués. Experts from the two regions also met regularly to further cooperation in several sectors, for instance, education, energy, environment, and security (Colombo & Committeri, 2013, p. 2).
Nevertheless, the above record does not paint the true picture of the relations between the two regional blocks in some areas. Several issues are specific to each side, while some universal matters have a specific significance to EU-GCC relations (Colombo & Committeri, 2013, p. 2). However, the primary motivator of the cooperation between the two regional blocks is energy relations. The cooperation ensures energy security for Europe’s ever growing energy demand, while GCC receives technology and know-how in return. The global financial crisis “raised significant queries regarding the role of the Gulf Independent Funds and Investments” (Schuman, 2002, p. 7; Atger & Guild, 2011, p. 4).
Even though EU-GCC relations appear lopsided in some way, with Europe competing with emerging economies for exceptional relations with GCC to deal with their money and energy demand, facts on the grounds paint a different picture (Nonneman, 2006, p. 8). The EU remains GCC’s major and main strategic partner; it is also considered to be an example of regional integration to follow and adhere to (Colombo & Committeri, 2013, p. 3). Besides their strategic interests, the two regional blocks are moving apart, with most of their current talks boring no fruit (Schuman, 2002, p. 5).
In the year 2010, the two regional blocks settled on a Joint Action Programme (JAP) for the implementation of the original cooperation agreement signed during the late 80s. Once again, the program was more detailed but an ambiguous list of areas of collaboration ranging from commerce and energy to way of life and reciprocal indulgent and advanced learning and technical studies (Colombo & Committeri, 2013, p. 3). JAP did not succeed in bringing back the initial enthusiasm that existed when the cooperation agreement was first signed in 1988. It has neither resurrected nor put the cooperation between the two regional blocks on a new path. Experts recommend that the relationship between the EU and GCC should be trimmed down to only important areas to be practical and achievable (Colombo & Committeri, 2013, p. 3).
After more than two decades since the two regional blocks signed the cooperation agreement and numerous council meetings, relations between EU and GCC remain shambolic and does not meet the aspiration of its people (Colombo & Committeri, 2013, p. 3). The current financial and economic challenges facing global institutions have only increased the pace at which the two are rethinking their strategic relations by dealing with a lack of political goodwill to resolve the imminent matters. Lack of political will to address these issues has brewed suspicion and anxiety, especially about the intent and the capability of the European Union to pursue a genuine, unconditional talk with the GCC to enhance reciprocal relation (Escribano, 2013, p. 8).
Over the recent past, the so-called Arab revolution (Arab Spring) has shown how unpopular the EU is in the Gulf region. The EU’s narrow view is evident in its initiatives targeting the Middle East and the neighboring region. The EU has been carrying out these initiatives without engaging GCC. As a result, the EU risks losing its presence and influence in the Gulf region given the new developments (Escribano, 2013, p. 7). This section will start by discussing the structural and contingent factors that have affected the performance of the EU-GCC relations and then proceed with the Free Trade Agreement (FTA).
Among the reasons for the sub-standard performance and remarkable intricacies in developing the relations between the two regional blocks are structural and contingent factors. Generally, EU-GCC relations have considerably been impacted by the local, regional and global politics and economic conditions. Beginning with the organizational factors, the many-sided relations between the two regional blocks have been affected by the buoyancy of mutual relations between member states from both sides. Some experts attribute this to institutional weaknesses in the Gulf States (Colombo & Committeri, 2013, p. 4).
Even though economic and financial integration is still incomplete, most decisions on strategic matters, for instance, foreign policies are still being made at the domestic level rather than within the GCC framework (Colombo & Committeri, 2013, p. 4). This is also evident in the rivalry among some of the GCC member states about several important decisions affecting the region and the world at large. The rivalry between the GCC member states has been on the rise in the wake of the Arab Spring. Besides, the GCC member states had veiled struggle regarding the formation of the monetary union. In 2010, the GCC six member states formed a monetary council to tackle this issue. However, the institution has been dormant since then due to a lack of consensus. GCC has also experienced disagreements among its member states regarding the type of cooperation to be pursued between them and other regional blocks (Colombo & Committeri, 2013, p. 7).
Nonetheless, the challenges facing the cooperation between the two regional blocks cannot be blamed on the GCC member states alone. From the European side, EU member states have come up with an autonomous foreign policy, therefore having an extra advantage over the GCC member states when negotiating bilateral relations (Colombo & Committeri, 2013, p. 7). This is exemplified in some European countries, for instance, the UK and France which have attempted several times to develop a privileged relation with GCC member states. This has caused uneasiness among some GCC member states with how the EC has lately pursued a leading role in their relations with the GCC countries. Besides, the policies of the GCC member states prove that they lack seriousness (Colombo & Committeri, 2013, p. 8).
The development of EU-GCC cooperation is also affected by the structural challenges of the EU overseas and security strategy. Before the signing of the Lisbon agreement, the EU leaders played a major part in enhancing or thwarting the EU-GCC relations. Some of these leaders had the capacity and willpower to enhance the relations of the two regional blocks, while others remained so dormant. With the signing of the Lisbon agreement in 2009, the relations of the two regional blocks had plummeted into the competencies of the EU foreign policy (Colombo & Committeri, 2013, p. 8).
Most of the Joint meetings held between the two sides in the recent past have only deliberated on several regional and global challenges and the need to come up with a common strategy to tackle those challenges. On the contrary, hardly any information is available on the arrangement to further relations between the two regional blocks in the area that rises above the regular course of action. These meetings just perpetuated the trend that began following the 9/11 attack, which entailed EU foreign policy towards the Arab States. These policies focused on counterterrorism strategies and the need to tame turmoil originating from Iraq and the Afghan war (Colombo & Committeri, 2013, p. 5).
According to Richard Young from Madrid University, one of the principal reasons why the cooperation between the two regional blocks has never been successful is because the EU has not been able to water down socioeconomic tensions in the Gulf region. He argues that a strong emphasis on economic issues such as FTA has led to the negligence of political and governance subjects. Furthermore, the level of cooperation being sought by the two sides had not borne any fruit (Colombo & Committeri, 2013, p. 5). Even though the disparity in political and economic aspiration always exists in any form of cooperation, resolving tensions in the Gulf region has proven to be a hard nut to crack. Lack of adaptability on economic strategies has been a major hurdle to political goals, at the same time short-term policies have impacted the cooperation negatively (Antkiewicz & Momani, 2009, p. 221).
From the economic perspective, full integration of the Gulf economies has not yet been realized. The integration was aimed at enhancing the customs union, implementing a common market, and introducing a unified currency. This has hindered advance cooperation and integration with the European Union on economic subjects. The European Union views the above elements as the basic threshold for setting up a Free Trade Area (FTA) (Atger & Guild, 2011, p. 5). From a global perspective, the Gulf States have over and over again blamed the EU for its half-hearted support on the international stage. Also, they have always denied petroleum products from the Gulf region access to their markets. They have also on many occasions denied petroleum products from the Gulf region access into their market. This is highly attributed to the intense pressure on the part of the petroleum producers in Europe who are very much against the liberalization of petroleum products (Nonneman, 2006, p. 17).
Gulf States has always blamed the protectionists in the EU for using the subject of human rights as a scapegoat for not providing a benevolent package. The Gulf States have never concealed the fact it views the FTA treaty as a precondition for further cooperation. This ambition has constantly been thwarted by the European Union, which views the Gulf States as mere suppliers of energy rather than key partners in the larger Middle East region. However, some scholars believe that this will change owing to the Arab Spring (Schuman, 2002, p. 10).
From a political point of view, the European Union has contributed very little. The EU’s emphasis on counterterrorism, entrenched in its foreign policies, means that the EU has made very little effort to support good governance in the broader Middle East. The Gulf States also have a fair share of the blame. They have vehemently opposed any form of external interference in their political matters. At the same time, the EU has made less contact with the civil societies in the Gulf region or funded projects initiated by these organizations to promote good governance. It is purported that such support could destabilize regimes whose cooperation is very important in the war against terrorism (Schuman, 2002, p. 10).
Structural limitations on the EU’s capacity to kick start political negotiations with the Gulf States have been complicated by the short-sighted strategies towards Eastern Europe. According to analysts, an additional reason why the EU has made less impact on developing relations with the Gulf States is their downbeat attitude towards East and Central Europe. The expansion of the EU towards the east has resulted in a more inward-looking approach. This has had a significant impact on its constitution and institution (Colombo & Committeri, 2013, p. 8).
The disruption of the FTA talks confirms that the substance of the EU-GCC relations has over and over again been challenged by one or both sides. The collapse of the FTA talks has always dominated major headlines and is considered to be one of the main hurdles to cooperation (Colombo & Committeri, 2013, p. 8). On the other hand, GCC leaders have complained of the attempt by the EU counterparts to force human rights issues into the negotiation table. They regard this as unnecessary efforts to interfere with the internal affairs of these countries (Antkiewicz & Momani, 2009, p. 224).
The GCC denunciation of the conditions set by the EU on the ground that these conditions have nothing to do with economic cooperation and negotiations have stifled the hope of realizing FTA and further cooperation between the two regional blocks (Atger & Guild, 2011, p. 6). The EU’s point of view is that the failure of the GCC member states to take human rights issues seriously camouflages a deeply-rooted resistance to actual liberalization in all sectors and minimizations of subventions in their economies. The EU argues that the FTA could have acted as the foundation for other forms of cooperation between two regional blocs. Among the EU’s top agenda in the Gulf region is energy discourse given the global anxiety about energy security. Despite the obvious complementarities existing in the energy sector, full cooperation has not been realized (Colombo & Committeri, 2013, p. 6).
With a view of revamping the cooperation between the two blocs based on a stronger foundation, it is essential to mark out the hitches and their effect. One of the ways of overcoming the standstill in EU-GCC relations could be to carry out measures that could boost confidence, for instance, establishing strong ties in less controversial areas such as education and training (Malmvig, 2006, p. 13).
Up to now the security of the Gulf region has continued to be outside the framework of the EU-GCC relations and their cooperation has been restricted to political rhetoric or bilateral agreements between the member states (Malmvig, 2006, p. 5). In the Gulf States, security acts as a pillar for their foreign policies. Taking this into consideration, their overdependence on the U.S. for security reasons has affected their relationship with the European Union too. Even though the presence of the U.S. military is fundamental and something that is non-substitutable, the Gulf States have considered expanding their relations to avoid over-identification with the U.S. However, this remains just a dream given their inflexible economic policies and poor human rights and governance rating (Colombo & Committeri, 2013, p. 7)…
Free Trade Agreement Discussions
The negotiations between the EU and GCC for a very long period have been about the conclusion of the Free Trade Area (FTA). The two regional blocs signed a cooperation agreement under which FTA was ratified (Antkiewicz & Momani, 2009, p. 218). The GCC countries were interested in accessing the European market and trade concessions similar to Israel. On the other hand, the EU was interested in the stability of the Middle East and the creation of the energy import framework. The cooperation agreement was not full of ambition from the start and was pursued without pressure. The agreement was basically to strengthen EU-GCC relations, expand economic and industrial ties, and contribute to the region’s stability through development and diversification (Escribano, 2013, p. 8).
The EU favored inter-regional relations instead of bilateral agreements with individual GCC states and this has hampered the depth of cooperation between the two regional blocs. EU favored the regional approach because of two reasons. One of the reasons is the lack of capacity to carry out bilateral talks concurrently with different countries. Another reason is the EU’s foreign relations approach that promotes regional integration and development (Escribano, 2013, p. 3).
In 1990, the Joint Council Committee was formed and provided for cooperation in different economic sectors, for instance, trade, agriculture, and energy among others. The cooperation agreement exposed massive trade inequality and for that reason recommended the establishment of the Free Trade Area (FTA). Despite the clause for cooperation outside the Free Trade Area, the relations between the GCC and EU have been held back by a failure to agree on FTA. After 20 years of intense talks, the FTA wasn’t signed, while the cooperation in other sectors is still restricted (Antkiewicz & Momani, 2009, p. 221).
Scholars argue that FTA negotiations have been held back from the start by bureaucracy and lack of experience to negotiate inter-regional trade agreements. The comprehensive nature of the Free Trade Area (FTA) has also contributed to the slow negotiation process (Antkiewicz & Momani, 2009, p. 221). Most of the subjects that were to be addressed surpassed the liberalization measures that have been used by the Gulf States in the early period, particularly because a number of the Gulf States were not affiliated to the World Trade Organization when the agreement was signed. As a result, these countries have found it very difficult to speak in one voice and the Gulf Cooperation Council lacked the influence to negotiate trade deals on behalf of its members (Antkiewicz & Momani, 2009, p. 222).
EU representatives time and again complained of the amorphous bureaucracies within the Gulf region that impeded the implementation of agreements reached the political level. They add that the GCC secretariat does not have the managerial capacity or enough decentralized power from the member states to issue a collective decree for customs processes, swap domestic customs procedures, and bargain on behalf of the member states (Escribano, 2013, p. 2).
According to the EU, it is not possible to continue with significant economic cooperation and liberalization unless the GCC establishes a full customs union. In the early 90s when the FTA agreement was being ratified, the GCC promised it would establish a full customs union by 2005. This was later brought forward by three years. The FTA negotiations stalled for over a decade and were only re-launched in 2002 when the Joint Council Committee (JCC) issued a directive for what was now referred to as a comprehensive FTA. The comprehensive FTA went beyond a goods-only agreement to include issues such as services, investment, and inter-government tendering process (Escribano, 2013, p. 2).
The 2003 custom union did not take place, instead, the GCC members were looking towards the U.S. for preferential treatment and bilateral agreement. Besides, the 2010 target for realizing GCC monetary union was postponed as the political rivalry between some GCC member states, for instance, Saudi Arabia and Qatar continued to affect the negotiation process (Echague, 2007, p. 9). According to economic experts from the Gulf region, negotiations are to some extent lopsided given the size of the region compared to the EU. However, the EU maintains that the dispensation will be reciprocal although GCC exports are limited compared to numerous products from the EU. Besides, the GCC countries normally protest that the EU often increases the number of items beyond the agreed figure (Escribano, 2013, p. 6).
In 2005, there was tension between the EU and the GCC because of the governance and human rights clause introduced by the European Union. The GCC member states felt that the two clauses were mere distractions, despite these clauses being a mandatory part of the comprehensive agreement. The Gulf States perceive these clauses as extraneous to economic talks, particularly when the proposed clause was linked to the unlawful immigration of labor (Echague, 2007, p. 10).
The European Union has always emphasized the significance of the FTA agreement. However, the obstacles towards the conclusion of the FTA agreement have carried on for so long. A number of these stumbling blocks were resolved when Saudi Arabia joined WTO. But stumbling blocks still dwell on investment, tendering process, and services. Quite a few flashes of optimism have come and gone in less than a decade ago when the FTA agreement was almost concluded only to one more time prove hard to pin down. Just like his predecessors, the German president was so determined to agree by 2007 but failed to do so (Echague, 2007, p. 10).
Whereas the European Union insists on the GCC member states to abide by the human rights and governance clause, these issues are so sensitive in these countries to the level that they are entrenched in the fundamental structure of their political system and society at large. In the Gulf region the procurement process is not done through the tendering process, but rather through an informal agreement usually linked to the power-based distribution of resources (Malmvig, 2006, p. 6; Echague, 2007, p. 10).
Many political scientists believe that the caution exercised by the GCC regimes on the mentioned clauses are linked to strategies meant to hold political reforms at bay. The bilateral agreements signed by the several Gulf States with the U.S. have made matters more complicated since the EU has refused to accept conditions that do not match those offered in the U.S (Escribano, 2013, p. 19). In the meantime, the trade between the Gulf State and Asian states is increasing at a fast rate. Many observers from the Gulf region stress that the EU’s inflexible terms have provided an avenue for the Asian states, for instance, China and India to strengthen their relations with the region, and that other developing economies are following the same path (Echague, 2007, p. 9).
Sectoral Relations: The present State of affairs and the future
Commerce and EU-GCC Integration
By analyzing the trends of exports by Gulf states to Europe in the last decade, it rose by about 16 percent of Gross Domestic Product (GDP). In 2009, the entire Gulf region experienced a decline in exports; yet, the global economic crisis had more impact in some Gulf States more than others. For instance, the United Arab Emirates (UAE) bounced back very fast and by 2010 its economy had recovered fully, whereas Saudi Arabia suffered heavily and had a slow pace of recovery. On the contrary, in the corresponding time, the number of goods and services imported rose by about 8 percent compared to the Gross Domestic Product. Nonetheless, after the crisis, all the economies either remained stable or increased. None of them plunged (Colombo & Committeri, 2013, p. 9).
Similarly, by taking a look at the outflows and inflows of services in the corresponding time, it appears that they also rose similarly, despite the global financial crisis. Besides, by taking a look at the Ease of Business Index (provided by the World Bank), which evaluates the legal environment of carrying out business activities, it comes with no shock that, by mid-2011, the Gulf states were ranked top in the MENA region, with Saudi Arabia being the first. Nonetheless, on an international level, the disparity between the Gulf States was remarkable. Saudi Arabia was ranked 12th, the United Arab Emirates 33rd, and Kuwait which was last ranked 67th (Colombo & Committeri, 2013, p. 10).
When the Gulf Cooperation Council was established in the early 80s, the member countries were focused on the framework of the cooperation council and on the measures to be taken to realize a unified economic bloc (Malmvig, 2006, p. 7). The current efforts are aimed at achieving a unitary custom, tax, and currency system. However, these projects have not been realized due to several obstacles, for example, procurement and administrative incompetence, old rivalry among some Gulf States, and the need to maintain autonomy. Even the massive oil wealth has also played a major part in this. Economists argue that since some of the Gulf States are already growing vigorously, they have less motivation to undertake fundamental changes to realize faster growth (Colombo & Committeri, 2013, p. 12).
According to a study conducted on behalf of the Breton Wood institutions to investigate how the Gulf States interrelate with each other, the GCC countries exhibit signs of conflux on several macroeconomic pointers, including the rate of inflation, foreign exchange reserves, and government debt to GDP ratio among others. This conflux, while significant in the establishment of a unitary currency, also shows how susceptible these economies are. The lack of diversification in the Gulf economies subject them to similar externalities, for instance, fluctuation in global oil prices and the depreciation of the dollar (Nonneman, 2006, p. 12; Colombo & Committeri, 2013, p. 12).
Correspondingly, the integration of GCC states through commodity and service exchange has not achieved its best. Commodity exchange in the Gulf region, apart from petrochemical products, is far much lower than commodity flows in other regional blocs. Nonetheless, the reduction of nontariff obstacles to conform to the WTO directives and the introduction of uniform commodity standards for several products is an indication of progress (Colombo & Committeri, 2013, p. 12).
The current trend can be improved by investing more in regional infrastructure and reducing border controls, as well as comprehensive economic reforms to enhance complementary among different states. Service flows in the region has risen significantly, principally because of the common market agreement, which permits GCC citizens to move and do business freely from one Gulf state to another. However, these privileges do not apply to foreign investors. Also, the method of entry, level of conducting business, and market participation still varies and demands harmonization (Escribano, 2013, p. 11).
In 2003, the Gulf region introduced a customs union. This to some extent managed to eliminate obvious trade barricades within the GCC region. However, the full implementation of the customs union has not been realized due to differences over the criteria to be used in dividing the custom revenues among the GCC member states (Antkiewicz & Momani, 2009, p. 223). In mid-2012, the Gulf Cooperation Council established a Customs Union Authority (CUA) to address these differences. One of the options that were available for the CUA to resolve this dispute was splitting up of revenue in accordance to the level of imports, population size, and the GDP of the member states (Colombo & Committeri, 2013, p. 12).
Other projects initiated by the Gulf Cooperation Council also ran into a state of confusion. For the last seven years, GCC has been considering the possibility of introducing a unified value-added tax at a five percent rate, with the aim of abating over-reliance on petroleum revenue. However, given the recent resilience in the petroleum sector, there is no abrupt need to increase revenue. According to the recent data released by OAPEC, crude oil exports from the Gulf region has increased by almost $200 billion, with Saudi Arabia accounting for almost half of the total revenue (Colombo & Committeri, 2013, p. 11).
The GCC’s most aspiring project is the creation of a unitary monetary unit. However, this project seems unlikely to press on shortly (Colombo & Committeri, 2013, p. 11). Theoretically, a single currency unit normally promotes business growth and investment within a certain jurisdiction. Even though trade between GCC member states increased to over 65 billion US dollars in 2010 from 19 billion US dollars in 2003, official data released by the WTO show that these figures are a mere fraction of the GCC’s overall volume of trade of approximately 3 trillion dollars (Colombo & Committeri, 2013, p. 12).
Due to the rivalry between the UAE and Saudi Arabia, the former deserted the project because it was hosted by the latter. Smaller economies such as Oman had already abandoned the project, arguing that they were not ready. The absence of the United Arab Emirates due to its economic rivalry with Saudi Arabia is a major blow to the project (Escribano, 2013, p. 17). In the meantime, the debt and currency problems facing the Eurozone, where the unitary monetary unit has proven to be defective, have negatively impacted the proponents of a single monetary unit in the Gulf region. The European experience implies that a unitary monetary unit may not be feasible if the member states are not willing to surrender much of their financial autonomy, and GCC member state given their historical and political background would be the least to do so (Colombo & Committeri, 2013, p. 10).
Turning into the cooperation between the two regional blocs (EU and GCC) in matters of trade, the cooperation agreement signed in 1988 provides a framework for economic and trade relations between them (Ayadi & Gadi, 2012, p. 2). Article 3 of the cooperation agreement states that both regional blocs should endeavor to promote and assist each other in the productive sectors, financial infrastructure, transfer of technology, and development through a corporation. To be specific, article 11 of the corporation agreement highlights the importance of development and diversification of trade to the maximum (Ayadi & Gadi, 2012, p. 3).
Economic and trade relations between EU and GCC were improved further through a string of agreements and memorandum of understanding, the most significant of which is the 2007 memorandum of understanding signed between GCC and Euro chambers (Escribano, 2013, p. 12). This memorandum of understanding set ten goals including strengthening of bilateral agreements, exchange of information, and institutional mutual aid. In 2008, the two chambers came up with a joint statement on FTA negotiations, stressing the significance of an all-inclusive agreement. The statement also emphasized the need to enhance market access for manufactured commodities, services, foreign investment, and the government tendering process. Also, the statement called for support of the EU-GCC cooperation and setting up of the monitoring agency (Colombo & Committeri, 2013, p. 13).
However, the above developments only represent small steps on the road to the achievement of full cooperation between EU and GCC, owing to the breakdown of the FTA talks (Colombo & Committeri, 2013, p. 2). In 2009, the European Union exported goods worth over $60 billion, mostly equipment and automobiles, manufactured products, and petrochemical products to the Gulf region. At the same time, it imported goods worth $20 billion only from the Gulf member states, mainly petroleum and its affiliate products (Colombo & Committeri, 2013, p. 13).
To be specific, EU commodity exports to the Gulf region increased to €72 billion in 2011 from € 57 billion in 2009. Likewise, the EU’s business services exports rose to € 22 billion from € 21 billion within the same time. In a few words, the EU imports about 3.3 percent of the GCC goods, while exports about 4.7 percent of its products to the Gulf region. This shows that the Gulf States were more dependent business-wise on their counterparts from Europe than the other way round. However, this situation has started to change due to the recent exposure and diversification of the Gulf economies towards Asia and Eastern Europe (Colombo & Committeri, 2013, p. 14).
The exchanges between the two regional blocs are currently possible thanks to the Generalized Preferential System (GPS) introduced by the EC. With the amended GPS, some economies in the Gulf region will be left since their income is rated above average, for instance, Qatar. Nevertheless, if the free trade area (FTA) was to be realized in time, the entire Gulf region would be in a more favorable position in terms of economic relations with the EU (Colombo & Committeri, 2013, p. 14).
From the above data, numerous elements come into sight. It is apparent that, even though trade between the two regional blocs is vital, it is not adequately expanded. Petroleum products and equipment are the most traded commodities between the two regional blocs. Also, it turns out that full economic integration has not been realized both between the EU and GCC and among the Gulf States. One of the GCC’s shortcomings is its reluctance to expand the economy. Altogether, several issues obstruct the realization of the free trade area between the two regional blocs. Among these, the above-mentioned clauses set by the EU are regarded as the most serious complication. Without a doubt, the Gulf States will not assent to the FTA talks unless the EU renounces such clauses (Colombo & Committeri, 2013, p. 14).
Finance and investment
The elimination of the bureaucratic channels to ease the movement of goods and services in the region has enhanced the flow of resources and cooperation within the region. By analyzing the structure of the economy using macroeconomic data one can gauge the level of economic integration in the region. The analysis of macroeconomic data for the GCC countries points out that capital markets are reasonably proficient at eliminating disparities in prices. It also appears to be more integrated within the Gulf region than in the international market. This proves the existence of financial integration in the region (Colombo & Committeri, 2013, p. 14).
However, the region’s financial system has been taken over by merchant banks. The commercial banks reflect the stability of the region. Nonetheless, the volume of foreign investment in the region is still wanting. Bahrain tops the list of the Gulf States with the highest proportion of foreign capital. Qatar and Kuwait follow in that order. Saudi Arabia’s financial institutions are nearly blocked from the rest of the world, thus have the least foreign assets and liabilities. Furthermore, “significant control remains, for instance, buying of shares in domestic markets and inward foreign direct investment (FDI), which obstruct regional and global integration” (Colombo & Committeri, 2013, p. 15).
The Breton Wood institutions highlight similar attributes of the Gulf financial sector, especially the dominance of five local banks which account for more than 80 percent of the total financial sector assets. At the moment, the Shariah-compliant system dominates the GCC banking and investment (nearly 30 percent). This has led to fewer nonbank financial institutions in the Gulf region. Other aspects obstructing international integration include tariffs and other trade barriers. However, substantial progress has been made in finance and corporate governance. The Central Banks in the region have accepted to abide by the Basel II standards and have already set up autonomous institutions responsible for the regulation of the capital market (Colombo & Committeri, 2013, p. 15).
The global financial crisis thwarted most of the region’s gains, particularly those aimed at realizing a common market. The development of a unitary currency would have reduced the exchange rate, operation costs, and enhanced price transparency. Also, the global financial crisis exposed flaws in the GCC financial sector. These flaws were dealt with on a case by case basis, hence are devoid of standard treatment criteria. This has further hampered the development of well-thought-out financial products. Last but not least, the global financial crisis, which brought about the UAE global debt dilemma, as well as the collapse of two major companies in Saudi Arabia and the general GCC financial problems, increased risk prevention measures and reassessment of the loaning process (Escribano, 2013, p. 15).
Turning to the cooperation between the two regional blocs as regards financial issues, article 7 of the 1988 agreement directs each member state to promote and protect each other’s venture. Joint projects such as Al-Jisr highlight shared financial interests between the EU and GCC (Escribano, 2013, p. 15). With regards to the global economic crisis, the member states must come up with preeminent practices. This will help in pulling external capital. Also, down to earth financial practices found in both regions, for instance, Islamic banking and cooperative banks help to strengthen the cooperation (Escribano, 2013, p. 16).
In recent times, the Euro chambers called for better economic cooperation between the two regional blocs, particularly regarding foreign direct investment (FDI). They even launched a project dubbed “EU-GCC Invest”, which was aimed at arousing debate on foreign direct investment (FDI) and the creation of a joint platform for doing business in both regions (Colombo & Committeri, 2013, p. 11). Despite the numerous negotiations and memorandum of understanding, a recent report released by the European Central Bank revealed that contact between financial institutions from both sides is way too low. The Gulf States blame this on the European banks which they allege to be concentrating on the Eurozone alone. For this reason, economic integration between the EU and GCC is still a work in progress. Bearing the above in mind, it is apparent that advanced economic integration between the two regional blocs is the principal means of realizing the free trade area (FTA). This can only be achieved once the GCC banks enhance their contact with the global market (Colombo & Committeri, 2013, p. 12).
In 2009, Gulf States produced more than one billion tonnes of oil and gas, owing to their colossal reserves of fossil fuel. Saudi Arabia accounted for nearly two-thirds of the aggregate volume. This was equivalent to approximately 11 percent of the global crude oil supply. The country became the principal exporter in the following year with over 300000 tones. However, the total amount of crude oil export has gone down compared to the earlier days (Malmvig, 2006, p. 8). This is attributed to the discovery of oil in other continents, for instance, the former Soviet States and Africa. Also, data from international financial institutions show an increase in domestic consumption and steady production. Nonetheless, the Gulf States are still the biggest oil exporters in the world (Colombo & Committeri, 2013, p. 12). e
As already been mentioned in the study, the relations between the two regional blocks mainly depend on energy (Malmvig, 2006, p. 8). Fossil fuel is the most traded commodity between the EU and GCC. This is largely attributed to the strategic location and corresponding patterns in petroleum production and consumption in the two regions, which has led to complimentary exchange terms between the two regional blocs. Article 6 of the cooperation agreement regulates the exchange terms. Article 6 states that in the energy field, the two regional blocs should endeavor to promote and facilitate cooperation in all aspects, for example, the exchange of opinions and information that are related to energy generally, without any form of prejudice (Colombo & Committeri, 2013, p. 13).
The energy flows between the two regional blocs is all about the exchange of fossil fuel. Saudi Arabia had the highest export to the EU, whereas UAE had the least. However, the volume of export towards GCC is considerably lower and does not exceed 10 percent. Up to date, Saudi Arabia is regarded as the biggest exporter towards the countries of Europe, with over 3400000 metric tons of fossil fuel per annum (Schuman, 2002, p. 16).
From the EU’s perspective, they still enjoy an advantaged energy relationship with the former Soviet States. EU’s imports from this region rose by more than 9 percent between 2005 and 2011. Another region where the EU enjoys a privileged energy relationship in Africa, with West and North Africa topping the list. Imports from these regions also increased steadily from 18 percent to 20 percent in 2005 to 2010 respectively, though the volume went down to 17 percent in 201I because of the Arab Spring (Colombo & Committeri, 2013, p. 14).
The trend observed in the African continent was also witnessed in the MENA region. The decline is attributed to increased competition from the former USSR states. The trend reversed when Russia started increasing gas prices (Malmvig, 2006, p. 16; Colombo & Committeri, 2013, p. 14).
To strengthen cooperation in the energy sector, the two regions came up with a Joint Action Programme in 2010-2013. The program concentrated on knowledge exchange, policies, excellent performance, and technological infrastructure. The program was conducted through seminars, workshops, and formal and informal training. Specific attention was devoted to the subject of green energy, particularly solar energy. Whereas the EU has begun embracing environmentally- a friendly energy, the Gulf States lack articulate structure since the majority of the governments have set up different goals and deadlines (Escribano, 2013, p. 25).
Nonetheless, this does not mean GCC countries are dormant in the renewable energy sector. All the Gulf States have massive projects of this nature. For instance, Bahrain has invested heavily in mobile solar units for desalination of water and wind turbines. The only exception is Kuwait, which has avoided investing heavily in renewable energy projects, though it has spent a substantial amount of money to finance research in the field of green energy (Escribano, 2013, p. 25). The Kuwait government has made plans to develop green electricity. However, how this plan will be realized is yet to be decided. Correspondingly, the Oman government is at the present financing research projects that are meant to increase the expansion and consumption of solar energy, especially nationwide solar thermal plants (Colombo & Committeri, 2013, p. 22).
On the other hand, the Qatar government had previously carried out studies on solar plants and is in the preliminary phases of execution. This project is expected to be completed by the end of 2014. Over the recent past, the Saudi private sector has invested a substantial amount of money in solar plants. An example of such massive spending on renewable energy is the city of Jubail II. Last but not least, the United Arab Emirates, while investing in numerous projects across the country, the most notable is the renowned city of Masdar based in Abu Dhabi. The entire Masdar city relies on solar energy (Schuman, 2002, p. 3; Escribano, 2013, p. 19).
The United Arab Emirate government also supplies resources and funds to various kinds of green technology organizations and is currently planning partly to construct a large municipality that uses restorable power and is engaged by green technology organizations. This plan is expected to be completed by 2016, with an expectation to cover approximately 7 kilometers square and domicile of up to 50,000 individuals. The United Arab Emirates continuously goes green with the type of energy produced in a bid to reduce environmental pollution (Escribano, 2013, p. 20).
Numerous discussions on renewable energy have been held between the two regional blocs. Generally, the discussions normally touch on areas of common interest. Sustainable development has drawn attention to the increased energy consumption in the Gulf region and the increasing pressure on fossil fuels. On the other hand, the EU’s interest has always been on the development of green energy and these encompass all forms of energy that produce fewer emissions/pollutants as compared to biofuels. These conferences have led to the formation of the clean energy network. A clean energy network is a framework by which institutions from the Gulf region can access EU partnerships and take part in the development of pilot projects (Antkiewicz & Momani, 2009, p. 28).
As already been mentioned, the energy relations between the two regional blocs are the basis of their political and economic cooperation. The gains accrued by both sides of the divide from these relations cannot be underrated. The GCC is a very significant supplier of biofuel to the European Union, whereas the European Union can assist the Gulf region in building a steady and robust framework for the ambitious projects aimed at diversification of energy. Also, the two regional blocs can assist each other in creating a model in renewable energy projects and technologies (Schuman, 2002, p. 9).
The concept of maritime security encompasses several distinct factors that surround maritime transport. The Gulf States are very much aware of the dangers posed by maritime insecurity, especially of the Strait of Hormuz. The most recent maritime security issues in the Gulf region include piracy, narcotics trafficking, and to a certain level, illegal immigration (Colombo & Committeri, 2013, p. 20).
These factors touch both on nonstate actors and regional. As a result, GCC has promoted numerous meetings and forums to boost coordination among the Gulf States. Particularly, Maritime Security and Close Watch conference held in February 2012 established three major domains affecting the Gulf coast. These were piracy, narcotics trafficking, and poor maritime harmonization. Piracy and drug trafficking are considered areas where GCC and EU have made positive progress, despite the fact that there is no absolute global body and laws to deal with them. As regards coordination, numerous surveillance techniques are still under examination (Antkiewicz & Momani, 2009, p. 28).
At the global level, a subject as transnational as this has resulted in the establishment of certain conventions in the form of accords and initiatives in an attempt to tackle the multidimensional nature of Maritime Security. The most notable conventions aimed at tackling such insecurity are ratified under the UN charter on maritime security. The United Nations Convention on the law of the Sea was established in 1992. The convention underlines “terms for bringing individuals suspected of illegal activities in the Sea to justice”. The entire Middle East (Except UAE and Iran) has ratified this convention (Colombo & Committeri, 2013, p. 21).
The already mentioned dispute over the Mousa Island and Strait of Hormuz are subject to the convention, particularly for the system of navigation through global channels, the delimitation of the waterways, and special economic zones between the neighboring and countries under dispute. The Gulf region constitutes closed and semiclosed areas of the sea covered under the UN charter. This provides the EU with the liberty to choose areas of cooperation. The areas of cooperation envisaged under article 123 include marine research, conservation of the marine environment, and exploitation of fisheries (Colombo & Committeri, 2013, p. 21).
The Gulf States comprises the Combined Task Force 151 which was created a couple of years ago to tackle the problem of Somali piracy. The waters of the Gulf of Eden along the Somali coast are among the most heavily trafficked of the globe. Approximately 20,000 vessels pass through these waters every year. In early 2003, new incidences of the attack on fishing vessels started taking place along the Somali coast. The frequency of these attacks increased exponentially and companies started to become more worried as the attacks also targeted commercial vessels. The last five years have recorded the highest activities of the pirates in the Gulf of Eden, with over 100 attacks on commercial vessels (Antkiewicz & Momani, 2009, p. 30).
The biggest irony is that the Gulf States have never been included in the EU military program aimed at ensuring safe passage along the Somali Coast. They are only allowed to make operational contributions or supply military staff from the headquarters in the United Kingdom. For this reason, the participation of the GCC in this program is limited. Nevertheless, the fact that GCC as a non-EU member is allowed to take part in the program as an operational contributor represents a step in the right direction (Colombo & Committeri, 2013, p. 21)
Media and Communication
The success of regional integration is not only gauged by the amount of traded commodities or services exchanged, but also by bringing the public services standard into line. Media and communication are examples of public services (Colombo & Committeri, 2013, p. 22). For communication, particularly, the GCC has been working very hard to produce an articulate rule and directives on the same. Communication and IT steering committee are mandated with this task. Besides, the employment and the tariff commission recently came up with a peripatetic price standard, which is to be applied throughout the region. The secretariat also recently approved the use of digital media to pass vital information to the public. The use of social media (Twitter and YouTube) will help to involve the younger generation in the council’s decision-making process. This undoubtedly shows that social media is gaining popularity in the Gulf region for its ability to link and interlink and for its demand and influence over a section of the population (Colombo & Committeri, 2013, p. 23).
It would not be enough to talk about the region’s media and communication without talking about the remarkable role played by the Qatari-based media-Aljazeera. Aljazeera was established in the mid-90s, thanks to massive funding from the Emir of Qatar. Aljazeera has considerably expanded and is now regarded as the main voice of the Arab world and the rest of the globe. Before Aljazeera was founded, BBC Arabic was the only global channel representing the Arab world. Following the closure of the BBC Arabic, Aljazeera took over and even absorbed most of the BBC’s employees (Colombo & Committeri, 2013, p. 23).
Aljazeera only started airing uninterruptedly after the new millennium. For this reason, it surpassed other Arabic Broadcasting house, for instance, the Middle East Broadcasting Centre (MBC). MBC was the first broadcasting housed to air free pan-Arab news and entertainment. Al Arabiya, Dubai-based news and entertainment channel, is a brainchild and an affiliate of MBC. They are all state-owned channels (Colombo & Committeri, 2013, p. 23). Both Aljazeera and MBC can be accessed online, through Aljazeera has a wider network. Last but not least, it is significant to note that, since both channels are founded and funded by the state, they tend to air local, regional, and global concerns of their sponsors. Therefore, the GCC media are still going through a fundamental media revolution (Colombo & Committeri, 2013, p. 24).
The relation of the media and communication with the whole world grew on account of Aljazeera’s role in the after-effects of the 9/11 attack on U.S. soil, broadcasting videotaped messages by the terror cells. This was the defining moment for Aljazeera and the whole Arab media. It was at this end that the US and the European nations started to recognize the growing popularity of the Arab TV channels. Besides, the strong coverage of the Middle East conflicts and the U.S. war against terror gave prominence to their deeply-rooted global-based offices. Aljazeera’s broadcasting success in the war zones led to the creation of new offices globally (Escribano, 2013, p. 4; Colombo & Committeri, 2013, p. 26).
The entry of the GCC in the international media and communication platform is also noticeable in several specialized magazines originating from the Gulf region, for instance, Timeout. The setting up of Aljazeera offices in the UK and the subsequent launching of the English Channel, further promoted media relations between the two regional blocs. This is also evident in the concrete attempts to revamp common media and communication policies and the role of the state in the development of IT. The employment and tariffs committee sanctioned the directive to enhance relations with the EU member states in the ICT sector (Schuman, 2002, p. 16).
Higher Education and Research
Over the recent past, Gulf States have been worried about the quality of their education and have now begun taking necessary steps to improve it. Training in the field of security is a subject of major concerns in the Gulf region, hence the reason why it was given priority in the meeting. Nonetheless, all-inclusive reforms should take into account all the concerned stakeholders. Several studies underscore the significance of complementary skills and theoretical teachings in capitalizing on the outcome (Colombo & Committeri, 2013, p. 23).
The after-effects of the recent Arab revolution have forced Gulf regimes to increase their welfare budget. The increased fund also had a positive impact on the education system. Particularly, funds for foreign scholarship increased, at the same time the education sector reforms are underway (Colombo & Committeri, 2013, p. 23). Thus, it is apparent that the present strategy used by the GCC member states is to send their nationals for overseas training. From this perspective, the EU has enough scope of action to improve its relations with the Gulf States. The Joint Action Programme by the two regional blocs emphasizes the continuation and improvement of cooperation at all levels, particularly promoting relations between EU and GCC institutions of higher learning. Furthermore, countries that are involved in the exchange programs must endeavor to increase awareness across other member states (Colombo & Committeri, 2013, p. 23).
A partnership between several EU institutions of higher learning and the GCC institutions for higher learning already exists. The most notable one is the exchange programs, for instance, ERASMUS MUNDUS. The program involves students from the undergraduate level up to the Post-Doc level, as well as the university staff members. However, less than a hundred students take part in this program annually. As a result, the two regional blocs should strive to increase the number of students participating in the program, especially Gulf students studying full-time in Europe (Colombo & Committeri, 2013, p. 24).
Lastly, to help in the education reforms in the GCC region, EU institutions of higher learning should share their most excellent practices with their Gulf counterparts, especially in developing a syllabus, managing students and teachers, and research practices. Regarding research programs, the Gulf States have differentiated themselves from their neighbors for their accessibility and willingness to host foreign scholars and students. Therefore, the implementation of the Joint Action Programme will increase the level of cooperation between the two regional blocs in the field of education and research as well as the transfer of technology (Escribano, 2013, p. 30; Colombo & Committeri, 2013, p. 24).
EU and the Security of the GCC countries
The European Union (EU) looks forward to playing a more dynamic role in the Gulf region as far as security is concerned. Despite the region’s clear strategic significance, the EU has until lately paid a lot of attention to the Mediterranean countries. For that reason, the Gulf region has remained largely in the hands of the U.S. both politically and militarily (Viera, 2006, p. 11). Nonetheless, new security conditions and precedence have surfaced for both the GCC and the EU. In the wake of the 9/11 attack, the U.S. invasion of Iraq, and the U.S. foreign policy, the EU and the Gulf states have become more fascinated in strengthening their relations. “The sharp division between U.S. and a number of the EU member states over the Middle East’s foreign policy, particularly policies in the Gulf region and the rising opposition to the GCC government over their dependence on U.S. military power has drawn the two regional blocs closer” (Antkiewicz & Momani, 2009, p. 218).
The EU is increasingly becoming an important player in global affairs, not only in the realm of economic affairs but also in security matters. The presence of the EU is gradually being integrated into the reality of international politics by scholars and global players. Some experts believe that the EU will play a major role in security matters in the coming years. The recent EU operation in the DRC and the war against piracy on the coast of Somalia are examples of how its responsibility for security matters is growing.
The EU-GCC security relations can be dated back to the early 70s. During that period Europe had to confront the price shocks in the global petroleum industry and later on the insurgency in Iran. All these incidences helped the EU member countries acknowledge the need to have an autonomous foreign policy (Nonneman, 2006, p. 5). An example of this increasing awareness is the Venice Declaration in the early 80s where the EU made its first contact with the Middle East, calling for basic fundamental rights, territorial exchange, and security in the entire region. Yet, it was until recently that the EU and GCC signed a comprehensive framework (Nonneman, 2006, p. 8).
In a nutshell, war and unrest in the Middle East during the early 70 marked the beginning of the EU’s relations with the region, although it was a humble start, with more focus on bilateral trade agreements and limited policy cooperation between member countries. Quite the opposite with the Mediterranean, the Gulf region has for a long time not been regarded as a priority area. However, things have begun to change as will be discussed in the study (Nonneman, 2006, p. 8). The EU security discourse has evolved gradually, at first as a bilateral trade agreement but later on acknowledging the significance of the region, lately calling for the implementation of the cooperation agreement. Furthermore, regardless of the bilateral nature of the discussion, security issues have been there and therefore are not a new concern for the EU. The only thing that has changed is the awareness of the impact of Gulf security on global peace and stability (Ismael, 2012, p. 2).
As regards security, their several issues that seem to preoccupy both the EU and GCC. These issues include the Middle East conflict, proliferation of nuclear weapons, the confrontation with Iran over nuclear weapons, and the war against terror. The situation in GCC is very captivating; the first captivating aspect is its nature as a regional bloc. Even though the GCC’s level of integration is not the same as the EU, it amounts to a very important partner in the entire region. Also, GCC has exhibited a strong will to grow, following the EU’s footsteps (Nonneman, 2006, p. 10).
Another captivating aspect is the region’s security dimension existing as the raison d’être of the Gulf region, which is responsible for the local and foreign threats to regional security. From this perspective, the EU approves a dual strategy: On one side, engaging the GCC on several security issues affecting the region, and on the other side, pressing for increased integration in the Gulf region as a way of maintaining long-term security for the member states (Viera, 2006, p. 7).
During the EU-GCC meeting held in 2005, the regional economic integration process was acknowledged as an instrument of upholding peace, stability, and development. Having established some foundation in the region, the EU will become a very significant partner in the Gulf region (Ismael, 2012, p. 4). In the case of Iran, the involvement of the EU has been steady concerning the nuclear quandary, pressing for discourse and a diplomatic solution. The major security concern concerning Iran is its alleged nuclear weapons program, though the country is also marred with human rights violations and support for terror groups. However, the last two subjects have never been the EU’s major security agenda. This is bizarre because these issues are handled from a security point of view (Viera, 2006, p. 7).
Concerning Iran, the EU has proposed several issues to steer their discourse. These issues are categorized into three: global issues, regional issues, and areas of cooperation. Global issues include terrorism, human rights violations, and the proliferation of illicit weapons. On the other hand, regional issues encompass the peace process in the larger Middle East and Central Asia. Lastly, areas of cooperation include energy, trade and investment, illegal immigrants, and drug trafficking. It should be noted that experts from both sides have met on several occasions to discuss the issue of narcotics trafficking and refugees, showing the EU’s increased rendezvous with Iran (Ismael, 2012, p. 10; Viera, 2006, p. 8).
Iraq and Yemen are two Middle East countries that engage with the European Union within the agreed framework. In the case of Iraq, the EU and particularly EC have given the country much-needed support in the reconstruction process. The rebuilding process is part of the EU’s foreign policy (Viera, 2006, p. 8). The EU’s foreign policy in Iraq had three principal objectives. First, develop a safe, steady, and democratic Iraq. Second, establish a free, sustainable, and expanded market. Last but not least, facilitate Iraq’s integration into regional and global systems (Viera, 2006, p. 9).
The country’s stability and safety are of major concern for the European Union. For this reason, the EU has committed considerably large sums of money not only for infrastructural reconstruction but also for political reconstruction. Also, the EU is looking forward to strengthening its relations with Iraq and is currently working on a cooperation framework for Iraq (Viera, 2006, p. 9). Up to date, the EU’s participation in Iraq is still being considered unsatisfactory, though the UK which is one of its member states has deployed large numbers of troops in the country. Regardless of this, the EU has continued to engage with the Iraqi officials to realize its objective of a stable and secure Iraq (Viera, 2006, p. 10).
The EU’s main concern in Yemen is terrorism. According to the European Commission, the main challenge facing Yemen’s current regime is security. The country is not only a target for the attack but also a prospective haven for the terror cells. Several terrorist groups have used the country as a logistical base for smuggling arms, training, and hiring new members (Ismael, 2012, p. 10). Besides the financial assistance received by Yemen from the EU, they also engage each other in political matters. The dialogue between the two has always focused on terrorism and the proliferation of illegal weapons. Also, the dialogue touches on human rights issues and democratization. The overall objective of the political discourse between the two is the security and stability of the region (Ismael, 2012, p. 11).
According to Malmvig (2006, p. 3), the EU’s security relations with the Middle East can be divided into three clusters namely: Euro-Mediterranean relations, EU-GCC bilateral relations, and critical dialogue with individual countries, for instance, Iraq, Yemen, and Iraq. However, the reason for the bilateral security relations with the GCC member states is attributed to several factors. First, the GCC member states have never been able to speak in one voice on matters affecting regional and global security. This is highly attributed to the historical rivalry and suspicion among them. Second, the Gulf States have always tended to engage Western countries separately on matters of security and trade, instead of engaging them collectively as a block (Malmvig, 2006, p. 3).
All the Gulf States, except Saudi Arabia, have bilateral security relations instead of multilateral security relations with the US. Also, their artillery system and platform have been usually purchased without considering interoperability between them. Recently, Bahrain and Oman made a bilateral trade agreement with the U.S. to the dismay of Saudi Arabia and the EU (Ismael, 2012, p. 12). Similarly, EU member states have the problem of speaking in a solitary voice and the majority of them have shown a strong liking for bilateral relations with Middle East countries. For instance, the UK and France boost good relations with Middle East kingdoms. Specifically, France enjoys favorable relations with Kuwait and Saudi Arabia. On the other hand, the United Kingdom has a cordial agreement and rewarding contracts with several GCC member states (Nonneman, 2006, p. 19).
However, none of the Gulf States have been interested in the EU’s policies and partnership at the regional level. Therefore, EU-GCC security relations lack regional representation and willingness to fight for wider representation. This is probably one of the factors that harm the EU-GCC relations (Viera, 2006, p. 14). In summary, both sides of the divide have relatively failed to strengthen EU-GCC relations over the last three decades. Nonetheless, the new security conditions and preferences have prompted the two regional blocs to start showing interest in strengthening their ties.
Over the recent past, the EU’s visible interest in strengthening its relations with the GCC is mainly attributed to the present security concerns both regionally and internationally. The 9/11 attack on US soil, Iraqi invasion, and Iranian bid for Middle East domination, not only stress the increasing insecurity in the region, but also the significance of the region to Europe. The fact that the majority of the 9/11 terror suspects originated from Saudi Arabia played a major role in the rethinking of the EU/US strategies in the Middle East, particularly the US which enjoys a close relationship with the Saudi Monarch (Viera, 2006, p. 15).
The 9/11 also acted as a distress call for the governments across the globe on the rising influence of the fundamentalist and the need to carry out administrative restructuring. Besides, Saudi Arabia’s decreasing power and Iran’s increasing influence due to its nuclear aspiration, changed the subtle power balance in the Middle East, demonstrating once more why the GCC member countries can never work in unison (Nonneman, 2006, p. 19).
The present security challenges in the Gulf region aroused the EU’s interest. As a result, the EU started collaborating with the Gulf governments to combat common security challenges and in general help in stabilizing the region. With the introduction of the EU’s new locality Policy and the probable upgrading of Turkey to the European Union, the EU began acknowledging the fact that the Gulf region would soon become their backyard, and therefore make EU involvement in the region inevitable (Ismael, 2012, p. 12). The EU’s greater involvement in the negotiation over Iran’s nuclear enrichment program was viewed by several experts as a sign of readiness to take on larger responsibilities in the Gulf region (Viera, 2006, p. 16).
The US assertive policies also played a role in the EU’s rejuvenated focus on the Gulf region (Viera, 2006, p. 17). When Bush’s government declared in 2003 that it would reconsider its relationship with the dictatorial regimes in the Gulf region, the EU received this declaration with mixed feelings. On one hand, a section of the EU member states was unconvinced by the way the US was going to spread democracy in the Gulf region. They stressed that democracy could not be forced on other countries and could only be achieved through a discourse, essentially from within not without. Therefore, the EU felt that the US did not have sufficient knowledge of the differences and diversities among the Gulf States (Ismael, 2012, p. 7).
Besides, many European countries felt the US Middle East Partnership Initiative was an imitation of their long-term approach to the East. As a result, they feared that the US would have an added advantage over the EU and therefore would once more strengthen its position in the region at the expense of the European Union (Ismael, 2012, p. 8). For this reason, the EU launched the Strategic Partnership Initiative as a response to the American strategy in the larger Middle East, indicating that the EU had a different agenda in the region and that it wishes to engage on a one-on-one basis with member states in developmental matters. Indeed, the EU’s new approach incorporated both the Gulf and Mediterranean countries (Ismael, 2012, p. 9).
The new security strategies used by the EU attracted a lot of interest from the region. Besides, the growing bad blood between the US and Arab world drew them closer to the EU. This was facilitated by the massive domestic opposition and criticism of the Gulf governments owing to their overdependence on US military power and protection (Ismael, 2012, p. 9). Furthermore, the US’s overwhelming support for Israel and war against Iraq has created widespread mistrust with the Arab world. For the Gulf States, it had become a matter of national security to be associated with the US. As a result, the Gulf regimes have been doing everything possible to show that they are not dependent on US power in one way or the other and this has provided the EU with a massive opportunity to strengthen its ties with the Gulf region (Ismael, 2012, p. 10).
On the whole, as we have already witnessed, the EU does not have a general security policy for the Gulf region. Instead, the EU has established several independent initiatives and most of its discussion has been largely bilateral. Besides the GCC member states, the EU has also entered into agreements with Iraq, Iran, and Yemen. Ironically, a region with such a complex historical background on security matters, for example, terrorism and the proliferation of nuclear weapons, has never been given the much-needed attention (Viera, 2006, p. 18). The absence of energy security in the security discussion is very interesting. This is surprising given the energy reserves present in the Gulf region. Besides, the discussions between the EU and the Middle East countries have never focused on security issues. Furthermore, the EU-GCC discussions and initiatives have never been of any substance. Regardless of this, the EU has started paying a lot of attention to security issues in the Gulf region and the Larger Middle East (Viera, 2006, p. 20).
Unfilled Potential: exploring the relationship between the GCC the EU
Given that more than two decades have passed since the signing of the cooperation agreement between the two regional blocs, it is proper to evaluate and analyze the experiences of the past 20 years to see what has been achieved so far. It is also important to explore new areas of cooperation and probably mull over new approaches to prevail over existing impediments or barriers. This summarizes what this chapter is all about.
Even if there is a lack of optimism concerning EU-GCC relations, particularly as far as the implementation of the cooperation agreement signed in 1988 is concerned, there is no doubt that the two have engaged in several occasions. However, the relations between the EU and GCC have been weighed down by the inability of the two to reach a consensus on the Free Trade Area (FTA) (Schuman, 2002, p. 9). Even though the representatives from both sides have met on many occasions in recent times and emphasized their commitment to expand and deepen relations beyond FTA, nothing substantial has been done up to date. No wonder the GCC secretary general’s announcement of the unilateral deferral of the FTA talks surprised the EU. But this should have never been the case since the negotiations have been dragged for so long with never-ending suggestions from both sides. Besides, GCC felt that it was only them who were asked to make sacrifices and the negotiations were lopsided. The EU has also failed to help GCC integrate into the international market (Schuman, 2002, p. 10).
Experts argue that EU-GCC relation has not achieved its full potential. Nonneman (2006, P. 6) Attributes the underdevelopment of the GCC-EU relations to several factors. First, the disparity in the objectives and institutions of the two regional blocks. For example, GCC began as a security agreement and only progressed in economic cooperation later on. On the other hand, it started as economic cooperation and later transformed into a foreign policy and security apparatus. Therefore, none of them enjoys the absolute mandate over certain important issues, for instance, energy (Schuman, 2002, p. 11).
As a result, most of these issues have remained under the control of the individual member states. This is one of the reasons why bilateral agreements are still popular instead of the collective agreement. Second, European preconditions for engagement. The EU has always used human rights and full operational customs union as preconditions for further engagement. Gulf region has time and time again bemoaned the attempt by the European Union to incorporate human rights matters in their negotiations. They regard this as unnecessary efforts to interfere with the internal affairs of these countries (Nonneman, 2006, p. 8).
Some of the areas which have not been exploited fully include politics and security, excellent leadership and respect for human rights, workforce and training, commerce and investment, petroleum, and lastly money markets. Politics and security have the greatest significance in any form of cooperation including EU-GCC relations. GCC stability can only be guaranteed through collaboration within a structure that spells out the values and instruments of tranquillity. Any of such frameworks must take into consideration neighboring geopolitical domains and the EU’s endeavor at regional integration (Schuman, 2002, p. 11).
GCC member states should swallow their pride and start functioning as one in matters of regional and global security. Security engagement between the GCC member states and their western counterparts are mainly bilateral. Tackling these issues as a block is more economical and also enhances good relations within and without the bloc (Schuman, 2002, p. 12). The EU can act as a mediator to bring these countries together and dispel historical rivalry and suspicion between them. The EU can also pacify in the region by engaging the member states and helping them to come up with a regional security system. Besides tackling security issues within the region, the system will also help in averting conflict in the neighboring states such as Iraq, Iran, and Yemen. The EU can also explore the concept of the Gulf Convention for Security and Relations. This organization should include all the neighboring countries and be devolved into specific subject matters, for instance, control of arms, territorial disputes, energy, and water (Nonneman, 2006, p. 9).
The EU should establish a contractual partnership with countries like Iran, Iraq, and Yemen which are not included in the GCC membership. At the moment, the EU has only maintained a discourse with them on regional issues, global issues, and areas of cooperation. Since these countries have no contractual relations, they are less institutionalized relationship-wise than the Gulf States. The EU should also come up with a convergence policy for both categories of regional players to create a wider framework (Schuman, 2002, p. 13).
Since regional security is also associated with stability, the EU’s concept of security encompasses good leadership and respect for the rights of all individuals. Therefore, steady political evolution towards good governance and respect for human rights is inevitable in the GCC if necessary reforms are undertaken. The EU should persuade rather than pressure the Gulf States to embrace the contemporary styles of governance. They can also share their experience in governance. Lastly, support reform agenda in these countries (Schuman, 2002, p. 13).
Both the EU and GCC appreciate the importance of education and training. They have all channeled large sums of money to enhance their human capital. Even though the partnership between the EU and GCC in the sector of education has increased over the recent past, more still needs to be done (Schuman, 2002, p. 13). Partnership in the education sector can be improved further through the following: first, attracting Gulf students to EU’s institutions of higher learning. Adequate information should be availed to these students and appropriate mechanisms should be put in place to help foreign students overcome the problem of the language barrier. Second, twinning arrangements should be promoted to enhance the quality of education in the Gulf’s institutions of higher learning. Winning arrangement entails posting of foreign tutors in local universities. Last but not least, the European Union should encourage their universities to open up constituent colleges in the region. Other forms of cooperation could be in the form of distance learning, an Erasmus – type of program, and other special programs to enhance knowledge (Schuman, 2002, p. 14).
The two regional blocks have been negotiating a Free Trade Agreement (FTA) for over two decades. FTA is aimed at opening the Gulf region to global competition and communication as well as encouraging economic reforms and social transformation. Therefore, it is part of a major scheme aimed at integrating the Gulf States into the international market. The expectation of foreign investors in the region will bring about development in the business sector, strengthen the legal system, and generally increase the tempo of the reform agenda. Besides, FTA will strengthen the Gulf region institutionally and change it into a larger market (Malmvig, 2006, p. 9).
Because the FTA negotiation process is based on an international trade structure, the European Union should persuade the Gulf States to embrace regional integration. They can achieve this by reducing foreign trade obstacles and creating one agency to represent them. The EU should also help Saudi Arabia join and become a member of the World Trade Organization by taking part in the negotiation process. Saudi’s accession to the WTO would boost the FTA talks. The prospective EU-GCC free trade area should be merged with the Mediterranean free trade area. This will further push for another free trade area between the Southern Mediterranean region and the Gulf region and generally promote relations among Arab states (Nonneman, 2006, p. 23).
Even though the petroleum market is global, a regional discourse between the two blocs may bring about an improvement in the European and global power supply. The discourse should be coordinated with similar initiatives sponsored by other institutions, for instance, OPEC. Nonetheless, the arrangement of alternative forums should not correspond with the EU-GCC discourse. The EU-GCC discussions have the advantage over the alternatives in that it sets energy in a wider context aimed at developing and stabilizing the region (Schuman, 2002, p. 12).
The discourse between the two regional blocs should guarantee that oil prices are dictated by market forces instead of the government. This will enhance transparency and efficiency in the global oil market. Second, the discourse should also make sure that oil prices do not fluctuate to extreme levels. For example, prices that are too low would harm the development of alternative sources, whereas prices that are too high would slow the rate of economic growth. Security of supply should also be included in the discourse. This involves setting up a framework for building up and liquidating energy reserves and supporting the development of energy infrastructure (Schuman, 2002, p. 16; Malmvig, 2006, p. 5).
EU-GCC discourse should encourage downstream integration through the national oil to have direct contact with the ultimate consumers and gain a direct interest in the market. The discourse should promote the use of natural gas to supplement energy needs. Last but not least, the dialogue should also entail ways of collaborating to minimize the adverse effects of petroleum on the environment. The negative impact of fossil fuel can be minimizing by applying the Kyoto protocol on greenhouse gas emissions (Schuman, 2002, p. 17).
The region’s financial markets are restricted within the national border, though Bahrain’s market is expanding within the region (Antkiewicz & Momani, 2009, p. 232). Nevertheless, the Gulf region has the most advanced financial markets in the whole MENA. This is largely attributed to the petroleum affluence, currency flexibility and firmness, and fairly liberalized economy. The European Union should facilitate the integration of the GCC financial market with global markets (including European markets). Integration of Gulf financial markets with the global markets will in turn expedite funding of the Gulf projects. Besides, the European financial institutions have a wealth of experience to share with their Gulf counterparts, especially in funding cottage industries and SMEs (Antkiewicz & Momani, 2009, p. 233).
Managing the future of EU-GCC relations
Challenges and Opportunities for Restoring EU-GCC Cooperation
The challenges that face the relations of the two regional blocs are due to numerous factors, ranging from structural inadequacies from both sides of the divide and the lack of genuine discussions on political and governance matters to inequalities caused by the global financial crisis and the recent unrest in the Arab world (Escribano, 2013, p. 23). Several impediments have to be defeated with a view of making the relationship of the two regional blocs more vibrant and capable of handling numerous tests at all levels. This chapter will highlight several issues that need to be urgently tackled and how to do so to restore and improve the EU-GCC relations (Colombo & Committeri, 2013, p. 24).
The latest regional state of affairs characterized by the change of guard in the North African States, persistent volatility in Syria, and the war of words with Iran on its nuclear program demands a more rigorous by the two regional blocs to transform their relations into a radical force capable of handling these issues satisfactorily. Both sides have always had the same outlook on regional and global matters, from the war against terror to the nuclear program in North Korea. Nonetheless, the political negotiations between the EU and GCC have for the most part remained mere pronouncements and irrelevant on important subjects, especially those touching on regional and global security (Escribano, 2013, p. 20).
By taking advantage of their common point of views on regional and global matters, the two regional blocs should engage each other on how to develop a practical solution to the various challenges facing the world today, for instance, instability in the Arab World. The socio-economic challenges facing some South Mediterranean States can be handled through financial cooperation between the two regional blocs taking into consideration the considerable surpluses enjoyed by some EU member states. This can be achieved through the collaboration with Europe’s top financial institutions (European Bank for Reconstruction and Development and European Investment Bank), which are already funding some projects in the Mediterranean region; GCC can chip in whenever necessary. The two regional blocks can also invest in the existing bodies, for instance, the North Atlantic Treaty Organization (NATO), and strengthening their partnership with them (Malmvig, 2006, p. 10).
EU-GCC relations can also be promoted by increasing the participation of young people in national and international matters. Concerning this, there is a need to increase student and faculty participation in socioeconomic and political affairs (Colombo & Committee, 2013, p. 24. As already been witnessed, cooperation in the higher education sector between the two regional blocks is still relatively low. This is one of the main obstacles in promoting educational exchanges, knowledge mobility, and better convergence at the decision-making level. Such cooperation can be achieved through the liberalization of travel permits (Colombo & Committeri, 2013, p. 24).
The removal of any obstacles that could hamper the realization of the FTA would help to strengthen relations at the political and individual levels. As already been mentioned, the Gulf States have always used FTA to test the EU’s sincerity in strengthening cooperation between the two regional blocks. Indeed, the conclusion of the FTA would represent a significant stride in the right path. This is because it would make resources available, streamline economic relations, provide new impetus for the diversification of the region’s economy, and boost political relations to a new level. This can be achieved by dispelling fears and uncertainties on the EU’s intent in the region. Besides, more work has to be done to lay the foundation for such responsibility. Taking the above issues into consideration, it may not be the right time to revamp the FTA negotiations given current the challenges experienced by the European Union.
The relationship between European Union and Gulf Cooperation Council has developed gradually and at first largely on a mutual basis. This relationship can be traced back to late 1980s when they signed a cooperation treaty, though relations between Europe and Gulf States based on historical and colonial ties stretch back to over 200 years. Nonetheless, the cooperation between the two regional blocks is only two decades old. GCC comprises of six countries namely: UAE, Saudi Arabia, Kuwait, Qatar, Oman and Bahrain. The main objectives of signing the cooperation agreement were to enhance economic relations between the two sides, increased trade and investment, enhance global cooperation and open political discourse. The cooperation agreement was also aimed at encouraging regional integration among the Gulf States strengthens the region’s stability, safeguard petroleum supplies to European and promote economic growth and development in the region through diversification.
Although it had been the energy policies among the Arab States that had brought the Euro- Arab contact, apparent weaknesses and gaps in the wider EU policies towards the Middles East and Mediterranean region played a major role in bringing the two regional blocks together. Even though the cooperation agreement provides a broad list of ambiguous objectives, EU-GCC relations have been basically restricted to business and economic matters for so long. Among these objectives was the setting up of the Free Trade Area (FTA). FTA was clearly stipulated in the cooperation agreement framework. The FTA framework also covers business policy and directives, rules governing competition and property rights among others. Even though negotiations on Free Trade Area began two years after the signing of the agreement, it has never been realised up to date.
There are numerous explanations as to why FTA has never been realized up to now. Some of them include bureaucracy and lack of experience by the two parties to negotiate inter-regional trade agreements as well as the comprehensive nature of the Free Trade Area. In addition, the GCC member states have refused to accept the UN conditions. Inability to reach consensus on Free Trade Area has weighed down the relationship between the two regional blocks. In other words, the EU-GCC relations have been pegged on the realization of FTA. Currently, most of the engagements between the two sides have been undertaken on a bilateral basis. The removal of any obstacles that could impede realization of the FTA would help to strengthen relations between EU and GCC both at the political and individual level. As already been mentioned, the Gulf States have always used FTA to test the EU’s genuineness in strengthening cooperation between the two regional blocs. Given the current regional and global challenges, EU-GCC relations will continue to endure rough times in the foreseeable future. However, there are some areas that are yet to be fully exploited to maximize the benefits of regional integration. Some of these areas include politics and security, excellent leadership and respect for human rights, workforce and training, commerce and investment, petroleum and money markets.
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Appendix 1: Export of Goods and Service (%GDP)
Source: Colombo & Committeri (2013, p. 9).
Appendix 2: Imports of Goods and Services (%GDP)
Source: Colombo & Committeri (2013, p. 10).
Appendix 3: Trade in Services (% GDP)
Source: Colombo & Committeri (2013, p. 10).
Appendix 4: Doing Business World Bank Index-Ranking for GCC Countries
Source: Colombo & Committeri (2013, p. 11).
Appendix 5: Energy Production (Kt of Oil Production)
Source: Colombo & Committeri (2013, p.17).