The Gulf Cooperation Council (GCC) signed a free trade agreement with South Korea today, Thursday. The Secretary-General of the Council, Jasem Al-Budaiwi, stated in a statement that the agreement is a "historic step towards achieving Gulf economic integration and enhancing economic and trade relations between the two sides." Strengthening global trade and investment relations is a key element in the Gulf countries' strategy to diversify income sources and economic sectors away from oil and gas.
The statement noted that the free trade agreement with South Korea "included trade in goods and services, government procurement, digital trade, cooperation in small and medium enterprises, customs procedures, intellectual property, and more." The South Korean news agency Yonhap reported that Seoul will eliminate tariffs on nearly 90% of all items, particularly liquefied natural gas and other petroleum products, while Gulf countries will eliminate tariffs on 76.4% of exchanged products and 4% on traded goods.
Al-Budaiwi stated that the agreement "included trade in goods and services, government procurement, digital trade, cooperation in small and medium enterprises, customs procedures, intellectual property, and more." South Korean Trade Minister Ahn Duk Geun welcomed the agreement, saying it "will maximize the results of integration between trade, industry, and energy."
The GCC's secretary-general appointed a head for a trade negotiation team in 2022 and held new rounds of talks on free trade agreements with key trading partners over the past year, including China and the United Kingdom after its exit from the European Union. This year, GCC countries signed a free trade agreement with Pakistan.
The volume of trade between the Gulf and South Korea surged to $78 billion from $50 billion between 2021 and 2022, according to data from the Asia House research center based in London, while trade volume between the council and emerging Asian economies, including China, rose to $516 billion last year from $383 billion in 2021. Talks between the GCC and South Korea, which began in 2007, were suspended for nearly 13 years before being revived last year.
