Update 2: First Round of Australia-GCC FTA Negotiations – A Positive Start
The first substantive round of negotiations for a free trade agreement with the Gulf Cooperation Council (GCC) was held in Canberra from 30 July to 1 August 2007. This meeting was the next step agreed at our preparatory meeting in the Gulf in May, which was covered in the last update.
The GCC sent a large delegation to Canberra, with representatives from a number of Ministries in all GCC member states. The delegation was well prepared to engage constructively in the negotiations.
Overall, we made solid progress in the first round of negotiations. Our talks covered all likely components of an FTA including goods (rules of origin, government procurement, customs procedures, technical barriers to trade and sanitary and phytosanitary measures), services (including cross border trade, education, movement of natural persons, e-commerce, telecommunications and financial services), investment, intellectual property, competition policy, institutional and framework provisions and dispute settlement.
On goods, we had detailed talks with the GCC on market access and on draft chapter texts. While it was disappointing not to be able to exchange initial tariff offers at the first round, we had a constructive discussion with the GCC about what each side might be prepared to offer on tariffs and on how to ensure that initial offers kick the negotiating process along at a good pace. We have encouraged the GCC to agree to exchange high-quality tariff offers before the next round of negotiations; we will be following this up with representations in GCC capitals over coming weeks.
We raised with the GCC the range of non-tariff barriers identified by Australian industry, including the obligation to pay fees to GCC embassies, short shelf-life requirements, inconsistent standards and other issues. We will pursue these in further negotiating rounds.
On two issues of particular importance to some Australian industries – intellectual property rights protection and government procurement – we explained at some length our approach to the negotiations, and gave the GCC side text for it to consider. The GCC has agreed that the FTA will cover both issues, but we will need to do more work to ensure that commitments in these areas are commercially meaningful.
We made reasonable progress in the services negotiations. We exchanged initial offers and spent some time discussing these with the GCC. In some sectors the GCC offers were useful, going beyond WTO commitments, but in others there is a long way to go. Overall, the atmosphere was positive. Australia and the GCC also tabled and discussed draft services chapters texts and conducted a useful information exchange on the regulatory environments in our various services sectors. The GCC agreed to consider the FTA including separate chapters covering regulatory and other issues in financial services, telecommunications, e-commerce and education.
Not surprisingly, investment negotiations proved challenging, as the GCC’s ambition on the scope of commitments is significantly lower than ours. Both the GCC and Australia tabled draft investment chapter texts. Both sides agreed to look for common ground in the texts before the next meeting.
Australia and the GCC agreed in principle that the second round of negotiations will be held in Riyadh, Saudi Arabia in the third week of November (week beginning 17 November). Both sides have much work to do before the second round of negotiations, and undertaking that work expeditiously will be important to the success of that round.
I would like to thank the Federal Chamber of Automotive Industries for hosting a reception for the GCC negotiating team, to which it also invited representatives from other Australian industries. Discussion with industry representatives underlined to the GCC the range of Australia’s commercial interests in Gulf markets.
Your views on the Australia-GCC FTA negotiations are always welcome. For more information, updates, or to provide us with your views or concerns please visit our website or email us at gccfta@dfat.gov.au.