Singapore and six Gulf Arab states have agreed to start talks for a free trade agreement (FTA), the government said on Saturday. The trade pact will help contribute towards the process of economic integration between the Gulf Co-operation Council (GCC) members.
The GCC members, which comprises Saudi Arabia, Kuwait, Qatar, Bahrain, Oman and the United Arab Emirates, the Ministry of Trade and Industry said in a statement. The Gulf Arab states want to create a single currency overseen by a single central bank in the world's top oil exporting region by 2010, in the manner of the European currency union.
The GCC is currently Singapore's seventh largest trading partner, with bilateral trade amounting to US $23.7 billion in 2005, a 43 percent increase over 2004. The FTA will be "a key institutional framework that will strategically link the Gulf region and Singapore," the government added.
The GCC and Singapore will hold the first round of negotiations early next year. Both parties are committed to a pact that covers substantially all trade. The announcement of the FTA talks came during Singapore Prime Minister Lee Hsien Loong's four-day visit to Saudi Arabia which began on Friday.
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