The European Union and six Gulf Arab states have made some headway towards a much-delayed trade deal, officials said after talks on Saturday in the United Arab Emirates.
Talks about a free trade deal between the EU and the Gulf Co-operation Council (GCC) - a political and economic alliance grouping Saudi Arabia, the United Arab Emirates, Kuwait, Qatar, Bahrain and Oman - began more than 15 years ago.
"We were able to narrow differences in areas such as market access and rules of origin," EU Trade Commissioner Peter Mandelson told reporters in the UAE capital.
Mandelson said an he would be "extremely surprised and disappointed" if an agreement was not reached before the year-end.
"There was substantial discussion about the future agreement related to services. We don't have identical views but we understand the need to show flexibility," he said.
Mohammed Khalfan bin Kharbash, UAE minister of state for finance & industrial affairs said: "On market access, there is a great convergence. On services, both sides are instructing their negotiating teams to prepare new offers and study them in the near future". EU officials have previously said unresolved issues include government procurement regulations and rules of origin as well as access for services companies.
The GCC has previously criticised European requests for clauses in the trade deal on issues such as weapons of mass destruction, illegal immigration and human rights, saying the demands were delaying tactics. "The status of those clauses are that they are in place and they have been agreed. There are no fundamental problems in this part of the agreement," Mandelson said.
The EU is the fifth-largest market for GCC goods, and there is a roughly $17 billion trade deficit in favour of the EU. The EU wants better access for European service sector companies in the Gulf states as well as lower tariffs for its industrial exports.
"I would like to invite the GCC technical committees to come to Brussels in the next month so that before the summer arrives we will have a very clear road map," Mandelson said.