World Trade Organization Phobia in Saudi Arabia
Majed el Munif Al-Hayat - 07/07/05//
Several sectors of the Saudi public opinion and business sectors are in a state of expectation and doubt regarding the conditions and the implications of the accession of the Kingdom of Saudi Arabia (KSA) to the World Trade Organization (WTO). It’s an ongoing and fluctuating situation since the start of the negotiations, nearly 10 years ago. It is an outcome of the lack of awareness about the nature of the organization, its laws, its scope of expertise on the one hand, and about conditions and negotiation mechanisms of the accession on the other hand. Finally, it is about the course and turning point of the Kingdom’s accession. The Kingdom’s announcement that it started the accession negotiations was greatly welcomed, especially since the public opinion took it for granted.
This state of affairs is quite understandable, since the Kingdom is voicing and implementing the principle of a liberal economy and has established close trade, economic, and political relations with the major countries in the organization. Furthermore, its partners in the Golf Cooperation Council (GCC), which enjoy comparable economic structures and degree of openness, have joined the organization, through negotiations, in a relatively short time. But with time passing, the slow negotiation process the welcoming turned into anxiety. At times, it turned into negative positions towards certain business sectors, as a result of the three above-mentioned reasons, especially when it became clear that the accession will take much longer and require concessions. The organization, which a large portion of the public opinion in the member countries ignore what it symbolizes, has become, during the last 10 years, the talk of the meetings and the foreword of articles in the Kingdom, either as good news or as warnings of the accession dues.
Some believed that this will change the mechanisms of the national economy, while others linked it to political change. These people oversee that when the Kingdom accedes to the WTO, it will be one of the member countries, whose number exceeds 140, and where business is run and politics are drafted in a normal way, without the direct interference of the WTO, contrary to the belief of some people in the Kingdom. Furthermore, the accession negotiations and the concessions yielded weren’t necessarily against the interest of the national economy, whether in the opening of some service sectors, -such as communication, insurance, and monetary services - or the updating of systems and laws that affect business practice.
Even though the Kingdom is not yet an official member of the WTO, the Kingdom, in its trade practices, relations, and agreements, is considered part of the world trade system. During the course of the negotiations, the kingdom has changed many of the systems and practices that affected the concerned sectors, which soon adapted to the new norms and continued their operations within these norms. Thus, most of sectors of the Saudi economy are indeed working in the frame of the WTO agreements even before the Kingdom’s accession. The exaggeration and overstatement expressed by some people in the government body and the private sector, about the overwhelming positive or negative effects of the accession to the WTO is not justified. Countries, including the Kingdom, basically negotiate and offer possible concessions that do not affect the national economy and its sectors’ growth course.
Thus, when the economy is more diversified, stronger, greater, and has quality foreign trade relations, or is less responsive to change for political and administrative reasons, the course of the negotiations is longer and more complicated. This explains, to a certain extent, the short negotiation periods witnessed over the past ten years for the accession of, for instance, Qatar, UAE, Oman, and Jordan, as compared to the accession negotiations of China, Russia and the Kingdom of Saudi Arabia.
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Mr. El Munif is a Saudi Economic expert
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