Impact of Tariff Reductions in NAMA and Agriculture WTO Negotiations on GCC Common External Tariffs

The Gulf countries (Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and United Arab Emirates) have a common external tariff that is unusually low with the exception of selected products such as alcohol and tobacco. As exporters of oil and gas and importers of agricultural products, the GCC is interested in the impacts of tariffs reductions in these products following the eventual completion of the Doha round. Of particular interest are four sectors (raw materials, gas-related goods, fisheries and chemicals), in which it is hoped tariffs will be eliminated. This will improve market access for the GCC countries, but it may also increase the competition depending on the initial bilateral tariffs. In agriculture, rising import prices driven by policy changes occurring elsewhere will increase import costs in the GCC countries. Potential gains and losses are identified using a bilateral trade model.