1. Gulf Cooperation Council

2. GCC overview & organization Gulf cooperation council

3. overview 1. GCC's official name is "The Cooperation Council for the Arab States of the Gulf" Usually being referred Gulf Cooperation Council( 걸프협력회의 ) 2. The current member states including Kingdom of Saudi Arabia, State of Kuwait, United Arab Emirates, State of Qatat, Sultanate of Oman, Kingdom of Bahrain`s Gulf coast from 6 countries. 3. Background of GCC is bound by the basis of Islam and the common features and similar systems

4. Background of GCC Gulf cooperation council All Member States except for the Bahrain Islamic(sunnipa) religious homogeneity. Members have the characteristics of the monarchy countries The primary goal of gcc Will solidify adjustments between Member States in all areas, integration, and ties between the peoples. - Islamic(sunnipa) religious homogeneity except for the Bahrain -The characteristics of the monarchy countries -The goal of GCC will solidify adjustments between Member States

5. Background of GCC Gulf cooperation council All Member States except for the Bahrain Islamic(sunnipa) religious homogeneity. Members have the characteristics of the monarchy countries The primary goal of gcc Will solidify adjustments between Member States in all areas, integration, and ties between the peoples. Political : To maintain a hereditary monarchy system Economic : Rich countries to export oil Consider the conditions that are geographically close Very similar structure to the political & economic

6. GCC organization The organization of GCC is composed of 1. Supreme Council 2. Ministerial Council 3. Secretatiat General 4. Each organization can configure necessary under organization Gulf cooperation council

7. The features of the GCC economy Gulf cooperation council

8. 1983 : Free Trade Zone Free Trade Zone - Elimination of tariff barriers in the internal - The release of travel restrictions - Tariff Elimination of moves in the internal between members (All agricultural, animal husbandry, industry & natural resource products)

9. Developed by Customs Union 2001 - Confirmed the economic integration roadmap 1. Common External customs tariff (CET) 2. A single customs regulations and procedure 3. Tariffs are collected on the first point of entry 4. Remove all tariff and nontariff barriers to barracks, but Is applied prohibitions, restrictions on goods and agricultural products and livestock quarantine regulations 5. Handing domestic product about Internal products Custorms Union Enforce from 2003.1.1, Completed after transitional period of three years 4. Remove all tariff and nontariff barriers to barracks

10. -Customs procedures for all products of imports from GCC Destination country, the first product -In the case of regional goods, For Statistics - BorderPassage, Implementation of reporting procedures Developed by Customs Union Develop Custorms Union 2003 Unified customs code By GCC - External customs tariff Tax-free or 5% tariff unification

11. Impose tariffs of 12~20% about some item (by countrys) Developed by Customs Union But, Tobacco, pork, alcohol - Import item prohibitions, above 100% tariff

12. Five areas of economic activity (Residence, transfer, private sector workers, the movement of capital, employment) The beginning of the Common Market Common Market

13. 1.Resident and transfer 2.Working in private and government sectors 3. Pension and social welfare 4. Employment in all economic, investment, service sector activity 5. Real estate holdings 6. Movement of capital 7. Stock Ownership and Establishment of the company 8. Education, Health and Social Services Common Market

14. 1987.3.1 Open retail sector 1990.3.1 Open wholesale sector 1988 Opening of stock ownership and trading, established stock company 1995 GCC Commercial Arbitration Center was established in Bahrain 2002 Established GSO(gcc Standards Organization : GSO) in Saudi Arabia Riyadh 2000 Summit meeting in Bahrain : About 17 countries in the field of external - Negative list 2004.5 except for individual employment offices, car rental, cultural activities (printing and publishing, newspapers and magazines are excluded) Do not open the sector(10) - 2010 Common Market

15. Until the end of 2002, Fixed exchange rate against the U.S. dollar Until the end of 2005, Economic performance targets are agreed for criteria economic Single Currency, Monetary Union(2010)

16. 1. Financial deficit is within 3% of GDP 2. Public sector debt is within 60% of GDP 3. Foreign Exchange Reserves will be exceeded income of four months 4. Interest rates will not exceed 2% than the average of three countries in the lowest interest rates 5. Inflation will not exceed 2% than the average of six countries 6. complete plan of currency unification(2010) Single Currency, Monetary Union(2010) precondition for monetary unification in 2005

17. 1. target shortfall from Foreign exchange reserves in 2005 - Bahrain 2. Inflation target(4.5%) Exces - Qatar(8.8%),UAE(8.0%) Single Currency, Monetary Union(2010) However,

18. The difficulty with currency unification in 2010 Expected to become clearer in 2012 Single Currency, Monetary Union(2010) As a result,

19. FTA Current Status and Highlights Gulf cooperation council

20. Impel background FTA of GCC 2003 fixing oil price situation(2nd Iraq war) - Secure energy resources and Feel the need to expand political influence GCC countries : Long-term economic growth dependence on oil for the improvement of industrial structures

21. FTA Positive : trade and investment expansion Negative : hit the domestic industry Nevertheless, The promotion Impel background FTA of GCC

22. positiveness FTA GCC <Relative countries 1. High oil prices 2. Secure a stable of energy resources Impel background FTA of GCC

23. Country`s FTA Trends Promotion The world's major economies is pushing for an FTA with GCC

24. Highlights on promoting FTA of GCC Joint response of International negotiations FTA negotiations : Negotiation of GCC units

25. Conflict resolution of Member States concluded FTA-related Bahrain -2004.9, Oman -2005.10 : Individually FTA with the United States UAE, Kuwait : Promoting individual negotiations Flouting the basic principles(Joint response)

26. - Until 2005.6, Recognize an individual agreement - After Joint negotiations Conflict resolution of Member States concluded FTA-related Thus, GCC finance ministers and Supreme Council

27. FTA of effect According to the report EU PWC (Price Waterhouse Coopers) But, The results of Scott L.Baier &Jeffrey H. Bergstrand Both countries occurs trade creation effect Improved international status Trade creation and economic welfare effects

28. Necessity of KOREA-GCC FTA Gulf cooperation council

29. Transportation machinery Industry electronic SteelTextile Crude oilPetrochemicals Nonferrous metals Industry electronic KOR-GCC trade status

30. Necessity of KOREA-GCC Agreement Gulf cooperation council Become more important as the fourth trading partner Import above 60% of crude oil from the GCC Weak the competitiveness by driving other nations` FTA with the GCC Increase the demand & improve construction plant project order condition Import above 60% of crude oil from the GCC Weak the competitiveness by driving other nations` FTA with the GCC Increase the demand & improve construction plant project order condition

31. Effect of trade relationship If other nations agree FTA with GCC, effect of KOR-GCC FTA is nothing _Improve balance of trade $22 million in others industry except for Petrochemicals _Increase Export $36million & import $70billion Gulf cooperation council

32. Implication of KOREA-GCC FTA Gulf cooperation council & Countermeasures

33. Implication of the GCC Gulf cooperation council With the economic integration, roles of the GCC increase in the world. _ the biggest economic block _ about 40% of oil reserves _ FTA negotiations with the EU, Japan, China, and Korea etc. The GCC is

34. Each country establishes a strategy to conclude FTA with the GCC Gulf cooperation council Implication of the GCC EU is pushing ahead FTA with both sides GCC and Mediterranean Sea area since 1980s USA is pushing ahead FTA with each country of GCC China and India decided to conclude FTA with GCC as the increase of oil demand Each country establishes a strategy to conclude FTA with the GCC Most countries are judged to have a strategic purpose -> EU is pushing ahead FTA with both sides GCC and Mediterranean Sea area since 1980s -> USA is pushing ahead FTA with each country of GCC -> As the increase of oil demand, China and India decided to conclude FTA with the GCC

35. Implication of the GCC The strategic purpose Gulf cooperation council _ To exert their influences toward the middle ea st _ Competition for oil is more intense _ To improve relationship with Islam area

36. Countermeasures - Conclusions FTA of competing countries such as China, Japan with the GCC weaken main companies’ competitiveness in exports - Especially, even though Korea is depending on the middle east about 80% of oil, the way Korea’s policy toward the middle east was insufficient Keep the present competitiveness in exports through FTA with the GCC _Weaken main companies’ competitiveness in exports _The way Korea’s policy toward the middle east was insufficient

37. - The GCC is a group of richest oil countries in the middle east - The political and diplomatic importance is highly required comparing to the other countries - China and Japan are trying to have stronger relationships with the GCC - “Look East” policy Gulf cooperation council Countermeasures Political & diplomatic exchange

38. What Has Been Achieved? Gulf cooperation council The third round of the Korea – GCC FTA negotiations has been held until now - Goods and services, investment, government procurement, IPR and economic cooperation, rules of origin, customs procedure - Both sides also agreed that on FTA with a high level of liberalization will be sought as the two economies do not have overlapping areas of sensitivity and are mutually complementary