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Customs duty list ready 'by end of 2008'
Gulf Arab states should this year finalise a list of goods on which they can collect more than the agreed five percent duty under a customs union, a UAE official said on Monday.
The six Gulf Cooperation Council (GCC) countries, including Saudi Arabia, introduced a customs union in 2003 as one preparatory step towards the formation of a regional common market.
But many of them still levy duties of more than the unified five percent on imports of some goods in order to protect local industries, said Saeed Khalifa al-Marri, deputy director general of the UAE Federal Customs Authority.
This is one of the key hurdles to implementing the regional customs union by the end of 2008 - a deadline they have been urged to meet by Saudi Arabia's King Abdullah, Marri said.
"The protection fees that some countries collect are one of the main issues behind the delay," he said.
Saudi Arabia for instance charges more than five percent on about 400 imported goods, he said.
The kingdom said in April it was cutting import tariffs on food and building materials, having already reduced duties on food products such as frozen poultry, dairy goods and vegetable oils to five percent from about 20 percent.
"The idea is to make a unified list of protected goods," Marri said. "Each country has its own industries it wants to protect (and) that should be complete by the end of the year."
The customs agreement will apply to "180 items ranging from basic foods, necessary building materials and other consumer goods", the Saudi cabinet has said.
At a meeting in Riyadh last week the GCC customs union committee drafted a recommendation to Gulf finance ministers to speed up the completion of the unified customs list which the ministers will study at a meeting this month, he said.
The GCC industry committee is involved in deciding on the list, he added.
Implementation of the customs union, which initially envisioned a three-year transition period, has been fraught with hurdles as Gulf customs authorities struggle to raise awareness of the rules among traders.
The main feature of the union was the introduction of a five percent tariff charged at the first Gulf port of entry, after which the goods can move freely through the region.
GCC states except Oman are also driving to meet a 2010 deadline to negotiate a single currency but policy makers including Saudi and United Arab Emirates central bank governors have said the deadline would be very difficult to meet. (Reuters)
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