WTO approves Saudi Arabia?s membership

The World Trade Organization (WTO) approved Saudi Arabia’s admission to the international body after 12 years of negotiations, The Associated Press news agency reported.

"The gavel has gone down", WTO spokesman Keith Rockwell said Friday.

The WTO's ruling General Council, which includes all 148 current member states, approved Saudi Arabia’s application for membership at a special meeting in Geneva, Rockwell added.

WTO chief Pascal Lamy welcomed the kingdom’s accession, saying it's good for Saudi Arabia, it's good for Saudi Arabia's trading partners and it's good for the organization."

By extending membership to Saudi Arabia "The WTO truly becomes a 'World Trade Organization,'" Lamy said. "It is the world's 13th largest merchandise exporter and the 23rd largest importer."

"One more heavyweight around the table (is) good news," he added.

The world’s largest oil exporter will formally be admitted to the WTO on December 11, two days ahead of organization’s ministerial summit in Hong Kong.

At the conference, WTO members are expected to agree on an outline deal to boost the world's economy by lowering trade barriers.

"Saudi Arabia has always believed in a free economy and liberal market operations," Saudi Trade and Industry Minister Hashim A. Yamani said at WTO headquarters in Geneva. "The accession will further integrate Saudi Arabia's economy into the world economy."

WTO rules

Saudi Arabia now has to adopt the entire body of WTO legislation, a process that involves liberalization of currently restricted sectors.

The kingdom must open its long protected economy to the outside world, including fellow WTO member Israel.

Saudi Arabia's participation in the Arab League boycott of Israel will thus need to be considered.

Itzhak Levanon, Israel's ambassador to the WTO, said Saudi Arabia had provided sufficient guarantees in its membership process that it would follow the WTO's regulations, which include “not having a boycott against anyone else inside the organization."

"Such types of boycotts within the WTO are totally unacceptable," Levanon told AP. "As soon as Saudi Arabia accepted all these rules, the door has been open for future relations when the moment is ready for that."

But Saudi Arabia’s assistant minister for petroleum affairs, Prince Abdulaziz, was less clear. "They are a member and we are a member. We are just there as members of the WTO. Nothing more."

Saudi Arabia's services industry was also a major block to its WTO membership. Several major WTO members, including the U.S. and the EU, have expressed concern over the lack of access to the kingdom’s banking, financing and insurance industries.

Under the terms of membership, foreign firms will be allowed to operate direct branches in Saudi Arabia, and international banks will be permitted to open up branches under national subsidiaries.

Saudi Arabia's stock market has risen steadily since WTO entry talks ended successfully on October 28.

Investors have high hopes about the kingdom’s economic future due to the benefits it will derive from WTO accession.

Some 40 countries are currently involved in talks to join the WTO, while others, such as Syria, still have a request pending to start membership talks.

Saudi Arabia | Business | |