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The birth of the Gulf Cooperation Council was conceived as a response to the outbreak of war between Iran and Iraq. The nascent bloc was formed in order to coordinate the economies, politics, cultures and security of the six Gulf states. The countries forming this council were Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates. The stated objectives were to effect coordination, integration and interconnection between member states in order to achieve unity. The purpose reflected the Arab nationŐs long-term dream of achieving strength in unity.
The proposal for an Arab common market was first articulated in 1951. It was not until many years later that the idea took root in the Gulf region. During a meeting of the foreign ministers of the six states in 1981, the text of the "Charter for the Gulf Cooperation Council" was agreed upon. The heads of state of these countries signed the Charter on May 25, 1981 in Abu Dhabi. This was the beginning of the GCC.
The birth of the European Union was from the ashes of World War II, with a determined resolve to forge unity to prevent any more disastrous inter-European conflicts. In order to create a single market, the seven founding members of the EU initially targeted a limited goal of coordinating their heavy industries. The objectives have gradually been raised as each target has been achieved. The process of developing a single market where goods, services, people and capital can move freely has been slow and deliberate, but substantial.
Institutional Development
In November 1981, the GCC Unified Economic Agreement was signed and it was ratified in 1982. Free trade among member states in all agricultural, animal, industrial, and natural resource products of national origin were among its aims. Also, the agreement set an objective of achieving a common external tariff and trade policy. In 1984, the Gulf Investment Corporation was formed to consolidate economic activities among member states in agriculture, commerce, industry, mining, and general investment. When the Saudi Arabian Standards and Measures Organisation was transformed into a regional body in November 1982, the Gulf Standards Organisation was created. In December 1992, the Patent Office was created in order to carry out the implementation of patent regulation. In order to settle trade disputes between GCC citizens both between each other and with foreigners, the GCC Commercial Arbitration Centre was created in December 1993.
In order to revive the economies of a war-ravaged Europe and to guard against dangerous political instability, in 1947 the United States instituted the massive aid and restructuring program for Europe which came to be known as the Marshall Plan. An immediate result was the creation of the Organisation for European Economic Cooperation (OEEC) in 1948.
In Strasbourg, 1949, the Council of Europe was formed. The actual first step in economic integration was the establishment of the European Coal and Steel Community (ESCS) in 1950.
The initial attempt at military integration restricted to Western European democracies was called the European Defence Community, but it ended in failure by 1954.
The European Economic Community (EEC) and the European Atomic Energy Community (Euratom) were established in 1957. The EEC was composed of Belgium, France, West Germany, Italy, Luxembourg and the Netherlands. The ECSC, EEC and Euratom were merged in 1967. On July 1, 1968, the Customs Union was completed.
The first election of the European Parliament was in June, 1979. The next institutional milestone was the long and difficult negotiation which developed the Treaty on European Union, commonly called the Maastricht Treaty. Ratification was problematic as nationalists in member states organised opposition to the proposed additional erosion of sovereignty of the nation state members. The required unanimous ratification was secured, however, and the European Union came into effect with the Maastricht Treaty on November 1, 1993. The single European market was finally achieved when the European Economic Area was introduced during the same year.
 On several occasions neighbouring states on the Arab Peninsula and from the north side of the Gulf have knocked on the door of the GCC. Iraq was a candidate prior to its invasion of a member of the GCC, but the general consensus was that the size of its population and the advanced state of its economy would swamp the Gulf membership. Its political regime also adhered to an ideology alien to all of the membership. The Arab Republic of Yemen has also recently submitted an application to be considered for membership. The two Yemeni states at the southern end of the Arab Peninsula unified during the early 1990s, and fought a civil war which unsuccessfully challenged that integration. The same factors which applied to the other applicants also applied in this case. The population of Yemen is much larger than most of the Gulf states, and the political regime is different. In addition, the country has much fewer resources available to finance a pace of development as rapid as its neighbours to the north. The EU in contrast has managed to expand its membership in several stages. Denmark, Ireland, Norway and the UK signed treaties of accession in 1972, although the Norwegian people decided by referendum to not join. Greece joined the EU in 1981, with Portugal and Spain joining in 1986. The reunification of the two pre-war halves of Germany in 1990 accomplished the first integration of a former communist state. Austria, Finland and Sweden joined the EU in 1995. The EU now comprises all western European countries except for Liechtenstein, Iceland, Switzerland and Norway. Negotiations are already proceeding for the next stage of expansion, which will include states from Central and Eastern Europe. Structure The main institutions of the GCC are: the Supreme Council, Council of Ministers, the Secretariat General, and various specific committees to develop economic, social and cultural cooperation as well as internal and external security. The Supreme Council is the highest body and is made up of heads of member states. This Council meets once a year. The Council of Ministers is composed of the foreign ministers of the member states. Its tasks include preparing the sessions of the Supreme Council, drafting recommendations, launching joint projects and supervising the work of the Secretariat General. The Secretariat General must ensure that resolutions and recommendations are implemented, to report on a regular basis and to draft the budget. A commission for Settlement of Disputes is formed separately for every case and its recommendations are submitted to the Supreme Council. The main institutions of the European Union are: the European Parliament, the European Commission, the European Court of Justice, the Council of Ministers, and the Court of Auditors. The main decision-making bodies of the EU are the Council and the Parliament. The Council consists of ministers from the member states, and the Parliament is composed of 626 representatives from the Union, elected for five year terms. To push the pace of economic and political integration, the EU membership negotiated in the early 90s the ambitious agreement known as the Maastricht Treaty. By this undertaking, not only was a single market formalised, but also the groundwork was laid for monetary union and closer political integration. The treaty mandated that the member states prepare for a single currency and gave additional powers to the European Parliament. The treaty mandated a common security and foreign policy, as well as cooperation on justice and police affairs. Integration From the perspective of the member governments, the Gulf Cooperation Council has been successful as a stabilising factor for their regimes and as a mechanism for avoiding conflict. From the perspective of the citizens of the six member states however, the GCC has provided little tangible benefit save for the confirmation of political stability. There has been limited labour movement and trade benefits. The goal of inter-Gulf trade has not materialised, as there has been very little growth in gross inter-GCC commerce. In 1985, trade between member states was 6% of gross trade, while in 1995 it remained at the identical 6%. From the perspective of the member states, the loss of sovereignty has been compensated by the unprecedented period of political and economic stability. In addition, there has been a transfer of wealth from the richer states to the less developed members. Because of the resulting economic progress in those states, the disparities between the membership have been reduced, which is a factor of stability. The EU has instituted several income sources, derived from import duties, farm levies and VAT revenues. One quarter of the resultant budget goes to wealth redistribution from rich members to poor members. If a member stateŐs income per head is below the EU average, it receives a special rebate on its contribution to the EU budget. Also, the budget covers policies like research and development, single market programmes, overseas programmes and other external activities. To the ordinary citizen, the EU provides a number of benefits. While retaining cultural and linguistic diversity, each citizen can live and work in the country of his choice. Border controls have virtually disappeared. People can shop where goods and services are least expensive, as well as having a wider selection in their own country which may not have been available otherwise. Also, the Maastricht Treaty provides a common European citizenship in addition to national citizenship. Nationals can vote and participate in elections in any member country, so long as they are resident and register in that locality. There have also been disadvantages. While the populace in the poorer states have benefited tremendously, the citizens of the richer states naturally complain at the extra subsidy which they have had to pay. While coordinated economic policy is helping member governments to achieve macro-economic targets, the loss of policy options has made it more difficult for individual states to achieve popular goals such as increased employment rates. The lack of flexibility has provoked popular discontent in some countries. Comparison The member states of the Gulf Cooperation Council have a common culture, language and religion, as well as great blessings in terms of natural resources. They share a common ground from which to grow and develop. Since the institution of the GCC in 1981, however, various national considerations have limited the realisation of the goals of the original Charter. Common tariffs and trade policies are not in place, nor is there progress to the goals of a common currency and citizenship within the members of the GCC. The achievement has not matched the aspiration. As Dr. Obaid Saqer Busit, Director General of Dubai Customs, and Chairman of UAE Customs Council, recently said: "We want an economic bloc that caters for our economic welfare and places us in a distinguished rank on the international economic map." The EU, in spite of many languages, cultures, wars, currencies and setbacks, has achieved real progress in its goal of building a well-defined trading block. The rationale and the history of the community dates back to the trauma of World War II. The region is rich in industry, agriculture, people and has a strong education system in place. All these contribute to the targets defined in 1947 and enhanced several times since. During the implementation, expansion in membership and an escalation of the pace of integration has occurred continuously. By the very nature of its location, between the highly developed EU to the northwest and the developing huge block in Asia, the Gulf Cooperation Council must move forward to enhance its integration. The World Trading Organisation might very likely impose a deadline in several years time for the implementation of such measures. If the GCC is ever to achieve some measure of its potential for influence on the world stage, a serious programme of economic integration must be negotiateand implemented as soon as possible. |
A New Resolve For Gulf Cooperation