On 19 January, Oman became the fifth Middle Eastern country to sign a free trade agreement (FTA) with the US. The agreement must still be approved by legislators in Oman and the US Congress, which US Trade Representative Rob Portman expects to happen early this year.
Concluded in October 2005 after only seven months of negotiations, the deal calls for immediate and deep tariff cuts to take effect upon its implementation. "On the first day it is in force, 100 percent of bilateral trade in industrial goods will flow duty-free. In addition, Oman will provide immediate duty-free access for 87 percent of agricultural products," Portman said in a speech on Thursday. Textiles and clothing, a major Omani export, are a notable exception, with the US retaining the right to maintain some duties.
The deal will also liberalise services trade, and includes intellectual property rights and investment provisions that establish "a predictable and secure legal framework" for US companies doing business in Oman, according to US officials.
The US-Oman FTA is the latest in a series of deals between the US and Middle Eastern countries. The US has been actively pushing for trade liberalising deals in the region in an effort to establish a Middle East Free Trade Area (MEFTA). MEFTA proposes bringing 23 Middle Eastern countries — including Israel — into a trade pact with the US by 2013. Israel, Jordan, Morocco and Bahrain have already established FTAs with the US.
While the US and Bahrain signed an FTA in May 2004, implementation has been delayed over modifications to the latter’s intellectual property laws. Bilateral talks between the US and the United Arab Emirates (UAE) are currently underway, and formal discussions with Egypt are expected to begin this year.
"Oman, US sign free-trade pact," TIMES OF OMAN, 1 January 2006; Oman, US sign FTA," AL BAWABA, 22 January, 2006; "United States and Oman Sign Free Trade Agreement," USTR PRESS RELEASE, 19 January 2006; "Oman pact boosts US agenda in the Middle East," INTER PRESS SERVICE, 21 January 2006.