Japan, 6 Persian Gulf nations to hold preparatory FTA talks in May

Originally at http://www.tmcnet.com/usubmit/2006/02/14/1369983.htm

(Japan Economic Newswire Via Thomson Dialog NewsEdge)TOKYO, Feb. 14_(Kyodo) _ Japan and the six-nation Gulf Cooperation Council including Saudi Arabia and the United Arab Emirates will hold preparatory talks on sealing a free trade agreement in late May, government sources said Tuesday.

The GCC, to which four other oil producers -- Bahrain, Oman, Qatar and Kuwait -- also belong, has asked Japan to start FTA negotiations, while Japan's biggest business lobby the Japan Business Federation urged the government last September to launch FTA talks with it at an early date.

Foreign Minister Taro Aso told ministry officials last week to promote talks with the GCC, saying it is necessary for Japan to reinforce its economic ties with the Persian Gulf states in order to secure a stable supply of energy resources.

Japan's crude oil imports from the Middle East account for about 90 percent of the total.

The GCC has been in FTA talks with economies such as the European Union, China and India, but no countries have concluded agreements with the entity yet. The regional organization, which was established in 1981, has set a 5 percent common external tariff.

Japan's annual exports to the GCC market amount to more than 1 trillion yen, while the country's imports from the six members of the organization, mainly oil, stand at more than 5 trillion yen per year, according to the sources.