Understanding the Greater Arab Free Trade Area: Key Business Opportunities and Impact for Investors in Oman
Muscat: On Monday, the Ministry of Economy spotlighted the key aspects of the Greater Arab Free Trade Area (GAFTA) agreement, which aims to enhance and facilitate trade among Arab countries.
Established under the League of Arab States in 1978 and progressively implemented since 1998, the GAFTA agreement seeks to create a comprehensive Arab free trade zone by removing customs duties and non-tariff barriers on goods traded between member states. It achieves almost 100% elimination of duties on most agricultural and industrial products.
The agreement emphasizes the removal of obstacles such as administrative, financial, technical, quantitative, and qualitative restrictions that hinder trade. It also mandates the gradual abolition of customs duties on Arab goods, while ensuring preferential treatment and protection for Arab products against competition from non-Arab goods.
The Ministry of Economy confirmed that GAFTA is a cornerstone of collective Arab economic cooperation, promoting economic integration, easing the movement of goods, and bolstering sustainable development across the region.
Oman, having acceded to the agreement by Royal Decree in 1997, continues to align with regional and international trade commitments to strengthen its economic presence and support its development goals.
Notably, trade volume between Oman and other Arab countries has surged by approximately 68.5% since 2019.
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The Greater Arab Free Trade Area (GAFTA) agreement presents significant growth opportunities for Omani businesses by drastically reducing trade barriers and customs duties within Arab countries, fostering seamless market access. Smart investors and entrepreneurs should leverage this enhanced economic integration to expand cross-border trade and diversify supply chains, while also positioning themselves to capitalize on the increasing intra-Arab trade volume, which has surged by 68.5% since 2019. However, staying vigilant about competitive pressures from non-Arab goods within this preferential framework will be crucial to maintaining market share.
