Tide in the Gulf: The EU and monarchies have returned to creating a free trade area

After a long break, the European Union and the Cooperation Council for the Arab States of the Persian Gulf resumed discussions on the agreement on the establishment of a free trade area. This was reported to Izvestia by the press secretary of the European Commission, Paula Pinho. Negotiations on a rapprochement of positions are underway in an expert format. In parallel, Brussels and Abu Dhabi have agreed to launch a separate trade negotiation track. These steps reflect the EU's desire to diversify partnerships against the backdrop of the US tariff policy. What points of intersection Europe and the Arab monarchies have is in the Izvestia article.

EU discusses free trade with Gulf countries

After a 16-year pause, the European Union and the Cooperation Council for the Arab States of the Persian Gulf are once again discussing the possibility of creating a free trade area. According to the European Commission, negotiations are underway at the expert level to bring positions closer, and in parallel, Brussels and Abu Dhabi have agreed to launch a separate bilateral track of trade negotiations.

These steps reflect the European Union's desire to expand trade ties, particularly against the backdrop of the growing protectionist policy of the United States, which has resulted in the imposition of tariffs on a number of countries.

"The EU and the GCC negotiated a free trade agreement, but they were suspended in 2008, mainly due to different levels of ambitions on key points," European Commission spokeswoman Paula Pinho told Izvestia.

Now, according to her, the EU's legal framework in the field of trade agreements has evolved significantly, which opens up a window of opportunity for resuming dialogue.

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"Discussions at the expert level have resumed to improve mutual understanding, taking into account possible negotiations on a trade agreement that will address issues of mutual interest," Paula Pinho said.

We are talking about the implementation of the provisions of the "Joint Communique on Strategic Partnership with the Persian Gulf Region" dated May 2022, as well as the declaration of the EU–CISGPA summit dated October 2024. As the official representative of the European Commission emphasized, these documents form a "comprehensive agenda for deepening cooperation," including in the field of investment and trade.

"As stipulated in the joint communique, the EU and the UAE also continued to exchange views on the prospects for strengthening trade and investment relations and agreed to start negotiations on free trade,— the EC told Izvestia.

EU's reaction to US tariffs

In an interview with the Asharq Al-Awsat newspaper, David McAllister, Chairman of the European Parliament's Foreign Affairs Committee, said that the EU is ready to resume negotiations on a free trade agreement with the Gulf Cooperation Council (GCC).

McAllister noted that the association was shocked by the decision of US President Donald Trump to impose 20 percent duties on European exports. Against the backdrop of such trade tensions, the EU is seeking to strengthen and diversify its economic ties, especially with regions of strategic importance such as the Persian Gulf.

A 10% base duty on imports from most countries came into force on April 5. Then the rates rose sharply: China faced duties of 145%, Vietnam — 46%, and the European Union — 20%. Nevertheless, after the collapse of the United States stock market, Trump suspended the increase in duties for 90 days for 75 countries (including the European Union) that agreed to start negotiations. "The European Union has suspended measures taken in response to unjustified US trade tariffs to allow time and space for negotiations," the European Commission said on April 14.

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In response to economic pressure, Brussels is intensifying international activity by concluding new trade agreements and expanding the circle of partners, says German political analyst Egor Belyachkov. According to him, this intensification has become particularly noticeable in recent weeks: European Commission President Ursula von der Leyen has held bilateral meetings with leaders of a number of countries, including Malaysia, the Philippines, Canada, the UAE and India. This geographical diversification speaks to the EU's desire to reduce dependence on the United States and create a more sustainable economic model.

— The Persian Gulf countries are considered one of the possible points of support for the EU in a situation of possible conflict with the Trump administration. Brussels may be interested in the GCC fuel and energy complex, since von der Leyen's green policy within the EU only provokes inflationary processes related to economic restructuring," Yegor Belyachkov added.,

The position of the Arab countries of the Persian Gulf

The success of the agreement is possible only if it is possible to develop a joint platform that will ensure a balance of interests of all participants, says Saudi economist Ali al-Hazmi. The topics of green energy and sustainable development are especially relevant now.

— Europe is striving for an accelerated transition to clean energy, and the Gulf countries, including Saudi Arabia, have the same goals. This creates points of intersection," he explained to Izvestia.

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According to him, the Gulf is already actively investing in European markets through one of the world's largest sovereign wealth funds, as well as through the placement of "green" and traditional bonds. He also stressed the importance of the Gulf region's logistical potential, especially given its location at the junction of three continents. This, in his opinion, can accelerate the formation of a free trade zone and create a mutually beneficial situation for all parties. In addition, he named food security, expansion of port infrastructure, tourism and culture among the key areas for cooperation.

"Nevertheless, for the successful implementation of the project, it is necessary to agree on a number of parameters, from tax and customs agreements to rules on commodity subsidies and anti—dumping measures," concluded Ali al—Hazmi.

In the context of global trade wars caused by the introduction of new tariffs by the United States, the UAE is taking active steps to strengthen its position in the global economy, draws the attention of the head of the Emirati political center Ebtesam Al-Ketbi.