GCC PROPOSAL FOR FTA TALKS COMPLICATES UAEG

UNCLAS ABU DHABI 000467 SIPDIS SENSITIVE STATE FOR NEA/ARP, NEA/RA AND EB/TPP/MTA/IPC STATE PASS USTR - KALVAREZ AND JBUNTIN USDOC FOR 4250/DOC/MAC/ONE/CLOUSTAUNAU E.O. 12958: DECL: NA TAGS: ETRD ECON EFIN USTR TC SUBJECT: GCC PROPOSAL FOR FTA TALKS COMPLICATES UAEG EFFORTS REFS: A) RIYADH 728 AND PREVIOUS B) ABU DHABI 136 ¶1. (U) This is an action request; please see paragraph 3. ¶2. (SBU) The GCC Secretariat's proposal to initiate region-wide free trade negotiations with the United States (ref A) has put UAE officials in the uncomfortable political position of having to support the GCC 'party line,' while at the same time, vigorously pursuing a bilateral TIFA and FTA agreement with Washington. In a February 17 meeting with Econoff, UAE Director of WTO Affairs Saeed Al-Nasibi asked whether Washington had responded to the GCC proposal, and noted that a negative response from Washington could "put to rest once and for all" the possibility of negotiating an FTA with the GCC. ¶3. (SBU) Comment and action request: Although some UAEG interlocutors have voiced restrained support for the GCC proposal (most probably out of a sense of obligation to their Gulf brethren),senior officials have made it very clear that the UAE intends to pursue bilateral trade agreements with Washington (ref B). They have said that GCC talks, which include Saudi Arabia, would "bog down" negotiations. The UAEG would welcome, however, clarification of our preference to pursue bilateral agreements with the Gulf states vice a multilateral approach to the GCC. We second Embassy Riyadh's request that Washington expeditiously provide a response to the GCC Secretariat's proposal, and provide talking points for use SIPDIS in the Gulf capitals, as well. End comment and action request. Wahba