USTR VISIT RE-ENERGIZES FTA IMPLEMENTATION PROCESS

C O N F I D E N T I A L MUSCAT 000743

SIPDIS

STATE PASS TO USTR, COMMERCE FOR THOFFMAN

E.O. 12958: DECL: 10/27/2018
TAGS: PREL ECON ETRD MU
SUBJECT: USTR VISIT RE-ENERGIZES FTA IMPLEMENTATION PROCESS

Classified By: Ambassador Gary A. Grappo for Reasons 1.4 (b, d)


1. (C) Summary: USTR Ambassador Schwab met with Sultan
Qaboos and government officials during her October 24-26
visit to Oman to resolve outstanding Free Trade Agreement
issues and achieve implementation by the end of the year.
While problems remain, the visit and related meetings between
USTR experts and their Omani interlocutors pushed forward the
implementation process and injected new momentum on the Omani
side to fulfill all of its FTA obligations. The Sultan's
personal commitment to see the FTA completed, and the amount
of attention devoted to the USTR visit, should help ensure
that Oman devotes appropriate technical and personnel
resources to close out remaining aspects of the landmark
trade deal. End Summary.


2. (C) A U.S. trade delegation led by U.S. Trade
Representative Susan C. Schwab visited Oman October 24-26 for
meetings with Omani officials, including Sultan Qaboos, to
discuss remaining issues for implementation of the U.S.-Oman
Free Trade Agreement (FTA). Oman's Minister of Commerce and
Industry, Maqbool bin Ali bin Sultan, served as Ambassador
Schwab's primary interlocutor during her stay. In a meeting
on October 25, Maqbool expressed his commitment to work
closely with the U.S. to help resolve all outstanding
differences and agreed with Ambassador Schwab that the
agreement needed to be implemented by the end of the year.
He and Ambassador Schwab proceeded to review a checklist of
issues to ensure both sides shared the same understanding of
the work that remained. Although Maqbool considered most
issues to be "doable," Ambassador Schwab noted that there
continued to be significant problems in the areas of
telecommunications, including licensing fees, and
intellectual property. Questions over transparency, customs
and government procurement regulations also remained. To
help overcome these obstacles, Maqbool pledged to arrange
meetings during the rest of the week for USTR technical
experts in the delegation with their Omani counterparts.


3. (C) On October 25, Ambassador Schwab, accompanied by the
Ambassador, met with Sultan Qaboos at his palace in the Omani
interior and received the Sultan's personal commitment to
push the FTA to completion "as soon as possible." In
particular, the Sultan reported he had ordered his Minister
of Legal Affairs, whose ministry is responsible for drafting
all Omani laws and reviewing most regulations, to instruct
his lawyers to work on the basis of approved English language
texts. With this commitment in hand, Ambassador Schwab,
after meeting with the head of Oman's Telecommunications
Regulatory Authority to discuss telecom issues, met again
with Minister Maqbool prior to her departure from Muscat.
She and Maqbool reviewed a revised checklist of outstanding
issues and agreed to personally follow-up on the status of
these issues via regular phone calls to keep things on track
until the FTA was implemented. Several USTR staff members
and experts would remain in Muscat until the end of the local
workweek for further discussions with Omani officials on
pending matters.


4. (C) Comment: The visit of Ambassador Schwab supplied new
impetus to the FTA implementation process and appears to have
motivated the Omanis to put resolution of remaining issues on
the fast track. The order of the Sultan to make
implementation a reality will help overcome the lack of
coordination between Omani government ministries, which has
contributed to several implementation roadblocks. In
particular, during Ambassador Schwab's visit USTR staff
directly engaged, for the first time, the Ministry of Legal
Affairs, which has unilaterally changed legal text previously
agreed to by negotiators on both sides. Interestingly,
Ambassador Schwab arrived in Oman on the heels of a visit by
the French Foreign Trade Minister who, despite the relatively
strong commercial ties between France and Oman, did not
receive an appointment with the Sultan even though she
reportedly carried a message from French President Sarkozy.
End Comment.
GRAPPO