Weisbrot said such agreements would force Arab companies to squeeze staff to make concessions to live up to the cut-throat competition

By Adam Wild Aba, IOL Correspondent

WASHINGTON, November 20 (IslamOnline.net) – Independent American economists and NGOs have warned Arab governments against racing to sign free-trade treaties with the US, which would exact a toll on their sluggish economies.

Such countries would find themselves caught in cut-throat competition with the high-quality and cheap-priced Chinese and Indian commodities inundating the American market, Mark Weisbrot, the co-director of the Washington-based Center for Economic and Policy Research, told IslamOnline.net.

He expected Arab companies to force staff to make concessions and waive their pay-rise rights to live up to the competition.

Arab countries would also pay mind-boggling sums of money in copyright fees to American firms in accordance with the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), Weisbrot said.

He stressed that such sums would certainly exceed any export proceeds Arab countries hope to harvest from free-trade agreements with Washington.

The Bush administration announced on Thursday, November 18, imminent free-trade talks with Oman and the United Arab Emirates (UAE).

Chairman of the US Congress Budget Committee Senator Bill Thomas led a  Congressional delegation in a multi-leg Mideast tour last week that took him to Egypt, Oman and Tunisia.

He said they were impressed with the desire of officials to make the necessary economic reforms to qualify for free trade deals, adding that Egypt-US Free Trade Area (FTA) talks would soon begin.

The United States already has free trade agreements with Morocco, Jordan and Bahrain, along with Israel.

Business Hegemony

Weisbrot said Arab countries engaging in free-trade talks with the  US will fall prey to the American giant.

He said such countries are victims of business hegemony in the absence of effective NGOs and parliaments.

Farmers, small businessmen and factory workers will take the brunt, the economist expected.

Many US business groups have been opting for a free trade agreement with Egypt, one of the most populous countries in the Middle East.

Egyptian businessman Rashid Rashid, now serving as Minister of Foreign Trade, said last week during his visit to Washington that Egypt stood ready to reduce its protective trade and industry measures.

Addressing the Brookings Institute, he added that Cairo was even ready to follow the Jordanian example of setting up industrial zones in cooperation with Israel to secure the FTA deal.

Repeated pattern

Oxfam, a development, relief, and campaigning organization working to find lasting solutions to poverty and suffering around the world, expressed similar concerns.

It said free trade agreements between Washington and the Central American countries threatened the livelihoods of thousands of small farmers who already live in poverty.

“The opening of markets exposes the region’s producers to unfair competition from the United States, whose agricultural industry receives enormous amounts of domestic support each year,” said the group on its Web site.

It noted that these countries will be forced to eliminate their import tariffs, while the US will be allowed to maintain generous financing for its system of internal supports and export credits.

“No farmer in the region will be able to compete against a  US farm program that in 2003 allocated the huge sum of $17.425bn for total agricultural supports – much higher than the GDP of most of the Central American countries.”

The Boston-based Oxfam American agreed, saying such agreements only serve best the interests of corporate America.

It cautioned that under such agreements poor and developing countries become consumers rather than producers.

As far as non-Arab countries are concerned, the Bush administration has so far struck free-trade treaties with Chile, Singapore, Costa Rica, the Dominican Republic, El Salvador, Australia, Nicaragua, Guatemala and Honduras.