GCC Structure and Business

The structure

The main decision-making body within the GCC is the Supreme Council of the Heads of State of the Member States. The council normally meets once a year but can also be convened if two or more members request it. According to cheeroutdoor, GCC changes its chairman every year in alphabetical order.

The Supreme Council draws up guidelines for the GCC’s activities and approves proposals from the Council of Ministers and the Secretariat (see below). In matters of fact, unanimous decisions are required, while in procedural matters, majority decisions are sufficient. A Commission may, if necessary, be appointed by the Supreme Council to mediate in disputes.

A Council of Ministers, which prepares recommendations and carries out studies and projects to develop co-operation, meets every three months and can also hold extra-convened meetings. The Council of Ministers consists of the foreign ministers or other representatives appointed by the countries. Defense issues are discussed annually in the Supreme Defense Council, consisting of the member states’ defense ministers.

The General Secretariat’s task is to facilitate the implementation of the decisions taken by the Supreme Council. It is headed by the Secretary-General, who is appointed for three years with the possibility of extension for a period. The post office rotates between member countries. The General Secretariat is divided into different departments which specialize in each area, such as politics, economics, environment and natural resources, coordination of legislation, administration and information.

The business

In 1983, free border trade and free movement of workers and vehicles were introduced in the GCC region and tariffs on certain goods were abolished. In the same year, the GCC states formed an investment bank for loans for development projects. But cooperation has shaken many times and is paralyzed by internal disagreements since 2017, when several of the countries launched a blockade against member state Qatar.

The investment bank Gulf Investment Corporation was founded in 1983 to provide loans for development projects, primarily in agriculture, trade, industry and mining in the region. In favor of products from the GCC countries, a common levy of between 4% and 20% on imported goods was introduced in 1986, and in the following years several steps were taken to further harmonize Member States’ tariffs with the rest of the world.

In connection with the war in the Persian Gulf in 1990–1991, the GCC states suffered an economic downturn, caused by reduced oil revenues and the costs of the war against Iraq. This meant that the oil states received less capital for grants to Arab funds and support bodies in poorer countries. During the 1990’s, member states preferred to focus on national reconstruction rather than on pan-Arab or regional projects.

At the turn of the millennium, however, the time was ripe to increase economic integration. A new economic cooperation agreement was adopted at the summit in the autumn of 2001. At the meeting, the Heads of State decided that a customs union with a common external tariff rate of 5 percent would be introduced at the beginning of 2003, which also happened. The GCC countries also became part of the Greater Arab Free Trade Area (GAFTA), which became a reality in 2005. By 2010, the GCC planned to form a monetary union, but only four out of six countries joined when decisions were made and the project supported on obstacles.

With the exception of Bahrain, the GCC countries largely managed to avoid the popular wave of protests that erupted in Arab countries in 2011 (the “Arab Spring”). The Bahraini demonstrations were crushed by the country’s royal family with the help of the Saudi military.

Member States have experienced reduced revenues due to falling oil prices from 2014, and later again in connection with the corona pandemic in 2020. But what has stopped co-operation is above all internal disagreements on political grounds. A crucial issue is the view of the Muslim Brotherhood, which operates in several countries, with or without a ban. It is Sunni Muslim conservative, but is still perceived as a threat by regimes in the region. In 2017, Saudi Arabia, the United Arab Emirates and Bahrain, along with Egypt, which is not a member of the GCC, launched a blockade against Qatar that weakened the entire organization ahead of the GCC’s 40th anniversary in 2021. Qatar is accused of supporting the Brotherhood.

Kuwait has taken a mediating role in the conflict, but the disagreement has led to discussions about new collaborations, perhaps a free trade area outside the GCC between Qatar, Kuwait and Oman. Qatar, which has large natural gas reserves, has sought cooperation with countries outside the GCC, mainly Turkey, Iran and Pakistan.

GCC Structure and Business

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