Trade Relations
Saudi Arabia's export and import figures with the EU fall under the GCC category countries. Therefore according to EU's external relations web site the latest figures from the year 2000 indicate that the EU exports revenue from the GCC amounted to 29 billion euro whereas imports amounted to 22 billion euro. Crude oil represents almost two thirds of EU imports from the GCC.
The EU is an important trading partner for Saudi Arabia. The country's biggest trading partner in the EU is the UK followed by Germany and France. Saudi petroleum exports are purchased by almost all EU member states. A large number of EU Petroleum companies, (eg from France, UK, Spain and Italy) are investors in the Saudi economy, especially in the country's petroleum industry. They are also observing Saudi Arabia 's economic reform and privatisation program with the goal of entering the market as investors as opportunities arise.
Saudi Arabia is also an important market for the export of EU industrial goods in areas such as Defence (eg. British Aerospace and EADS), Transportation and Automotive (eg. Airbus, Snecma, BMW, Mercedes Benz, Rover, Renault, Fiat), Medical (eg. Bayer and Glaxo Smithklein) and Chemical exports. Saudi tourists are also viewed as high spending category tourists and efforts are made to attract them to all major European holiday destinations.
Future plans for the development of Saudi - EU economic relations are framed within Saudi Arabia 's membership in the GCC. The GCC and the EU have made the commitment towards the eventual establishment of a Free Trade Agreement (FTA). One of the pre-conditions for the establishment of this agreement was the establishment of a uniform customs rate for the import of goods into the GCC market. This has been accomplished. Meanwhile in June 2004 the EU Trade Commissioner Pascal Lamy said that he hopes "the European Union and the Gulf Cooperation Council will forge a long-stalled free-trade agreement by the end of the year". However a date has still not been set for the creation of the aforementioned FTA.
Security and Political relations
In terms of security relations with the EU, the EU members with the closest ties to the country are Britain and France. Britain has had a long standing political and security relationship with Riyadh, dating back from Saudi Arabia 's establishment. The British government has been a long term weapons supplier to the Saudi government. A number of Saudi princes and top officers have trained at the British Army's officer school at Sandhurst. The culmination of the security co-operation between the two countries was the massive Al- Yamamah Defence project which entailed the purchase of billions of dollars of UK Defence equipment such as Tornado fighter aircraft, Tanks, War Ships and training of the Saudi Armed Forces. The security co-operation between the two countries was reactivated during the Iraqi invasion of Kuwait in 1991, where the UK was the second biggest defence contributor towards the protection of Saudi Arabia against any possible attack by Saddam's forces. Saudi Arabia has also been a important ally to the UK government in the Middle East where the UK has been able to stop off its warships in Saudi ports. Until recently the Royal Air Force was also able to maintain a number of its fighter aircraft at the Dahran air base in Saudi Arabia.
France also has security and political relationship with the Saudi government, however not to the same extent as the UK government. Saudi Arabia has purchased military equipment from France. The culmination of the security relationship between the two countries was during the siege of the holy mosque in Mecca in 1978 by Muslim fundamentalists. The Saudi special forces launched a number of operations to eliminate the terrorists. However they were all unsuccessful and the siege continued for more than 3 weeks. As a result the Saudi government turned to France for assistance. The French government subsequently trained the Saudi special forces and provided them with new equipment. Upon the completion of their training the Saudi special forces returned and duly eliminated the terrorists and ended the siege. The Saudi government's choice of France as a source of assistance, rather than UK or the US in this circumstance would be a valid question . The answer lies in the fact that between all Western governments, there is less hostility towards France in the Arab world. Therefore in a matter as religiously delicate as a siege at one of Islam's holiest mosques and a planned attack to free it, the Saudi government's choice of France was aimed at reducing potential criticism towards its military action in the Arab world. France also contributed to the 1991 Gulf War military campaign against Iraq. By: Meir Javedanfar- www.meepas.com Back |
