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Deeper Integration or Wider Integration? : the case of Gulf Cooperation Council

Author

Listed:
  • Boughanmi, Houcine

    (Sultan Qaboos University)

  • Al-Shammakhi, Ahmed

    (Sultan Qaboos University)

  • Antimiani, Alessandro

    (European Commission)

Abstract

We empirically evaluate whether fostering trade partnership within the region is a better economic course of action for the Gulf Cooperation Council than engaging into preferential trade arrangements with well-established trade blocs outside the region. We use the 8.1 version of Global Trade Analysis Project to analyze four scenarios representing various Gulf Cooperation Council trade integration paths, taking into consideration the issue of non-Tariff Barriers and trade facilitation measures. Results indicate that the Gulf Cooperation Council gain from lifting tariffs and non-tariff barriers on trade with the Greater Arab Free Trade Area subgroups and with the European Union is limited unless such barrier lifting is complemented with trade facilitation measures. With trade facilitation, the full completion of Greater Arab Free Trade Area scenario yields the highest welfare gain for the Gulf Cooperation Council, while the Gulf Cooperation Council-European Union Free Trade Agreement scenario yields positive but smaller gain. The small gain with Gulf Cooperation Council-European Union scenario is explained by the negative terms of trade effects following trade liberalization. These results underscore the importance of deepening Greater Arab Free Trade Area’s scope through introduction of trade facilitation measures as well as measures beyond merchandize trade liberalization.

Suggested Citation

  • Boughanmi, Houcine & Al-Shammakhi, Ahmed & Antimiani, Alessandro, 2016. "Deeper Integration or Wider Integration? : the case of Gulf Cooperation Council," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 31(2), pages 206-233.
    • Handle: RePEc:ris:integr:0684
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    Citations

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    Cited by:

    1. Ahcar, Jaime & Siroën, Jean-Marc, 2017. "Deep Integration: Considering the Heterogeneity of Free Trade Agreements," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 32(3), pages 615-659.
    2. SAEED Abdullah, 2020. "Us Economic Policy Uncertainty And Gcc Stock Market Performance," Studies in Business and Economics, Lucian Blaga University of Sibiu, Faculty of Economic Sciences, vol. 15(1), pages 223-242, April.

    More about this item

    Keywords

    Computable General Equilibrium; Global Trade Analysis Project; Gulf Cooperation Council; Regional integration; MENA;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F15 - International Economics - - Trade - - - Economic Integration

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