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1/20/07

Chron.com: Europe Ahead of U.S. for Arab Trade Pact

For the full report in the Chron.com click on this link

Europe Ahead of U.S. for Arab Trade Pact

DUBAI, United Arab Emirates — While U.S. free trade initiatives in the Gulf appear to be faltering, Europe has stepped into the vacuum, launching a charm offensive that appeared to be on the brink of clinching a trade pact with a bloc of six energy-rich Arab states. The European Union's decision to negotiate with all six members of the Gulf Cooperation Council appears to have put them ahead of their American trade rivals, who have tried to negotiate individual pacts with each country. After signing trade deals last year with Bahrain and Oman, American trade negotiators have failed to clinch a pact with the $130 billion-a-year economy of the United Arab Emirates.

Observers here say the agreement has been hung up on several American demands, while incentives to sign have plummeted alongside the Bush administration's popularity in the Gulf. Meanwhile, the Europeans have stepped up their overtures.

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