Trading for National Security? United States Free Trade Agreement in the Middle East and North Africa

Abstract

Free trade and customs union agreements are the rage. Hundreds of bilateral and regional free trade agreements have been notified to the World Trade Organization (WTO), which in theory "regulates" them under Article XXIV of the General Agreement on Tariffs and Trade (GATT).1 For example, free trade fever has reached such partners as Chile-China, Japan-Mexico, Canada-Costa Rica, Mexico-European Union, and New Zealand-Singapore. This contagion is a relatively recent phenomenon, one which poses systemic risk to the WTO.2 Far more than elsewhere in the world, United States free trade agreements in the Middle East and North Africa pursue economic policies in a seething political cauldron. This environment has led to a distinct friend or foe approach to a region most notable for its subtleties. This article commences with an analysis of free trade with a hard-core ally, Israel. It progresses to free trade with less obvious U.S. allies, Jordan, Morocco, Bahrain and Oman. The United Arab Emirates, with which U.S. free trade negotiations are in progress, is then reviewed as a problematic case study. Saudi Arabia, Egypt, Turkey and other key players in the Middle East and North Africa are woven into the analysis. Various themes permeate this article: The use by the United States of bilateral trade and investment treaties and WTO membership as prerequisites to free trade, links between U.S. free trade agreements and Middle Eastern oil and politics, the future of the Bush Administration's Middle East Free Trade Area (MEFTA) initiative, and the premise that national security can be enhanced and terrorism can be fought through trade. Analysis of these themes is comparative, with particular reference to the North American Free Trade Agreement (NAFTA) and WTO law.