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Gulf Countries Look to Form an Integrated Industrial System

Bahrain’s Minister of Industry, Commerce and Tourism Zayed Al-Zayani (Asharq Al-Awsat)
Bahrain’s Minister of Industry, Commerce and Tourism Zayed Al-Zayani (Asharq Al-Awsat)
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Gulf Countries Look to Form an Integrated Industrial System

Bahrain’s Minister of Industry, Commerce and Tourism Zayed Al-Zayani (Asharq Al-Awsat)
Bahrain’s Minister of Industry, Commerce and Tourism Zayed Al-Zayani (Asharq Al-Awsat)

Bahrain’s Minister of Industry, Commerce, and Tourism Zayed Al-Zayani revealed that Gulf countries were heading towards establishing an integrated industry system by creating a Gulf strategy for the industry.

Al-Zayani said that Gulf countries are working to depend on each other in industries instead of importing raw materials or semi-manufactured materials from abroad.

He noted that this trend will have great positives, in terms of creating jobs, diversifying the base of the economy, and expanding the export value of countries.

“We in the Gulf are heading for a customs and economic union by 2025. The presence of an integrated system for the industry and a unified strategy helps us to talk with global blocs as a bloc,” Al-Zayani told Asharq Al-Awsat.

The minister pointed out that Gulf countries are collectively the 12th economy among the countries of the world.

“This enables us to grow our economy, and to be in the top ten, which sheds more light on the region,” said Al-Zayani.

Speaking about the Gulf trade sector, Al- Zayani said: “We believe that we can enhance and strengthen it by standardizing specifications as much as possible, so that factories produce one product, and they can sell it in all Gulf countries.”

“The flow of goods between Gulf Cooperation Council (GCC) states will be facilitated by 2025, with the activation of the customs union,” revealed Al-Zayani.

“From time to time, we see some obstacles to the flow of materials and goods between borders, and we aspire to find solutions for that,” he added.

“GCC countries are looking to increase free trade agreements.”

“Recently we worked with the United Kingdom, which is an old strategic partner, and we have a large trade volume with them in goods, amounting to about 30 billion pounds ($40.4 billion), and 19 billion pounds in services ($25.6 billion),” noted Al-Zayani.

Stressing that Gulf countries are a major trading partner for the UK, Al-Zayani said that there is hope to establish trade agreements on the collective level, which is the GCC, and not with each member state on its own.

The Bahraini minister talked about how the tourism sector, which aimed to account for 7% of GDP at the GCC between 2015 and 2019, now is aiming at 11.4%.

“The features of the strategy include several factors, but in the end it is aimed at one goal, which is the focus on the contribution of the tourism sector to the domestic product,” said Al-Zayani.

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Trump Metal Tariffs Wreak Havoc on US Factory

Tariffs on metal imposed by US President Donald Trump are hitting small businesses like Independent Can very hard. RYAN COLLERD / AFP
Tariffs on metal imposed by US President Donald Trump are hitting small businesses like Independent Can very hard. RYAN COLLERD / AFP
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Trump Metal Tariffs Wreak Havoc on US Factory

Tariffs on metal imposed by US President Donald Trump are hitting small businesses like Independent Can very hard. RYAN COLLERD / AFP
Tariffs on metal imposed by US President Donald Trump are hitting small businesses like Independent Can very hard. RYAN COLLERD / AFP

In the sweltering US summer, metal containers decorated with snowmen and sleighs are taking shape -- but tempers are also rising as their manufacturer grapples with President Donald Trump's steep steel tariffs.

At Independent Can's factory in Belcamp, Maryland northeast of Baltimore, CEO Rick Huether recounts how he started working at his family's business at age 14.

Huether, now 73, says he is determined to keep his manufacturing company afloat for generations to come. But Trump's tariffs are complicating this task.

"We're living in chaos right now," he told AFP.

Since returning to the presidency in January, Trump imposed tariffs of 25 percent on imported steel and aluminum -- and then doubled the rate to 50 percent.

This has weighed on operations at Independent Can, and Huether expects he eventually will have to raise prices.

Not enough tinplate

With the steady beat of presses, steel plates that have been coated with tin -- to prevent corrosion -- are turned into containers for cookies, dried fruit, coffee and milk powder at Huether's factory.

But there is not enough of such American-made tinplate for companies like his.

"In the United States, we can only make about 25 percent of the tinplate that's required to do what we do," in addition to what other manufacturers need, Huether said.

"Those all require us to buy in the neighborhood of 70 percent of our steel outside of the United States," he added.

While Huether is a proponent of growing the US manufacturing base, saying globalization has "gone almost a little bit too far," he expressed concern about Trump's methods.

Trump has announced a stream of major tariffs only to later back off parts of them or postpone them, and also imposed duties on items the country does not produce.

For now, Independent Can -- which employs nearly 400 people at four sites -- is ruling out any layoffs despite the current upheaval.

But Huether said one of the company's plants in Iowa closed last year in part because of a previous increase in steel tariffs, during Trump's first presidential term.

Price hikes

With steel tariffs at 50 percent now, Huether expects he will ultimately have to raise his prices by more than 20 percent, given that tinplate represents a part of his production costs.

Some buyers have already reduced their orders this year by 20 to 25 percent, over worries about the economy and about not having enough business themselves.

Others now seem more inclined to buy American, but Huether expressed reservations over how long this trend might last, citing his experiences from the Covid-19 crisis.

"During the pandemic, we took everybody in. As China shut down and the ports were locked up, our business went up 50 percent," he explained.

But when the pandemic was over, customers turned back to purchasing from China, he said.

"Today if people want to come to us, we'll take them in," he said, but added: "We need to have a two-year contract."

Huether wants to believe that his company, which is almost a century old after being founded during the Great Depression, will weather the latest disruptions.

"I think that our business will survive," he said, but added: "It's trying to figure out what you're going to sell in the next six months."