RIYADH, Nov 11: Saudi Arabia, world biggest oil exporter, finally won the approval after 12 years of negotiations to join the World Trade Organization (WTO) on Friday in Geneva.

Saudi Arabia’s accession to the World Trade Organization as its 149th member was formally agreed at a meeting of the body’s General Council endorsing an earlier decision by its accession working party that the kingdom had met all the terms.

Minister for Commerce and Industry Dr Hashem Yamani signed the accession papers on behalf of the Saudi Council of Ministers. Membership takes effect 30 days after signing. Saudi Arabia will formally be admitted to the WTO on December 11, just in time for the organization’s Hong Kong conference which starts two days later. The formal signing will allow the kingdom to take a full part in the WTO ministerial summit.

The accession, approved in principle by the WTO last month, brings to a close 12 years of tough and complex negotiations. The kingdom originally applied in June 1993 to join the General Agreement on Tariff and Trade (GATT), which was then succeeded by the WTO.

It was hoped that the process would be complete by the end of last year but negotiations dragged on. The last hurdle, and one of the toughest, was the talks with the US, which were only completed in September. Bilateral agreements with most other countries were completed over a year ago.

Membership will bring no overnight changes. The kingdom, one of the last major economies outside the WTO, has been changing its commercial and economic laws over the past few years to comply with the WTO’s rules. Where it has been noticeable and where it has had the greatest effect so far is in the distribution, telecommunication, banking and insurance sectors.

Changes were effected in many areas of trade and industry in the kingdom, so as to be able to join the WTO as full member. Opening up the telecoms was one such area. This resulted in the licence to the UAE mobile operator Mobily to start operations in the kingdom and challenge the monopoly of Saudi telecom – Al-Jawwal. Changes attributable to the WTO membership could also be seen in other areas. Foreign insurance companies, financial services and banks are moving in. The National Bank of Pakistan and the State Bank of India have also been licensed recently to operate in the kingdom. Other international banks are contemplating entering the booming Saudi market.

According to analysts winds of economic change resulting from WTO membership will continue to blow across the kingdom. The age-old system of kifalat – sponsorship of employees – will go altogether in time. The residence permit –iqama-system will also be replaced in time with work permits. Cheaper goods would flow in –- more easily into the system, following the accession, many here believe.

Last month Yamani, who has led the Saudi negotiating team, called the decision to invite Saudi Arabia “a victory for the principles and objectives of the multilateral trading system.” The country had sought WTO membership, he said, because “We pride ourselves on having an open and liberal trade regime and believe in the market mechanism” as a means to growth and development. “Our road to accession has been long but finally rewarding,” Yamani said. Saudi Arabia had made “far-reaching, very substantial and commercially meaningful concessions and commitments on goods and services” that would benefit its trading partners.”

Commenting at the same time, WTO chief Pascal Lamy spoke of the decision to admit the kingdom as “historic,” both for the WTO and for the multilateral trading system. “I know the negotiations have been difficult and long. But I also know that both Saudi Arabia and the members have gone the extra mile to ensure the success that we see today.”

The Saudi Council of Ministers last month authorized Yamani to sign WTO accession documents, which include 38 bilateral agreements with member states, an accession protocol and the final report of the working team.