The announcement was jointly made by the GCC Secretariat and the Singapore Ministry of Trade and Industry during Singapore Prime Minister, Lee Hsien Loong’s official visit to Saudi Arabia from 24 to 27 November 2006.

The government of Singapore hailed the agreement to commence negotiations towards an FTA as a "milestone" in its strengthening of relations with the GCC bloc, whose member states include Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates.

The aims of the FTA are to help promote and facilitate the greater flow of goods, services, investment and people between the two economies and play a contributory role towards the process of GCC economic integration through the removal of trade and other barriers.

The first round of negotiations is due to commence in early 2007.

Economic relations between the GCC and Singapore have grown significantly in both scope and depth over the past few years. The GCC is currently Singapore’s 7th largest trading partner, with bilateral trade amounting to US$23.7 billion in 2005, a 43% increase over 2004. Likewise, Singapore is becoming an increasingly significant economic partner for many of the GCC countries.