Bahrain first of six Arab countries to finish economic boycott of Israel

Bahrain has repealed its economic boycott of Israel to comply with its free trade agreement with the United States, the Gulf state's foreign minister was quoted as saying Friday.

The move makes Bahrain the first of the six Arab states of the Gulf to abolish its trade boycott of Israel, although others, such as Qatar and Oman, have taken limited steps in that direction.

The repeal coincides with signs of a thaw in relations between Israel and Arab and Muslim states following its withdrawal from the Gaza Strip. Earlier this month, Pakistani President Pervez Musharraf met Israeli Prime Minister Ariel Sharon in New York, and the Israeli foreign minister held talks with his Qatari and Tunisian counterparts on the margins of the U.N. summit there, the AP says.

Only three Arab states have full diplomatic relations with Israel at present: Egypt, Jordan and Mauritania.

"Bahrain took the decision to end the boycott of Israeli goods because this is one of the conditions of the free trade agreement" with the United States, Bahrain's foreign minister, Sheik Mohammed bin Mubarak Al Khalifa, told the independent Arabic newspaper, Alwasat, in an interview in New York.

The minister did not say when the boycott was repealed. Foreign Ministry officials could not be reached Friday, the Muslim weekend in the island kingdom.

Bahrain, which hosts the base of the U.S. Navy's 5th Fleet, signed the free trade deal with the United States last year, becoming the first Gulf state to do so. Its parliament and king have endorsed the agreement, but it has not yet been ratified by the U.S. Congress.

The agreement calls for trade relations with all members of the World Trade Organization, which includes Israel.

Alwasat asked the foreign minister if Bahrain would forge diplomatic ties with Israel.

"That will depend on the general consensus of the Arab League," Sheik Mohammed was quoted as replying. The League's peace plan offers Israel full diplomatic relations in exchange for its withdrawal from all territories captured in the 1967 and 1973 Arab-Israeli wars, the establishment of a Palestinian state and a solution for Palestinian refugees.

The practical effects of the minister's statement remain to be seen. Up to now, Bahrain has refused to admit Israeli goods. A consignment of Israeli-made fuel filters and automotive parts were confiscated and destroyed in 2003.

It is also unclear whether Israeli business executives would be allowed to enter the kingdom. Officially, Israeli passport holders cannot pass through immigration at the island's airport.

Moreover, there have been many anti-Israeli demonstrations in Bahrain since its political system was liberalized in 2002.

The Arab embargo against Israel goes back to the 1960s when the Arab League declared a boycott of all Israeli companies and products. A blacklist was drawn up that featured Western companies which did business with Israel. However, the boycott was heavily eroded after Egypt in 1979 and Jordan in 1994 signed peace treaties with Israel.