The European Union and Saudi Arabia signed a trade deal yesterday aimed at easing the kingdom’s path to World Trade Organisation entry, and the EU said such deals helped stability in the whole of the Middle East.

Saudi Arabian Trade Minister Mr Hashem Yamani said his country hoped to enter the WTO early next year. "I think it is important for the region," EU Trade Commissioner Mr Pascal Lamy said as he signed the agreement.

Like other WTO hopefuls, Saudi Arabia has to seal bilateral agreements, usually with its most important trading partners, as well as adopt the whole body of WTO laws, before it can enter the trading organisation.

Saudi Arabia’a main trading partner is the EU. It also wants to agree a deal with the US. Mr Yamani said sealing the EU deal was an important milestone on Saudi Arabia’s route to the WTO.