Arab land waiting for reforms and investments [Archives:2005/864/Opinion]

August 1 2005

By Prof. Dr. Abdulaziz al-Tarb
In addition to oil, there are other assets that qualify the Arab area to be a fertile land with great capacities to attract prospective investments and fulfilling commitments and pledges (expediting the formation of arbitration boards in which disputers are represented to settle pending commercial, economic and banking disputes.

The population of the Arab World is roughly the same as that of the USA (about 300 million) and the annual per capita averages $3000 which makes it a great market. The growth rates in late 1990s resemble those of South Asia and Latin America (3%) and the saving rate from 1996-200 is larger than many other regions except for East Asia and the Pacific (25%). Moreover, the Arab area is of regions with the least debts.

As it is known, the Arab World is at a crossroad. Sustaining the current condition is very perilous and would widen the divide of development separating it from the rest of the World.

Hence, it should adopt fast-paced measures to qualify its societies politically, economically and socially in order to achieve regional integration first and integration into the international economy then. Thus, we realize the importance of taking new initiatives aimed at increasing economic and educational opportunities across the Arab World supported by programs focused on:

– Reinforcing law and strengthening NGOs.

– Finding out active ways to encourage favorable and balanced economic reform.

– Setting up developmental programs in order to improve educational opportunities and train workforce.

The economic reform process requires the development of governance systems in the Arab area through:

– Respecting the role of the law and improving the governmental performance by bettering the quality of public sector institutions.

– Improving the concept of partnership (partnership in public/private enterprises) and incorporating NGOs and businesses (private sector) in social development.

– Guaranteeing full protection of intellectual property rights.

– Improving the legal institutions and mechanisms to undertake arbitration and settle economic disputes so as to increase the confidence of investors and consumers.

– Developing the Arab judicial system; guaranteeing the independence of the judiciary; enhancing the efficiency of judicial departments by means legal and judicial training.

– Activating women's and youth's role in the society.

Of the economic openness and reform is the development of human resources which is a basic condition for accelerating regional competition and international integration as well as ensuring the stability of macroeconomics and the increase of trade and investment rates, especially the exports of the service sector and added-value products, poverty alleviation and employment fights. Local and foreign investment are two fundamental factors in the economic development process.

In this respect, a number of Arab countries have issued new laws and established and developed investment institutions and effected favorable changes to the investment environment. Yet, that is not enough. There is still a bad need for generalizing transparency, indiscrimination, organization of local affairs, freeing trade, providing the conditions for the Arab area to be a competitor in terms of offered investment opportunities.

The Arab area needs of broaden its infrastructure and improve its services so as to boost the growth of public and private investments and keep them in place. US and European companies present in the Arab area are the biggest investors because of the significant opportunities provided for them earlier and the opportunities they anticipate to come as a result of the ongoing economic reform.

It is quite vivid that the US policy reflects the importance of the Arab area for the US national security. It is always looking for possible economic and commercial means to achieve stability and prosperity to serve ultimately its strategic interests borne in this area. therefore, we have to search for our national interests by encouraging other countries to compete with the US in trade and investment by improving custom institutions and procedures, trade finance mechanism, export services, etc.

Here, we realize that reform programs and services suggested and offered from abroad, amidst Arab oblivion, are essentially necessary capitalist techniques meant for laying the infrastructure necessary to contain the Arab markets, exploit their economic opportunities and dominate them. This, consequently, entails that we should prepare our precautionary measures, plans, and studies. The Arab land is rich in men, money and opportunities. When shall we ever understand that and proceed accordingly? A mere question.