Wednesday, January 30, 2013

Arab Common Market? Why not?

MANY were surprised at the response of the American people to 9/11. I wasn’t. After living among them for five years, I realized how much Americans love their country. True they originally came from different parts of the world, with diverse and colorful backgrounds, but the governance system managed to build a strong allegiance to the novel idea of the United States of America.

The European Union is a newer idea. It should have a good chance of success because the people there are mostly European in origin. Unlike the immigrants to the New World, they are rooted in their older continent. However, Europeans may not have reached the US level of integration, and countries like Britain and Greece may leave the EU.  But Europe has make great strides in economic unification.

Europeans, today, feel more like one nation than they ever did in their long history of religious, racial, colonial and political competition.

Our Arab "ummah" has more in common than most nations. We speak one language, belong to the same heritage, and are mostly Muslim. For hundreds of years we belonged to one Caliphate. People share the same aspirations and feel the same pain. We bleed for Gaza and Syria and worry for Egypt and Libya, and pray for Yemen and Sudan.

During the Arab Spring, even young people switched from sports, movies and music TV channels to follow events in Arab streets they may never have heard of before. Saudis discuss political issues in Egypt on Twitter and Facebook today as much as Egyptians do. President Morsi is probably more popular among us than among his fellow countrymen.

So why are we still debating the principles of economic cooperation rather than integration? Why was the agenda of the 2008 Arab Economic Development Summit still being discussed in the third Summit, last week? What progress has been made? What chances are there of better success this time?

I was discussing these questions last week on a Saudi news channel with Dr. Abdulrahman Al-Sultan, professor of economics at Imam Muhammad Bin Saud Islamic University. He was pessimistic with good reasons, and I was optimistic with equally valid ones.

His argument is based on the following facts:

A. Arab economies are built mostly on exporting raw materials. In the absence of sophisticated industries, we are competing with each other in global markets. 

B. The unstable political environment in many Arab countries is frightening away local and international investors. Much more Arab capital is invested in US and Europe than at home.

C. The world’s highest unemployment rates among Arab youth are adding more dark colors to a pessimistic picture. 

Therefore, Dr. Al-Sultan doesn’t expect a bright future of cooperation for such failed economies. Any financial help provided to small and medium-sized enterprises will just go to the foreigners running these establishments for their local sponsors, as is the case in Saudi Arabia.

I begged to differ. The Arab world is diversified in its resources. Countries like Sudan, Egypt, Syria, Tunisia, Morocco and Yemen are rich in agriculture and human resources. Others, like Lebanon and the UAE are best in services. Saudi Arabia and other Gulf states have mineral and financial strengths with strong, open markets.

I can imagine Saudi money and high technology going into Sudan and Yemen to develop their agriculture and sell their products in Saudi and Gulf markets. And I can see Yemeni and Sudanese workers making petrochemical and farming equipment in Saudi Arabia for Yemeni and Sudanese farms.

Young women trained in interior and graphic design in Effat University and Dar Al-Hekma College could be working online with their peers in Sana’a, Amman and Cairo to provide services for companies in Riyadh, Dubai and Doha, while male and female engineers in these countries are collaborating on the same project in Abu Dhabi.

It is happening right now. Cooperation among small and medium-sized enterprises around the world is benefiting from the communication revolution. American and European firms are outsourcing to Indians, Brazilians and Vietnamese. Dedicated networks are providing support to members and facilitating their cooperation.

What we need is to join such networks and start our own. If Arab chambers of commerce could lead the way and if Arab governments support such initiatives, our young people could provide jobs instead of looking for them. We also need good infrastructure to facilitate development and economic growth. That includes public utilities, transportation and communication. The private sector can invest in these areas as well. Electricity and water production, transportation and the Internet may make good business.

I agree with Dr. Al-Sultan that for this and any kind of investment to happen, we need solid political, security and judicial environments. Sudan and Yemen, for example, could be the breadbasket of the Arab world. But unless investors feel safe they won’t risk their hard-earned capital. With a sophisticated new generation of leadership in the poorer Arab countries, combined with the wisdom and strength of the wealthier part of our world, I will bet the future of my children on the Arab Common Market. 

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