Arab Economic Integration: Between Hope and Reality

Despite numerous attempts in the second half of the 20th century, Arab states have not been successful in forming a regional economic bloc. Trade among the Arab states continues to be hampered by high tariffs and customs and transportation bottlenecks. Integration efforts are largely limited to attempts at reducing trade barriers in goods and have not extended to the service sector. While labour mobility is somewhat evident, capital mobility within the region remains limited. The ongoing liberalization of trade in goods through the Greater Arab Free Trade Area, scheduled for complete implementation in 2007, brings renewed interest to a longstanding goal. This volume examines the economic and political incentives surrounding Arab regional integration. The contributors focus on three issues: the failure of past attempts at integration, the impact on countries involved in any future integration and the possible lessons from other regional experiences, particularly the European Union. A common theme is the importance of extending the reach of cooperation efforts beyond trade in goods.