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Regional economic integration in the Middle East and North Africa : beyond trade reform (English)

Limited integration has stifled the Middle East and North Africa (MENA) region's ability to tap into its significant potential for economic growth and job creation. The MENA region is among the least integrated in the world economy. Although home to 5.5 percent of the world's population (on average for 2008-10) and 3.9 percent of the world's gross domestic product (GDP), the region's share of nonoil world trade is only 1.8 percent. By contrast, countries that have opted for a liberal trade and investment regime most notably in East Asia have experienced a significant increase in trade, employment, and per capita income. If petroleum and gas are taken into consideration, the MENA region is far more integrated in the world economy, with total exports accounting for 6.2 percent of total world trade. Exports of oil and gas represent about three-quarters of MENA's total exports. This study shows that, in spite of commendable reform efforts in recent years, the MENA region continues to face constraints to economic competitiveness in general, and trade barriers in particular. Of critical importance is the need to improve trade-related infrastructure and strengthen trade facilitation activities. Moreover, this study demonstrates that preferential trade agreements (PTAs), though helpful in many respects, do not significantly expand exports. Instead, the focus in must be on opening up to the rest of the world, which may require that individual countries aggressively pursue unilateral liberalization policies. While regional cooperation and integration can bring benefits, these efforts can also pose significant costs if not carried out in a manner that is compatible with broader global integration trends. Finally, while there is reasonable potential to enhance trade in goods, trade in services is a major untapped source of trade growth within the region and between the region and the rest of the world. The main objective of this report is to assess the achievements in, opportunities for, and challenges of deeper regional economic cooperation and integration within the MENA region and between the region and the rest of the world.


  • Author

    Rouis,Mustapha, Tabor,Steven R.

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  • Country

    Middle East and North Africa,

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    Middle East and North Africa,

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    Regional economic integration in the Middle East and North Africa : beyond trade reform

  • Keywords

    general agreement on tariffs and trade;information and communication technology;Trade and Foreign Direct Investment;early stage of development;supply chain and logistics;Technical Barriers to Trade;Logistics and Trade Facilitation;quality of logistics service;harmonization of customs procedure;trade and investment policy;economic integration;rules of origin;per capita income;regional economic integration;trade in services;global economic integration;trade in goods;preferential trade agreement;economies of scale;foreign economic relation;number of jobs;learning by doing;flow of good;inefficient public sector;high youth unemployment;division of labor;trade facilitation services;global production chain;national policy maker;movement of people;domestic competition policy;regional integration effort;term of productivity;governance reform programs;Exchange rate policies;regional financial institution;trade and fdi;common external tariff;oil exporter;reducing trade barriers;global financial crisis;preferential tariff treatment;formal trade barriers;share of employment;export of goods;quality of transport;misallocation of resources;cost to consumer;privileges and immunity;ict infrastructure;labor force growth;regional infrastructure investment;lack of integration;Oil & Gas;Oil and Gas;multilateral development bank;intellectual property rights;business process outsourcing;agricultural market access;security of tenure;factor of production;Rural Travel and Transport;exchange rate policy;global integration;global market;Job Creation;world economy;regional cooperation;nontariff measure;domestic investment;cross-border trade;employment growth;oil importer;world trade;partner country;job growth;reducing tariffs;reform effort;Trade Logistics;resource endowments;global trade;Export Diversification;removing barriers;investment need;regional economy;trade costs;popular participation;physical barrier;Trade Policies;commercial policy;Trade Policy;good governance;global commodity;inefficient policy;simulation analysis;Economic Management;Investment Flow;nontariff barrier;open regionalism;inclusive growth;cross-border infrastructure;cross-border trading;agglomeration economy;institutional practice;investment climate;capital inflow;Boosting Growth;domestic production;tariff peaks;telecommunications infrastructure;broadband service;political commitment;infrastructure network;geographic region;country variation;special interest;transmission network;commercial purpose;competitive regions;economic rent;product quality;license restriction;economic diversification;transport cost;high trade;trade growth;institutional transformation;middle-income economy;unilateral liberalization;economic competitiveness;logistics activity;employment generation;power trade;tie in;strategic investment;regional distribution;political landscape;unemployment rate;formal employment;aid effectiveness;political orientation;liberal trade;political reform;democratic institution;political regime;international market;efficiency gain;transaction cost;water scarcity;border formalities;formal sector;Financial Stability;professional association;informal sector;Capital Inflows;welfare effect;vertical specialization;oil trade;institutional barrier;lead partner;competitive product;primary commodity;manufactured goods;domestic reform;employment creation;enabling environment;production structure;strategy formulation;small economy;industrial structure;power supply;skilled labor;demographic reality;public finance;young people;gradual process;ad valorem;manufacturing good;tariff protection;international standard;trade restriction;uniform tariff;mobile telephony;cross-border issue;broadband infrastructure;preferential liberalization;economic reform;border control;border policy;trade preference;intraregional trade;high tariff;regional producers;participating country;signatory countries;knowledge spillover;imported merchandise;essential goods;prohibitive trade;weighted average;import tariff



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Rouis,Mustapha Tabor,Steven R.

Regional economic integration in the Middle East and North Africa : beyond trade reform (English). Directions in development : trade Washington, D.C. : World Bank Group.