The Cost of Inter-Arab Trade Conference Adopts the Launch of the Study by Talal Abu-Ghazaleh & Co. Consulting and Approves its Recommendations

Held in Cooperation between the Arab League and Economic Policy Development Forum

The Cost of Inter-Arab Trade Conference Adopts the Launch of the Study by Talal Abu-Ghazaleh & Co. Consulting and Approves its Recommendations

AMMAN----- August 24, 2014 ---------- In response to a request by HE Dr. Talal Abu-Ghazaleh, Chairman of the Economic Policy Development Forum (EPDF), and in cooperation with the League of Arab States (LAS), Talal Abu-Ghazaleh Knowledge Forum hosted the "The Cost of Inter- Arab Trade" Conference, in which the League was represented by the Assistant Secretary General of the League for Economic Affairs, H.E. Dr. Mohammad Bin Ibrahim Al-Tuwaijri.

A host of ministers of industry and trade and their representatives, accredited ambassadors to Jordan, members of the Economic and Social Council of the Arab League, representatives of Arab States in the World Trade Organization, representatives of specialized international bodies and research and study centers, members of Arab chambers of commerce and investment promotion authorities, experts and representatives of parties and media outlets attended the one-day conference.

Arab League Statement

In his speech, the Assistant Secretary General of the Arab League, H.E. Dr. Mohammad Bin Ibrahim Al-Tuwaijri, expressed his gratitude and appreciation to HM King Abdullah II and the people of Jordan, as well as HE Dr. Talal Abu-Ghazaleh and the Talal Abu-Ghazaleh Organization for the efforts they exerted in organizing this conference in cooperation with the Arab League; pointing out the significance of the conference as it coincides with the private sector’s endeavors to fulfill the requirements of the Great Arab Free Trade Area (GAFTA), and complimenting the ongoing cooperation between the Arab League and the Organization.

Dr. Al-Tuwaijri highlighted the efforts exerted by the Economic Sector of the Secretariat General of the Arab League in managing the requirements for creating the GAFTA; pointing out that the main objective of this sector is now to enhance the competitiveness of inter-Arab exports and improve the efficiency of their logistic requirements.

Statement of HE Dr. Hatem Al-Halawani,Jordan Minister of Industry and Trade

The Minister stated that the valuable study conducted by Talal Abu-Ghazaleh Organization on the cost of inter-Arab trade represents a positive addition to previous Arab efforts at all levels, as it addresses the obstacles hindering the growth of inter-Arab trade.

The Minister highlighted the advantages the Arab world possesses that enable it to strengthen its joint negotiating position in any commercial relationship with other countries of the world, pointing out the need for Arab states; represented by the Arab League, to be prepared to cope with international developments. He also added that the Arab League must take rapid steps towards completing the procedures for creating the common market, monetary union, economic union and economic integration.

Statement of the Economic Policy Development Forum

Meanwhile,  Dr. Abu-Ghazaleh delivered the opening statement in which he pointed out that this conference is the result of cooperation with the Economic Sector of the Arab League, represented in the establishment of the Arab Coalition for Trade in Services which was launched at the United Nations Conference on Trade and Development (UNCTAD) as he was assigned the responsibility of establishing it, in addition to providing consultation to the Humanitarian Aid Coordinating Committee upon a call by the Office of HE the Secretary General of the Arab League, as well as providing consultation in collaboration with the Economic Sector in conducting technical studies on the development requirements for the State of Palestine, Sudan and Yemen with respect to economic development programs within the framework of their membership in GAFTA; in line with the resolutions of Arab summits and the Economic and Social Council.

Dr. Abu-Ghazaleh pointed out that there is an ongoing joint research to enable the Arab League to join WTO as an observer, and to implement the WTO Trade Facilitation Agreement (Bali 2013) at inter-Arab level, in addition to working with the Arab League on adding Arabic to the official languages of the World Trade Organization.

In his speech, Dr. Abu-Ghazaleh stated that Talal Abu-Ghazaleh & Co. Consulting will conduct the study on the cost of inter-Arab trade led by Dr. Mohammad Abu Hammoor at its own expense; pointing out that this study will be at the disposal of each state to use it as it sees fit.

Recommendations

In light of the above, and based on the results of this study and the findings of previous studies, it is possible to put forth a set of recommendations for the purpose of forming policies to encourage inter-Arab trade. These also include suggestions on how to face obstacles which hinder its growth. These are as follows:

First: Seeking to remove obstacles that hinder inter-Arab trade so that it may play a natural role in growth and stimulate investment. This undoubtedly requires collective efforts to form a legal structure for its organization and for its related services which requires in turn effective cooperation:

1. To reduce inter-Arab trade costs, it is vital to improve infrastructure in many Arab countries. This assists in facilitating ties with these countries, opening ways for realizing savings in shipping costs and communications with other countries.
2. This entails roadways infrastructure as well as gas, oil and electrical systems. It also demands improving inter-Arab trading ports with the outside world. It thus requires an increase ports and airports’ quality and improving ties among Arab states in the joint lines.
3. Building suitable ports in a number of Arab states to increase their potential effectiveness in reaching regional and international markets and facilitate performing Arab imports’ tax and customs processing at a common window at Arab ports.
4. To reduce costs, it is also necessary to remove obstacles, which hinder storage, distribution and handling. These obstacles have a special effect on perishable goods. The remedy of this problem is associated with Arab goods customs processing which entails handling technical, administrative and financial obstacles.
5. Reducing inter-Arab trade costs requires working on two levels: the first is the internal level of each country which handles issues related to customs processing, shipping, air, sea, land and ports projects. The second level is regional where the existing authorities for most of the countries organize crossings measures for goods. This will lead to increased efficiency and would save time and effort.
6. Providing data related to specifications and/or necessary measures to complete clearing goods from border controls as well as the requirements of transit. This should pertain to transparency and clear governance to generally make this data available from all of the applicable government services.
7. Increasing the benefits of globalization. This is achievable through development institutions and projects, which raise performance levels and improve administrative effectiveness.  It additionally integrates technology, communication, programming and other fields and utilizes them in an effective manner in conjunction with the manufacturing process. This aids in lowering the trade costs of goods traded.
8. Establishing standard Arab specifications for goods exchanged among GAFTA members. Multiple standards are indeed a more complicated barrier than customs barriers.

Second: Growth of e-Trade and considering means to increase inter-Arab trade. This requires raising the awareness of the need to develop a special infrastructure for this type of trade and create the necessary legislative measure to ease its practice in order to reduce trade costs, increase Arab products’ competitiveness, while supporting the capacity of the Arab markets to compete with the international markets.

Third: Partnering with the private sector in decisions related to inter-Arab trade so that it creates possibilities for proposals ensuring trade costs reduction. This partnership enriches the chances for opening up different community parties and encouraging their participating in economic and social building development in the Arab states.

Fourth: Providing technical support for each of Palestine, Sudan and Yemen to develop their economies and their external trade by assisting the Organization to conduct economic and field survey through TAG-Org’s offices in the aforementioned offices on the economic status and fields of support provided by the WTO and other economic blocs to the economically poor countries.

Fifth: Providing the Economic Policy Development Forum/Jordan within the Talal Abu-Ghazaleh Organization with the official support to become an Arab economic forum that gathers politicians and decision makers to serve the joint Arab social and economic work within the framework of the Arab League’s General Secretariat and to be held in the Hashemite Kingdom of Jordan/Amman with an unlimited support from Dr. Talal Abu-Ghazaleh.