Building Collaboration Arab Entrepreneur Partnership

Forum

April 2-3, 2011

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Normally I would have spoken about:

• Horizontal and vertical integration

• Networking

• Innovation and best practice

• Arab complementarities

• Competitiveness and regional clusters

• Corporate social responsibility (CSR)

…………………But I am sure you know about all that!So, instead let’s talk about

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Amartya Sen & Sustainable Development

According to Sen, there are populations today that live in a state of 'unfreedom', unable to realize their capabilities.

Poverty is “a deprivation of basic capabilities, rather than merely low income"

Five freedoms: 1. Political freedoms2. Economic facilities3. Social opportunities4. Transparency guarantees5. Protective security

Population, Corruption and Freedom IndicatorsCountry Population

(Million)

Population

under 25

GDP per

capita, 000 at

PPP

Democracy Corruption Freedom Index of

100=most

unstable

Algeria 35.9 47.5 % 8.2 125 105 141 49.7

Bahrain 1.2 43.9 % 24 122 48 153 36.5

Egypt 84.6 52.3 % 5.9 138 98 130 65.7

Iraq 31.4 60.6 % 4 111 175 144 65.7

Jordan 6.4 54.3 % 5.2 117 50 140 48.7

Kuwait 3.5 37.7 % 40.6 114 54 115 21.7

Lebanon 4.3 42.7 % 13.4 86 127 115 30.7

Libya 6.5 47.4 % 18.7 158 146 192 71

Morocco 32.4 47.7 % 4.7 116 85 146 46.8

Oman 3.3 M 51.5% 23.3 143 41 153 58.4

Palestine 4.1 64.4 % 2.9 93 NA 181 NA

Qatar 1.7 33.8 % 66.9 137 19 146 20.7

Saudi

Arabia 27.1 50.8 % 22.9 160 50 178 52.5

Sudan 43.2 59 % 2.3 151 172 165 NA

Syria 22.5 55.3 % 4.7 152 127 178 67.3

Tunisia 10.4 42.1 % 8.6 144 59 186 49.4

UAE 6.7 31 % 27.2 148 28 153 24.3

Yemen 24.3 65.4 % 2.9 146 146 173 86.6

The Economist

Ranking of democracy

( out of 167 countries )

Ranking of corruption

( out of 178 countries )

Ranking of press

freedoms

( out of 196 countries )

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Democracy and GDP per capita in MENA

Income is positively related to Democracy

GDP per Capita (PPP, 1000s)

Source: IMF

Oil/gas Revenues

Economies are dependent on hydrocarbon revenues

Source: IMF

Military Expenditures as % of GDP

Foreign Direct Investment as % of GDP, 2009

% of Population Under the Age of 30

Quality of Education Index

Unemployment Rates (%)

Youth Employment Rates (%)

Youth Unemployment (%) vs. Political Stability

% of Population Below the Poverty Line

Development

Equitable Growth

Accountability

Transparency

Freedom of Speech

Democracy

A Thesis…

Collaboration?

But…

Agreement Date Signed Members

Pan-Arab Free Trade

Area (10 yr transition

period)

January 1, 1998. All Arab states

Agadir Agreement February 25 2003 Egypt, Morocco, Tunisia and

Jordan

Unified Economic

Agreement

Signed 1981 and

adapted December

2001

Gulf Cooperation

Council (GCC)

Arab countries resorted to intergovernmental approaches to integration due to reluctance of Arab leaders to transfer sovereignty to supranational bodies

Areas of Possible Cooperation:

• Evidence shows there is little gain from cooperating in manufacturing (goods): lack of competitiveness, low value added, little intra industry trade

• Integration in Services, Labor, FDI flows (Capital) have high potential gains from integration.

• Newly democratizing economies will most likely see greater economic integration with each other; the trend may spread throughout region.

Thank You