Regional integration

No new or significant developments were reported on the performance of the Arab countries in enhancing regional integration. Available figures draw a mixed picture: there was progress in performance on some indicators of Arab regional integration and a lag on others in 2005 and 2006. Arab intraregional trade as a percentage of total Arab trade grew slightly from 11.2 per cent in 2005 to 11.3 per cent in 2006. On the other hand, Arab intraregional investment as a percentage of total FDI dropped from about 34 per cent in 2005 to almost 27.4 per cent in 2006 (table 14), notwithstanding the significant growth by about 74 per cent of FDI inflows in 2006 due to the higher growth rate total FDI in comparison with the growth rate of Arab intraregional investment. The difference shows that the most important source of FDI flows into the Arab countries continues to be non-Arab countries, especially the European Union, United States of America and Japan; Jordan, the Sudan and Yemen are exceptions in the sense that intraregional investment there contributes a high percentage of total FDI inflows.

Related Subject(s): Economic and Social Development