Reuters
TUNIS: North African and East Mediterranean countries are expected to voice commitment to economic reforms in exchange for billions of euros in European Union (EU) aid at a meeting in Tunis on Sunday and Monday. The gathering of EU finance ministers and their counterparts from the southern and eastern Mediterranean is the latest of several steps to promote economic progress around the waterway and curb migratory pressures on Spain, Malta and Italy. Countries like Tunisia and Morocco depend heavily on the EU as an outlet for exports such as textiles and farm products and in theory have much to gain from the Euro-Mediterranean partnership, also known as the Barcelona Process. We are looking for more involvement by the EU in hopefully resolving the instability in the east of the region and more foreign direct investment from our European partners, not just financial support, Hamza Jaradat, an economic adviser to the Jordanian government, told Reuters. Despite their proximity, so-called southern Mediterranean countries account for only a small portion of European trade while falling trade barriers are pitting the region against new East European and Asian competitors, posing a new threat. Several Arab countries have embarked on reforms in exchange for EU grants and loans worth 15 billion euros over 10 years. The European Investment Bank has earmarked another 10 billion euros in loans for the region between 2007 and 2013, plus EU budget grants that could take up most of the 12 billion euros allocated for the bloc s neighborhood policy. But the EU s efforts to transform its southern neighbors have been held back by poor human rights records, democratic shortcomings, opaque governance and corruption in many of the partner countries, EU officials say. Mediterranean partners achieved economic growth of just 4.8 percent last year, lagging the 7.2 percent expansion rate of emerging markets and developing countries as a whole. Analysts blame part of the underperformance on a failure to nurture intra-regional trade, which accounts for just 15 percent of total trade, the lowest rate in the world for any region of that size. That proportion could grow as a recent free trade deal comes into force between Morocco, Tunisia, Egypt and Jordan and as countries like Morocco invest massively in roads and ports to tackle high transportation costs. But political rows and tensions over the Israeli-Palestinian conflict and Western Sahara are hurdles to the Euro-Mediterranean process of political, cultural and economic cooperation, born at the height of Arab-Israeli peacemaking in 1995. Because of the Sahara dispute, the Moroccan-Algerian border has been shut since 1994, crippling trade across the Maghreb. Ten years of Euro-Med cooperation haven t produced great results, because we haven t given enough priority to regional cooperation, Algerian Foreign Minister Mohamed Bedjaoui told a seminar in Algiers on Saturday. The EU has opened talks on free trade with its southern neighbors in agricultural goods and services to complement existing talks on industrial goods, but analysts say the goal of a Mediterranean free trade zone by 2010 looks ambitious.
The north African and east Mediterranean partners are Algeria, Egypt, Israel, Jordan, Lebanon, Morocco, the Palestinian Authority, Syria, Tunisia and Turkey.
