Arabs Urged to Work Hard to Raise GDP
03 Jan 1998A prominent Arab accountant called on the Arab nations to work hard on increasing their currently low gross domestic product which has been estimated at just half a million dollars for last year.
“Arab GDP is less than 10 per cent of global GDP. It is less than that of Spain’s and the Gulf’s is less than Belgium”, said Talal Abu-Ghazaleh, Chairman of the Arab societies of accountants, management, intellectual property and technology transfer.
“Arabs should work hard to raise their GDP by 10 times to reach the U.S.’s and Europe’s and ensure a place on the international economic map,” he added.
Abu-Ghazaleh said the latest WTO report ending in August, shows that the Middle East has a share of $163 billion of global exports estimated at $6.1 trillion with The U.S. account for $827 billion or 16.5 per cent of this.
Global trade in services touched $1.26 trillion with the U.S. having a share of up to I8 per cent (5225 billion). The Middle East had no existence in this particular sector, except for Egypt which stood it the 30th place among the top 4O countries, said Abu-Ghazaleh.
“These figures show where Arabs stand in trade and services in particular, which is going to be most important in the coming years,” he said.
Under the GATT agreement, services are divided into 155 sectors including five major ones: communication, information technology, financial services, professional services and movement of people.
“Three of these five major sectors, have been agreed upon which are:
financial, communications and information technology,” he said
“Arabs should prepare themselves well for negotiations in the 155 sectors and our legislators must know that trade liberalization is a continuous process and more pacts will be signed.” He stressed.
Trade in services is now the biggest income group, overweighing trade in goods by four times. Future global economic growth is in services, because the world is concentrating on liberalizing trade in services, said Abu-Ghazaleh.
”Growth of services is related to exporting them, unlike goods which coincide with growth of economy," Abu-Ghazaleh said. The Arab share of the global financial services is low with insurance amounting to only $4.7 billion or 0.25 per cent of global Insurance business.
”Insurance services form less than 1 percent in all developing countries. Financial services include banking, financing, insurance and other activities. Insurance is the most important in advanced countries, as it forms 80 per cent of their GDP,’ he stressed.
Daily global financial transactions touched $1.2 trillion last year with credits at $6.5 trillion, deposits at $2O trillion and insurance at $2 trillion.
”The world will see a future growth of electronic trade in which the U.S. aims at increasing its current $40 billion electronic commerce to more than $1 trillion within the coming three years,” said Abu-Ghazaleh.
Until recently, the U.S. controlled 95 per cent of electronic commerce but its share dropped to 85 per cent with the entry of Europeans.
”Arabs should bear this in mind and choose whether they want to vanish from the international map or become advanced countries.” Abu-Ghazaleh said.
Follow us
