JEDDH: P.K. ABDUL GHAFOUR
Published — Thursday 24 January 2013
Last update 24 January 2013 10:22 am
The resolutions taken by the Arab Economic Summit, which concluded its deliberations in Riyadh on Tuesday, will have a big impact on boosting joint Arab investment, said Abdullah Al-Mubti, chairman of the Council of Saudi Chambers’ board of directors.
He said the proposal made by Custodian of the Two Holy Mosques King Abdullah to increase capital funds of Arab organizations and joint investment companies would help them give more loans to accelerate economic growth in the region.
He said the readiness expressed by the king in his opening address to pay Saudi Arabia’s share in the increased capital funds reflected Riyadh’s pioneering role in supporting Arab economic issues and poor countries.
It has been estimated that the increase in capital funds of Arab organizations would help channel more than $ 10 billion to strategic projects in Arab League countries.
The CSC chief urged all Arab countries to follow the Kingdom’s example by committing themselves to pay the extra funds to help Arab organizations and joint firms drive the region’s economic growth.
Al-Mubti commended Arab leaders for their support to the private sector considering its important role in propelling growth. The private sector forum organized by CSC in Riyadh had presented 21 development initiatives including those related to food security, training and employment, support for small and medium enterprises, investment in information technology, center for supporting business pioneers and housing investment.
Al-Mubti underscored the summit’s decision to endorse the newly amended investment agreement, saying that it would encourage Arab businessmen to invest in their countries. “The Arab strategy for renewable energy passed by the summit would encourage many countries to make use of renewable energy for development projects,” he pointed out.
The inter-Arab investment agreement would allow a free flow of investment and capital between states. The agreement stipulates that the member states undertake to protect Arab investors in their territories.
However, it does not require modifications of national regulations, as it gives Arab investors the freedom to invest in any of the states party to the agreement within the national laws of each country.
The summit leaders also pledged to remove obstacles preventing the establishment of a free trade zone this year. They were also determined to clear obstacles to achieve the Arab customs union fully by 2015.
Foreign direct investment inflow dropped from $ 68.7 billion in 2010 to $ 43 billion in 2011, a year that saw a wave of Arab Spring uprisings hitting several nations. Trade between Arab countries comprises no more than 10 percent of total Arab commerce.