CASABLANCA, 30 April 2006 — Arab states attract only 1.0 percent of global foreign investment despite the need to cut sky-high unemployment because reforms required to make them more attractive have not been made, bankers said on Friday.
Leading bankers from several Arab countries including Saudi Arabia, Egypt, Kuwait, Lebanon, Morocco, Algeria, Sudan and Yemen, gathered in Casablanca for a Thursday-Friday conference to assess investment and business environment in the region.
“Red tape and lack of clarity in property rights make investors flee the region,” Mahmoud Al-Nouri, Kuwait’s former finance minister and head of the International Arab African Bank, told the gathering.
He added: “The solution is to give a leading role to the private sector and implement a clear program of privatization and reform of the administration and a crackdown on corruption and respect of property rights.”
Some bankers gave the example of Singapore which they said attracted $30 billion in foreign investment per year while the whole Arab world got only $9 billion.
They said that underlined how poor the business climate is in the region, where unemployment is at 15 percent, the highest of any region in the world.
“All the Arab countries have together managed to lure only 1.0 percent of the global flow of foreign direct investment,” said Aissa Hidouci, chief executive officer of the Tunisian-Saudi Investment Bank.