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Catching Up with the Competition
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Studi" i, In"motio,o/ E,o,omi" indud" WOf," d"ling with
the theory, empirical analysis, and evaluation of international policies and institutions,
in the area of international macroeconomics and finance, international trade theory and
policy, as well as international legal and political economy.
General Editor: Robert M. Stem
Editorial Board: Alan Deardorff, Kathryn Dominguez, Barry Eichengreen,
John H. Jackson, Robert Pahre, Gary Saxonhouse,
Robert Staiger, Linda Tesar
Keith E. Maskus, Peter M. Hooper, Edward E. Leamer, and
J. David Richardson, Editors
Quiet Pioneering: Robert M. Stern and His International Economic Legacy
Bjarne S. Jensen and Kar-yiu Wong, Editors
Dynamics, Economic Growth, and International Trade
Jagdish Bhagwati and Mathias Hirsch, Editors
The Uruguay Round and Beyond: Essays in Honor of Arthur Dunkel
Kala Marathe Krishna and Ling Hui Tan
Rags and Riches: Implementing Apparel Quotas under the Multi-Fibre Arrangement
Alan V. Deardorff and Robert M. Stem
Measurement of Nontarijf Barriers
Thomas Cottier and Petros C. Mavroidis, Editors
The World Trade Forum, Volume I: State Trading in the Twenty-First Century
Rajesh Chadha, Sanjib Pohit, Alan V. Deardorff, and Robert M. Stern
The Impact of Trade and Domestic Policy Reforms in India: A CGE
Modeling Approach
Alan V. Deardorff and Robert M. Stern, Editors
Constituent Interests and U.S. Trade Policies
Gary R. Saxonhouse and T. N. Srinivasan, Editors
Development, Duality, and the International Economic Regime:
Essays in Honor of Gustav Ranis
Charles P. Kindleberger
Essays in History: Financial, Economic, Personal
Keith Acheson and Christopher Maule
Much Ado about Culture: North American Trade Disputes
Alan V. Deardorff and Robert M. Stern
u.s.
Social Dimensions of Trade Policies
Thomas Cottier and Petros C. Mavroidis, Editors
Regulatory Barriers and the Principle of Non-Discrimination in World Trade Law
Bernard Hoekman and Jamel Zarrouk
Catching Up with the Competition: Trade Opportunities and Challenges
for Arab Countries
Catching Up
with the Com petition
Trade Opportunities and Challenges
for Arab Countries
Bernard Hoekman and Jamel Zarro uk, Editors
Ann Arbor
THE liNIVERSITY OF MICHIGAN PREss
Copyright © by the University of Michigan 2000
All rights reserved
Published in the United States of America by
The University of Michigan Press
Manufactured in the United States of America
Printed on acid-free paper
2003 2002 2001 2000 432 1
No part of this publication may be reproduced,
stored in a retrieval system, or transmitted in any form
or by any means, electronic, mechanical, or otherwise,
without the written permission of the publisher.
A elP catalog record for this book is available from the British Library.
Library of Congress Cataloging-in-Publication Data applied for
ISBN 0-472-111S4-X (cloth: alk. paper)
ISBN13 978-0-472-11154-1 (cloth)
ISBN13 978-0-472-02646-3 (electronic)
Contents
Preface vii
Tables, Figures, and Boxes ix
Abbreviations and Acronyms xiii
Introduction
PART ONE Where Does the Region Stand?
1. Beyond the Year 2000: Implications of the Middle East's Recent
Trade Performance
Alexander J. Yeats and Francis Ng 9
2. Agricultural Trade and Rural Development in the Middle East
and North Africa
Dean A. DeRosa 45
3. Intra-Industry Trade of Arab Countries: An Indicator of Potential
Competitiveness
Oleh Havrylyshyn and Peter Kunzel 81
PART TWO Quantifying the Gains from Liberalization
4. Assessing the Implications for Lebanon of Free Trade
with the European Union
Will Martin 103
5. A Free Trade Agreement between the European Union
and a Representative Arab Mediterranean Country: A
Quantitative Assessment
Thomas F. Rutherford, Elisabet E. Rutstrom, and David Tarr 145
6. Rents, Red Tape, and Regionalism: Economic Effects
of Deeper Integration
Bernard Hoekman and Denise Konan 171
vi Contents
PART THREE Policy Challenges
7. Enhancing Egypt's Exports
James H. Cassing, Samiha Fawzy, Denis Gallagher,
and Hanaa Kheir-EI-Din 207
8. Regulatory Regimes and Trade Costs
Jamel Zarro uk 227
9. Strengthening Intellectual Property Rights in Lebanon
Keith E. Maskus 251
PART FOUR Institutional Options
10. The Greater Arab Free Trade Area: Limits and Possibilities
Jamel Zarrouk 285
11. Benefiting from WTO Accession and Membership
Bernard Hoekman and Jayanta Roy 307
Contributors 325
References 327
Preface
The Middle East and North Africa region has been lagging behind much of the
developing world in integrating into the world economy, as measured by the
ratio of trade to GDP, growth of nontraditional exports, the share of intra
industry trade, and inward foreign direct investment flows. The papers
collected in this book analyze the recent trade performance of Arab countries
and the trade policy strategies that have been pursued by governments in the
region. Preferential trade agreements, both among Arab countries and between
Arab countries and the European Union, have become a major instrument of
trade policy reforms in the region. Many of the contributions to this volume
explore the implications of the regional integration strategies that are being
implemented and discuss options that might be considered by governments to
further the objective of greater integration into the world economy.
Acknowledgements
A number of the papers that are included were originally prepared for other
purposes and required significant reworking. We are very grateful to the
authors of the papers for agreeing to undertake revisions and to have their
work published in this book. We are also indebted to two anonymous referees
for constructive comments on the draft manuscript, to Susan AI-Baker for
copyediting and putting together the camera-ready manuscript, to Maria Kasi
lag for helping finalize the manuscript, and to Ellen McCarthy of the
University of Michigan Press for helping to bring this project to fruition.
Disclaimer
All opinions expressed by the authors are strictly personal and should not be
attributed to any government, official agency, or institution with which they
may be, or have been, affiliated.
Bernard Hoekman and lamel Zarrouk
Tables, Figures, and Boxes
Tables
1.1 The Most Recent Year of Availability for Middle
Eastern Countries' Trade Data 11
1.2 The 1997 Geographic Destination of Middle Eastern
Countries' Exports 12
1.3 The Share of Middle Eastern Countries in OECD Total
and Non-Oil Imports 1980, 1988, and 1997 14
1.4 The 1997 Product Composition ofOECD Imports from
the Middle East 16
1.5 Industrial Countries' Thirty Largest 3-Digit SITC
Non-Energy Import Products from the Middle East 18
1.6 Dynamic Products in Industrial Countries' Imports from
the Middle East 21
1.7 1985 and 1997 IIT Ratios for Middle Eastern Countries 22
1.8 The Relative Importance of Parts and Components in
Individual Middle Eastern Countries' Trade 24
1.9 The Impact of Competition, Demand, and Diversification
on Middle Eastern Non-Oil Exports 27
1.10 The Share of Individual Countries in Intraregional Exports
in the mid-1980s and 1990s 29
1.11 Middle Eastern Countries' Thirty Largest 3-Digit SITC
Intraregional Exports in the mid-1980s and mid-1990s 30
1.12 Dynamic Products in Middle Eastern Countries' Regional
Exports 32
1.13 1997 "Trade Intensity" Indices for Middle Eastern
Countries' Exports 33
1.14 Implications of Middle Eastern Countries' Export
Diversification Indices 35
1.15 Middle Eastern Countries' Trade Complementarity Indices 36
