Messerlin, PatrickHoekman, Bernard2014-08-012014-08-012002-10https://hdl.handle.net/10986/19233The authors compare the European Community's "trade fundamentals" prevailing in the 1960s with those applying in Arab countries today. The fundamentals differ significantly-Arab countries trade much less with each other than EC members did, and the importance of such trade in GDP varies greatly. This suggests that a viable Arab integration strategy must follow a path that differs from the preferential trade liberalization-led approach implemented by the European Community. An alternative is to complement long-standing attempts to liberalize merchandise trade with an effort that revolves around service sector reforms and liberalization. This may prove to be an effective mechanism to support reforms as, in principle, there is a major constituency in each Arab country that has an interest in improving the performance of services-the natural resource-based and manufacturing sectors. A key condition for such an approach to be feasible is that Arab cooperation helps overcome political economy resistance to national, unilateral action, or, generates direct gains from cooperation in specific policy areas. The EC experience suggests that a services-based integration strategy will be complex and must be carefully designed and sequenced. Given the importance of services-related trade and logistics transactions costs, a first step might focus on bringing such costs down through a concerted joint effort.en-USCC BY 3.0 IGOAGRICULTURAL PRODUCEAGRICULTUREBENCHMARKSBILATERAL AGREEMENTSBILATERAL TRADEBORDER MERGERSCAPITAL MARKETCARTELCARTELSCOALCOLLUSIONCOMMERCIAL POLICYCOMMON MARKETCOMMON TARIFFCOMPARATIVE ADVANTAGECOMPARATIVE ADVANTAGESCONSUMERSCONVERGENCECREDIBLE TARIFF REMOVALCURRENCYCUSTOMSCUSTOMS UNIONCUSTOMS UNIONSDEVELOPMENTDIMINISHING RETURNSDISCRIMINATORY TRADE AGREEMENTSDOMESTIC INTERESTSDOMESTIC MARKETSDOMESTIC REFORMSDOMESTIC REGULATIONECONOMIC COMMUNITYECONOMIC COOPERATIONECONOMIC EFFICIENCYECONOMIC FACTORSECONOMIC IMPACTECONOMIC INTEGRATIONECONOMIC POLICIESECONOMIC POWERECONOMIC PROCESSECONOMIC SIZEECONOMIES OF SCALEELIMINATION OF TARIFFSEMPLOYMENTEMPLOYMENT POLICYEXCESS SUPPLYEXPORT MARKETSEXPORT SHARESEXPORT STRUCTUREEXPORT SUBSIDIESEXPORTSEXTERNAL PROTECTIONEXTERNAL TARIFFEXTERNAL TRADEEXTERNAL TRADE POLICYFACTORS OF PRODUCTIONFINANCIAL SUPPORTFOREIGN POLICYFREE TRADEFREE TRADE AGREEMENTSFREE TRADE AREAFUELSGDPGDP PER CAPITAGOVERNMENTAL COOPERATIONGRAVITY MODELHARMONIZATIONHIGH TARIFFSIMPORT BARRIERSIMPORT PRICESIMPORTSINCOMEINCOME DIFFERENCESINDUSTRIAL POLICIESINDUSTRIAL PRODUCTSINDUSTRY TRADEINTEREST GROUPSINTERNAL MARKETINTERNAL TRADEINTERNAL TRADE LIBERALIZATIONINTERNATIONAL TRADEINTRA-REGIONAL TRADELABOR FORCELABOR MARKETSLEGISLATIONLIBERALIZATION OF TRADELOW TARIFFSMARKET SEGMENTATIONMARKET SEGMENTINGMARKET SHAREMARKET SIZEMEMBER COUNTRYMEMBER STATEMEMBER STATESMERCHANDISE TRADEMONETARY POLICYMULTILATERAL NEGOTIATINGMUTUAL RECOGNITIONMUTUAL TRADENATIONAL LAWSNATIONAL LEGISLATIONNATIONAL POLICIESNATIONAL REGULATIONSNATURAL RESOURCESOILOIL EXPORTERSOIL PRICEOIL SECTORPARTNER COUNTRYPOLICY HARMONIZATIONPOLICY INTEGRATIONPOLICY MAKERSPOLITICAL ECONOMYPREFERENTIAL BASISPREFERENTIAL TRADEPREFERENTIAL TRADE LIBERALIZATIONPRICE SUPPORTSPRIVATE SECTORPROCESS OF INTEGRATIONPRODUCERSPRODUCT CATEGORIESPRODUCT DIFFERENTIATIONPRODUCT MARKETSPRODUCTION COSTSPRODUCTION PROCESSPRODUCTIVITYPROFESSIONAL QUALIFICATIONSPROFIT MAXIMIZATIONPROTECTIONIST POLICIESPROTECTIVE TARIFFSPUBLIC HEALTHPUBLIC INTERESTPUBLIC SAFETYRATES OF PROTECTIONREGIONAL COOPERATIONREGIONAL INTEGRATIONREGIONAL TRADEREGULATORY AREASREGULATORY ISSUESREGULATORY OBJECTIVESREGULATORY REGIMESRESTRICTIVE BUSINESS PRACTICESSAFETY STANDARDSSHARE OF WORLD EXPORTSSOCIAL SECURITYSOCIAL SECURITY COSTSSPECIALIZATIONTARIFF LINESTARIFF SCHEDULETARIFF SCHEDULESTRADETRADE AGREEMENTSTRADE ARRANGEMENTSTRADE BARRIERSTRADE CLASSIFICATIONTRADE COSTSTRADE DEPENDENCETRADE FACILITATIONTRADE FLOWTRADE FLOWSTRADE INTENSITYTRADE INTENSITY INDICESTRADE LIBERALIZATION EFFORTSTRADE PATTERNSTRADE POLICIESTRADE POLICYTRADE POLICY INSTRUMENTSTRADE REFORMTRADE RESTRICTIONSTRADE VOLUMESTRADING PARTNERSTRANSACTION COSTSTRANSACTIONS COSTSTRANSITION PERIODSUNILATERAL ACTIONVALUE OF TRADEVOLUME OF TRADEWAGESWORLD ECONOMYWORLD MARKETWORLD MARKETSWORLD PRICESWORLD TRADE10.1596/1813-9450-2921