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RIYADH: Arab leaders pledged to remove obstacles to finalising a free trade zone this year and agreed to facilitate capital flows, as they wrapped up an economic summit in Riyadh yesterday.
“We stress our determination to complete all the prerequisites of (forming) the free trade area before the end of this year,” Arab League chief Nabil Al Arabi said at the end of the third Arab Economic and Social Summit.
The leaders, he added, were determined to clear obstacles to “achieve the Arab customs union fully by 2015.” Saudi Finance Minister Ibrahim Al Assaf said officials working to facilitate a customs union were struggling to sort out rules on the origin of goods.
“We still have problems with the issue of country of origin... in order to establish which goods are from Arab countries and the percentage of foreign components,” he told reporters.
The regulations of the customs union stipulate that exempted goods should have at least 40 percent local components.
Meanwhile, Arab leaders agreed amendments proposed to strengthen the flow of capital and investments between countries, Arabi said. The Arab League leader’s assistant for economic affairs, Mohammed Al Tuwaijri, had described investment laws in Arab countries as a “repellent for investments”.
He also highlighted “significant deficiencies” in the 1980 common agreement over capital movement. Foreign direct investment inflow dropped from $68.7bn in 2010 to $43bn in 2011, a year that saw a wave of Arab Spring uprisings hitting several Arab nations.