Riad al Khouri asked in Executive Management 25th Jan '16:As recession continues in many Mediterranean countries, is strengthening of Euro-Med partnerships through more free trade and investment a solution? What is your advice please?.
Tarek Kettaneh replied 7th Feb '16:
Research in the past 50-70 years has demonstrated without a doubt that fre trade is a powerful booster of economic growth; this is what Doha rounds internationally, and WTO are all about.View all replies to this question
However, growth is not uniform across industries; some benefit, some suffer, but the overall effect is unquestionably positive; politicians who make such decisions and tend to think about vote getting and vote losing; those who win are less likely to vote- they are happy - those who lose are more likely to vote "against", which explains why progress is slow and fitful.
In addition, under EuroMed and similar agreements, assistance and financing are normally tied to improved governance, environmental protection measures etc, which the less developed countries / companies are still reluctant to consider.
In some countries, Lebanon for example, many industries act as cosy oligopolies, (cement, banks, oil distributors...) and dislike the idea of legislation threatening to disrupt comfortable long standing ways of doing business, so they will lobby against any opening up of competition.