Description:
The Pan-Arab Free Trade Area, negotiated
under auspices of the Arab League, came into force in 1997.
Under the agreement all tariffs on goods of Arab origin were
to be removed by January 1, 2005. This paper summarizes the
results of a firm-level survey in nine countries regarding
the implementation of the Pan-Arab Free Trade Area. A
majority of respondent companies report that tariffs on
intra-regional trade have largely been removed, and that
there has been a marked improvement in customs
clearance-related procedures. Costs associated with
administrative red tape and weaknesses in transport-related
infrastructure services are ranked as the most important
constraints to intra-regional trade. This suggests that from
a policy perspective, efforts to reduce real trade costs
deserve priority, including transportation and logistics
services. Periodic monitoring and assessment of trade
incentives and performance would help governments to
benchmark performance and identify priority areas for
action, at both the national and the sub-regional levels.