Regional Economic Integration: This is our time, and our moment
Author: Alain Bejjani — CEO, Majid Al Futtaim — Holding
What would the MENAP region look like if we collectively generated more than twice our current GDP? What could we achieve for our people, businesses, sectors and nations if we worked together to unlock more than USD 230 billion as a first step on the way to closing a USD 2.5 trillion regional GDP gap and realising our true potential?
At the World Economic Forum in Davos today, Majid Al Futtaim together with the Forum and McKinsey have launched a new report, ‘The Time is Now: A Perspective on Economic Integration in MENAP’ that outlines a roadmap for how we can get there and why we in the private sector and public sector need to come together and act together as soon as possible.
Two years ago, we debuted our first report detailing the potential of economic integration in the MENAP region. Since then, the world has faced tremendous challenges including the pandemic, tremendous volatility in supply chains and commodity prices and major geopolitical tensions that continue to affect us today. Although we have been understandably preoccupied with those, it is clear regional economic cooperation could have dampened the impact of those events, and that the same events have made collaboration even more critical.
Here are a few findings I found particularly interesting:
1. We are immeasurably stronger together. While some countries have made remarkable progress since 2020 through unilateral improvements, others have lagged. As a region, we are still economically fragmented, making it much more difficult to attract investment and reap cross-border and bloc economic benefits. To cultivate the needed national champions who can catalyse growth, for example, access to larger bloc markets is non-negotiable — local markets are simply not enough.
2. The changes we need to make are within reach. We’ve identified three initial key levers that can have outsize impact on economic growth in the region — selective deregulation; the free movement of goods, services, capital, people and data; and common standards that would allow companies to operate easily and effectively in multiple markets.
3. We need more private sector leadership. We’re looking for an A-team of private sector players from the 15-nation region spanning the Maghreb, Levant, Gulf and Pakistan to come together to not only articulate a private sector perspective on the most critical issues, but also play an active role in supporting SMEs, investing in R&D and innovation to increase productivity, upskilling people and driving job creation. This is win-win for us individually and collectively.
4. There’s never been a better time to achieve closer regional economic cooperation. Changes in tech, startups, awareness, energy demand and resource flows have positioned us at a fulcrum moment. Our report details the burning platform of food security for the MENAP, for example, through which we can design, pilot and refine mutually beneficial initiatives in this critical area — initiatives that can then be upcycled and expanded to other sectors.
‘Give me a lever long enough and a fulcrum on which to place it, and I shall move the world,’ Archimedes is reported to have said. We have the fulcrum, and we know what levers we need — who will join us in moving our region from underperforming to right-sizing?
Or, if we need something more contemporary and regional, the lyrics of the Dubai Expo2020 come to mind: This is our time, this is our moment, we have to decide.