Deeper Integration of Goods, Services, Capital and Labor Markets: A Policy Research Agenda for the MENA Region

This report aims at providing ERF with a sound basis for selecting and designing a research program over the next 3-5 years for one of the major themes of the initiative - regional integration in the Arab region. The report was initially prepared for a workshop on “Regional Integration in the Arab Region,” held in Cairo in November 2008. At the workshop authors received valuable comments from attendees, which have been integrated into this policy research report. The report addresses the subject by first providing a summary review of existing knowledge about regional integration. Regional integration is considered in a broad sense both with respect to markets, that is goods, services, labor and capital; and in terms of geographical coverage, that is preferential agreements between Arab countries or with non-Arab countries and openness without any preferential treatment. Secondly, it goes on to identify the knowledge gaps on regional integration in the region. These gaps are assessed both in terms of policy-relevance and according to international best practice. Finally, the report proposes a number of directions and priorities for a future policy-relevant research program.