Regional Integration

Stimena

STIMENA was launched in October 1994 at the Economic Summit of Casablanca by then Minister of Economic Affairs Delamuraz, as a contribution by Switzerland to the peace process initiated at the Madrid conference in October 1991. The central objective of the initiative was to contribute to the peace process by assisting in improving regional cooperation in the field of economic development and trade. Mr. Arthur Dunkel, former GATT Director General, was entrusted with the task of giving effect to the Swiss Initiative and has chaired its secretariat, based in Geneva, since July 1995.

STIMENA is based on the conviction that sustained regional trade, economic cooperation and attractive investment frameworks are essential for improving the living conditions in the Middle East and thus for contributing to the peace process. STIMENA has carried out its task in close cooperation with the four “Core Parties” - i.e. Egypt, Israel, Jordan and the PLO - and maintained close contacts with the USA and the EU, as well as academic and think-tanks (e.g. Council on Foreign relations, Harvard University, Israeli and Palestinian think tanks) and organizations working on trade-related issues in the MENA region.

In a first Phase, from July 1995 to July 1998, the main focus of the initiative was on interacting with the regional parties acting jointly in the context of the Regional Economic Development Working Group (REDWG) of the multilateral peace process. In the second phase, from mid-1998 to mid 2000, contacts were maintained on a bilateral basis with the Core Parties but the work focused primarily on Israeli-Palestinian relations as they were seen as central to the improvement of regional cooperation. While Syria and Lebanon did not participate in the multilateral process, contacts were established in the second phase. In this regard, IDEAS is currently advising Lebanon towards its WTO Accession.

Following a request formulated by the Trade committee of the REDWG, STIMENA published in 1997 a Study on the framework of rules, principles and practices governing the trade relations between the Core Parties and between them and the key third parties, namely the USA and the EU. To obtain a comprehensive picture of trade relations in the region and with outside partners, the Study reviewed the relevant bilateral agreements, the relationship with the World Trade Organization (WTO) and the autonomous trade policy measures of the core parties.

The following aspects of the core parties’ trade policies and practices were specifically analyzed;

1. The core parties’ involvement in trade agreements, both with each other and with key third parties, focusing on;
• The way in which the core parties rely on trade agreements as instruments of their trade policy;
• The Israel-PLO/PA trade relationship;
• The core parties’ status regarding WTO agreements.

2. Their different customs tariff protection regimes, core-party-wise and/or in a comparative way, focusing on;

• The MFN regime;
• Preferential treatment of other core parties;
• Preferential treatment in favor of the key third parties;
• The NTMs;
• Other trade-related measures

3. The level of tariff protection faced by their exports to the other core parties and key third parties (density and depth)

It was envisaged that a second part of the analysis would assess trade policies and barriers in the field of services and trade-related investment measures (TRIMs). In addition to the analytical part, the study contained findings and recommendations for the harmonization of economic and trade-related policies.

The Study, which has been translated into Arabic, has been widely distributed and commented by experts and has served as a reference for the economic and trade-related harmonization process in the region.

STIMENA was asked to present the findings of the study to various conferences and events, such as the Trade Committee of the REDWG, the Ministerial conference sponsored by the US-government in Taba, as well as to the Summit and Conference of the Middle-Eastern and North African countries in Amman and respectively, Cairo.

Further, STIMENA participated from 1996-2000 in various international high-level conferences, workshops and seminars dealing with the economic and security situation in the Middle-East.

In addition to the publication and dissemination of the findings of the Study, STIMENA played an active role as go-between, respectively “honest broker” between the involved parties aiming at facilitating the search of possible solutions acceptable to all parties.

STIMENA’ s know-how of the regional economic situation and its good reputation on both sides could be used by IDEAS in the framework of a multilateral peace process, as a specific input for (re-) launching and strengthening economic and trade-related cooperation in the region; IDEAS could in this regard, capitalizing on the work done so far and the network of contacts established, inter alia:

1. (a) Update the study on trade relations among the core Parties and with key third parties, and expand it to include aspects of trade in services and investment;

(b) Develop specific options and recommendations for the development of regional cooperation among the parties, this in line with WTO requirements;

(c) Provide specific expertise in the field of economic and trade policy, either through assistance for defining trade policy regimes, for cooperation among the Parties and/or support towards the WTO Accession process.

2. Capitalizing on the experience and goodwill obtained so far by STIMENA and specifically its Chairman, and the numerous contacts established throughout the Middle-East, IDEAS could - further - act as go-between, respectively “honest broker” between the two sides in searching for pragmatic solutions to the current impasse in economic relations; In this regard, the neutral character of a Swiss initiative, without specific geo-strategic interests in the region, coupled with a systemic approach of WTO related issues could certainly be of specific value-added in the multilateral process.