President of the Agadir Technical Unit (ATU) Ferid Tounsi urged private sectors in the pact’s member states, Jordan, Egypt, Morocco and Tunisia, to be more engaged in the deal and take advantage of what he described as the “distinguished and excellent” incentives provided by the agreement.
Signed in February 2004, the Agadir Agreement allows the four countries to cumulate origin to export to the EU duty-free and quota-free.
This means that even if Jordanian input into a product is not large enough for that product to be exported freely from Jordan to the EU, Egyptian, Tunisian or Moroccan input can be added, so that the required value-added percentage is reached and the product can enter the EU market and enjoy the same privileges.
The agreement was designed to create an integrated market of 120 million people and allow industries in the signing countries to cooperate in exporting to large economic powers such as the EU and the US, providing an even larger market. The deal is also meant to promote mutual investment among member states, and to make their shared economic space more attractive.
“In light of the current difficult situation, regional integration between the four member states can be a positive response to the crisis,” Tounsi told reporters at a press meeting yesterday.
“The EU wants to create a counterpart to deal with in the south of the Mediterranean, and Agadir member states should make use of that and further activate the agreement, especially since growth rates in Arab states, including member states, are expected to be higher than those of the EU in 2009,” Tounsi said.
Estimates by the International Monetary Fund (IMF) indicate that investments will increase in developing countries more than in advanced states in 2009 and that although economic growth rates in developing countries will witness a decrease, they will still be higher than those in their advanced counterparts.
Tounsi said member states can use the Agadir Agreement to increase overall trade volume among themselves, which in 2007 stood at about $2.7 billion.
“There has been an increase in trade volume among the four countries, but it is still weak and there is potential to increase trade among member states and to increase exports to the EU,” said Tounsi.
He added that the Jordanian, Moroccan, Tunisian and Egyptian private sectors should be key players and effective partners in the agreement, especially given the sincere will on the part of the four countries and the EU to make it succeed.