By Arab News
Upheaval across the Arab world is causing capital flight of up to $500 million (349 million euros) a week, Jordanian Finance Minister Mohammed Abu Hammour said Thursday at an Arab banking conference in Rome.
“There is capital flight. Five hundred million dollars a week are leaving the Arab world. Tourism is falling, foreign direct investment is falling,” Abu Hammour said, pointing to volatility in oil prices as another negative.
“Economic development is lagging. We need to guarantee job opportunities. This is a huge challenge … We need five million new jobs every year but we have only been able to generate three million jobs a year,” he said.
Abu Hammour called for greater economic integration between Arab countries, greater assistance to small and medium-sized enterprises and development of the private sector as ways to improve the economic outlook for the region.
The minister was taking part in the International Arab Banking Summit organized by the Union of Arab Banks with senior bankers and central bank governors to discuss the implications of the current political upheaval in the region.
The cost of weeks of Arab unrest to two of North Africa’s most important tourist economies is set out in airline industry data, with at least 100,000 fewer seats a week flying to or from Egypt and Tunisia.
Tourism is vital to both nations and although life is creeping back to normal after revolutions discarded long-time rulers, the further spread of Arab protests and war in Libya have forced airlines to rethink plans for the summer tourist season.
Tourism accounts for over 6 percent of Tunisia’s economy and employs roughly 400,000 of its 10 million people. Egypt’s economy also nearly froze during weeks of protests that started Jan. 25 and some of its main sources of foreign exchange, including tourism, collapsed.
The Geneva-based airlines association IATA predicted in March that political instability would dampen demand in affected areas but gave no forecasts. Egypt, Libya and Tunisia comprise a fifth of the region’s international passenger traffic.