• by IPS Correspondents (bonn)
• Monday, December 26, 1994
• Inter Press Service

BONN, Dic 26 (IPS) - A lack of cohesive economic policies among North African countries continues to make regional integration a "very difficult" goal to attain six years after the Union of the Maghreb (UMA) was formed, says a new European bank study.

The UMA comprising Algeria, Libya, Mauritania, Morocco and Tunisia was set up in Feb 1989 with the aim of encouraging joint ventures and establishing a common market.

This objective is however far from being achieved and may remain out of reach in the near future, according to a report prepared by the Banque Nationale de Paris for ABECOR, an association of European banks.

The group includes: Banca Nazionale de Lavoro, Bank Austria, Banque Bruxelles Lambert, Banque Internationale a Luxembourg, Barclays Bank and the Hypo-Bank. The study made available to IPS by Germany's Dresdner Bank, analysed the situation in Algeria, Libya, Morocco and Tunisia.

Taking note of the instability in civil war-torn Algeria, the report highlighted that the political situation in the four countries is as divergent as their economies.

While Algeria and Libya depended for 95 percent of their export income on hydrocarbons, oil accounted for 12.8 percent of Tunisia's exports in 1993 and its importance as foreign exchange earner was declining since the 1980s.

On the other hand, Morocco is for more than 80 percent of its foreign exchange earnings, dependent on export of food, semi- finished and other goods as well as on tourism, noted the study.

Providing a synopsis of the economic performances of the four countries under study, the report said that Algeria owed toward the end of 1993, a total of 25.1 billion dollars abroad, and debt service accounted for 80 percent of its foreign exchange receipts.

Algeria is a member of the Organisation of Petroleum Exporting Countries (OPEC). And the fall in oil prices in 1986 had led to a sharp fall in export revenues.

Still, the government insisted on servicing foreign debt without undertaking a formal debt rescheduling. This forced the authorities to introduce drastic cuts in imports which in turn disrupted both the operation and the modernisation of the economy, reducing the standard of living.

© Inter Press Service (2014) — All Rights Reserved. Original source: Inter Press Service

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