The Impact of Regional Integration on Intra-Arab Trade in Agrifood Commodities: A Panel Data Approach

Abstract

This paper assesses the impact of Arab integration arrangements on intra-Arab Agrifood trade. The main results indicate that Arab regional integration efforts have been ineffective in promoting Agrifood trade flows among the Arab countries. The results also show that actual intra-Arab Agrifood trade is consistently lower than the predicted values by the gravity model. Furthermore, Arab sub-regional trade agreements have had a modest impact on intra-Arab Agrifood trade. Taken together, these findings suggest that i) there is untapped trade potential in agricultural and food commodities among the Arab countries and thus they could potentially attain deeper levels of Agrifood trade integration, and ii) despite the significant progress that has been made over the past two decades in lowering tariff barriers, Agrifood trade among Arab countries has remained below its potential which in turn points out to the existence of non-tariff barriers that restrain the trade effects of Arab economic integration