- P. van den Boogaerde
- Published Date:
- June 1991
© 1991 International Monetary Fund
Library of Congress Cataloging-in-Publication Data
van den Boogaerde, Pierre
Financial assistance from Arab countries and Arab regional institutions / Pierre van den Boogaerde.
p. cm. — (Occasional paper / International Monetary Fund, ISSN 0251-6365 ; 87)
Includes bibliographical references.
1. Economic assistance, Arab countries—Developing countries.
I. Title. II. Series: Occasional paper (International Monetary Fund); no. 87.
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This paper examines the volume and distribution of concessional and nonconcessional financial flows from Arab countries and national agencies and from Arab multilateral institutions to developing countries, with a special emphasis on Arab recipient countries, from 1973 to 1989. In line with the rapid rise in oil prices and government revenues in oil producing countries, financial assistance increased very rapidly from 1973 through 1980. A large part of this assistance was granted unconditionally, and the geographic distribution widened over the years. Essentially because of the softer oil market, disbursements of financial assistance fell gradually in the 1980s. Nonetheless, Arab contributions as a share of GNP remain by far the most generous among the major donor groups and well above the target set by the United Nations. Arab multilateral agencies have flourished, with cooperation among them and the cofinancing of projects increasing over the years. All are now well equipped to appraise and administer their own lending programs.
This study encompasses all the members of the Arab League, classified into two groups: the Arab donor countries, which include Algeria, Iraq, Kuwait, the Libyan Arab Jamahiriya, Qatar, Saudi Arabia, and the United Arab Emirates, all of which are oil exporting countries and members of the Organization of Petroleum Exporting Countries (OPEC); and the Arab aid recipient countries, which are Bahrain, Egypt, Jordan, Lebanon, Mauritania, Morocco, Oman, Somalia, the Sudan, the Syrian Arab Republic, Tunisia, the Yemen Arab Republic, and the People’s Democratic Republic of Yemen. Algeria and Iraq have also been recipients of Arab aid and are identified as such in the section dealing with the geographical distribution of aid among recipients. In that section, Arab aid recipient countries are subdivided into two groups: the Arab Middle East countries and the Arab African countries.
Arab countries received about 61 percent of total Arab financial assistance between 1973 and 1989. The bulk of this assistance was extended bilaterally; a significant part of it consisted of general support assistance. The economic development of the Arab world during this period was also heavily influenced by the migration of labor. Most of the imported labor in Arab donor countries was provided by nationals of the Arab recipient countries, and total workers’ remittances were about one and a half times larger than the total Arab financial assistance extended to Arab recipients between 1973 and 1989. Combined, these flows represented a large portion of most of these recipient countries’ GNPs, imports, and fixed investment, and thereby accelerated their economic development beyond what would have been otherwise possible.
Several countries referred to in this Occasional Paper have since merged: the Yemen Arab Republic and the People’s Democratic Republic of Yemen became the Republic of Yemen on May 22,1990; the Federal Republic of Germany and the German Democratic Republic were reunified on October 3, 1990. Because the data and the period being covered predate these events, the countries are referred to by their pre-unification names.
The author wishes foremost to thank Jurgen M. Bartsch, Head, Non-DAC Countries’ Unit of the OECD, for providing most of the time series on Arab financial assistance flows. He is also grateful to officials of the national and multilateral Arab aid agencies, the OPEC Fund for International Development, and the Islamic Development Bank for their cooperation in providing information. Thanks finally to Muhammad Yaqub and Leigh Alexander and other colleagues of the IMF’s Middle Eastern Department for helpful comments and suggestions. The analysis, conclusions, and any errors are the sole responsibility of the author.