Can Islamic countries have economic cooperation?

Can Islamic countries have economic cooperation?

At Davos in the World Economic Forum this year, I attended many sessions covering the Islamic world, and it made me hurt badly inside, particularly the pathetic economic situations of countries such as Egypt and Tunisia that triggered the Arab Spring. Unemployment is hitting a record high among the youth, while the aid coming from rich neighboring countries is unable to reach its destination and is being pocketed on the way.

For this reason, I especially focused on the 15th executive board meeting of the Islamic Chamber of Commerce, Industry and Agriculture held in Istanbul. Hosting the meeting, the President of the Union of Chambers and Commodity Exchanges of Turkey (TOBB) Rifat Hisarcıklıoğlu, the keynote speaker Customs and Trade Minister Hayati Yazıcı, and the President of the Islamic Chamber of Commerce and Industry Sheikh Saleh Kamel all agree on this: “The global crisis has changed power equilibriums in the world. Those countries known to be powerful yesterday are today far from their former power. The center of production is shifting from the West to the East. As Islamic countries, it is possible for us to increase our significance in the global system. There is a window of opportunity ahead of us and we should take action immediately.”

Yes, truly, a move has to be made as soon as possible, but how will this be made? Islamic countries - in which 1.6 billion people live - only provide 8.2 percent of world’s production, even though they constitute 22 percent of the world’s population.

How will they recover?
In the meeting, as a first step to changing this negative picture, there was a consensus on developing trade between themselves.

However, there are so many obstacles to be overcome. Between many Islamic countries there are still visa applications to be made. Besides, the “İslam Ülkeleri Tercihli Ticaret Sistemi Anlaşması" (TPS-OIC) that would boost trade in the Islamic world has not been put into effect, as some countries have yet to sign the agreement. Moreover, the customs tariff rate currently applied in Islamic countries is 26 percent above the world average; as a matter of fact, the fact that trade between them is only 17 percent of total foreign trade in the Islamic World is proof of this.

Yazıcı’s figures:
These figures reveal clearly the major conflicts and the major gaps between Islamic countries:
1) Islamic countries produce 65 percent of the oil, 51 percent of the natural gas, 70 percent of the natural rubber, 52 percent of the tin, 33 percent of coconut and 39 percent of the spices of the world.

2) Despite this, 22 of the 48 countries categorized as “the least developed countries” are in the Islamic world, as are 22 of the 40 categorized as “heavily indebted poor countries,” as are 33 of the 70 countries in the world categorized as “low-income, suffering from food shortages.”

3) During the period between 2007 and 2011, the Gross Domestic Product (GDP) per capita increased from $4,725 to $5,500 in the Islamic countries. In five years there was an increase of 20 percent.

4) However, the richest Islamic country is 220 times wealthier than the poorest. Qatar is the richest with a GDP of $53,000, while Ethiopia is the poorest with a GDP of $177.

Turkey increasing
And, when it comes to us? Also, with the contribution of the crisis in the West, Turkey has rapidly increased its exports to Arab countries recently. Total exports to Iraq in 2012 surpassed Germany, which had been the number one country for years. Some 36 percent of last year’s exports - $55.3 billion - went to Islamic countries. However, the share of the Islamic world in our imports has been just 13 percent ($31.7 billion). When these two figures are combined, it corresponds to a share of 23 percent of our foreign trade.

Turkey has long been seeking the position of being a “locomotive” for Islamic countries. However, as far as I saw in Davos, especially among the Arab world, solidarity and cooperation are very difficult for now.

Meral Tamer is a columnist for daily Milliyet in which this piece was published on Feb. 8. It was translated into English by the Daily News staff.