CAIRO, Egypt, (AP) – A sharp rise in oil prices has led the gross domestic product of Arab states last year to increase to more than $1 trillion for the first time, the chairman of a pan-Arab economic council said Sunday.
The GDP of the 22-member Arab League countries reached $1.05 trillion at the end of 2005, a $180 billion increase from the previous year, said Ahmed Gweili, chairman of the Arab Economic Unity Council.
High oil prices in the past two years have added billions of dollars to the coffers of some Arab states, mainly in the Gulf, leading to a boom in stock markets, real estate prices and budget surpluses.
Gweili said oil revenues increased 44 percent to $350 billion last year.
The Arab League includes countries with huge oil reserves, including Saudi Arabia, the world’s largest oil producer, as well as the United Arab Emirates, Kuwait, Iraq and Qatar.
But the region, with a population of about 300 million, includes poor countries such as Somalia and Djibouti, and countries like Egypt and Morocco with negligible oil reserves.
The U.S., which has a comparable population, had a GDP of $12.5 trillion last year.
Gweili said earlier this week that unemployment is about 20 percent in the region. Unemployment is a large problem facing Arab governments because most of the oil money is invested in real estate rather than in sectors that create jobs such as factories.
Meanwhile, the value of 15 Arab stock markets remained the same at $1.28 trillion, according to the Arab Monetary Fund, a regional organization that covers Arab economies.
The organization, headquartered in the United Arab Emirates’ capital of Abu Dhabi, said the amount mainly comes from three markets — the Emirates, Saudi Arabia and Kuwait.
“This number is very small,” said Ibrahim Akoum, the head of the AMF’s financial markets department, about the value of the Arab markets compared to stock markets in New York, London and Tokyo.
“The markets need to be developed in order to play a bigger role in financing the development process” in the region, he said.