A conclusion may be reached that the objectives of economic integra¬
tion in the Maghreb are not what has been taken care of by the conventional integration economics, and the crucial problem of the Maghreb countries
is how to develop their economies, in other words how to industrialize.
Hence the fusion of the national markets of these countries in an attempt
at integration is to speed up their industrial development by creating optimum or near optimum markets for their industrial
enterprises.(3)
Other integration measures in the other sectors are to facilitate the industrialization efforts. So policies concerning the harmonization of agricultural production
(ï)
ÏÏ.C. Wallish, Monetary Problems of an export Economy. Harvard University Press, Cambridge Mass. 1950»(2)
U.N. Instability of Export Markets of underdeveloped countries^Hew York, 1952.
(3)
Chenery lays some emphasis on the production of investment goods - He argues that the limitation on the market size are an important factorin preventing growth of developing countries by they being unable to
move to the production of investment and intermediate goods where
economies of scale are especially important. "Pattern of Industrial growth op.cit."
and marketing, elimination or reduction of trade restrictions, the
economic or social infrastructure projects should "be oriented to serve that purpose. Integration schemes in the underdeveloped world cannot
"be evaluated in terms of whether they are more trade creating than trade diverting. An integration scheme would "be desirable and useful so far
as it heljjs the member countries to develop even if it is trade
diverting(l)
In the following section we select"Some areas of cooperation in the industrial
field.-(1)
There are some authors who deported fundamentally from the Static analysis of the comparative cost theory, and the conventional theoryof customs union, and started a dynamic arguement for integration,
and emphasized its contribution to economic growth and to the structu¬
ral transformation of the developing economies. Inputs of factors of production- are taken to be variable and the character and effectiveness of factors are assumed to be bound up with the''character' of production.
They contend that what is at issue in a developing countries is not merely marginal changes but its structural transformation. Comparative advantage is not only changing but should be forced to change. This dynamic approach lays emphasis on the unemployed resources disregarded by the convential theory. They observed the persistent trend towards
external imbalance for those countries and suggest the reduction of export dependence in the interest of promoting domestic stability.
They emphasized the contribution of industrialization to the develop¬
ment of new skills and growth, to facilitate changes in personal atti¬
tudes and include social consideration in their analysis.
(See
RobsonsEconomic Integration in Africa, op.cit. - Examples of these writers:
Myradal op.cit., D. Seers, "a model of comparative Rates of Growth in
the World Economy", Economic Journal, March
1962;
Nurkes R. Patternsof Trade and Development, Blackwell, Oxford
1962).
Other examples of the authors who advocate the industrialization approach in the integration schemes for the developing countries are:
A Breton, The Economics of Nationalism, Journal of Political Economy, August 1964» Other authors mentioned in the footnotes of our study:
H.G. Jonson, "An Economic Theory of Protectionism," op.cit.
A. Hazlewood, African Integration and Disintegration, R.I.I.A.
Oxford University Press 1969»
C.A. Cooper & B.E. Massell "Toward a- general theory of Customs Union
for developing countries" op.cit.
Some of them contend that the conventional theory of customs union considers the replacement of domestic consumption by cheaper imports commonly regarded as a cost rather than a benefit, whereas benefits
are expected to result both from trade diversion and from trade creat¬
ion in favour of domestically produced products, see Robson op.cit.
IDEP/ET/2340
Page 49.
MAGHREB INDUSTRIAL INTEGRATION INTRODUCTION
It should be stressed again that although we are laying emphasis on industrialization as the most effective approach to economic integration
in the Maghreb, we are still aware of the importance of agriculture as well as the basic services, in the development of the underdeveloped
economies and in the development of industry itself. This interrelation¬
ship between industry, agriculture, and services is the essence of any
meaningful planning.—'1/
Rrom the previous chapter one can see that the characteristics of
the Maghreb economies are those typical of the developing or "under¬
developed" world : with low per capita income or per capita gross product,
the economies are heavily dependent upon agricultural and other primary products^ their industrial production constitutes a small proportion of
the gross domestic product. Their exports are composed mainly of agri¬
cultural and mineral products, and as the climatic and natural conditions
are similar in the four countries, they produce more or less the same primary products. These products are exported and hardly exchanged
between themselves. The bulk of their imports are manufactured goods.
■ If our analysis in the first chapter of the leading role
of
industryin the economic development process is accepted, the Maghreb countries
are left with the only alternative open to them, i.e. to industrialize.
They need to join forces with each other to form an integration scheme,
based mainly on integrating industriar sectors of these countries, or integrating particular industries within
these
industrial sectors, oreven agree upon joint or integrated projects. These joint projects can be undertaken by the four countries together or between two or three
of
them, or can be assigned to one country with a free access to the whole Maghreb market.Some of the already existing industries in the sub-region can also
be agreed upon as "integration" industries.
\J
See chapter 1.It goes without saying that industries cannot achieve their optimum production, and hence reduce their costs, unless they have a "large market.
Thus the coordination of the industrial development plans of the Maghreh countries, and the integration cf their markets can allow these countries
to achieve proper specialization and division of labour among themselves,
and benefit from economies of scale and the efficient use of their re¬
sources, This would also allow them to avoid duplication and a great
amount of waste in roseurcos which are urgently needed to accelerate the
rate of their economic development.
We will divide the Maghreb industrial integration shceme into three categories :
1. Integration industries based on natural resources 2. Integration industries based on Maghreb local demand 3. Coordination of industries to avoid idle capacity.
It is obvious that our classification of the three categories of
industries suggested as integration industries for the whole Maghreb is
not water-tight. First, all industries should be established to cater
for an effective demand either local or foreign or both. Hence the category we classified as industries designed to supply the Maghreb de¬
mand can expand its operation to cover foreign markets as well. Also,
the category we classify as industries depending on local raw materials
can be found under the category of industries working for the local market such as food industries, for instance, which process agricultural pro¬
ducts. Moreover, most industries, whether or not they depend on local inputs, and whether they supply the local or foreign demand, may have ex¬
cess unutilized capacity and hence would be put under the second category and so on. Nevertheless, the classification may be illuminating, because
it draws attention to the most important characteristic of the group.