The Arab economic conference due in Cairo in November is set to discuss a proposal to establish an Arab bank to provide financing for joint Arab investments, reported Egypt Online.
Economists and banking experts have said that the present Arab financing institutions cannot provide long-term financing, adding that “setting up the proposed bank would be a significant step on the path to achieving Arab economic integration.”
The undersecretary of the Federation of Egyptian Chambers of Commerce, Mohammed Al Masri, told the news service that there was a great need for a bank that could provide long-term financing for Arab investment projects.
He said it would also help make the best use of available Arab resources.
“Arabs have not utilized their natural and human resources properly so far. If these resources were used well, they would soon lead to Arab economic integration," he said.
The head of the federation's importers section, Moustafa Zaki, stressed the need for Arab economic integration, especially in financial services.
"It is well known that most banks in the Arab World offer short-term loans at high interest rates, which constitutes a heavy burden on the project even before it starts, a matter which calls for introducing long-term financing with lower interest rates that could be offered by the proposed bank, which will [have] profits as its main target," Zaki said.
Businessmen in Arab countries could contribute to the bank through deposits or shares, he added.
He said that the proposed bank should not be under any official control, so as not to be affected by any political differences.
The secretary general of the federation, Abdul-Sattar Ashra, welcomed the proposal, saying that in order to achieve the bank's objectives, it should offer loans at lower interest rates.
He said that the proposed bank could not depend solely on financing long-term projects, but would also have to finance medium and short-term projects covering all sectors.
"It has to be a giant bank with tremendous ability to finance, and it will offer loans at low interest so as to secure success and continuity," he said.
Egypt proposed holding an Arab economic conference during the Amman Arab summit that was held in March - Albawaba.com
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