Source: Euro-Arab Partnership Dialogue | 27 June 2006 | Country: Rome, Italy

The International – Arab Banking Summit: Opening Speech of Dr. Joseph Torbey Chairman, UAB

The International – Arab Banking Summit

 

Opening Speech of
Dr. Joseph Torbey
Chairman, UAB

 

 

Rome – Italy
27-28/6/2006
 
H.E. Dr. Romano Prodi, Prime Minister of Italy,
H.E. Mr. Fouad Seniora, Prime Minister of Lebanon,
H.E. Dr. Lamberto Dini, Former Prime Minister of Italy, and Chairman of the Foreign Relations Commission at the Italian Senate,
Dr. Maurizia Sella, Chairman of Associazione Bancaria Italiana,

Your Excellencies,
Distinguished Guests,
Ladies and Gentlemen,


I am pleased to welcome you all to our 2006 International Arab Banking Summit, which gathers today this highly representative and distinguished elite of public and private sectors, as well as the banking sector.

Our Summit gains a special importance due to the valuable presence of H.E. Dr. Romano Prodi and H.E. Mr. Fouad Seniora, with us today; such presence surely reflects the official embracement and concern in developing not only the economic and banking ties between the Arab region and its European partner, but also in bridging the way to stronger mutual understandings and culturals exchanges.

I would also like to thank Associazione Bancaria Italiana and its Chairman Dr. Maurizio Sella, and the International Bankers Forum and its Chairman Dr. Nader Maleki, for cooperating with us in organizing this Summit. Our thanks also go to all sponsoring institutions, whose support made this event a reality.


Distinguished Audience,

This Summit is the international event of the Union of Arab Banks, which has a special importance in our overall activities. It constitutes an international platform allowing both Arab and international bankers to discuss mutual financial and economic concerns which are crucial to the sound development of the Arab and international banking industries.
The wave of accelerated globalization, liberalization of trade in financial and non-financial markets, continuous developments in the e-business, and increased partnerships between regions of the world, have been creating a time of tremendous challenges, which is also a time of significant opportunities.

The Arab region perceives the importance of being an effective part of the global economy, affected by the ongoing changes, and at the same time driving these changes. It has been witnessing an ongoing economic boom over the past few years, stimulated mainly by the observed outstanding oil price increases which injected great liquidity in domestic markets.

There is currently some USD300 billion pursuing viable investment opportunities in the region. This constitutes a valuable opportunity for the Arab countries to support their economic and social development programmes, and to foster the openness of their markets in the face of much-needed integration moves.

The Arab countries have well benefited from the reforms that have been implemented in their economies and financial markets. Today, several Arab economies are well outperforming many emerging economies in the world, with overall economic growth for the region exceeding 10% as of end-2005. The largest part of the region is growing today as a major economic and financial hub for business, finance and investment.

In addition, some Arab markets, namely Bahrain, Dubai, Qatar and Saudi Arabia are building competitive financial centers to attract both Arab and international capital as well international financial and banking institutions.

On the financial level, the Arab banking sector has been growing fast over the past few years, organically and via mergers and acquisitions. Expanding the presence to some regional markets is today an outstanding feature of the strategies of several Arab banks.

Privatization of state-owned banks is on growth in some Arab countries. Product-service diversification and expansion towards modern banking domains such as wealth management, capital market activities, financial leasing, and the introduction of state-of-the-art technologies are today key features of the Arab banking sector.

Today, there are some 470 Arab banks are managing more than USD 1 trillion, with over USD 632 billion in deposit base, and USD 96 billion in capital base. They are allocating nearly 83% of their consolidated deposits to finance economic projects and enterprises in the region.

The growth of the Arab banking sector has been substantial in recent years, reaching nearly 20% in 2005, with its assets representing more 130% of the GDP of the Arab countries. This points to high and growing financial importance of the Arab region.

These are definitely positive elements and developments. On the other front, however, the Arab region is currently facing several socio-economic problems, which are hindering further growth and development.

Your Excellencies,
Ladies and Gentlemen,

The Arab world and the European Union are two strategic partners. This is a basic fact that has sustained over the past decades. Both parties enjoy excellent cultural, trade, investment and financial relations. The EU’s share in total Arab exports is in excess of 25% and its share in total Arab imports is more than 45%. There are huge Arab investments and capital in European markets, and European investors and financial institutions have good financial interests in many Arab countries.

Today, the Arab World and the EU are adventing towards a new multi-directional partnership, whether on political, economic, financial and even social levels. The partnership comes at times where the Arab region and its banking sector are seeking greater integration in the world economy in general and the European economy in particular.

In this sense, the Arab region with the support of the international community is keen to establish and promote peace in the Middle East region, given that the establishment of a firm political stability in the Euro-Med area is a prime element of the Euro-Med partnership.

Furthermore, the Arab region needs the support of its EU partner to enhance trade creation and reduce trade diversion between the two parties, since trade is a vital cooperation channel between the Arab countries and the European partner. This certainly will support the positive prospects of the establishment of the planned Euro-Med Free Trade Area by the year 2010.

The Arab region also needs the assistance of the EU partner to develop its capital markets and strengthen their financial governance, and to further capital and investment flows (both direct and portfolio investment) in both directions.

Last, but not the least, the Arab region needs strong financial support from the EU partner to finance the ongoing economic and financial reforms, transfer of advanced technologies, socio-economic development projects, SMEs promotion, and others, in the context of the activities of the associated-EU programs.

Dear Friends and Colleagues,

Italy has a leading position in the list of strategic partners and friends to the Arab countries. It is the first trade partner to many Arab countries, and it has distinguished cultural relations with the Arab region. Also, mutual investment relations are on growth in both directions, and we are eager to see the financial cooperation growing to support overall cooperation between Italy and the Arab region.

Certainly we are in the right place, today, to call for strengthening and expanding the scope of Euro-Arab relations, given the fact that Italy has always been a country of excellent relations with its neighboring Mediterranean and Middle Eastern  countries, and a major center for international cultural, economic and social interaction.

We feel inspired today by the successful experiences of H.E. Dr. Romaro Prodi and H.E. Mr. Fouad Seniora and their wisdom in joining politics and economics to reach better relations and viable solutions in supporting the social and economic development in our countries.

We, in this meeting, which gathers major political and economic parties, assure that economics should lead politics and not the other way around, and that a stable political situations is the prime prerequisite for a fastly growing economy and better social development.

Also, it is economics and not politics that allow and encourage countries to strengthen and expand their business relations in all fields, and definitely banking is a prime motivator of better economic relations.

Our increased partnerships, on both the economic and financial fronts, will allow us as Arab bankers to reach better your markets, and will allow you, as European and international bankers, at the same time, to reach our increasingly open markets.

Our banks, your banks, definitely have a key role to play in shaping the future of our region. We could join forces and synergize our potentials to play the role of engine of growth and development, being the financial arms of our nations, which finance economic, reconstruction and development projects in our countries. We can also act as catalysts for attracting investments, from abroad to create a big investment push in our economies. Most importantly, we can work together to ensure better strategic economic partnerships between our countries.

To Conclude:

The opportunities for today are great and those of tomorrow are greater. The time is still opportune to grab together today’s opportunities and build on them to grab those of tomorrow. For this, we need to collectively pro-act and not re-act, as well as to partner in ensuring a better future for our economies, banks and people.

I would like to thank you all for your kind attention and wish our Summit complete and concrete success.
 

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