The Moors invaded and conquered much of the Iberian Peninsula in 711AD. By the time they were driven out of Granada in 1492, the Arabs had left an indelible racial and cultural imprint. Both the Spanish and Portuguese languages have a marked Arabic influence.

Yet, when the Spanish and Portuguese crossed the Atlantic to conquer America, the close connection with the Arab world was somehow lost as the new colonies fought to establish their own identities.

More than five centuries later, the arrival of South American heads of state on Mar. 31 in Doha, Qatar to attend a presidential summit with Arab leaders is a conscious effort on each side to rediscover the other and forge a relationship that is seen as long overdue.

For Luiz Inacio Lula da Silva, the president of Brazil, it is a priority.

“It is imperative for the countries of South America to establish a real understanding with the nations of the Middle East, with the Arab world, so that we can establish not just a commercial relationship, but a political and cultural relationship, so that we can be free of the ties and decisions of the so called rich countries,” he said in an exclusive interview with Al Jazeera.

Common Ties

The effort to find common ground with the Arab region reflects Latin America’s changing priorities.

In the last eight years, the political map has changed radically, with every major South American country, except Peru and Colombia, now being led by a left or centre-left government. From Venezuela’s fiercely anti-American president, Hugo Chavez, to Chile’s and Brazil’s more moderate leaders, all are staunch proponents of a multi-polar world, not dominated by a super power nor a bloc of industrialised nations.

“Ten years ago it would have been impossible to think of a meeting like this between the Arabs and Latin America or South America,” Chavez said.

“It is now that the left-wing movements have managed to obtain political power and lead governments in Latin America, that this possibility has opened, because before our governments would always kneel before the U.S. state department,” he said.

Limited Links

While they are on opposite sides of the globe and have very different cultures and political structures, the two regions share a common colonial experience.

Given the changing global political and economic map, South America and the Arab region are attempting to join forces, so their voices carry more weight, especially in multi-lateral forums such as the G20 group of leading industrialised nations.

South America’s powerhouse, Brazil, is counting on Arab support to help push its candidacy for a permanent seat on the U.N. Security Council, which, if successful, would give the Arab region an ally in a strategic arena.

The South American-Arab Leaders’ Summit was the brainchild of the Brazilian president, who hosted the first such meeting in 2005 in Brasilia. At the time it was little more than a declaration of good intentions to strengthen ties, yet it was as significant first step.

“Our relations with [the Arab world] were very limited, very small… we had a trade balance of 8 billion dollars with the Arab world, and after that meeting, after that initiative of our government, our trade balance has climbed to 20 billion dollars,” Lula said.

Something similar has happened in Argentina where, in just three years, exports to the Arab region have jumped from 1.8 billion to 4.5 billion dollars, according to Sattam Al Kaddour, the secretary-general of the Argentine-Arab Chamber of Commerce.

Arabian Origins

It should not be so surprising.

There are up to 20 million Arabs and descendants of Arabs living in the region, most of them in South America.

In Brazil alone, there are an estimated 10 million. About 8 million of them are Lebanese – more than in Lebanon itself.

Argentina has an estimated 3.5 million people of Syrian and Lebanese origin. Carlos Menem, Argentina’s former president, is the son of Syrian immigrants.

Neighbouring Chile has the largest community of people of Palestinian origin outside of the Middle East, the vast majority Christian Palestinians who migrated from Beit Jala and Bethlehem.

The first exodus occurred in the mid-19th century, when Palestine was ruled by the Ottomans.

After the foundation of Israel in 1948, when hundreds of thousands of Palestinians lost their homes, many Christian Arabs followed their ancestors to the Americas.

The majority went to Chile, where the mountains and Mediterranean climate of Santiago’s central valley seemed familiar.

Today, many Chilean Palestinians are prominent members of the business and political community. Nevertheless, despite the large number of South Americans of Arab origin, the direct contact between the two regions has been limited. It was not until last year that the first direct flight between a South American city (Sao Paulo) and an Arab country (Dubai) was inaugurated.

Trade Benefits

So, why has it taken so long?

Celso Amorim, the Brazilian foreign minister, said: “Until now, both regions used to always look towards the United States or towards Europe, but never towards each other.

“The unprecedented push to bring the two regions closer is being applauded, especially by the South American business community.

“The potential here is unimaginable because, if we look towards the Arab world as a whole and Latin America, we see that the economies of the two regions compliment each other perfectly.

“In the Arab region they have large deserts and a very dry climate, and in Latin America we have green, fertile soil and 26 percent of the world’s fresh water supply,” Al Kaddour said.

The balance of trade so far is in South America’s favour.

“The fod export sector is the most important right now because the Arab region is a big buyer of food products and South America, especially Brazil and Argentina, are countries with a large agro-industry,” Al Kaddour said.

It is hoped the second South American-Arab Leaders’ Summit in Doha will give a push to the newfound relationship.

The widespread sympathy for the Palestinian cause in South America, especially after Israel’s recent war on Gaza in which more than 1,300 Palestinians were killed, should contribute.

Venezuela and Bolivia went as far as to expel the Israeli ambassadors in their countries, and Chile and Brazil issued strong condemnations during the Israeli attacks on Gaza.

“It is very interesting to exchange views between Arab and South American leaders, to establish accords, no?” Chavez said. “The most important thing, though, is the geopolitical relationship. I think this is the beginning of a path that we are building, in the construction of a multi-polar world.”

*Published under an agreement with Al Jazeera.

By Stephanie Nieuwoudt
CAPE TOWN, Mar 30 2009 (IPS)

Despite the challenges that the global economic crisis poses to Africa and other developing regions in the southern hemisphere, South-South trade still offers huge opportunities as there is room for growth beyond the current levels.

According to Jean-Louis Ekra, president of the African Export-Import Bank (Afreximbank) – a multilateral organisation that finances and promotes trade with African countries – the potential benefit from South-South trade may offer the same financial gains as trade with richer, Northern countries.

With the downscaling of North-South investments, Southern countries will do well to forge intra-regional links to optimise potential and opportunities, he said. Ekra was speaking at the third Annual Africa Trade and Investment Conference in Cape Town, South Africa. It ended on Friday Mar 27.

However, while a feeling of optimism reigned at the conference, which was attended by bankers and investors, there were also voices urging constraint because of the negative impacts the global financial crisis have already had on Africa.

Sketching a positive picture, Ekra said that South-South merchandise trade has grown significantly in the past 20 years, albeit from a very low base. South-South trade represents six percent of world trade, a 100 percent increase from 1985 levels.

South-South merchandise trade grew at an average rate of 12.5 percent per year over a 24 year period – a figure that compares well to the North-North growth rate of seven percent and 9.8 percent for North-South trade.

African trade with the BRICs (Brazil, Russia, India and China), especially India and China, has been robust with a rise of 1,170 percent between 1985 and 2007. In 2007, trade between these countries amounted to 256.25 billion dollars and represented 32.7 percent of Africa’s total trade.

Intra-African trade has grown at a slower pace – from seven percent in 1985 to about 10 percent in 2008. These figures lag behind eastern and south-eastern Asian countries where intraregional trade equals more than 40 percent of total trade.

Until recently South-South trade was dominated by commodities. It was widely accepted that this stymied growth as countries were trading very similar products.

South-South trade got a tremendous boost with the industrialisation of China and India. These countries became large-scale manufacturers, dominating the export market to a large extent. According to Ekra, South-South trade was further boosted through multilateral trade negotiations which eventually led to the establishment of the World Trade Organisation, the internet revolution and sweeping economic reforms in many countries.

The current economic crisis has led to a strong demand for investment stocks outside of the U.S.. In Egypt, Ghana, Kenya, Nigeria and South Africa some of the highest global stock returns were posted between 2003 and 2007. Investors were quick to tap into this market.

Yet, despite strong growth in gross domestic product (GDP) these past five years and political stability in many African and other developing countries, these countries have not remained unscathed by the current economic crisis.

The value of stocks in Africa has declined since the beginning of 2009 – with Nigeria being the worst affected. The World Bank’s estimates indicate that exports of Asian countries will fall by more that 40 percent this year when compared to 2007/08 levels.

Ekra added that some African countries, especially those producing fuels and solid minerals, will probably experience export declines of more than 50 percent.

‘‘The World Bank estimates that the expected decline in global trade will be 90 percent attributable to demand and 10 percent to lack of trade finance. There is therefore a strong argument for boosting domestic demand across the world,’’ Ekra stated.

He added that Afreximbank, as a trade facilitator, has placed emphasis on pursuing pan-African initiatives that ‘‘make sense as a self-reliance strategy’’.

This means that African financial institutions should share information and work together on intra-regional projects. Co-operation has already led to the creation of the African Bankers’ Association; the development of an African correspondent banking and letter of credit confirmation scheme (Africorrbanking); and an annual trade finance seminar.

Afreximbank is also working with the BRICs countries because ‘‘greater interaction with the BRICs provides an opportunity for the transfer of cutting-edge technical and managerial competencies as well as market access capabilities for African traders’’.

Konrad Reuss, managing director of Standard & Poor’s, a financial institution providing credit ratings, indices, investment research and data, told the conference that projected GDP growth for many African countries is around 3.8 percent – down from an average of between five percent and six percent over the last five years.

‘‘This is still positive growth. However, with the projected increase in population, the per capita expenditure will also increase which to a large degree could negate the growth. In these stormy seas, we will soon see where the good African skippers are.’’

Avril Stassen, investment advisor at the Africa Agribusiness Investment Fund (Agri-Vie), a private investment fund focusing on agribusiness in sub-Saharan Africa, argued that the contraction in commodity prices will moderate growth on the continent.

But there is still strong growth in infrastructure investments – railroads, roads, dams as well as agribusiness – in Africa. ‘‘In fact, it seems as if investors are even keener to invest on the continent than last year. Foreign direct investment inflows in 2008 increased by 17 percent, from 2007 levels, to 62 billion dollars,’’ Stassen told delegates.

This is despite risks posed by potential political instability, exchange rate volatility, lack of infrastructure and a thin layer of managerial capacity in many countries.

Stassen explained that Agri-Vie bases its optimism about Arica on four pillars: Africa is resource-rich; there is continuous capital inflow; urbanisation is taking place at a rapid pace; and many countries have instilled measures to ensure improvements on the national and corporate governance levels.

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By Baher Kamal
MADRID, Mar 29 2009 (IPS)

In the shadows of a critical Arab summit in Doha this week, a parallel Arab- South American heads of state meeting is expected to seal key political and economic cooperation agreements between the two regions.

According to the draft final declaration accessed by IPS, the Arab-South American summit in the Qatari capital Mar. 31 will pledge mutual political support in international fora, and increasing trade, energy and technological exchanges.

The document stresses the need to establish an "independent, sovereign Palestinian state" through "a negotiated solution" that leads to the creation of a "united, integrated state, within concrete and internationally recognised frontiers", alongside Israel.

On Iraq, the draft declaration prepared by the South American and Arab foreign ministers in Cairo earlier this month underlines the need to "respect the unity, freedom, sovereignty and independence of Iraq, without interference in its internal affairs."

During the 22-day Israeli war on Gaza, most South American leaders strongly condemned Israel for its attacks on the Palestinian civilian population, which left more than 1,400 dead and 5,000 wounded. Venezuelan President Hugo Chavez and Bolivian President Evo Morales cut diplomatic relations with Israel.

Venezuela and Bolivia, along with several other South American countries, have condemned the former U.S. administration's policy in the Middle East, its occupation of Iraq, and its 'war on terrorism'.

The draft declaration also expresses "deep concern" about the international financial crisis and its impact on the economies of the Arab and South American countries.

The League of Arab States estimates that Arab countries have lost more than 2.5 trillion dollars due to this crisis. The document calls for the creation of an international financial system capable of preventing financial speculation.

Beyond such political agreements, the summit will focus on ways to strengthen economic and trade cooperation.

Commercial exchanges between the two regions increased from 8 billion dollars in 2005 to 21 billion dollars last year, according to Ibrahim Moheiddin, director of the Two Americas Department at the Cairo-based League of Arab States.

There is much room for cooperation between the Arab and South America regions in technology, peaceful use of nuclear energy, the aviation industry, the fight against desertification, and over water resources, Moheiddin said in a statement in Cairo.

The South American and Arab Business Forum, to take place Tuesday on the sidelines of the summit, will discuss specific cooperation projects in these and other sectors.

The initiative of holding Arab-South American summits was taken by Brazilian President Luiz Inacio Lula da Silva during his visit to five Middle East countries in December 2003. The first such summit was held in Brasilia in 2005. It drew 34 heads of state – 22 Arabs and 12 South Americans.

The new agreements are based on a strong political will to strengthen South-South cooperation. The push for that has strengthened with the election of several leftist regimes in a number of South American countries looking to reduce dependence on the United States.

For the Arabs too, this inter-regional cooperation represents a gradual political and economic shift from traditional European and U.S. political influence, and dependence on their markets.

There is scope for cooperation at many levels. Brazil and Argentina, and Saudi Arabia, are members of the G20, whose leaders are gathering at a critical summit in London this week. Ecuador and Venezuela are members of the Organisation of Petroleum Exporting Countries (OPEC), along with Arab oil producers.

The two regions are looking also to expand ties at the people level. The Arab League estimates that between 10 and 15 percent of the population of South America is of Arab origin, seven million in Brazil alone.

Qatari officials expect that at least 16 of the 22 Arab heads of state, and eight of the 12 South American presidents will join the Doha summit. The other countries from the two regions are expected to be represented by high-ranking officials, including vice-presidents and prime ministers.

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By IPS Correspondents
DOHA, Dec 1 2008 (IPS)

For the past three decades, indebted developing countries have been forced by the International Monetary Fund (IMF) and the World Bank to deregulate financial and labour markets, privatise national industries, abolish subsidies, and reduce social and economic spending.

Now – during the worst financial crisis since the 1930s – northern governments that control these multilateral financial institutions have launched a massive and unprecedented programme of government intervention, nationalising banks, injecting massive subsidies into ailing institutions and re-regulating their financial sectors.

"This double standard is unacceptable," asserts Roberto Bissio of the international Social Watch coalition. "The financial system, its architecture and its institutions must be completely rethought."

Only an approach based on human rights can overcome the current crisis, argues Social Watch in its 2008 report, ‘Rights is the Answer’, launched Monday at the International Conference on Financing for Development in Doha, Qatar.

"Human rights must be the starting point," the document states, "and not some distant goal in the future, and a rights-based approach to development [with gender equality, decent work and human rights at its core] must be the main guiding principle."

Social Watch, an international NGO watchdog network monitoring government compliance with international commitments, has published this annual report since 1996.

The report documents the relation between human rights and the economic and financial architecture in 59 countries through the testimonies of grassroots activists and civil society analysts in these countries.

The national reports show how the pervasiveness of extreme poverty and gender inequity is intimately linked to the immediate effects of the current triple crisis and to longer-term painful economic adjustments ingrained in the global financial architecture.

Social Watch documents the widespread, haphazard implementation of policies promoting economic liberalisation and deregulation. They found that these policies have provoked the curtailment of people’s economic and social rights around the globe, that liberalisation and deregulation now curtail the ability of many developing countries to comply with their international commitments to end poverty and achieve gender equality.

The growing income inequalities both within and between countries spurred by capital flight, tax evasion, and privatisation have slowed down the progress on key social indicators. According to the Social Watch calculations, meeting the eight Millennium Goals is virtually impossible if world governments maintain a "business as usual" attitude.

In the first thematic report of the 2008 Social Watch document, Nicholas Shaxson and John Christensen of the Tax Justice Network demonstrate how weak tax reporting policies allow for illicit financial flows. They cite from a University of Massachusetts study that estimates capital flight from 40 African countries over a 35-year period amounted to 420 billion dollars (2004 dollars). Compare this with their total external debt, which amounted to 227 million dollars in 2004.

According to Shaxson and Christensen, "We can no longer focus so strongly on aid, without bringing tax into the core of the debate. Tax is the most accountable, and sustainable source of financing for development."

In another thematic report, Mirjam van Reisen and Simon Stocker of Eurostep document how the promises made by the European Commission (EC) to focus its development aid strategies on promoting poverty eradication have not been fulfilled, due in large part to Europe’s overriding interest in liberalising trade flows.

EC aid to developing countries is now largely channelled towards improving infrastructure and facilitating trade, instead of contributing towards the realisation of basic social rights such as access to health care and education.

Kinda Mohamadieh of the Arab NGO Network for Development provides a developing country view in her thematic report on social and economic rights in the Arab region. In recent years, Mohamadieh says, economic liberalisation has actually thwarted attempts to strengthen democracy in the region.

Social Watch calls for the convening by the U.N. of a comprehensive, inclusive process to review and reconstruct the international financial and monetary institutions – a demand that has become a bone of contention at the Doha talks here.

Only an international conference convened by the U.N. that includes developing countries and civil society can yield benefits for the majority of the world's people, according to Social Watch.

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By IPS Correspondents
DOHA, Dec 1 2008 (IPS)

The most severe financial crisis since the Great Depression needs massive economic stimulus packages that are coherent and linked with sustainable development imperatives, asserts a new report by top U.N. economists released Monday on the sidelines of the Monterrey Review conference in Doha.

The first chapter of The World Economic Situation and Prospects 2009 – to be launched in early January – calls for "deep reforms of [the] financial system" to counteract the "synchronised global downturn". The report urges a more inclusive global economic governance, to prevent against any future repetition.

The developed countries could enter into a deep recession in 2009, causing world output to fall and GDP growth in the developing world to drop to 2.7 percent, which would be dangerously low for the ability of countries to sustain poverty reduction efforts and social and political stability, the report warns.

Was this a crisis foretold?

According to Rob Vos, director of U.N. Department of Economic and Social Affairs (DESA), past issues of this annual report from the U.N. have repeatedly pointed out that the "apparently robust growth" of the last few years came with enormous risks.

"That analysts and policymakers are now expressing bewilderment at the extent of the crisis suggests not only a gross underestimation of the fundamental causes underlying the crisis but also unfounded faith in the self-regulatory capacity of unfettered financial markets," the report states.

Fingers are pointed at the growth driven to a "significant extent by strong consumer demand in the U.S., stimulated by easy credit and underpinned by booming house prices, and by very high rates of investment demand and a strong export growth in some developing countries, notably China".

What price for developing countries?

For developing countries, the cost of external borrowings has risen sharply and capital inflows are reversing. Also, prices of primary commodities have reversed sharply affecting export growth and the current account balance of many countries has shifted into the red.

The dollar has appreciated in the crisis, while currencies in a number of developing countries, particularly those that are commodity exporters, have fallen against the dollar substantially since mid-2008. The bailout packages in the U.S. and the flight to safety to the U.S. by many financial institutions resulted in the rebound of the dollar.

But Vos predicts the recent strength of the dollar will be temporary and the risk of a "hard landing of the dollar" in 2009 or beyond remains. Job creation will get significantly harder in most regions during the course of 2009. The concern of policymakers should be to stave off sharp downfalls in economic growth, the economists point out.

Growth prospects of developing countries will be severely hampered. Africa will suffer from lower commodity prices and weakening export demand. Growth in East Asia is affected by the weakening of global demand and the global credit crunch. Capital outflows and waning investor confidence will dim growth in South Asia.

Lower oil prices and the global slowdown will affect growth prospects in West Asia. While Latin American and Caribbean economies will slow markedly in 2009.

What is to be done?

U.N. economists see the crisis as an opportunity to create a new international financial architecture that will make for more inclusive participation of developing countries.

The report identifies the need for the creation of a "credible and effective mechanism" for international policy coordination to guide fundamental revisions of the governance structure and functions of the IMF and the World Bank, now led by the U.S. and EU.

In addition, fundamental reforms of existing systems of financial regulation and supervision that will lead to the creation of a new internationally coordinated framework to stem past excesses.

Economists also call for the reform of the present international reserve system to create a multilaterally backed multi-currency system that will end the almost exclusive reliance on the U.S. dollar.

And finally, "reforms of liquidity provisioning and compensatory financing mechanisms, backed, among others, by better multilateral and regional pooling of national foreign exchange reserves, and avoiding onerous policy conditionality."

Will the reforms find consensus in Doha?

U.N. Assistant Secretary General for Economic Development Jomo Kwame Sundaram asserts there is political will. "The EU and G-77 are prepared to accept the draft outcome document which makes a number of provisions including the call for a summit organised by the U.N. to respond to the crisis."

In addition, the United Nations High-Level Expert Commission to Study the Reform of the International Monetary and Financial System headed by well- known critic of neo-liberalism, Joseph Stiglitz, was recently set up by the President of the General Assembly Miguel d'Escoto Brockmann.

However, Sundaram qualifies, "there is continuing resistance to the initiative (for a summit) largely by some countries!" The buzz in the corridors at the conference in Doha suggests the spoiler is the United States.

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By IPS Correspondents
DOHA, Dec 1 2008 (IPS)

The demand is seemingly simple. ‘Vote for democratic, people-centred development’, advise civil society at the ongoing inter-governmental review of the Monterrey Consensus in Doha, Qatar.

Casting a vote for 'people-centred development' at the Doha talks. Credit: IPS

"This is a general assembly of the U.N., and the G192 should vote on who will decide the outcome document," urges Roberto Bissio of Social Watch as he button holes delegates and participants in the corridors of the Doha Sheraton, the venue of the four-day Follow- up International Conference on Financing for Development.

Civil society representatives, who met over two days in this Gulf state capital, ahead of the official meeting which began on Nov. 29, have been watching with dismay as the draft of the outcome document which is currently on the table still fails to provide the decisive, action-oriented direction that they want to see from the 192-member countries.

"The Bush administration is trying to block the draft document (that has the support of the EU and the majority of members)," says Sylvia Borren of the Global Call to Action against Poverty (GCAP) which, together with other civil society groups, held an "emergency meeting" on Sunday to strategise.

Pressure is being cranked up through a sign-on online letter to "ignore (the) anti- democratic power-play by the Bush administration" whose first five signatories are Bissio’s Social Watch, Borren’s GCAP, the Arab NGO Network for Development (ANND), UBUNTU, Campagna per la Riforma della Banca Mondiale and Stamp out Poverty (Britain).

Most world leaders recognise the urgency of the crises which will hit the most vulnerable countries and people, particularly women and children, unless there is action now, the campaign urges. Some 30 heads of governments and ministers have addressed the plenary over the first two days

The Doha negotiations come at a time of serious global financial crisis and the fear of a shortfall in resources that jeopardise the lives and livelihoods of hundreds of millions, in the South and the North, and threaten the realisation of the internationally agreed development goals including the Millennium Development Goals (MDGs).

Repeatedly activists point out that while the governments of the richest countries bail out banks and private financial institutions with more than three trillion US dollars of public guarantees and funds they are failing to respond decisively to the worsening crisis of food, fuel and finance that has afflicted the majority of peoples in the world.

The current crisis will result in the loss of 20 million jobs by the end of 2009; another 100 million people will be pushed into the informal economy on top of the existing 200 million unemployed and 1.3 billion underemployed workers.

"Many of these will be women," says Borren, "but no one here is talking about the feminisation of poverty!"

So far the international community has proven incapable of raising funds for the poor and dispossessed. "The world’s women’s organisations have to make do with 100 million U.S. dollars annually," Borren told IPS. A few percentage points of the trillions of dollars raised to save financial institutions could cut by two thirds the child mortality in the poorest countries.

Over 250 civil society organisations and networks had gathered in Doha under the theme ‘Investing in people centred development’. "Place people and their needs back at the centre of development," they urged.

"Developing countries should be allowed to take effective democratic ownership and leadership of their domestic policy space that allow national social and economic policies as well as development programmes … without interference from Northern countries or the Bretton Woods institutions," states a declaration issued at the end of the civil society forum on Nov. 28.

Governments were urged to "take the side of women and men, workers, farmers, youth and children to promote environmental sustainability by taking an alternative economic path" to foster the creation of decent work for all, gender equality and equitable growth and fair trade and investment policies as a key step towards poverty eradication.

But calls for a comprehensive U.N.-led review of the international financial economic governance structures through a "major international conference at Summit level" have become a sticking point in the Doha outcome document under negotiation.

The call for reform has been watered down in the outcome document, says Nuria Molina of Eurodad, to include the Bretton Woods institutions which are among the major institutions responsible for the current global crisis.

"They have no legitimacy and no credibility (to start a self-reform process). Trade liberalisation, of the kind pursued under the Doha round, has contributed to increased vulnerability of developing countries in key areas," Molina told IPS.

"The U.N. has a vital role to play," says Ariane Arpa of Oxfam International. "So far the conference is falling well short of our expectations. A failure to address key issues … will mean that it will not provide the concrete and decisive outcome that poor countries had been promised."

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