Mediterranean Disunion

The second biannual summit of Mediterranean heads of state and government, initially scheduled for last week, has not taken place. It was called off long before the serious incident off the Gaza Strip. It could theoretically be held in November but preparatory ministerial meetings cast doubt on that.

The “Barcelona Process” promoted by Nicolas Sarkozy to restart regional cooperation was bold. But the project is now reduced to a long series of hollow, self-referential conferences. Europe’s policy regarding the southern rim of the Mediterranean is again in stalemate.

With the euro and public finances under heavy pressure, this failure by comparison could be regarded as minor. But to underestimate it would be a mistake: The goal of developing, modernizing and integrating the southern Mediterranean countries is not a “post-colonial” mirage but a priority for Europe. Here’s why.

First, significant risks stem from persistent economic inequalities between the two sides of the Mediterranean. Per capita gross domestic product in the Middle East-North Africa region has decreased by 58 percent in real terms compared with peak levels during the oil boom of the 1980s. Measured in purchase price parity (G.D.P. adjusted to reflect the local cost of living), the income differential with Europe is 1 to 4 in Algeria and Tunisia, 1 to 6 in Egypt and Jordan, and 1 to 8 in Morocco and Syria. Reducing these disparities means defusing time bombs — clandestine immigration, the rise of Islamic fundamentalism and instability in a region one flying hour from Europe’s shores.

Second, great potential exists in Mediterranean co-development. By 2050, the European Union will still have approximately 500 million inhabitants. The south’s population will have grown by half to 320 million. Furthermore, the region’s annual G.D.P. is rising between 4 percent and 5 percent. Opportunities exist for those willing to seize them. China has gotten the message and is investing heavily in the region. Europeans, in turn, keep pretending not to hear, even though the Mediterranean region could help us strengthen our economic competitiveness with Asian and American companies. By mobilizing the potential synergies between southern labor, energy and raw materials and northern know-how, technical expertise and advanced technologies, Europe could lift its annual growth rate by a crucial 1 percent.

So why the hesitation? Why haven’t we been able to do in the southern Mediterranean what Germany has gotten the E.U. to do in Eastern Europe (with substantial gains for German industry)? We should not delude ourselves: Though the crisis between Palestine and Israel is often portrayed as the cause of all evils, it is rather the tree that hides the forest. The true causes are deep distrust, overly bureaucratic vision, pointless competition among E.U. member states and private-sector reticence.

Despite undeniable achievements, the European Neighborhood Policy will not be enough to face this challenge alone. Now that the institutional prospects are fading and public resources are evaporating due to the global economic crisis, there is only one way out: involve private companies. This requires creating the right conditions for private capital investment. There is no point in trying to force companies to endorse abstract ideas conceived by technocrats. Companies must be encouraged to propose projects that meet their own requirements. The much-needed expansion of private investment will not take place unless sufficient levels of security and profitability are guaranteed.

The president of the European Commission has asked me to promote this initiative in close cooperation with the E.U. commissioner in charge of the European Neighborhood Policy, Stefan Fulle. We are working with more than 200 large enterprises from the Mediterranean basin affiliated with the Mediterranean Business Council. The object is to develop a consistent set of projects that can be quickly implemented. We will try to identify initiatives to develop new financing sources, increase human capital, create jobs, develop logistics and improve land management. It is crucial to get a dozen feasible and emblematic private-public projects under way in 2011.

Working together on that objective is the only way to bring the 43-member countries of the Union for the Mediterranean back on track. Otherwise the dialogue will be dead for 10 more years.

Andrea Canino, president of the Mediterranean Business Council-EcoMed.