A ROADMAP TO ECONOMIC DEVELOPMENT IN ARAB COUNTRIES: THE INVESTMENT ZONES AS INNOVATIVE CLUSTER MODALITIES. THE EXPERIENCE OF EGYPT

Contending (and reaffirming through diverse multidisciplinary literature review) that Arab countries are clearly seeking economic development; that competitiveness is key for such economic development; that the position of Arab countries allows for significant improvement in competitiveness rankings (most clearly in areas of innovation and cluster-related pillars); that Arab industrial R&D is not close to where it should be; that the global scene is dominated by innovative knowledge-based economies; that the regional level (governorates) is the right level to start strategizing and implementing initiatives in competitiveness fields; and that clusters/special economic zones and large investment projects have all proven track records in creating economic development, and boosting value and competitiveness (locally and nationally); and that there is need for innovative modalities of clusters/EZs that are flexible and speedy enough to accommodate Arab countries’ diverse sectoral needs (manufacturing, knowledge-based and other) via cluster approaches.
This research analytically describes the practices in investment zone public policy implementation in Egypt as a model for government-led economic development initiative in Arab countries. The research approaches the topic through providing a review of key competitiveness-related trends in Arab countries, and providing a logical approach to catalytic cluster models as means to address such trends, emphasizing the importance of setting sufficient conditions for forming clusters/EZs to enhance regional economic growth. The research reviews the status of EZs in Egypt with particular emphasis on investment zones as an innovative, recently adopted, model in terms of governance and flexibility in ownership, development, configuration, management, and regulation approaches. The analysis is based on a review of recent studies and assessments in related multidisciplinary fields, as well as a case study of zones in Egypt, and validating expert opinions.

The research draws out a logical staged roadmap approach to zone development that may facilitate investment zone implementation in a form that maximizes unique benefits to their host economies.
The research concludes that investment zone models are very suitable to meet the cluster needs of Arab countries, especially in the case of government-led clusters, AND HIGHER EDUCATION CLUSTERS. The investment zones address many of the failures in the competitiveness aspects of the Arab countries, and upon implementation have proven to allow for benefitting speed in implementation, simplified operations and sustainability.
These represent managerial implications that make sense to the businessmen operating in Arab countries.