A study of developing secondary industry in the Arab world based on joint-venture between Kuwait and Morocco
The availability of surplus capital from the oil producing Arab Gulf States has allowed joint ventures to become an economic reality and important Arab World phenomenon. Using appropriate methodology, projections have been made of population growth, petrochemical production levels and per capita income with a view to determining the market for textiles in the Arab States. Shirt production has been chosen as an area for the pilot development of projects based on textiles. Factors influencing the choice include the relatively small capital requirement, the use of sophisticated technology in a labour intensive industry, the possible diversions into similar areas and the use of raw materials produced in the Arab World. The project envisages the creation of an inter-Arab joint venture between Kuwait, the provider of capital, and Morocco, the production base. A computer model has been designed to produce one million shirts of various types per annum. The model embraces cash flows, rates of erage utilised capacity. The model allows a variety of different situations to be analysed In terms of varying input parameters. The flexibility is such that it may be made the basis for many similarly oriented projects. Constraints were identified - particularly those associated with obtaining Venture Capital. The problem of regional enterprise development within the Pan-Arab World was examined, and past lack of success of such enterprises identified with over idealistic objectives.