Arab states will need to invest US$65-80 billion in agriculture by 2020 to cover the escalating gap in food security, UAE Minister of Finance and Deputy Ruler of Dubai, Sheikh Hamdan bin Rashid Al Maktoum said.
Speaking at the annual forum of financial institutions and ministers in Dubai on Tuesday, Sheikh Hamdan said the region’s poor agricultural infrastructure and investment would cause the food security gap to more than double from nearly US$41 billion in 2010 to US$89 billion in 2020.
“Food security is one of the main challenges that Arab countries face, taking in consideration that Arab agriculture projects did not achieve the predicted increased productivity for several reasons,” Sheikh Hamdan said.
“Those reasons vary and include the following: weakness in the infrastructure, investment environment, financial resources, scientific research and agriculture services.
“This will require agriculture investments that range approximately between US$65-US$80 billion to cover the gap.”
Much of the Arab world is forced to import a significant proportion of its food products due to a lack of arable land, intense heat, and limited water supplies.
The UAE and other GCC countries, for example, rely on imports for up to 85 percent of their food products.
Forecast population increases are expected to put added pressure on prices and supply.
The meeting discussed how to achieve stability in food prices at a time when global demand for food is rising.
During his opening speech Sheikh Hamdan also said Arab nations needed to enhance cooperation in an era when regional ties were increasingly important.
The Arab natural growth rate had declined from 4.6 percent in 2010 to 2.4 percent in 2011, while the ratio of external debt to GDP had increased from 22 percent to 86 percent, he said.
External financial flows also decreased from US$20 billion to US$16 billion, while unemployment had risen, with rates across the region of between 18 percent and 30 percent.
"Regional cooperation and the establishment of mutual Arab business channels are important in creating an investment climate and to establish joint regional projects that are solid enough to face economical obstacles,” he said.
“This will eventually lead towards expanding Arab business markets, reinforcing investments and increasing trade activities.
"Arab societies face many difficulties and obstacles, and the presence of regional economic blocs has made it essential to enhance social and economic integration amongst Arab states.
"The five pillars that came in the UAE Initiative with regards to supporting the economic stability in the Arabic region is an essential step in the joint Arab economic path that calls to financial and economic reformations to support economic stability and help in the development of the financial sector.”
The meeting was attended by finance ministers and heads of financial institutions from Arab countries across the Middle East and North Africa.
Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.