Modernization of Maghreb countries in the context of external economic relations

Abstract

The article analyses how Maghreb countries’ involvement into the global economy, international trade and investment activity, particularly with France and European Union in general, affects their attempts to modernize their economy and to what extent they are efficient. Algeria, Morocco and Tunisia have made many steps towards closer integration with Europe, along with certain measures aimed at loosing the barriers for trade with the African continent, including trade relations inside Maghreb itself. However, their economies still hugely rely on the demand of the European market and foreign direct investments coming from the North of the Mediterranean Sea. Another point of great importance is the migration from these countries to EU, which also has a serious impact on their economic development. While liberation of trade and strengthening ties with the developed countries were expected to boost the local economies, improve their technological level through fostering production activity, and induce knowledge spill from multinational corporations to North African companies, the actual result yet does not seem so bright. Currently, Maghreb countries are stuck at their role of either exporters of crude materials like Algeria, or outsource producers of spare parts for particular European high-tech manufacturers who seek here cutting production costs by using the opportunity of paying lower salaries than in developed countries. The role of three Maghreb countries in international economy is, however, significantly different, although they are all dependent on their ties with their former common colonial metropole, France. Investigation of the factors that curb getting benefits from the involvement in global economic activity, as well as nuances of economic development in each of the three countries inside the international context, is the focus of the article.