The specters of an aging Europe and a growing and increasingly unemployed population south of the Mediterranean loom on the horizon. While Europe could soon face a shortage of labor, the population in the Middle East has doubled over the last 20 years to 158 million in 1998 and could reach 210 million within the decade. European states are poorly disposed to accept a wave of immigration. Still, the EU realizes that free trade alone is not a deep-reaching cure. At February's Euro-Med Conference on Investment, participants stressed the need for further integration within the southern Mediterranean basin before work on a free trade area can go ahead.
Regional cohesion is the price of admission, access to European markets the prize.
Europe is going ahead with its efforts in the Middle East. Nonetheless, the United States and the EU are not yet on the same page in the book on Middle East relations. While President Clinton has refrained from enforcing ILSA on French and Italian oil companies doing business in Iran, common U.S.-EU positions would help ease relations. While liberalizing trade in pistachios and carpets is a step forward and oil production limits a temporary step back, the big roadblock to U.S.-Iranian relations reaching the next level is the issue of Iranian state assets frozen in the United States. In comparison to the United States, Europe is uncharted territory for electronic commerce ventures.