16 estimates of intra-regional trade trends.8 This procedure is employed in the preparation of Table 7 which shows the value and share of each country's 1970, 1980 and 1990 intra-regional trade along with compound annual growth rates. The notes to Table 7 provide information on how these data were derived.

For 1990, intra-regional exports are estimated to have been $8.3 billion -- down by approximately 45 percent from their value of a decade earlier. The overall decline is largely due to, a sharp decline in intra-regional shipments of crude oil for refining, lower petroleum prices and the importance of energy products in regional intra-trade (see Table 8). Five countries, namely, Jordan, Saudi Arabia, Syria, Turkey and the UAE account for the bulk of this exchange i.e. over 60 percent of intra-trade. In contrast, Bahrain, Israel, Lebanon and Qatar only have a combined share of about 8 percent. Egypt's share of intra-regional exports is under 5 percent with petroleum exports to Israel accounting for a large portion of this exchange. Box 4 provides details on Egypt's largest three-digit SITC regional exports.

How important is intra-regional trade in the total exports of these middle-Eastern countries? Taking the statistics in Table 7 as a share of the total export values for ME countries given in Table 1 shows intra-trade accounts for only about 7 to 8 percent of all exports. These figures may appear low at first, but a key point is that ME countries as a group only absorb about 3 to 4 percent of global exports. As such, ME countries have a higher than average propensity to trade with each other. For several countries the intra-regional trade shares are considerably higher than the group average. Between 13 to 16 percent of all Egypt and Turkey's exports go to the region as do over 50 percent of all Cyprus' exports (mainly to Turkey).

What products are of primary importance in intra-regional trade? Table 8 shows the 20 largest three-digit SITC products traded along with the estimated value and share of this exchange. Although their shares have been very volatile -- due to price changes -- crude and refined petroleum products accounted for approximately one-third of intra-regional trade in 1990 -- down from their 80 percent share in 1980. The petroleum price changes and their impact on product shares conceal to some extent the impressive growth that has occurred in the intraregional exports of fruit, vegetables and live animals (i.e., items which are now three of the five largest export products).

'For example, Lebanon did not report its exports to the region in 1990. This exchange was estimated using reported imports from Lebanon by partners such as Egypt, Turkey, Cyprus, etc. Two problems should be noted with regard to this approach. First, imports are normally valued on a c.i.f. basis while exports are reported f.o.b. As such, the partner country data will overstate true exports by the margin of transport and insurance costs. Second, if some partner countries did not report data (like Lebanon-Iran in 1990) these bilateral flows would have to be excluded from these estimates of intra-regional trade. See the notes to Table 7 for details on how the regional trade data were estimated. These procedures did produce several interesting anomalies. For example, in 1990 Saudi Arabia reported no exports to the region yet regional countries reported about $1.4 billion in imports from Saudi Arabia.