ABSTRACT
This chapter explores some of the possibilities for industrial integration among the Arab countries. The increased use of agricultural machinery and implements provides another area which ranks high among the possibilities for industrial integration among the Arab countries, and which could be related to their collective self-reliance. The importance of industrial integration emerges essentially from the type of industries which it makes possible on the basis of the enlarged market. An integration industry usually tends to have a significant proportion of its output destined to meet demand in other countries within the regional grouping, and its production function tends to depend on the supply of inputs from other countries within that grouping. The optimal solution to an ‘industrial package’ would be that which allocates the industries among the participants in such a way as to minimise the cost of production of the total outputs of these industries.
