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Arab League


The Arab League, officially known as the League of Arab States, is not a financial term, but a regional organization of Arab countries in and around North Africa, the Horn of Africa and Arabia. Established in 1945, its main goal is to promote political, economic, cultural, and social interaction among its 22 member states. Its members collaborate in a wide range of areas including finance, but the term “Arab League” itself does not define a specific financial concept.


The phonetic pronunciation of “Arab League” is: ˈæ.rəb li:g.

Key Takeaways

  1. The Arab League, or the League of Arab States, is an organization that aims to strengthen and coordinate political, cultural, economic, and social programs of the Arab states, while mediating disputes among its members or between its members and third parties. It was established in Cairo in 1945 by Egypt, Iraq, Lebanon, Saudi Arabia, Syria, Transjordan (now Jordan), and Yemen.
  2. The Arab League is made up of 22 members throughout the Arab world from Africa and the Middle East. Although Palestine is not a recognized state, it is a full member of the Arab League. Additionally, the organization has seen several suspensions and withdrawals throughout its history due to political conflicts such as the suspension of Syria’s membership in 2011 amid the Syrian Civil war.
  3. While the Arab League has been significant in shaping policy and diplomatic efforts in the Arab world, its power has been questioned due to internal political conflicts among its members. Nonetheless, it continues to serve as a forum for member states to coordinate their policy positions and deliberate on matters of common concern, drawing up proposals to promote cooperation among them.


The Arab League is a significant term in business/finance because as a regional organization comprising 22 Arab countries, it fosters economic, political, cultural, and social cooperation among its members. The League, established in 1945, functions as a platform for its member nations to coordinate and integrate their economic policies and to negotiate trade agreements. This promotes a shared market and economic resilience, which could stimulate business growth and investment. Therefore, an understanding of the Arab League is crucial for any business or financial entity looking to engage with or invest in the Arab world, as it shapes key aspects of the region’s economic environment, including trade policies, customs, tariffs, and economic reforms.


The Arab League, officially called the League of Arab States, is a regional multi-national organization of Arab countries in and around North Africa, the Horn of Africa, and the Arabian Peninsula. It was created with the intention of promoting unity among Arab nations, safeguarding their sovereignty, and encouraging regional collaboration. This organization, founded in 1945, now consists of 22 member states. In terms of finance and business, the Arab League functions as a platform for the coordination of economic policies amongst member states. It aims to facilitate economic growth and development within the region. This includes promoting trade and investment, standardizing the financial and economic legislation, and coordinating efforts to ensure financial stability. Additionally, it serves as a conduit for the negotiation and implementation of free trade agreements, seeking to boost intra-Arab trade and economic integration. Ultimately, the League is a significant regional player in the economic and financial arena, influencing the business environment and opportunities in the Arab region.


1. Arab League Boycott of Israel: The Arab League has long maintained an economic and political boycott of Israel. This is a collective measure taken by the member nations to isolate Israel economically and politically, as a protest against its occupation of Palestinian territories. This real-world example provides insight into how the Arab League can influence international trade and business practices.2. Creation of Arab Union: The Arab League has initiated several proposals to create a unified Arab Union similar to the European Union. This would undoubtedly have a major impact on business and finance in the member states, promoting cross-border trade, shared currency, and economic integration.3. Arab Economic Integration: The Greater Arab Free Trade Area (GAFTA) is a pact made by the Arab League to achieve economic integration amongst its member states. Introduced in 1997, the arrangement aimed to stimulate economic growth through increased intra-regional trade. The agreement led to the reduction and elimination of customs duties on various goods and commodities traded between the member states. This is a practical example showcasing how the Arab League influences business and finance in the region.

Frequently Asked Questions(FAQ)

What is the Arab League?

The Arab League, also known as the League of Arab States, is a regional multi-national organization of Arabic-speaking countries on the African and Asian continents. The main goal is to promote the interests of the Arab countries, pursue the process of integration between them, and protect their sovereignty and independence.

When was the Arab League formed?

The Arab League was formed on March 22, 1945.

How many member states does the Arab League have?

The Arab League currently has 22 active members.

What does the Arab League do in terms of finance and business?

The Arab League aims to coordinate economic activity among member states, which includes setting financial policies, coordinating commercial standards, encouraging investment among members, and supporting economic development initiatives.

Which countries are part of the Arab League?

The Arab League includes many countries such as Egypt, Iraq, Jordan, Lebanon, Saudi Arabia, Syria, Yemen, among others.

How does the Arab League impact international business?

The Arab League can greatly influence international business by coordinating economic and financial policies among its members. This can affect trade agreements, tariffs, and other economic initiatives with non-member states.

Where is the headquarters of The Arab League?

The Arab League’s headquarters is in Cairo, Egypt.

Is the Arab League part of the United Nations?

While the Arab League is not a part of the United Nations (UN), it does hold observer status at the UN and has a mission based at the UN’s headquarters in New York.

How does the Arab League influence economic standards within its member states?

The Arab League works to harmonize economic and financial policies, regulations, and standards among its member states to facilitate integration and cooperation. This can include everything from trade and tariffs to consumer protection and financial regulation.

Related Finance Terms

  • Arab Economic Unity Agreement
  • Arab League Educational, Cultural and Scientific Organization (ALECSO)
  • Arab Investment & Export Credit Guarantee Corporation
  • Inter-Arab Investment Guarantee Corporation
  • Pan-Arab Free Trade Area (PAFTA)

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