Arab summit is told economic crisis to hit Middle East hard

Libyan leader Moammar Khadafy stormed out of a session at the Arab summit.

DOHA, Qatar - The global economic crisis may plunge the Middle East, already reeling from war and extremism, into further chaos, the ruler of Qatar warned other national leaders and diplomats yesterday at the annual Arab League summit.

Sheik Hamad ibn Khalifa al-Thani, emir of the tiny but increasingly influential kingdom of Qatar, brushed aside persisting squabbles among Arab states to warn that the world economic crisis would strike the Middle East hard.

"Our Arab world was among the most vulnerable regions in the world to be affected by the storm," Khalifa told the dignitaries assembled in the capital of his nation, which is rich in oil and natural gas.

Economic gloom overshadowed the summit, often a pageant of decorum and flowery rhetoric where substantive issues are overshadowed by petty rivalries among Arab states.

President Bashar Assad of Syria called for Arab unity even when there are stark disagreements. But politics took a back seat to economic worries as the contagion rooted in the collapse of the US financial system and real estate markets begins to affect the Middle East.

The French energy giant Total S.A. predicts that global demand for oil will drop by 2 million barrels a day. Economists say a decline in remittances from Arabs living in the West and the Persian Gulf countries and a sharp drop in commodity prices will eventually increase unemployment and political unrest in economically fragile countries such as Lebanon, Yemen, Egypt, and Jordan. The International Monetary Fund has predicted drops in the growth of gross domestic product in the Arab world for 2009. Analysts say North African nations dependent on trade with Europe will also be hurt.