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Such successes are not always as impressive as they look. For one thing, many European contracts with the Arabs are spread over periods as long as ten years. Also, some deals simply fall apart later under hard negotiation. A year ago the Libyans placed an order with Italy for a small 1.5 million-ton steel plant. But just when the construction plans and contracts were set, Tripoli changed its mind. What the Libyans wanted instead was a 5 million-ton plant. Back to the drawing boards went the Italians to work on new plans, new contracts, new financing. Then the Libyans decided that they would prefer a 3 million-ton plant, and that is where matters now stand.
Europe also faces some stiff potential competition in keeping its exports to the Middle East booming. The U.S. so far has not expanded its trade with the oil producers as rapidly as it could. American sales to the Arab world and Iran last year were $5.2 billion, double the 1973 figure but still less than a third of the European total. In dealing with the Middle East, Europeans have the formidable advantages of geographic proximity and a history of cultural contacts going back to the Crusades—besides which, they are under far more compulsion to deal, since they must buy much more Arab oil than the U.S. Still, many Arabs look upon the U.S. as a more desirable potential trading partner than Europe; they admire the technological sophistication and global scale of American industry.
Exporting Growth. The European countries' worst problem in selling to the Middle East is that to some extent they may be exporting their own industrial growth. In order to pay for oil, France, Britain and Italy are selling to the Arabs and Iran new plant and equipment that they otherwise would build for themselves. Indeed, some Europeans feel that industries now abuilding in the Middle East will one day compete directly with Europe while enjoying the benefit of cheaper labor. One possible solution: "triangular ventures" in which technologically rich nations cooperate with resource-rich states to develop countries that have neither technology nor resources.