Bald statistics rarely tell the whole story in the Arab world and stock market tables are no exception. If market capitalisation figures are to be believed, then the Middle East, with the exception of Israel, has stood still for the past four years.

Since 1997, total market capitalisation of the 50 top companies has been flat at around $130bn. There was a blip on the screen of the joint-stock cardiogram in 1999, when the total fell to $125bn; but otherwise Arab stock markets have been statistically dormant.

If there is a government-backed public offering, the patient tends to wake up. However, as a source of private sector capital funding, particularly for new ventures, Arab stock markets remain largely irrelevant.

The collective capitalisation of Saudi firms amounts to no less than 45 per cent of the total. But, at the same time, Saudi Arabia reflects many of the anomalies and illusions about corporate life in what passes for the Arab world's private sector.

Saudi Basic Industries Corporation (Sabic), which heads the list with a market capitalisation of $15bn, is described as a non-oil private sector company, despite the fact that Sabic is 70 per cent directly owned by the government, with a further 20 per cent of the total reportedly held by individual members of the ruling al-Saud family or their relations or nominees, who are indistinguishable from government and rarely trade.

As astate monopoly, Sabic, in the real world, would not have a place on any table relating to market capitalisation. Furthermore, as a corporate entity it would instantly vanish in a puff of methane were it deprived of preferential access to state-owned gas reserves.

In the United Arab Emirates (UAE), which claims seven companies in the top 50, the largest, Etisalat, is the state telecommunications monopoly, majority owned by the government. This year it slipped from second to fifth place in the rankings. UAE stock market activity has been so thin that several initial public offerings were put on hold for the third consecutive year.

While Arab markets sleep, Israeli companies are winning by default. Their membership of the top 50 has more than doubled to 13 in the same period. But the Israeli government, like its Arab counterparts, also weighs heavily on these companies. It owns more than 50 per cent of some of them.

According to western investment bankers and fund managers, the most glaring aspect of Arab corporate wealth is the scale of capital flight from the region. More than $1,000bn has left the region, twice the combined gross domestic product of all 22 members of the Arab League.

According to Mohammed Alabar, director-general of Dubai's economic development department and one of the emirate's principal business luminaries, the Middle East appeared to be "disintegrating" rather than "integrating", with the global economy.

Market transparency, he told delegates in March at the second annual conference on Trade, Treasury and Cash Management in the Middle East was "a serious issue", in the absence of which regional markets were "small" and even "boring".

But, he suggested, monopolies, protectionist policies and agency laws, which have been the hallmarks of business in oil-rich Gulf Arab states for the past 30 years, were "things of the past".

Not so, said one senior academic at Bahrain university's graduate school of business management. Monopoly companies, he insisted, were protected by the very governments that now preach the virtues of privatisation in an attempt to lure foreign investors into markets where Gulf officials themselves, and many other "high net-worth individuals", decline to put their own money.

"Gulf Arab governments," according to this academic, "will not release their hold on either energy or any other state-controlled entity because they are afraid of losing revenue and influence."

However, many bankers agree that for all their anomalies, market capitalisation tables do, when combined with other market intelligence, reveal several clues as to the recent pattern of corporate trends.

The fastest growing companies are financial institutions, 21 last year compared with 19 in 1999. Two Islamic banks are notably profitable. But the list also includes commercial banks that fulfil the three criteria of adequate shareholder capital, sound strategy and competent managers given a free hand by the board. Among their number are Saudi American Bank, Saudi British Bank, Saudi Dutch Bank, Saudi French Bank and Arab National Bank.

In addition, bankers say, there is more private Arab capital being invested in the region than is evident from available stock market capitalisation figures.

Apolitical merchant families, notably from the oil-producing Gulf states where many businessmen are related to each other and where contacts rule, are not waiting for their governments to set up properly regulated stock markets as a source of funding.

Businessmen from Saudi Arabia and the UAE, the two wealthiest oil states which together own more than half of the top 50 quoted companies, are raising their own finance to start ventures throughout the six Gulf Arab oil states and further afield, including Iran and into northern Arabia, primarily in real estate, gas-based industries such as petrochemicals and aluminium, and mining.

These and other private groups are what keep Arabia's commercial life-blood flowing.