A longtime reliance on
economic indicators as a barometer of progress in Middle Eastern and
North African countries masked the level of frustration and
dissatisfaction in the region ahead of the ‘Arab Spring,’ according to a
new World Bank report released today.
While many observers praised the region for its consistently high
growth rates in the years leading to the Arab Spring, polling of
populations at the same time showed a precipitous decline in life
satisfaction scores, especially for the middle class, said the latest
Middle East and North Africa Economic Monitor. The report attempts to
resolve the apparent paradox presented by mass demonstrations in the
face of improving economic conditions. In examining the causes of the
Arab Spring, the report identifies sources of frustration that persist
today, and run the risk of being aggravated by the current economic
slowdown.
The latest MENA Economic Monitor finds that the Arab Spring
revolutions were triggered by growing and broadly shared dissatisfaction
with the quality of life. Ordinary people were frustrated by their
deteriorating standards of living, reflected in a shortage of quality
jobs in the formal sector, poor quality public services, and the lack of
government accountability, the report said. The system of general
subsidies could not compensate for these problems – subsidies mattered
less for the wellbeing of the middle 40 percent of society than they did
for the bottom 40 percent.
“On the eve of the Arab Spring, the Arab world was an unhappy place for a variety of reasons,” said Shanta Devarajan, World Bank Chief Economist of the Middle East and North Africa Region.
“The old social contract of redistribution with limited voice had
stopped working, especially for the middle class, prior to 2011. People
wanted a say and real opportunities for economic advancement.”
According to the report, many countries in the region seemed...
primed
to fall into disarray following the Arab Spring uprisings. Unless there
are global efforts to end regional conflicts and help countries renew
the social contract, a vicious circle of instability exacerbated by
economic weakness could be the long term future for the MENA region.
Just a few weeks ago, the World Bank Group launched a new Middle East
and North Africa strategy focused on addressing the causes of conflict
to promote peace and stability. One of the primary goals of the new
strategy is to rebuild the relationship between citizens and governments
through improved service delivery and increased transparency and
accountability.
“The situation has continued to deteriorate in the region as many
of the factors that made people unhappy before the Arab Spring are still
present today,” said Elena Ianchovichina, World Bank MENA Lead Economist and principal author of the report. “Though
grievances alone do not lead to civil wars, grievance-motivated
uprisings can grow into civil wars in societies polarized along ethnic
or sectarian lines. High male youth unemployment rates and the abundance
of natural resources increase the risk of conflict.”
The report also provides an economic outlook for the Middle East and
North Africa, predicting that regional GDP growth will average 2.8
percent for 2015. Thanks to continued low oil prices, civil wars and
conflicts, and a likely global economic slowdown, prospects for faster
growth are slim. Civil wars have severely harmed the economies of
Libya, Yemen, Iraq and Syria, and have had spillover effects on the
economies of Lebanon and Jordan. MENA’s oil-importing countries have
not grown rapidly in the wake of low oil prices because they have been
hurt to different extents by terrorist attacks, spillovers from
neighboring wars, slow growth in the Euro zone, and political
uncertainty.
