In the 1930s, in the Great Depression, international oil companies were drawn to the newly-formed state of Saudi Arabia, where oil had been discovered. At first, companies were reluctant to go to a faraway desert kingdom, with little infrastructure, no modern institutions, and few people with technical education. But the resource looked rich, so importing equipment and engineers, the companies took the plunge. The rest, as they say, is history. Saudi Arabia, and much of the Middle East and North Africa (MENA), became the preeminent global supplier of oil.
Regional uncertainty in the Middle East and North Africa (MENA) region has brought economic challenges and slower growth. The weakening global economy due to the Eurozone crisis has lowered the prospects for a rebound next year. A major factor that could affect the growth in MENA is whether a downturn in European Union (EU) affects the price and quantity of oil. Our new report MENA: Eurozone Storm on the Horizon finds that a looming crisis in the Eurozone could severely impact the region, especially if it is accompanied by lower oil prices.
Transparency, accountability and participation in Iraq: A simple starting point for better governance
In a resource rich environment, Iraq faces a significant challenge; the government must apply its resources effectively in order to enhance development and growth. Resource rents also tend to greatly reduce the impetus and motivation for reform. Couple these issues with a volatile security environment and the problems seem endless. Against this backdrop, the recent Iraq Transparency, Accountability, and Participation Workshop, held in Beirut on November 16 and 17 provided a platform for Iraq’s government, civil society, and private sector to address these issues and to reach a consensus on the best way forward.
Small and medium sized enterprises (SMEs) are being targeted as never before for their potential to stimulate growth and create jobs. Many of the development agencies (World Bank, EBRD, Islamic Development Bank, among others) have plans to expand programs for financing and supporting SMEs. Most recently at the World Economic Forum in Jordan, government officials from countries in the Middle East and North Africa, as well as from the US and EU, talked up their potential for creating jobs in the region. This would be good news if it was true, but a growing body of evidence suggests that SMEs are not the silver bullet that we had hoped for.
Some countries of the Middle East and North Africa region are once again lighting up a new path. Following the social revolutions which showed the world the effect of combining non-violent protest with new media technology, an energy revolution is now underway. It also utilizes cutting-edge technology with the potential to lead the world into a new energy era. Pointing beyond fossil fuels, this revolution aims to harness an older and more abundant resource: sunshine.
We have all heard about the social, economic, and political issues currently facing the Middle East and North Africa (MENA) region. Of these challenges, the demand for better governance is among the most important issues. Therefore, MENA countries must adopt innovative solutions and clearly communicate the impact of their efforts on the topic of governance in a comprehensible way to its’ citizens.
On pre-election week, the team and I met with a large set of stakeholders in Tunis to kick off the in-country consultations on the regional Jobs Flagship report that we are preparing for the Middle East and North Africa region. I guess that thousands and thousands of people chanting “bread and dignity” in Tahrir Square makes it easy to motivate why we should be talking about jobs now. In the past few months, we started to analyze all the available data on employment and to put the common threads together to understand where the constraints lie and where the solutions might be to generate more and better jobs in the region.
When it comes to answering the tricky question of why increased enrollment in higher education, one of the region's notable successes, has not translated into increased employment gains, one common theme is a mismatch of skills. The skills being taught just aren't relevant to the new global economy. Yet the 'Arab Spring' revealed a generation that had a very sophisticated grasp of new technologies, and that had come up with ingenious ways of using them to organize and mobilize. A generation that was also clearly capable of critical thought and effective communication. This was evident in the ability to identify and articulate a collective sense of economic and political exclusion. In Tahrir Square, they displayed a high degree of creativity and enterprise.
Every year, during a time oscillating between summer and autumn, my institution the World Bank and the IMF jointly hold their Annual Meetings. Often, concerns about the global economy dominate the discussions. With all that is going on this year, I wondered why the main theme of the meeting was gender equality. As important as the topic may be, it was not going to deliver a tangible outcome in the near future, especially when developing countries in particular are facing uncertain horizons. And yet, I must say I felt a sense of pride in, and belonging to, this message. The message was bold and visible: In their different tongues they asked the same question: “Equal?”
The global economic crisis and the Arab Spring have sharpened the challenge to the countries of the Middle East and North Africa (MENA) from a large young population seeking better educational and professional opportunities. A variety of factors have impeded the countries’ abilities to absorb an increasing labor force: excessive GDP volatility; labor demand heavily dominated by the public sector; economies dependent on oil revenues and low value-added products; and weak integration into the global economy.