The Arab Spring: An Economic Perspective
Revolutions and uprisings in the Middle East have a deep economic underpinning. Unemployment, poverty, stagnant growth and low economic opportunities, these are the crises at the heart of the Arab Spring. While political corruption have been the centerfold for discussion in the media, the intensity of the Middle East’s economic repression have largely been put aside. What needs to be discussed however is precisely this backwards-developmental cycle that is preventing Arab states from realizing independence from its natural resources.
The Middle East is home to the largest oil reserves in the world. Growing economies are constantly thirsty for ...view middle of the document...
Governments who haven’t already nationalized their oil industry, feel entitled to take a large percentage of the profits, which enables them to stop depending on citizens and small businesses for tax dollars and allows them to become more authoritarian in structure. While every country’s history is unique, the Middle East has a general pattern of despotic regimes.
With no incentive to finance privatization, the inherent need to diversify in the Middle East has remained an aspiration only maintained in speeches and discussions, with no real success. But on the eve of the Arab Spring, it has become a more urgent issue. Youth unemployment and economic stagnation have become the pitfalls of authoritarian governments in the Middle East.
However, there is more than one barrier to achieving private sector development. Friction and competition between governments in the Middle East has led to the present economic fragmentation. Despite a rich history of trade and common culture and language, Arab states are among the world’s most divided regions in terms of connections in production and trade.
Intra-Arab trade between the region’s 350 million people remains minimal. Regional markets have been cut off from one another. The world dependence on oil may have sped the growth between the Middle East at the world, but the amount of intra-Arab trade has noticeably slowed.
Looking for Solutions:
The cost of fragmentation has had especially pronounced ramifications for the region as a whole. For example, the absence of a larger market denies Arab firms from benefitting from economies of...