UNDP report calls for economic reform in post-Spring Arab world

Marwa Hussein, Sunday 19 Feb 2012

If region's economic and social woes aren't competently dealt with, desired democratic transition in Arab world will fail, warns new report by UN Development Programme (UNDP)


"Democracy is necessary, but not enough." This was the conclusion of the United Nations Development Program (UNDP)'s second Arab Development Challenges report, the authors of which believe that economic issues – which have played a key role in the ongoing wave of "Arab Spring" uprisings – will be eclipsed by political issues in post-revolution public discourse.

The report, entitled “Towards the Developmental State in the Arab Region,” dedicates an entire chapter to human development and the pressing issue of poverty. It notes the region's generally poor performance in terms of human development, despite substantial investment in the health and education sectors.

The report points out that, although official figures in the Arab region indicate a decline in poverty levels, the reality is much different. The report's findings also cast doubt on common perceptions regarding the issue of wealth disparity in the Arab world.

At a Sunday press conference in Cairo held to mark the report's official launch, all speakers agreed with the study's findings.

"There is something wrong with [official] statistics," said Egyptian Supply and Internal Trade Minister Gouda Abdel-Khaleq. "Is it true that extreme poverty was eradicated in this part of the world?" he asked, noting that the reality appeared different.

"Maybe statistics are being manipulated for political reasons," he added.

According to Ibrahim Al-Saouri, author of the first report, the use of data and statistics in the region "is highly politicised."

"They always talk about the achievements of the regimes, but never about their failures," Al-Saouri said. "This information isn't accurate enough to use for establishing policies to combat poverty. Unemployment figures, for example, aren't at all within the safe levels they pretend they are. This can be easily verified."

Nor, do the report's authors believe, has the situation improved in the wake of the recent string of popular uprisings in the Arab world. In fact, the report warns that, if economic challenges and the need for social justice aren't competently dealt with, desired democratic transition in the region will fail.  

"People expect that social and economic change will come as quickly as political change, but this isn't the case," said Paolo Lembo, Officer-in-Charge UNDP Regional Centre for Arab States. "I hope we will eventually see the emergence of a radical social contract between the state and the people, not just economic reforms."

Abdel-Khaleq went on to express the belief that current political turbulence in Egypt, including the recent incidents of violence, was the result of the ongoing dynamic between revolutionary and counter-revolutionary forces. “No revolution in history managed to achieve all its goals in only one year," Abdel-Khaleq said.

Abdel-Khaleq, of known leftist orientation, expressed disappointment that the report failed to tackle the issue of globalisation, which he believes represents "the main obstacle to equitable wealth distribution."

"The forces of the counter-revolution are deeply committed to what is called the 'free market economy,' but I don’t know if this really exists," he said.

Abdallah Dardari, principal advisor for the report, said: “Only 200 companies have more than 40 per cent of the financing in the Arab world. Natural resources are also under the hegemony of states and are used politically. The social contract that the regimes established in the region involved garnering public support in exchange for social services and public-sector jobs. In recent years, however, these benefits were taken from the people and nothing remained of the old social contract. Therefore, a new one must be forged." 

Core team member of UNDP in Cairo Khalid Abu Ismail, for his part, said: "Economic policies aim to achieve economic stability – stable rates of inflation, stable exchange rates, etc. – but we must embrace the notion of the developmental state. We must set development goals for ourselves and then apply policies to realise them."

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