Around the world, more women are being elevated to positions of diplomatic and political leadership, and the Arab world is no exception.
The potential for entrepreneurship in MENA is high, based on digital consumption and a startling increase in investment funding for start-ups. Entrepreneurship is booming across the Middle East and North Africa.
Here's a closer look at some of the start-ups that are helping to several of the region's most pressing challenges. Governments in the Middle East must start finding ways to employ their workforce other than by public sector hiring - and this means keeping up to speed with technological innovation so t The youth population across the MENA region is set to increase, expanding the share of the working-age population.
This is a huge opportunity for the region's economic and social developm But the region must put the right support systems, regulations and access to funding in place, writes Khalid Rumaihi.
Economic Integration in the Middle East
MENA is the most water-scarce region in the world, and the largest market for desalination - an expensive and energy-intensive process. Could grey water - the stuff left behind by our was We have the tech and know-how needed to fight climate change - but we can't wait for individuals to do the right thing.
It's time for boldness and action from our national and regional la Collecting data is not enough. The region's institutions - agile, dynamic and unburdened by dated conventions - are at the forefront of the research that drives the Fourth Industrial Revolution.
The countries in the MENA region are waking up to the threat posed by climate change, but it also presents an opportunity - because to respond effectively, they must learn to put their di How do we convince young people living in some of the region's most fragile states, where jobs and food are often scarce, to engage in a conversation about the future of the planet?
Economic Research Forum (ERF)
Fuelled by climate change and dwindling fossil fuel resources, the region is leading the race to decarbonize its energy production. A recent study suggests that almost half of all entrepreneurs will suffer from poor mental health. Here are three ways to help stem the growing mental health crisis in the business world.
Limited access to finance, a difficult business environment and a relatively low level of human capital are standing in the way of small- and medium-sized businesses in the MENA region. Pressures on traditional retailers from the internet and changes in consumer buying behaviour are compounded in the Middle East by rising costs associated with economic reforms.
Population Trends and Challenges in the Middle East and North Africa – Population Reference Bureau
Here's fi The role of women across the Arab world has been dictated by tradition for generations - but today, younger women want more from life, and they are determined to upend the status quo. The mena19 meeting will convene over 1, key leaders at the Dead Sea in Jordan to enable collaboration on the most pressing challenges facing the region. Bank lending and accommodative policies helped output recover in H1,but a continued fall in investment limits the pace of real GDP growth.
TRY depreciation has led the current account to shift to a surplus, and FX reserves appear sufficiently large to cover external debt repayments.
Recent attacks on Saudi oil facilities led to the worst supply disruption in last 50 years. The impact on the Saudi economy includes a small contraction in overall real GDP and a wider fiscal deficit. Promoting nonhydrocarbon growth and diversifying away from traditional sectors remain key challenges. We expect nonhydrocarbon growth to reach 1. More emphasis on innovation is vital.
Yet, due to a surge in population growth and urbanisation, the consumption of fresh water in the Gulf States has spiked dramatically Aidrous In response, governments have become reliant on the extraction of non-renewable fresh water from subsurface aquifers and the expensive desalination of sea water to meet demand. While the World Bank does concede that desalination could potentially alleviate some future water shortfalls, it does come with a price World Bank The desalination process requires a large energy input, which is largely dependent on fossil fuel consumption.
The problem is that as the price of fossil fuels continues to fluctuate, desalination becomes more and more expensive as long as it requires fossil fuels to operate efficiently World Bank In fact, a recent article reports that as the populations grow in the GCC states, water will become a more expensive geostrategic resource than oil. One ton of fresh water is already more expensive than a ton of oil Aidrous Despite the expense, the price of water in this part of the world is heavily subsidised by the government and there is very little institutional oversight and control over its use.
These two factors in turn contribute to the over-consumption and misuse of this scarce resource by wealthy citizens who build private pools, golf courses, and gardens in states like Kuwait. Yet, while government water subsidies primarily help the middle and wealthy classes, people living in poverty in the Gulf sub-region gain little benefit UNDP Droughts, for example, primarily affect those populations who live in rural areas beyond water and energy infrastructure and are thus dependent on wells, which can dry up Sullivan Food insecurity in the GCC states reflects a similar disproportionate distribution.
It is a distribution that primarily benefits the wealthy and the middle classes but hurts poorer segments of the population.
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The MENA region is a large food importer in part due to the lack of arable land and declining water supply. While the region continues to see a population boom and thus an increase in demand for food, the local production of food cannot keep up World Bank To ensure food security, governments have expanded the production of agricultural crops that consume a large amount of fresh water. The UNDP report argues that this water consumption is ultimately untenable.
Macroeconomic Issues and Policies in the Middle East and North Africa
As the region becomes more dependent on desalination, the local production of food becomes unsustainable UNDP Thus, as water becomes scarcer and the price of hydrocarbons continues to fluctuate, water and food insecurity could possibly lead to further conflict in the region UNDP A growing population and a concomitant increase in demand for both food and water will continue to put pressure on the Gulf economies. Conflict between states for dwindling resources also contributes to increasing economic insecurity Sullivan Finally, the lack of critical infrastructure for private and public investment throughout the region continues to stunt economic growth.
The central governments in the GCC states have neglected to develop their respective rural and peripheral areas. The exclusion of these areas in general development programs has only continued to exacerbate inequality and poverty Sika , Indeed, the UNDP report notes that programs focused on the construction of infrastructure roads, rural clinics, affordable housing, water supply networks are critical for sustained economic growth Furthermore, important infrastructure like desalination plants and hydrocarbon production plants are vulnerable to conflict and war, which could potentially disrupt GCC economies.
Keeping the above regional problems in mind, the rest of this chapter will now examine the economic in security of the GCC economies beginning with a short historical overview of Middle Eastern economic integration. Yet, following the defeat of Nasser in the war against Israel, the Arab unity movement declined and left a fractured region made up of warring post-colonial Arab states Hudson , As put forward by Cummings and Hinnebusch , the clash between regional pan-Islamic or pan-Arabic supranational structures e.
According to de Albuquerque , this lack of formal economic integration is in part due to two factors: Arab state-driven nationalist economies and the fear of the political elite in smaller states that have concerns that countries like Egypt under Nasser or Saudi Arabia could potentially utilise regional organisations to dominate the region Yet, that is not to argue that there have not been any attempts by the political elite in the Middle East to establish more formal economic arrangements — especially among the Gulf kingdoms.
In the s and the s, the political elite in the Middle East embarked on major economic liberalisation, privatisation, and deregulation projects in their respective states. Between those decades, both the Arab Mediterranean and the fuel-endowed nation-states outpaced southern Europe in both life expectancy and income. For example, by , life expectancy in the fuel-endowed states was higher than in southern Europe Rauch and Kostyshak States have attempted to cooperate in smaller sub-regional organisations over the decades as well.
Food, Agriculture, and Economic Policy in the Middle East and North Africa
Two sub-regional organisations include states that are in geographical proximity to each other and have historical economic ties: the Arab Maghreb Union AMU — which includes Tunisia, Morocco, Algeria, Libya, and Mauritania — and the Mashreq that includes five states: Egypt, Jordan, Syria, Iraq, and Libya. While the six member states have achieved some agreement over security policies, especially in response to the Arab Spring, the exact nature and goals of the GCC remains rather ambiguous Abdulla , Neither a strict security community, a political alliance, nor an economic integration venture, the GCC remains a loose collaboration among nation-states that share Islam as a religion, Arabic as a common language, a similar tribal heritage, and a common economic dependence on the export of oil and natural gas Abdulla , The economic structure of the GCC has over the years undergone changes in an attempt to deepen the arrangement among its members.
In , the GCC established a free-trading zone that exempted local products and services from tariffs and taxes and, since the end of , member states have also established a common market; in , the GCC also put a customs union into effect Karns et. These economic measures have resulted in some success.
The GCC was also the fourth largest exporter in the world after China, the US, and Germany; these exports consisted primary of crude oil, natural gas, and other petrochemical products Abdulqader That said, these economic accomplishments have been quickly overshadowed by a drop in world oil prices between and , the civil war in Syria, the war in Yemen, and the conflict with the Islamic State. Indeed, the Middle East as a region has experienced a growth rate of less than three per cent in the last five years.
This slower than expected growth rate may continue as the GCC economies face unstable global oil prices World Bank Indeed, the long-term economic outlook for this region will continue to deteriorate if the Gulf oil-producers do not further diversify their economies ISA ; Stevens Other regional attempts beyond the GCC have largely failed.
The EU — due to its proximity and historical connections to the MENA region — has also attempted to promote regional and economic integration in the Middle East through various policy measures with non-EU states. Envisioned as a continuation of the EMP, the UfM also floundered on the Israeli-Palestinian conflict and therefore failed to further integrate the two regions Yildiz , Yet, even prior to the Arab Spring, Brussels worked with the authoritarian rulers in the MENA periphery in an effort to stabilise and secure the region Del Sarto , Yet, despite the apparent successes of the GCC relative to other attempts at regional integration, the sub-regional institution remains divided by internal strife among its members.
The proposed common currency, the Gulf Dinar, remains in limbo after the UAE rejected the common monetary project because of the plan to locate the central bank in the capital of Saudi Arabia, Riyadh, instead of Abu Dhabi Ulrichsen In another instance, the monarchies in the GCC, led by Saudi Arabia, in a response to the events of the Arab Spring sought to establish thicker political and security ties with the monarchies in Morocco and Jordan in order to counter the protests and demonstrations that overthrew established dictators in Egypt, Libya, and Tunisia.
While the GCC sub-region is not as economically or politically integrated as some other regions in the world, the nation-states within this sub-region face similar problems. The rest of this essay will examine two problematic areas: hydrocarbon dependence and the confluence of high inequality and increasing youth unemployment. One of the enduring economic problems in this sub-region is its economic dependence on the export of hydrocarbons.
Yet, as the global energy market turns toward renewable energy sources, oil reserves begin to dwindle, and low-carbon emission technologies gain popularity in response to climate change, the economies of the primary oil-exporting nation-states in the GCC face a steep challenge. This section will briefly go over the history of oil in the Middle East and then detail the current challenges facing the region due to its reliance on the export of oil.
In the twentieth and twenty-first centuries, Western European empires, and later the United States helped transform the MENA region into a key node in the global energy circuit. The turning point in the production of crude oil was the end of the Second World War. The meeting between Franklin D. Important for oil-exporting states in the Middle East in terms of this model were the increasing oil revenues, which allowed these states to sustain their welfare systems. This growth was in part caused by government investment in infrastructure, education, health, and state-owned businesses.
Yet, by a more competitive international economy, weak oil prices, and a reduction in the demand for migrant labour marked the roots of an economic crisis Yousef Yet, in the s and s the region underwent a period of economic trade liberalisation, privatisation, and deregulation under the supervision of international monetary institutions and structural adjustment policies in response to the s debt crisis.
While, as Hanieh notes there were some protests against some of these austerity measures, the neoliberal policies that were popular outside of this region were implemented by Middle Eastern governments throughout the region Hanieh In the following decades, further conflict among nation-states in the Middle East and foreign intervention damaged oil production infrastructure in the region.
The invasion of Kuwait by Iraq, the Gulf War, the invasion of Iraq, and the subsequent Global War on Terror allowed regimes throughout the Middle East to both suppress dissent in the name of fighting terrorism and request more international resources to do so Dahi Thus, because earlier attempts at diversifying their economies away from oil have failed, the volatility of the global oil-market nonetheless puts the GCC economies at risk. In response to the decline in oil prices, several of the GCC member states released economic strategic plans that outline economic diversification strategies.
Generally, these plans emphasise increased private investment in the economy, the generation of jobs, and the creation of more opportunities for education and innovation Tagliapetra , This strategic plan focused on moving the Saudi Arabian economy away from its dependence on oil, improving the life of its citizens, and increasing the role of the private sector in the national economy. Ghafar further argues that a weakness of the plan is its lack of consideration for the political costs of the plan on citizens.
These political costs become more apparent as the food-water-energy nexus is disrupted. As demonstrated by the conflict in Syria, food and water insecurity can act as factors that can lead to civil war Sullivan Discontent with the ruling classes and authoritarian governments in the Middle East came to a head in as the Arab Spring uprisings overthrew authoritarian leaders in Egypt, Tunisia, and Libya.
While the Arab Spring uprisings primarily involved the autocrats of the Arab Republics who undertook economic reforms under the auspices of the IMF and the World Bank, which boosted their economies but undermined their legitimacy, the GCC group was largely spared.