Arab Countries in Transition Seek Path to Strong, Inclusive Growth
The latest issue of the IMF’s quarterly magazine, Finance & Development (F&D), looks at the challenges this transition presents, focusing both on the long-standing forces that have shaped the region’s economies and fresh solutions that can help them achieve strong, inclusive growth in the future.
A guiding vision
While political and economic stability is the immediate goal, modernization and diversification of the region’s economies are essential if the region is to create new jobs and provide equitable opportunity for all, writes Masood Ahmed, head of the IMF’s Middle East and Central Asia Department. “Restless populations’ growing impatience for quick results—in the form of new jobs and better incomes and social conditions—is an incentive for policymakers to proactively introduce changes to the existing economic systems.”
Bread and freedom go together
These reforms must be implemented in parallel with political change, says Marwan Muasher, Jordanian diplomat and author. He reminds readers that the region has faced dire economic challenges before, and offers five lessons from the past:
• Economic reform will not work without political reform: if people feel they have been part of the political consultation process, they will tolerate economic challenges.
• Growth policies must be inclusive, allowing the less privileged to improve their lives.
• Economic reform plans must be prepared with the general public’s input.
• Economic reforms must be measurable and have a clear final goal.
• Communication must be planned as part of the reform process, to garner buy-in from the public.
While the global press described the revolution of two years ago as an “Arab renaissance,” what mattered to most people in the region was “decent work, fair access to education and health care, “support in old age; accountable government; and a say in how the country is run,” say Nada al-Nashif and Zafiris Tzannatos of the International Labour Organization.
Business, trade, and finance drive growth
The limited effectiveness of the financial sector in the Middle East is another factor...
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