Two sets of determinants are responsible for MENA’s failure thus far to reap the potentially large benefits of globalization. First is the configuration of political and geo-strategic circumstances that has regularly disrupted the region both with intra-regional conflict and with interference from foreign partners in its internal affairs, and has encouraged the hemorrhage of domestic resources—either to be spent on security and defense or to be transferred abroad by the private sector to escape endemic instability. Second is a combination of poorly designed and executed national economic and social policies. Except in three or four of the region’s twenty-two countries, economic management has been passive and crisis-driven, lacking a clear vision and related programs for achieving proclaimed goals such as productivity growth, job creation, and export diversification.
Despite their wealth of human and natural resources and rich cultural heritage, countries of the Middle East risk further impoverishment and isolation. Globalization poses enormous policy challenges for the region. The policies associated with past socialist regimes and centrally planned economies sorely need revision. Creating an enabling environment for private sector investment and exporting will help to achieve the growth that is needed to absorb the swelling tide of job-seekers. But adjustment is a difficult process, given the embeddedness of certain policies, institutional arrangements, and norms. Revisiting the role of the state in MENA is imperative in the new global context. At the same time, a delicate balance should be achieved between those policies that aim at integrating the region into the world and those that are needed to maximize its development potential.
The region will make no real progress on the development plane while it lives in constant turmoil, the root of which is humiliation and threats to the identity and future of an entire generation of young Arabs. Globalization should mean widening the scope of human choice and the full exercise of human rights. The Middle East, more than any region in the world, needs a fair arbitrator in the global political arena, along with the provision of all other public goods. When the international community can deliver respect for the rights of individuals to security in their own homes, citizens of the region can better demand democracy from their leaders.
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