RETHINKING THE ARAB SPRING

STABILITY AND SECURITY IN EGYPT, LIBYA, TUNISIA, AND THE REST OF THE MENA REGION
By Anthony Cordesman
November 8, 2011

Anthony H. Cordesman Arleigh A. Burke Chair in Strategy acordesman@gmail.com

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No one can ignore the short-term problems the political upheavals in Egypt, Libya, and Tunisia create for each country. New leaders must be chosen and security systems must be changed. The problems involved can kill political, economic and demographic reforms before they even begin. There is a serious danger, however, in focusing on short term needs and failing to focus on the depth of the problems that Egypt, Libya, Tunisia, and virtually every other Middle Eastern and North African state now faces. Experts can debate just how much the structural problems in each state led to the current round of political unrest and upheavals, but there is no debate over the fact that only a few oil-rich states with tiny native populations are free from massive problems in dealing with population growth, youth unemployment, failed or weak governance, and security structures that do as much to repress as to protect. These are problems both the Arab world and outside analysts have tended to downplay and neglect, but they are so serious that no advances in democracy and human rights can offer most MENA countries either security or stability. Even the best election, and major reforms of national security structures, will be a prelude to a new round of political upheaval unless these forces are given fare more consideration that they have been given to date. The Impact of Demographics and Low Economic Growth Both Muslim and Western states have ceased to focus on population growth for differing religious and political reasons. As the detailed numbers for population growth in Figure One show, however, population growth has been truly explosive in virtually every MENA state. It is true that population growth rates have been dropping, but they are dropping far more slowly than many predicted in the past, and populations that have grow 4 to 6 times since 1950 will generally double again by 2050. They will do so in nations that have far more restrictions in terms of water and arable land than most states in the world, and where the policies of past regimes have often kept economic growth and diversification far below the rates of progress in Asia and Latin America. Governments have failed both to create the social and political conditions that will reduce population growth and deal with the growth that has already occurred. As Figure Two shows, the end result is a massive youth bulge that is pouring more and more young men and women into economies that cannot offer them productive jobs, or meaningful per capita incomes. This is as true of many oil-exporting states as it is of oil poor states. Even if one ignores the corruption, cronyism, and nepotism that has sharply increased the gap between rich and poor in most MENA states, and that has lowered the status and security of much of the middle class, Figure Three shows just how low the CIA World Factbook ranks the average per capita income of far too many MENA states. It is striking to see just how poor Algeria, Iraq, and Iran now are largely because of history of internal conflict, terrible economic policies, and gross over dependence on the petroleum sector.

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Many other states, however, have per capita incomes ranking below 100 a rough indication of serious overall poverty in todays global economy. This is often disguised by the growth of modern urban areas, but it is all too real in practice. While there is no direct correlation between poverty and political unrest, it is all too clear even from these numbers why so many Arabs and Iranians could regard their governments as having failed them. These data, however, only hint at how much sharper the disparities between the richest and poorest MENA states have become. (A sparsely populated Libya with major oil wealth still had a poverty rate of some 30% of its population before the current political upheavals began. Models that focus on GNP growth or on per capita income without addressing income distribution are little more than political and economic rubbish.) These basic economic pressures interact with hyperurbanization throughout the region which has forced radical shifts in tribal, ethnic, sectarian and social structures in every state (Saudi Arabia has gone from 8% urbanization in 1950 to over 80% today). Traditional elements have sometimes adapted, but traditional societies of the kind that existed before 1950s have virtually vanished. No Arab or Persian cleric, leader, regime, or political party that keeps ignoring these realities can serve a given nations people or create the groundwork for political stability. Political change in Egypt, Libya, and Tunisia as is the case with states that so far have been more stable will fail, or will make the future even worse if it does not face the need for major improvements in the economy, infrastructure, education, and governance that can deal with these pressures. No amount of progress in democracy or human rights can succeed unless these issues are addressed as well. The Issues MENA Governments Must Now Address It is dangerous to generalize too much in addressing the challenges MENA government must now address. They do differ sharply by country, and polling data in the Arab Development Report for 2009, as well as in polls that have never had public distribution, show very different priorities and perceptions in given countries, and within given ethnic, sectarian, tribal, and income groups in the same country. Once again, there is no consistent correlation between public perceptions and potential political unrest, and any given factor or metric. There are, however, a list of factors that every country must consider, and that do emerge as proven or potential causes of unrest many driven by the combination of demographic and economic pressures summarized earlier. These factors along with measures to address population growth and a youth bulge that must continue for at least another decade, have become a virtual check list of the measures that MENA governments must address to avoid future unrest, failed states and governments:

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Middle Class status, income distribution, poverty line, perceptions of social equity: Demonstration after demonstration has made it clear that perceptions of economic status and future opportunity are as critical as baseline metrics. Traditional metrics like national per capita income, GDP growth, and poverty lines set near the subsistence level do not measure potential or real unrest. Employment and job quality: The issue is not simply employment, it is whether the job is real, has status, provides the ability to marry and have a family, and is seen as offered on the basis of merit for those outside a privileged elite. Job creation alone will not address the causes of unrest. Education: Governments differ radically in investment in education, educational quality, and the relevance of education. Some countries provide limited access. Others create low-quality higher education that is little more than a series of diploma mills. Where employment rates are low, education often does not create meaningful or reliable skills. Role of women: Women now make up a majority of secondary school and university graduates in countries like Saudi Arabia but lag badly in both employment rates and real jobs with serious productivity gain. This wastes a critical part of the labor force, raises population growth, and puts a heavier burden on young men and their families to finance marriage and careers. The human right issue is only part of the story, and discrimination penalizes men as well as women. Services and utilities: Countries differ sharply in providing services sometimes grossly distorting demand and their economies through mixes of subsidies and free services. Electricity, water, fuel prices, medical services, and housing all present serious mixes of problems in many MENA countries. The scale of these problems is often disguised by ignoring how well and how fairly government funded efforts are distributed and the quality of distribution of services. Gross measures of total national effort e.g. total power generation or access to medical services are worse than useless: they are sharply misleading. Foreign labor: Many Gulf countries, and Libya have far too much dependence on foreign labor, often as a result of government policies that favor low cost foreign labor and distort the domestic labor market. These problems continue to grow in most such states, in spite of policies that claim to favor local labor, and are a source of serious corruption in terms of the ruling elites manipulation of foreign labor permits for its own advantage in at least one Gulf state. Hyperurbanization: Showpiece buildings can disguise a lack of proper housing, urban services, and commuting capability. The quality of urban life is a serious problem. State sectors and employment: The failure to create effective private sectors and market systems, gross over-employment in the state sector, reliance on inefficient state industries, and lack of effective and implemented economic

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planning often make governments a de facto burden or threat to their own economy as well as job creation and economic equity. Agriculture: Sharp rises in population pressure, and sometimes limits to water, increase land density or drive people out of agricultural areas. A lack of capital and modern farming techniques adds to the problem. Most countries lack effective government planning and services for the agricultural sector, and government actions and incentives often distort agriculture in ways that lower productivity and income. Military spending: Governments often spend far too much on their military forces, and particularly new military equipment of uncertain mission value and sustainability, when funds are badly needed in the civil sector. Security services, national security courts, and emergency laws: The legitimate struggle with terrorism and extremism affects some countries, but far too many have steadily increase the internal security role of their military forces, and increased the size of their security and paramilitary/police forces to secure the regime. Special national security courts and legal procedures are abused, along with open-ended national emergency laws (some of which are de facto rather that formal legal actions). Access to lawyers, abuses of detention, closed trial procedures, and inability to locate prisoners and learn their status are all problems in the more repressive MENA states. Rule of law: Quite aside from the internal security issues, there are serious abuses of property, criminal, business, and other civil law. Corruption in the courts and legal system is a key problem, along with delays in procedures, cost, and access to police and legal systems than function without corruption or special charges. These affect economic as well as personal security. Corruption: A rough measure of corruption is shown in Figure Four. Corruption, however, is seen in terms of special privilege, unfair income distribution, nepotism, and a lack of social equity and not simply corruption in the narrow sense of the term. It is often coupled to poor governance, grossly over-staffed government offices, small fees and bribes, and delays or failures by bureaucracies to perform their jobs. It has become a top to bottom source of unrest or anger. Failed censorship and impact of alternative media and communications: Many countries still attempt to control or limit media, use of the Internet, access to satellite TV, etc. The end result is increasingly to drive populations to rely on illegal or alternative media and social networking systems. This reinforces patterns of unrest and distrust of governments. Moving Forward None of these issues mean reforms like creating effective representative governments, rule of law, and human rights are less important. These reforms, however, are only part of the reforms necessary to bring stability and security. MENA states must act as quickly as

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possible to address all of the previous issues as well. Elections alone will serve little purpose, particularly if inexperience and self-serving new political parties end up endlessly feuding, the quality of governance remains low, corruption and inequity continue to affect daily life, and economic progress only benefits the limited portion of the population favored by the state. This presents serious problems for both new governments that must build on a legacy of decades of failure and incompetence, that lack experience political parties that know how to work with their opposition, that have leaders who have never really governed, and that must work with bureaucracies, militaries, and internal security services that lack competence and often integrity and basic capacity. The better and more stable governments will have far fewer problems in basic institution building, but still face daunting challenges out of sheer population pressure. One key suggestion is that the wealthier Arab states work with the poorer states to create the equivalent of an Arab Marshall Plan. As has been shown earlier, however, the wealth of the oil states is relative and even nations like Saudi Arabia need to focus on the needs of their own people. The wealth of the smaller and wealthier oil states is also limited relative to the needs of the larger of more highly populated MENA states. Moreover, it is the quality of governance that will be the key issue. Aid is pointless if it exceeds the capacity to use it effectively, and destructive and corrupting if it is misused. In practice, this means each Arab state needs to reexamine its own structure, the forces affecting its future, and develop plans and improved institutions to both use its own resources and outside aid more effectively. In practice, it may well take a decade or more to make the necessary changes and implement them in ways that meeting popular expectations. Certainly, as has been clear in Iraq, elections alone do not produce either effective representative government or address the key issues shaping the future of the MENA region. This also requires: The creation of effective governance and a civil service with adequate capacity, efficiency, and integrity. Adequate urban, local, and regional governance that meets sectarian, ethnic, and tribal needs; rather than the current degree of over-centralization. Political partiers capable of addressing key issues with honesty and transparency, willing to work with their opposition, and experience in actually governing. Acceptance of checks and balances to limit the role of the state and preserve human rights. An effective and honest rule of law based on social justice, and one that can check leaders that seek to abuse their power.

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Security services that respect human rights as well as provide security. Militaries sized to meet real nation security needs, not pointless regional rivalries and competing in glitter-factor military purchases. Effective economic planning that frees market forces while protecting the people and creating real jobs and economic diversification. Restructuring of government services to reflect popular needs and priorities, and effective planning and expansion of education, health, and key government services. Educational reform to create job-oriented skills and competitive teaching and educational standards on a global basis. Major anti-corruption efforts coupled to dealing with nepotism and special privileges. Use of the tax structure to limit gross problems in income distribution. Effective efforts to address population growth. Policies that give women equity and a productive role in the labor force. Actions by the government and media to provide full transparency, and look beyond elections to use polling, focus groups, public meetings, and other mechanism to find out the priorities of their population, their perceptions of governance, and deal with sectarian, ethnic, tribal and regional tensions and grievances. Above all, it requires the kind of leadership and honesty that can explain that most of the expectations that have led to the most violent upheavals in the Arab Spring will take a decade or so to fully address, that even an Arab Marshal Plan will have serious limits in terms of outside aid and spending, and that no one can (or should) help a MENA state that cannot help itself. No MENA nation is going to be able to address even its most serious problems quickly and easily, any more than the US can. Managing expectations is going to be a critical challenge for years to come particularly given the fact there is a nearly two-decade long bow wave of new workers that are already born and still have to enter the labor force. It will be al too easy for new (and old) governments to fail, and be replaced by a new set of authoritarians, demagogues, failed governments, or extremists. The promise of the Arab spring is going to be anything but easy to keep.

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Figure One: The Population Explosion in the Middle East

North Africa (In Millions) 50 45 40 35 30 25 20 15 10 5 0
Algeria Morocco Libya Tunisia 1950 8.893 9.343 0.961 3.517 1960 10.909 12.423 1.338 4.149 1970 13.932 15.909 1.999 5.099 1980 18.806 19.487 3.069 6.443 1990 25.089 24 4.146 8.207 2000 30.429 28.113 5.125 9.508 2010 34.586 31.627 6.461 10.525 2020 38.594 34.956 7.759 11.494 2030 41.641 37.887 8.901 12.086 2040 43.425 40.267 9.981 12.284 2050 44.163 42.026 10.872 12.18

Levant (In Millions) 160 140 120 100 80 60 40 20 0

Egypt Israel Jordan Lebanon Syria 1950 21.198 1.286 0.561 1.364 3.495 1960 26.847 2.141 0.849 1.786 4.533 1970 33.574 2.903 1.503 2.383 6.258 1980 42.634 3.737 2.163 2.899 8.752 1990 54.907 4.478 3.267 3.44 12.5 2000 65.159 6.115 4.688 3.791 16.471 2010 80.472 7.354 6.407 4.125 22.198 2020 96.26 8.479 7.278 4.243 24.744 2030 9.459 8.611 4.335 28.224 2040 10.28 9.954 4.298 31.257 2050 10.828 11.243 4.155 33.658

111.057 125.242 137.873

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Figure One: The Population Explosion in the Middle East (Part Two)
The Gulf (In Millions) 120 100 80 60 40 20 0
Bahrain Kuwait Iran Iraq Oman Qatar Saudi Arabia UAE Yemen 1950 0.115 0.145 16.367 5.163 0.489 0.025 3.86 0.715 4.777 1960 0.157 0.292 21.6 6.822 0.601 0.046 4.718 0.103 5.872 1970 0.22 0.748 28.994 9.414 0.783 0.115 6.109 0.249 7.098 1980 0.348 1.37 39.709 13.233 1.185 0.237 10.022 1 9.133 1990 0.506 2.131 58.1 18.14 1.794 0.446 16.061 1.826 12.416 2000 0.655 1.972 68.632 22.679 2.432 0.627 21.312 3.219 17.407 2010 1.18 2.543 76.923 29.672 2.968 0.841 25.732 4.976 23.495 2020 1.505 2.994 86.543 36.889 3.635 0.905 29.819 6.495 29.727 2030 1.639 3.331 93.458 43.831 4.305 0.971 33.825 7.484 35.473 2040 1.758 3.623 50.459 4.879 1.04 37.25 7.948 40.901 2050 1.847 3.863 56.316 5.402 1.116 40.251 8.019 45.781

97.685 100.045

Source: U.S. Census Bureau: International Database, http://www.census.gov/ipc/www/idb/informationGateway.php, accessed 21/4/2011

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Figure Two: The Impact of the Youth Bulge in the MENA Region
Percent of total Population of 0 to 14 Years 50 45 40 35 30 25 20 15 10 5 0

CIA World Factbook, 2011

Young People Entering the Labor Force Each Year and Impact on total Labor Force
1,800,000 1,600,000 1,400,000 1,200,000 1,000,000 800,000 600,000 400,000 200,000 0
Qatar Women Entering Labor Force Annually Men Entering Labor Force Annually New Men as a % of the Total Existing Labor Force

Bahrai Kuwai n t

UAE

Oman

Leban Tunisi Saudi Yeme Moroc Libya Jordan Syria on a Arabia n co

Iraq

Algeri a

Iran

Egypt

5,162 8,117 16,232 24,419 30,264 35,121 57,070 69,420 87,346244,712 244,763 277,612 298,366 322,010 330,098 677,372 748,647 6,429 8,988 17,653 27,439 31,959 36,856 59,547 73,574 90,436256,698 261,105 287,141 300,327 332,194 342,895 715,111 783,405 0.51% 1.47% 0.82% 0.70% 3.30% 1.49% 3.44% 4.28% 2.36% 4.64% 3.56% 4.20% 2.58% 3.91% 3.47% 2.78% 3.00%

New Women as a % of the Total Existing Labor Force 0.41% 1.33% 0.75% 0.62% 3.12% 1.42% 3.30% 4.04% 2.28% 4.43% 3.34% 4.06% 2.57% 3.79% 3.34% 2.64% 2.87%

CIA World Factbook, 2011

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Figure Two: The Impact of the Youth Bulge in the MENA Region (Part Two)
Unemployment Rate Among Arab Youth

Youth Unemployment as Percent of Total Unemployment

REGIONAL ECONOMIC OUTLOOK: MIDDLE EAST AND CENTRAL ASIA

Figure 2 (20083) MENA Youth Unemployment vs. Other Regions

Youth unemployment (Percent)

Total and Youth Unemployment Rates by Region1,2

23 21 19 17 15 13 11
South-East Asia and the Pacific Latin America and the Carribean MENA6 Central and South-Eastern Europe(non- EU) and CIS

and participation rates in tertiary exceed 25 percent in Egypt, Jorda and Tunisia. Yet, entrepreneurs re lack of suitable skills as an impor to hiring (Figure 3), and unemplo are highest among the most educ together, this suggests that educa the region fail to produce gradua skills.

World

Labor market rigidities. According to Global Competitiveness Report, hi East Asia 7 regulations in most MENA6 count 5 restrictive than those in the average 10 4 6 8 Total unemployment rate (Percent) developing country. Moreover, data Sources: National authorities; IMF, World Economic Outlook; staff surveys indicate that, worldwide, the estimates; Government and Private Sector Jobs With No Productive or Useful Output, and predate Arab unrest (2008-2009) Levels of Unemployment Ignore Disguised Unemployment andand International Labor Organization. Source: Arab Development Report, 2009, p. 109, and IMF, World Economic and Financial Surveys, Regional Economic Outlook, Middle East and Central Asia, October 2010, p. identifying labor regulation as a majo 38 Unemployment rate for Morocco reflects data from Urban Labor Force Survey . Youth unemployment estimate for MENA6 excludes Jordan. their business operations is, on avera Or most recent year for which data are available. MENA6 (Figure 4). Such rigidities li creation by discouraging rms from to outpace most other regions. The number employment in response to favorabl of labor force entrants remains daunting
9
1 2 3

Developed Economies and South Asia EU

Sub-Saharan Africa

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Figure Three: Global Rankling in Per Capita Income

World Ranking Maghreb Morocco Algeria Tunisia Libya Levant Egypt Palestinian Israel Jordan Lebanon Syria Gulf Bahrain Iran Iraq Kuwait Oman Qatar Saudi Arabia UAE Yemen 54 104 159 10 54 1 55 9 172 $38,281 $7,685 $13,508 $1,085 $1,686 $21,416 137 169 46 143 81 152 150 127 113 52 $6,837 $1,540 Limits to Oil Wealth ($ Per Capita in 2010)

Source: CIA World Factbook, 2011 for per capita income ranking, DOE/EIA, http://www.eia.gov/countries/regions-topics.cfm?fips=OPEC for per capita oil export revenues

Cordesman: Stability, security, and the New MENA Spring Figure Four: The Burden of Corruption

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Note: 1.0 = most corrupt; 10 = least corrupt Source: Transparency International, Corruptions Perceptions Index 2010. Transparency International (TI) defines corruption as the abuse of entrusted power for private gain. This definition encompasses corrupt practices in both the public and private sectors. The Corruption Perceptions Index (CPI) ranks countries according to perception of corruption in the public sector. The CPI is an aggregate indicator that combines different sources of information about corruption, making it possible to compare countries. The 2010 CPI draws on different assessments and business opinion surveys carried out by independent and reputable institutions. It captures information about the administrative and political aspects of corruption. Broadly speaking, the surveys and assessments used to compile the index include questions relating to bribery of public officials, kickbacks in public procurement, embezzlement of public funds, and questions that probe the strength and effectiveness of public sector anti-corruption efforts. For a country or territory to be included in the index a minimum of three of the sources that TI uses must assess that country. Thus inclusion in the index depends solely on the availability of information. Perceptions are used because corruption whether frequency or amount is to a great extent a hidden activity that is difficult to measure. Over time, perceptions have proved to be a reliable estimate Perceptions are used because corruption whether frequency or amount is to a great extent a hidden activity that is difficult to measure. Over time, perceptions have proved to be a reliable estimate of corruption. Measuring scandals, investigations or prosecutions, while offering non-perception data, reflect less on the prevalence of corruption in a country and more on other factors, such as freedom of the press or the efficiency of the judicial system. TI considers it of critical importance to measure both corruption and integrity, and to do so in the public and private sectors at global, national and local levels.2 The CPI is therefore one of many TI measurement tools that serve the fight against corruption Source: : Transparency International, Corruptions Perceptions Index 2010