Arab Spring Brings Some Sour Fruits
By Simba Shani Kamaria Russeau
CAIRO, Mar 26, 2012 (IPS) - Recent shifts in the Middle East and North
Africa have presented several economic challenges such as high unemployment,
an exodus of migrants from Libya and a reduction of tourism revenues. Given
that economic discontent played a vital role in the Arab uprisings, economic
growth has become vital to sustain the fruit of revolution.
"In societies characterised by young populations, and by a need to create
hundreds of thousands of new jobs every year in order to absorb new
workforce entrants, efforts to reshape economic policies and restructure the
various economic sectors are of extreme importance," Ziad Majed, assistant
professor of Middle East studies at the American University of Paris tells
IPS.
"For this reason, the development of new frameworks for regional and
international economic cooperation with public and private sector
organisations should be a priority, not only for the direct benefits that
such cooperation would provide, but also in the interest of long-run
stability and prosperity in the societies concerned."
According to the Arab Tourism Organisation (ATO), popular uprisings that
began a year ago - leading to the toppling of regimes in Tunisia, Egypt and
Libya - cost the Arab world nearly 96 billion dollars, with 18 percent of
those losses in the tourism sector.
In the Middle East and North Africa (MENA), tourism is considered a major
source of foreign exchange after remittances from overseas migrant workers.
The travel and tourism industry plays a crucial role in generating
employment as well as aiding in reducing reliance on other economic sources.
In Egypt, tourism employs almost two million workers, generates 11 percent
of the GDP, and is the principle source of foreign currency - accounting for
20 percent of the total.
In Tunisia, tourism provides employment for approximately 400,000 Tunisians
and generates nearly 8 percent of the GDP. It represents the main source of
foreign currency in the country.
Last year, Syria generated more than 8 billion dollars due to a 40 percent
increase in the number of tourists before the uprisings.
The region has struggled to get back on its feet with ongoing instability in
countries like Bahrain where recent statistics indicate that 12 months of
political unrest has cost businesses nearly 800 million dollars. Rising
unemployment and loss of remittances from overseas migrant workers have also
contributed to economic stagnation.
According to the International Labour Organisation (ILO), unemployment in
the Arab world was 10.3 percent in 2011 compared to a global rate of 6.2
percent.
Egypt's population of about 85 million, which constitutes a third of the
Arab world, is growing by two percent a year. Two-thirds of the population
is under the age of 30, and that age group accounts for 90 percent of the
jobless.
Last year, the World Economic Forum's Global Competitiveness Index revealed
that institutions in the MENA region have failed to create supportive
economic and social environments that could encourage youth
entrepreneurship.
"Reforms like fair wages, and a proper educational and healthcare system is
what we need right now," 25- year-old Egyptian business graduate Hassan
Massri tells IPS.
"Investing in young entrepreneurs could offer alternatives for recent
graduates who are entering a non- existent job market. Young Egyptians, who
were the drivers of political change, have so much potential in terms of
contributing to the economic development of this country. Our talents
shouldn't be wasted."
Remittances have been the most important source of private investment in
rural and urban Egypt, from lower as well as from higher skilled
occupations, for the past 30 years.
In 2008, the World Bank ranked Egypt as one of the top 10 remittance
recipient developing countries.
"The IOM World Migration Report 2011 assumes that the sudden return of large
numbers of migrant workers to developing countries in the course of the
political transitions that took place in Tunisia, Egypt and Libya's civil
conflict may have a serious impact on the economic stability of these
states," IOM Cairo programme manager Piera Solinas tells IPS.
"Many of them are already struggling with high unemployment, and now they
have to absorb large numbers of returnees into their labour market. These
countries are also likely to be hit financially, as migrant workers
returning home will no longer be able to send remittances."
This is strongly the case in Egypt, Solinas says. "To date, nearly 200,000
Egyptian migrants have returned back to Egypt. Most are semi-skilled adult
males, and were likely to have been single and/or primary breadwinners who
were supporting dependents through remittances, which have now been
disrupted."
Prof. Majed says the need for remedial action is urgent. "Incentives, joint
projects, vocational training and specialised initiatives could be designed,
and investments developing the national economies and enlarging their social
bases could be made. This would diminish immigration pressures, social
tensions and poverty, and would allow for the emergence of more dynamic
economic sectors." (END)
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Received on Mon Mar 26 2012 - 18:27:01 EDT
