As the price of oil falls, the discussion is heating up on what the impact will be for countries in the Arab World – especially online through the popular Arabic hashtag النفط_دون_50_دولار # translating to “oil below US$50 . The World Bank’s Chief Economist for the Middle East and North Africa, Shanta Devarajan, weighs in on the conversation.
Yemen, Republic of
When I first arrived in Sana’a in early 2012, I met with many segments of Yemeni society; including political leaders, civil society organizations, youth, and women leaders and, of course, the new government. From the conversations I had, it was clear that education was always foremost on everyone’s mind.
Fiscal and administrative corruption continues to strain the Yemeni economy; the very same corruption that was a major driver for the 2011 street protests and the ouster of the most recent national unity government. The three year transition period has not brought any noticeable improvement in anti-corruption efforts. On the contrary, with an all but absent and weakly performing government, corruption is still rampant and growing.
Governments in the Arab world have long subsidized the price of energy. This gives citizens throughout the region access to cheap petrol and diesel, and electricity supplied at below-market rates. But what has been the real impact of subsidies, and do they justify the huge financial burden they place on national budgets? This is a critical question in the Middle East and North Africa (MENA), as the region represents a disproportionate share of the world’s energy subsidies.
If you think the summers in the Middle East and North Africa (MENA) region are hot—think again. Summers are likely to become much warmer. Global temperatures are rising; the question now is by how much and what the impact of them will be. People in the region already face very high summer temperatures—and these could get worse. Compared to the rest of the world, the MENA region will suffer disproportionally from extreme heat.
In December 2013, Yemen set-up an office to co-ordinate its use of development aid. Amatalim Al Soswa, one of the few women in Yemeni public life, was chosen to head the office, which is known as the Executive Bureau. Now, almost a year later, she reflects on the frustrations her Bureau has encountered, and on the progress she is making at this time of enormous political uncertainty in her country.
Since the signing of the GCC supported agreement that ended the political crisis in 2011, Yemen embarked on a political transition that was applauded by many of the regional and international powers. Above all, it saved Yemen from a terrible civil war. The transition included the resignation of the former President Saleh, the formation of a national reconciliation government, election of the Vice President as the new head of the state, and the undertaking of a comprehensive national dialogue to discuss and agree on a political road map to resolve Yemen’s long term political problems.
The Middle East and North Africa region has a large diaspora. According to the latest United Nations estimates, 11 million citizens from the MENA countries lived abroad in 2013. Many of the members of this group hold prominent positions in their adopted countries. They have the potential to contribute to the development of industries in their countries of origin. Executives in multinationals can influence the choice of locations abroad in increasingly defragmented supply-chains. This is especially relevant for members of the diaspora. Seddik Belyamani, originally from Morocco, was Boeing's top airplane salesman, and was instrumental in converting an initial push-back by Boeing’s executives into an interest and a first mover investment in Morocco.
A former hotel owner in one of the region’s major cities, who wants to remain anonymous, tells a story that should have had a happy ending. Her 40-room hotel was doing well. It had built a reputation for excellent service. She decided to capitalize on her success and expand the business by adding a restaurant. This would have provided her with another revenue steam and allowed her to attract more customers, especially foreign tourists. Apart from expanding her business, the need for new kitchen and wait staff would have meant jobs for the local community. It would also have meant more business for local suppliers of everything from food to tablecloths.
With such a long list of potential benefits, who would want to stand in the way?
What makes smart politicians? Jeffrey Frankel has an idea. His recent blog examines the allure, and trap, of universal subsidies. For one thing, they know that pulling the plug on bad policies should be done sooner rather than later. The same can be said of other policies related to investment and labor legislation. Economic democracy is a great thing. However, beware of misguided routes to achieving it.
- Egypt, Arab Republic of
- Iran, Islamic Republic of
- Saudi Arabia
- Syrian Arab Republic
- United Arab Emirates
- West Bank and Gaza
- Yemen, Republic of
- Middle East and North Africa
- Global Economy
- Labor and Social Protection
- Public Sector and Governance