Veteran reporter describes economic decay in Middle East, hope for future lies in trade and middle class
Regional, Economics, 12/7/2002
The former Middle East correspondent for the Wall Street Journal, Phillip Kurata, says Islamic extremist groups such as al-Qaeda are the result of economic and institutional decay that has been taking place in the region for the past 80 years.
"I would argue that al-Qaeda is the by-product of this process of economic and institutional decay," said Stephen Glain in a presentation to the New America Foundation in Washington December 4.
"When you have governments that can no longer deliver on basic goods and services, you create economic margins in society that are susceptible to being politicized and then radicalized," he added.
Glain said before the imperial powers of Britain and France carved up the Middle East in a strategy of divide and rule after World War One, the large area that is now divided among countries such as Iraq, Syria, Jordan and Lebanon were "essentially one nation economically."
Glain said the Sykes-Picot agreement in 1916, a secret pact between Britain and France with the assent of Russia on the dismemberment of the former Ottoman Empire, marks what he calls the beginning of the "slow, steady sclerosis in the Arab world."
Glain said the imperial powers split up "a great market of 40 million people" and left "behind tiny little markets that weren't viable." He said the tariff systems that the subsequent Middle Eastern governments later imposed "strangulate these economies and their ability to grow."
"If I'm a foreign investor, I would rather build a car plant in a country with 60 million people or 80 million people," Glain said.
Glain said the challenge of the United States and the West is to help the Middle East reform its financial institutions so that trade and commerce can flourish once again.
At the height of Arab civilization, Arab currency was held from Scandinavia to China, and a draft order signed against an account in Damascus would be honored in Guangdong, Glain said.
"These were known in Arabic as 'sek,' from which the English 'check' is derived," he said.
Glain's assertion that economic sclerosis is debilitating the Middle East is corroborated by the United Nations Development Program (UNDP).
"Over the past twenty years, growth in per capita income was the lowest in the world except in sub-Saharan Africa," UNDP said in its first Arab Human Development Report, issued in 2002.
"At an annual growth rate of 0.5 percent annually, if such trends continue in the future, it will take the average Arab citizen 140 years to double his or her income, while other regions are set to achieve that level in a matter of less than 10 years," the report said.
"The decline in workers' productivity has been accompanied by deterioration in real wages, which has accentuated poverty," the report said. "From a human development perspective, the state of human development in the Arab world is a cause for concern."
Glain describes much of the Arab world as being in a "pre-revolutionary state" after years of stagnation.
"When you see the degree of hopelessness and despair that pervade in the region, it is not surprising that a lot of these emotions are expressed with violence," Glain said.
Nevertheless, Glain said it is significant that, after the September 11, 2001, attacks, there was not "an uprising in the Arab and Muslim world in favor of a theocracy of the kind that failed so utterly in Iran."
"That means that the vital center of Arab and Muslim society, which is vast, is in play and it is not intrinsically disposed to an authoritarian theocratic regime anymore than it is disposed to an autocratic secular regime," Glain said.
Despite the success of Islamic-based parties in recent elections in several countries, Glain said the core concerns of people in the Arab world are same as people everywhere -- raising and educating their children.
He said in Egypt, people turn to the Muslim Brotherhood for help on welfare issues because that is where they find help.
He said the lack of state-funded schools in Egypt causes parents to send their children to madrasses (Islamic schools). "They don't want their children to be illiterate," he said.
As for what to do about reversing the sclerosis of Arab society, Glain said the task is enormous.
"I have yet to meet a minister, let alone a head of state, in the Arab world who really knew how an economy works," he said. "The middle class in the Middle East will decide whether extremists make a convincing, significant thrust into Arab society."
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