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In 2011-2012 unprecedented political transformations reshaped North Africa. In order to sustain the early success of the transitions and for positive long-term outcomes it became increasingly evident across the Arab world that matching employment, entrepreneurship and education opportunities with the aspirations of young populations was essential.
In direct response, the Global Agenda Council on the Arab World – a unique gathering of top Arab intellectuals and practitioners as well as leading economists – decided to focus on Arab economic governance, and particularly on surfacing novel thought leadership and counsel, which are actionable in countries undergoing a transition.
During the course of the term, the Council addressed this topic along the following dimensions: expanding youth employment; ensuring macroeconomic stability; building the institutions of governance; promoting inclusive growth; exploring region-wide solutions; and enhancing the business community.
Over the course of the term, the Council generated critical insights through the development of a new model for understanding the region’s economic governance issues, while also contributing to original thought leadership in the form of two compendiums of essays on regional economic topics. These compendiums, The Compendium in Economic Governance in the Arab World 2011, and The Compendium on Arab Youth Employment 2012 – Addressing the 100 Million Youth Challenge, were released at the World Economic Forum Special Meeting on Economic Growth and Job Creation in the Arab World 2011 and the World Economic Forum on the Middle East, North Africa and Eurasia 2012, respectively.
Short-term and long-term challenges
Given the context of the extraordinary events which unfolded across the Arab world in 2011, the Members of the Council segmented many of the region’s economic issues into subsets of short and long term challenges. The New Model for Economic Governance, developed by the Council at the Summit on the Global Agenda in Abu Dhabi on 10-11 October 2011 was a significant framework for approaching the many challenges and subtopics at hand.
The summit in Abu Dhabi provided Council Members with the opportunity to determine the Council’s purpose and direction and it was also the first time that Council Members met in person and were able to form a working relationship. This relationship was further developed a few weeks later at the Special Meeting on Economic Growth and Job Creation in the Arab World at the Dead Sea in Jordan on 21-23 October 2011. These events provided the Council with platforms to establish excellent collaboration between Members of the Council itself as well as with the World Economic Forum’s regional and global community.
At these events, the Council Members worked together to generate original insight, and also took full advantage of these unparalleled venues to disseminate these insights in public and private sessions across the Network of Global Agenda Councils and with Forum Members and constituents.
The two-day working meeting in Abu Dhabi was also an important milestone for building community among the Council’s membership. The meeting itself was divided into three primary sessions, the first for brainstorming the general issues facing the Arab world and then prioritizing them for the practical work of the Council. The second session was utilized to compare the work of the Council with the work of other Global Agenda Councils and for determining how to incorporate some of their experiences. The third session was dedicated to laying out an action plan for the Council in the year ahead. This plan focused in great part on providing tangible solutions for the disenfranchisement and alienation experienced by the Arab population at large, and the youth population in particular.
As a result of the meeting in Abu Dhabi, Members of the Council came together and concluded that the Arab world will face significant economic challenges going forward, with persistent deficiencies in terms of leadership and good governance. This crisis is not limited to the public sphere; it also permeates the private sphere. In their deliberations Council Members agreed that the problem lies in the structures and systems in place that allow for misguided leadership. There is a lack of strong institutional guarantees for sound governance, and this issue has had an impact on a variety of avenues, from economic stability to social cohesion throughout the years.
Early conclusions based on developments of 2011-2012
- The former top down governance model, whereby centralized authority usurped individualism and inclusive society, has proven ineffective in many examples across the region.
- The new model beginning to spread across the region is grounded in a bottom up approach to decision making, and based on the imperative for more transparent and effective institutions which will facilitate consensus building.
- The new model will necessarily require structures which can meet the aspirations of civil society, support the development of a stable middle class and promote good and accountable governance within the private sector
The development of a stable society with accountable leadership will require those in power today to cede certain privileges in the short term to make room for long-term success. This was an issue that the Council Members began discussing with stakeholders in the wider community on numerous levels, at the Dead Sea in Jordan and then again later at the World Economic Forum Annual Meeting in Davos 25-29 January 2012. Council Members synthesized their insights and concluded that there were six key factors required to support a more stable and prosperous Arab world. These factors are as follows and map on to the The New Model for Economic Governance, which was developed and formalized in Abu Dhabi.
Key factors for a more stable and prosperous Arab world:
- creating or strengthening governing institutions
- promoting inclusive growth, including expanding youth employment
- enhancing business stability through institutional guarantees
- developing region-wide solutions
- ensuring macro-economic stability
There are a variety of factors that influence the ecosystem surrounding the stages mentioned in Graph 1, and contribute to their success or failure. One key element is the need to foster an ‘informed society’ which mandates a responsible use of the media to raise awareness and promote accountability.
The events of 2011 led to a paradigm shift for addressing the opportunities and challenges presented in the Arab world. This was not due to a fundamental change in the human and economic development challenges endemic to the region but rather in the governance approaches for addressing these challenges and associated mechanisms of policy coordination and implementation. The Council developed the New Model associated with the bottom up approach to the paradigm shift as depicted in Graph 1. The model is built around three main enabling pillars. Each of the dimensions of economic governance which the Council is exploring was sub-grouped under one of the three pillars.
- Path to Success: ensuring macro-economic stability, exploring region wide solutions
- Stakeholder Engagement: expanding youth employment, enhancing the business stability, promoting inclusive growth
- Establish the Foundation: building the institutions of governance
While the framework which was developed by the Council and shared with the wider World Economic Forum community is broad in scope, there was a concerted effort to avoid generalisations. This is especially true with regard to the differences between resource poor and resource rich countries in the region, along with the differences in the development of public and private sector institutions.
Given the prominent role of youth in the region’s transformations, as well as the region’s demographic youth bulge, Members of the Council determined that a focus on youth employment was highly important. The opportunity for investing in the youth of the Arab world, estimated to represent up to 60% of the population, is highly significant for the short and longer term. It has become increasingly evident that growth and job creation are not only about providing wages but rather livelihoods, stability and, most importantly, dignity for the current and coming generations.
Davos and spring 2012
At the World Economic Forum’s Annual Meeting held in Davos in January 2012, Council Members actively engaged with heads of government and senior leadership from Jordan, Morocco and Tunisia, sharing their views on shifting regional dynamics, as well as outlining new economic agendas. Presidential candidates from Egypt also participated in these discussions. Members of the Council in Davos played an active role in the debates surrounding the future of the region by participating in various panel discussions and closed sessions.
In April, Council Members joined a roundtable co-hosted by the World Economic Forum, Saudi Basic Industries Corporation (SABIC) and Booz & Company in Riyadh, Saudi Arabia, under the title of Roundtable on the Role of Large Employers in Driving Entrepreneurship in the Arab World.
The spring regional meeting in Istanbul, to be held in June 2012, will be markedly different from that held in Jordan the previous year. It will be the first meeting to contend with the initial phase after the revolutions of Tunisia, Egypt and Libya; along with developments across other countries of the region. The Council can play a critical role in supporting the leaders of the region in strategizing for the next stage. Several meetings have been held between Council Members and many of the new-decision makers of the region.
In addition to producing the two compendiums several Members of the Council authored opinion pieces to spread the ideas generated throughout Council discussions. The Council’s quarterly teleconferences were also important milestones for solidifying the ties between Council Members and developing the Council’s approach to working on the Arab world.
Some of the main challenges that the Council faces in the coming months will include playing a more active role in the ever-changing dynamics of the Arab world – whether through idea generation or problem solving. The pace of change and the number of variables means that various avenues must be pursued at any given time. The Council has sought important tracks on which to focus its efforts, including that of working on capacity-building and new sources of job creation. The past year has allowed the Council to provide blueprints and present hard truths in forging a better future. In the coming year, in the post-Arab spring era, decision makers will be redrafting economic policies and facing a tabula rasa – a situation which will provide a unique opportunity for the most relevant thought leaders to generate real impact on the regional economic agenda.
- “The Compendium on Economic Governance in the Arab World 2011”. World Economic Forum http://www.weforum.org/reports/compendium-economic-governance-arab-world-2011, 2011
- “The Compendium on Arab Youth Unemployment – Solutions for the 100 Million Youth Challenge in 2012”
The opinions expressed here are those of the individual members of the Council and not of the World Economic Forum or any institutions to which they are affiliated.