The
Greater Middle East[i]
(GME) region poses a unique challenge and opportunity for the international
community. The three "deficits" identified by the Arab authors of the
2002 and 2003 United Nations Arab Human Development Reports (AHDR) - freedom,
knowledge, and women's empowerment - have contributed to conditions that
threaten the national interests of all G-8 members. So long as the region's
pool of politically and economically disenfranchised individuals grows, we will
witness an increase in extremism, terrorism, international crime, and illegal
migration. The statistics describing the current situation in the GME are
daunting:
* The
combined GDP of the 22 Arab League countries is less than that of Spain.
*
Approximately 40% of adult Arabs - 65 million people - are illiterate, two
thirds of whom are women.
* Over 50
million young people will enter the labor market by 2010, 100 million will
enter by 2020 - a minimum of 6 million new jobs need to be created each year to
absorb these new entrants.
* If
current unemployment rates persist, regional unemployment will reach 25 million
by 2010.
*
One-third of the region lives on less than two dollars a day. To improve
standards of living, economic growth in the region must more than double from
below 3 percent currently to at least 6 percent.
* Only 1.6
percent of the population has access to the Internet, a figure lower than that
in any other region of the world, including sub-Saharan Africa.
* Women
occupy just 3.5 percent of parliamentary seats in Arab countries, compared
with, for example, 8.4 percent in sub-Saharan Africa.
*
Fifty-one percent of older Arab youths expressed a desire to emigrate to other
countries, according to the 2002 AHDR, with European countries the favorite destination.
These
statistics reflect a region that stands at a crossroads. The GME could continue
on the same path, adding every year to its population of underemployed,
undereducated, and politically disenfranchised youths.
Doing so
will pose a direct threat to the stability of the region, and to the common
interests of the G-8 members.
The
alternative is the route to reform. The two Arab Human Development Reports
represent compelling and urgent calls for action in the GME. These calls have
been echoed by activists, academics, and the private sector throughout the
region. Some GME leaders have already heeded these calls and have taken steps
toward political, social, and economic reform. The G-8 countries have, in turn,
supported these efforts with their own Middle East reform initiatives. The
Euro-Mediterranean Partnership, the U.S. Middle East Partnership Initiative,
and the multilateral reconstruction efforts in Afghanistan and Iraq demonstrate
the G-8's commitment to reform in the region.
The
demographic changes described above, the liberation of Afghanistan and Iraq
from oppressive regimes, and the emergence of democratic impulses across the
region, together present the G-8 with a historic opportunity. At Sea Island,
the G-8 should forge a long-term partnership with the Greater Middle East's
reform leaders and launch a coordinated response to promote political,
economic, and social reform in the region. The G-8 could agree on common reform
priorities that would address the AHDR deficits by:
§
Promoting Democracy and good governance;
§
Building a knowledge society; and
§
Expanding economic opportunities.
These
reform priorities are the key to the region's development: democracy and good
governance form the framework within which development takes, well-educated individuals
are agents of development, and enterprise is the engine of development.
"There is a substantial
lag between Arab countries and regions in terms of participatory governance… This freedom deficit undermines human development and is one of the most
painful manifestations of lagging political development." Arab Human Development Report, 2002
Democracy
and freedom are essential to the flourishing of individual initiative, but are
sorely lacking throughout the GME. In Freedom House's 2003 report, Israel was
the only GME country rated "free," and just four others were defined
as "partly free." The AHDR noted that out of seven world regions, the
Arab countries had the lowest freedom score in the late 1990s. Databases
measuring "voice and accountability" rank the Arab region the lowest
in the world. Further, the Arab world ranks above only sub-Saharan Africa in
the empowerment of women. These discouraging indicators hardly square with the
expressed wishes of the region's people: in the 2003 AHDR, for example, Arabs
topped the worldwide list of those supporting the statement that
"democracy is better than any other form of government," and
expressed the highest level of rejection of authoritarian rule.
The G-8
could show its support for democratic reform in the region by committing to:
Between
2004 and 2006, numerous GME countries[ii]
have announced intentions to hold presidential, parliamentary, or municipal
elections.
Working
with those countries that demonstrate a serious willingness to hold free and
fair elections, the G-8 could actively provide pre-election assistance by:
§
Providing technical assistance, through exchanges or
seminars, to establish or strengthen independent election commissions to
monitor elections, respond to complaints and receive reports.
§
Providing technical assistance for voter registration and
civic education to requesting governments, with a particular emphasis on women
voters.
In order
to strengthen the role of parliaments in democratizing countries, the G-8 could
sponsor exchanges of parliamentarians, with a focus on drafting legislation,
implementing legislative and legal reform, and representing constituents.
Women
occupy just 3.5 percent of parliamentary seats in Arab countries. In order to
increase women's participation in political and civic life, the G-8 could
sponsor women's training academies to provide leadership training for women
interested in running for elective office or establishing/operating an NGO. The
academies could bring together female leaders from G-8 countries in the region.
While the
U.S., the EU, the UN, and the World Bank have already undertaken numerous
initiatives to promote legal and judicial reform, most are working at the national
level in areas such as judicial training, judicial administration, and legal
code reform. A G-8 initiative could complement these efforts by focusing at the
grassroots community level, where the true perception of justice begins. The
G-8 could establish and fund centers at which individuals can access legal
advice on civil, criminal, or Sharia law, and contact defense attorneys (which
are very uncommon in the region). These centers could also be affiliated with
law schools in the region.
The AHDR
notes that there are less than 53 newspapers per 1,000 Arab citizens, compared
with 285 papers per 1,000 people in developed countries, and that the Arab
newspapers that do circulate tend to be of poor quality. Most news television
programs in the region are state-owned or controlled, and their quality is
often poor, lacking analytical and investigative reporting. This deficit leads
to a lack of public discourse and interest in print media, and limits the
information available to the public. To counter this, the G-8 could:
§
Sponsor exchanges for print and broadcast journalists.
§
Sponsor training programs for independent journalists.
§
Provide scholarships for students to attend journalism
schools in the region or abroad; fund programs that would send journalists or
journalism professors to hold training seminars on issues like election
coverage or spend a semester teaching at schools in the region.
The World
Bank has identified corruption as the single biggest obstacle to development,
and in many GME countries it has become endemic. The G-8 could:
§
Promote adoption of the G-8 transparency and
Anti-Corruption Principles.
§
Publicly support the OECD/UNDP Middle East-North Africa
initiative, through which senior government leaders, donors, IFIs, and NGOs
discuss national strategies to fight corruption and strengthen government
accountability.
§
Launch one or more G-8 transparency pilots in the region.
Since
quite genuine reform in the GME must be driven internally, and since the best
means to promote reform is through representative organizations, the G-8 should
encourage the development of effective civil society organizations in the
region. The G-8 could:
§
Encourage the region's governments to allow civil society
organizations, including human rights and media NGOs, to operate freely without
harassment or restrictions.
§
Increase direct funding to democracy, human rights,
media, women's, and other NGOs in the region.
§
Increase the technical capacity of NGOs in the region by
increasing funding to domestic organizations (such as the UK's Westminster
Foundation or the U.S. National Endowment for Democracy) to provide training
for NGOs on how to define a platform, lobby government, and develop media and
grassroots strategies to garner support. These programs could also include
exchanges and the creation of regional networks.
§
Fund an NGO that would bring together legal or media
experts from the region to draft annual assessments of judicial reform efforts
or media freedom in the region. (This could follow the AHDR model.)
"Knowledge constitutes
the road to development and liberation, especially in a world of intensive
globalization." Arab Human Development Report, 2002
The
Greater Middle East region, once the cradle of scientific discovery and
learning, has largely failed to keep up with today's knowledge-oriented world.
The region's growing knowledge gap and continuing brain drain challenge its
development prospects. Arab countries' output of books represents just 1.1
percent of the world total (with religious books constituting over 15 percent
of this.) roughly one-fourth of all university graduates emigrate, and
technology is largely imported. Five times as many books are translated into
Greek (spoken by just 11 million people) as Arabic.
Building
on education reform efforts already underway in the region, the G-8 could
provide assistance to address the region's education challenges and help
students acquire the skills needed to succeed in today's global marketplace.
Basic
education in the region suffers from inadequate (and declining) public funding,
increasing demand due to populations pressures, and cultural factors that limit
access for girls. The G-8 could commit to a new GME Basic Education Initiative
with the following components:
* Literacy
: In 2003, the United Nations launched the literacy Decade Program, under
the theme "literacy as Freedom." The G-8 literacy initiative would complement
the U.N. program through a focus on creating a literate generation in the
Greater Middle East over the next decade, with the goal of cutting in half the
region's illiteracy rate by 2010. As with the U.N. program, the G-8 initiative
would target women and girls. Given that 65 million adults in the region are
illiterate, the G-8 initiative could also focus on adult literacy and training
with a variety of programs, from on-line curricula to teacher training.
* Literacy
Corps : To improve literacy among girls, the G-8 could create or expand
teacher-training institutes targeting women. At these institutes, female school
teachers and educational specialists would train women to become teachers (in
some countries men are not permitted to teach girls), who would then focus on
reading and basic education for girls. The program could employ the guidelines
established in the Education for all program coordinated by UNESCO, and the
goal would be to train a "literacy corps" of 100,000 female teachers by
2008.
* Textbooks
: The AHDR notes a marked shortage of translations of basic books on
philosophy, literature, sociology and the natural sciences, and makes note of
the "sorry state of libraries" in universities. To counter this
deficit, each G-8 country could fund a program to translate its
"classics" in the fields, and where appropriate, countries or
publishers (in a public-private partnership) could reissue classic Arabic texts
that are now out of print. These books would then be donated to school, university
and local libraries.
* Discovery
Schools Initiative : Jordan has begun implementing its "discovery
schools" initiative, in which new technology and teaching methods are
employed. The G-8 could support the expansion of this concept to other GME
countries, providing funding and calling on support from private sector.
* Education Reform : Prior to
the G-8 Summit (in March or April), the U.S. Middle East partnership Initiative
will sponsor a Middle East Education Reform Summit. This event will bring
together reform-minded public, private sector, civic, and community leaders
from the region, along with their counterparts from the United States and EU in
order to identify common areas of concern and discuss methods for bridging
education deficits. This event could be hosted as a G-8 event, as a way to
build support for the GME initiative in the run-up to the summit.
* Digital
Knowledge Initiative : The region has the world's lowest level of
Internet access. Given the ever-increasing stock of Knowledge available on the
Internet, and the growing importance of the Internet to education and commerce,
it is critical to bridge the "digital divide" between the GME and the
rest of the world. The G-8 could launch public-private partnership to provide
or expand computer access in schools throughout the GME, especially in remote
areas. With the great diversity of wealth and infrastructure among countries in
the region, and between rural and urban areas within the region's countries, in
some areas it may be more appropriate to provide to provide computer access in
post offices, as has been done successfully in Russian towns and villages. The
project could initially focus on GME countries with the lowest Internet
penetration (Iraq, Afghanistan, Pakistan, Yemen, Syria, Libya, Algeria, Egypt,
Morocco), and would seek to wire as many schools/post offices as possible,
funding permitting.
This
initiative to wire schools in the region could be coupled with the
"literacy Corps Initiative" described above: Institute teachers could
train local teachers to develop curricula for on-line instruction, and the
private sector could supply needed hardware. The computer could then be used by
local teachers/students, particularly in rural or poor areas.
* Business
Education Initiative : In order to boost business education throughout
the region, the G-8 could establish partnerships between G-8-based business
schools and educational institutions (universities or specialized institutes)
in the region. G-8 countries could fund the placement of faculty and resources
in these partnership institutes, which would host specific educational
programs. These programs could run the gamut from formal year-long graduate
training to short courses on specific issues, such as preparing a business plan
or marketing strategy.
The
Bahrain Institute of Banking and Finance, which has an American director and
partnerships with several U.S. universities, could be a model for such
institutes.
Closing
the Greater Middle East region's prosperity gap will require an economic
transformation similar in magnitude to that undertaken by the formerly
communist countries of the Central and Eastern Europe. Key to that
transformation will be to unleash the region's private sector potential,
especially small and medium enterprises, which are the primary engines of
economic growth and job creation. The growth of an entrepreneurial class in the
GME would also be an important element in helping democracy and freedom
flourish. The G-8 could commit to the following actions:
Increasing
the efficiency of the economic growth and job creation. The G-8 could commit to
an integrated finance initiative consisting of the following components:
* Microfinance
: While some microfinance institutions exist in the region, entrepreneurs
continue to face a large financing gap: only 5 percent of the people seeking
microfinance receive it, and only 0.7 percent of the total financing needed is
actually provided. The G-8 could help fill this gap through microfinance,
especially for-profit microfinance, focused primarily on women. For-profit
microfinance institutions are self-sustaining and do not depend on external
grants of funds for continued operation growth. We estimate that, assuming an
average loan of $400, $500 million over 5 years could help 1.2 million
entrepreneurs help themselves out of poverty, 750,000 of whom could be women.
* Greater
Middle East Finance Corporation : The G-8 could agree to co-finance a
corporation modeled on the International Finance Corporation to help incubate
medium and larger-sized businesses, with an aim toward regional business
integration. The corporation could be managed by a group of G-8 private sector
leaders committed to applying their expertise in business development to the
GME region.
* Greater
Middle East Development Bank (GMEDBank) : The G-8, along with creditors
in the GME region, could establish a new regional development institution
modeled on the European Bank for Reconstruction and Development (EBRD) to help
reforming countries finance basic development priorities. The new institution
would pool the resources of wealthier GME nations and the G-8 to focus on
improving access to education, health care, and basic infrastructure. The
GMEDBank would also serve as a store of technical assistance and development
knowledge for the GME. Lending (or grant-making) decisions would be governed by
each borrower's ability to demonstrate measurable reform results.
To advance
reform of financial services in the region, and to better integrate the GME
into the global financial system, the G-8 could offer a new partnership to
reform leaders in the region. This partnership would aim to liberalize and
expand financial services in the Greater Middle East, by providing a basket of
financial sector technical assistance and expertise focused on:
§
Implementing reform plans that reduce state dominance of
financial services;
§
Removing barriers to cross-border financial transactions;
§
Modernizing banking services;
§
Introducing, refining, and expanding market-oriented
financial instruments; and
§
Building regulatory structures that encourage the
liberalization of financial services.
Intra-regional
trade in the Middle East is extremely low, comprising just 6 percent of all
Arab trade. Most GME countries trade with countries outside the region, and
have built preferential trade agreements far away rather than next door. As a
result, tariff and non-tariff barriers have become the norm, while cross-border
trade remains rare. The G-8 could commit to establish a new initiative designed
to promote trade in the Greater Middle East, comprised of these elements:
* WTO
Accession / Implementation and Trade Facilitation : The G-8 could
increase its emphasis on WTO accession and implementation for countries in the
region[iii].
Specific technical assistance programs would include providing in-country
advisors on WTO accession and generating a G-8-wide commitment to encouraging
the accession process, including a focus on identifying and removing non-tariff
barriers to trade. Once WTO accession is complete, the focus would move on to
the signing of additional WTO commitments such as TRIPS and Government
Procurement Agreement and linking continued technical assistance to
implementing these WTO commitments. This technical assistance could also be
linked to a G-8- sponsored region-wide program on customs facilitation and
logistics to reduce administrative and physical barriers to intra-regional
trade.
* Trade
Hubs : the G-8 would establish hubs in the region focused on improving
intra- regional trade and customs practices. The hubs would provide a variety
of services to support private sector trade flows and business to business
contacts, including "one stop shopping" for foreign investors,
linkages to customs offices to reduce transportation processing times, and
unified regulations to ease entry and exit of goods and services from the
region.
* Business
Incubator Zones (BIZ) : building on the success of export processing
zones and special trade zones in other regions, the G-8 could help establish
specially designated zones in the GME that would encourage regional cooperation
in the design, manufacturing, and marketing of products, The G-8 could offer
enhanced access to their markets for these products, and provide expertise in
establishing the zones.
To
encourage enhanced regional cooperation, the G-8 could establish a Middle East
Economic Opportunity Forum. Which would bring together top officials from The
G-8 and GME (with possible side meetings of non-governmental officials and
individuals from the business community) to discuss economic reform issues. The
forum could be based loosely on the APEC model, and would cover regional
economic issues, including finance, trade, and regulatory issues.
[i]
The "Greater Middle East" refers to the countries of the Arab world,
plus Pakistan, Afghanistan, Iran, Turkey, and Israel.
[ii]
Afghanistan, Algeria, Bahrain, Iran, Lebanon, Morocco, Qatar, Saudi Arabia,
Tunisia, Turkey, and Yemen have elections scheduled.
[iii]
WTO Accession Applicants (WTO working party established): Algeria, Lebanon,
Saudi Arabia, and Yemen. WTO Accession Applicants (application not yet
reviewed): Afghanistan, Iran, Libya, and Syria. Observer Status Applicant:
Iraq.