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[World
Development Indicators 2003 table of
newspapers per 1000 people]--CH],
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.