Economics: Middle-Eastern and North African Development


Figure 1.--When the British established a protectorate in Egypt to protect Suez, Egypt like most of the Aran world was a country largely untouched by the nodern world. There was virtually no modern infrastructure. One has to ask why the Arab and wider Muslim world has fallen so far behind the West. Another important question is why since World War II have Arab countries relied almost entirely on imported Western technologies. Arab countries produce very little for export other than petroleum. Political movements like the Young Officers and Bath ascribed Aran backwardness to Ruropean colonilism. Today nore than 50-60 years after independence and the availabilty of vast quantiies capital from oil exports, Arab countries still do not have productive economies.

Much of the Middle East and at times virtually all of it except Persia have been governed by the Ottoman Turks. This is especially true for the Arabs. The era of European colonization was very brief in the Arab heartlands of the Middle East while Ottoman domination lasted for about four centuries. Thus for most of the Arab countries, colonial rule ment their experience under Ottoman rule. It is the Europeans, howeve, the most recent colonial power that most people in the Middle East recall today. The Middle East today is dominated by the Arabs and Islam. And because of cultural and religious affinities it make sence for analytical purposes to include North Africa in this discussion. While the Arabs dominate the area there are some other communities which need to be considered, including Israel, Iran, Turkey and the Kurds. While each of the countries in the region have their own unique characteristics and historical experience, there are common threads which merit discussion. The most notable observation emerging from the Middle East is the lack of economic progress since World War II and the end of the colonial era. In fact, with the exception of the oil producing countries, the Middle Eastern countries are almost uniformily poor and getting poor. And even in the oil producing countries there has been a general failure to build producive economies. These countries in several instances consume along Western patterns, but have not built industries capable of producing ad market products in the international market. Given the extrodinary anount of available investment capital this is an extrodinary onservation. The question is why have Middle Eastern leaders so badly failed their populations since World War II. The Arab failure stands in sharp contrast to the one country in the region that has suceeded in developing a modern economy--Israel. Here we have a country in the middle of the region without oil and other natural resources, which has sucessfully developed.

Ottomon Empire

Much of the Middle East and at times virtually all of it except Persia have been governed by the Ottoman Turks. This is especially true for the Arabs. The era of European colonization was very brief in the Arab heartlands of the Middle East while Ottoman domination lasted for about four centuries. Thus for most of the Arab countries, colonial rule ment their experience unfsder Ottoman rule. The situation os only slightly different in North Africa where the French in particular seized Algeria in the 19th century and attempted to colonize it. The British influence in Egypt also dates to the 19th century, but the British took little interest in actually governing Egypt. It is Ottomon rule that was the primary colonial experience. And under Ottomon rule the economies of the Middle East languished, especially in the years of decline during the 18th and 19th centuries. The people of the Middle East entered the 20th century in great poverty. Percapita eanings were anong the lowest in the world. Modern education, universities, hospitals, and technology, did not develop within the cacoon of Ottoman rule.

European Colonization

Europe during the 19th century carved Africa into colonies. The two most important colonial powers were Britain and France, but Belgium, Germany, Italy Portugal, and Spain also participated in what became called the Scramble for Africa. The pattern was different in the Arab world. Much of the Arab world was controlled by the Ottomans. The Europeans did colonize North Africa. France in particular colonized Algeria and tried to turn it into a department of France. France subsequently took control of Tunisia and Morocco, although their policies there were somewhat different. Italy seized Libya with the idea of using it to settle landless peasants. Britain exerted a protectorate over Egypt because if the Canal, but attempted to avoid direct rule.

World War I

World war I fundamentally changed the political situation in the Middle East. After the Ottomons entered the War Egypt and the Canal became a new front of the War. The Arabs obtained British suppoet for a revolt against the Ottomns. A two-pronged British offensive through Palesine and Mesopotamis drove the Ottomans out of the Arab lands. The French after the war attempted to colonize addotional Arab countries (Lebenon and Syria). The British because of Suez and the discovery of oil in Iraq and Persia attempted to influebce the region by setting up fiendly monarchies and maintaining a colonial regime in Palestine. The British and GFrench to varying degrees attempted to introduve secular reforms which were often resented by the Arab populations.

World War II

As World War II approached, Arab nationalists saw the rise of Fascist powers n Europe (Italy and Germany) as a way of expelling the British and French from their countries. They also saw what seemed to be economic progress in the totalitarian states. Thus Fascism had a considerable influence on Egypt as well as the rising Bath Party in Syria and Iraq. The work of the Grand Mufti in Palestine also helped to sprea anti-Semitism a preceived problen to which Hitler ad the NAZIs also had annswer. After the War the sucess of the Soviet Union had considerable appeal as providing a rapid course of economic development. Both the Fascist and Soviet models had great appeal throughout the region. WhiFasc and Soviet Comminism may seem radically different approaches, there is in fact considerable overlaps as both are titalitarian systems. There seem to be no appreciation throughoy the refion for the role of modern liberal democracy and toleration of diversity and perhaps even more important the rule of law in building modern productive economies.

Israel and Palestine

One of the most intractable conflicts of the 20th century is the conflict between Jews and Arabs over Palestine. The problem began in the 19th century, although the two groups trace their claims to the land back to Biblical times. Most Jews in the 19th century lived in Europe and accept for Russia after centuries of isolation and repression had schieved a high degree of integrtion in civil society. Most Jews had been emancified and were full citizens. Pogroms in Russia during the 19th century had driven many Jews to Western Europe and America. This resulted in rising anti-Semitism, but this was partially restrained by the force of law. Most Jews saw their future as Europeans. Zionism gained grown with the Russian Pogroms, but until the rise of the NASIs in Germany Zionism was supported by only a small minority. The NAZI Holocaust shatered Jewish society throughout Europe. Many of the surviving Jews turned to Zionism and in 1947 managed to obtain United Nations recognition for a new Jewish state in Palestine. This basic outline is historical fact. Virtually everything else about the conflict is a manter of contention. An unusual aspect of the current Isreali-Palestinian conflict is that children (Arab and Jewish) are not only the victims of the conflict, but they are also participating in the violence. We have all seen the images of rock-throwing Palestinian boys, some as little as 6 years old. Palestinian youth have carried out suicide bombing attacks killing Isrealis of all ages.

Cultural Ethos

The Middle East is still stuck in the medieval age. They may look modern, but only because oil has allowed them to buy Western technologyŚnot because they generate technology themselves. The Middle East does not have one world class university, virtually no Nobel Prize winners, no major corporations (except oil companies), virtually no advanced science (there is more advanced science in tiny Israel than in all the rest of the Middle East). And no medical advances. All advanced technology comes from the West and is imported. Where is the passion in the Middle East. Hatred of Israel and the west. Fighting over the 7th century successor of Mohamed. Rejection of secular society. Keeping women in a subservient place. Hanging homosexuals. Until the passion for young people becomes creating (and not just using) modern technology, science and medicine, the Middle East can not advance. Countries like Saudi have made efforts to diversify, but often this has meant subsidizing industries with oil revenueŚmeaning they are not real productive enterprises. In short fundamental cultural changes are needed. Tragically the trajectory in recent years has been to reject modernity, tolerance, diversity, and secular life.

Major Groupings

The Middle East today is dominated by the Arabs and Islam. And because of cultural and religious affinities it make sence for analytical purposes to include North Africa in this discussion. While the Arabs dominate the area there are some other communities which need to be considered, including Israel, Iran, Turkey and the Kurds. While each of the countries in the region have their own unique characteristics and historical experience, there are common threads which merit discussion. The most notable observation emerging from the Middle East is the lack of economic progress since World War II and the end of the colonial era. In fact, with the exception of the oil producing countries, the Middle Eastern countries are almost uniformily poor and getting poor. And even in the oil producing countries there has been a general failure to build producive economies. These countries in several instances consume along Western patterns, but have not built industries capable of producing ad market products in the international market. Given the extrodinary amount of available invest capital this is an extrodinary onservation. The question is why have Middle Eastern leaders so badly failed their populations since World War II.

The Arabs

The most notable observation emerging from the Middle East is the lack of economic progress since World War II and the end of the colonial era. This failure is especially notable in the Arab world. In fact, with the exception of the oil producing countries, the Middle Eastern countries are almost uniformily poor and getting poor. And even in the oil producing countries there has been a general failure to build producive economies. These countries in several instances consume along Western patterns, but have not built industries capable of producing ad market products in the international market. Given the extrodunary amount of available invest capital this is an extrodinary onservation. The question is why have Middle Eastern leaders so badly failed their populations since World War II. he League of Arab States as of 2006 had 22 members. The 22 Arab states re in many ways remarkable for their diversity in both etnicity and political structures. The Arab states include traditional monarchies (Bahrain, Morocco, Kuwait, Oman, Qatar, Saudi Arabia, the United Arab Emirates) and various states giverning through various levels of authoritarian rule, includinf some very repressive regimes. There are also many similarities. There are throughout the regions to varying degrees legal and social structures limit individual liberty. Limits are to varying degrees placed on free expression, democraic rule, reigious diversity, women's rights, education, the rule of law, and property rights and free enterprise. After World War II leaders like Nasser who attracted a large following persued Arab socialism believing that it was the colonial powers that impaired economic development. With the failure of Arab Socialism, some Arabs have turned to fundamentalist Whahbi-style Islam. No where in the Arab world does their seem to be a willingness to adopt the secular, liberal traditions of Europe that have brought such unprecedented prosperity.

Israel

The Arab failure stands in sharp contrast to the one country in the region that has suceeded in developing a modern economy--Israel. Here we have a country in the middle of the region without oil and other natural resources, which has sucessfully developed.

The Kurds


Turkey






HBC






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Created: 5:37 AM 1/7/2007
Last updated: 11:13 AM 5/19/2016