MEDPRO methodology to explore scenarios of cooperation and
development in the Euro-Mediterranean Region
By Carlo Sessa - ISIS
The methodology presented here is a conceptual tool/framework conceived to help a group of experts to
explore and develop coherent pictures of possible futures of the Euro-Mediterranean Region. The
methodology will be developed and tested in the EU 7th Framework Project MEDPRO.
It is based on the assumption that the North-shore and South-shore countries of the Mediterranean may
experience different growth pathways, but the whole Euro-Mediterranean region eventually will follow one
of the four possible alternative directions illustrated in the following grid:
Cooperation between
EU and MED countries
COOPERATION
GLOBAL EU-MED
UPSIDE SCENARIO
TREND SCENARIO
Projection of current trends of
growth without improvements in
the EU-MED bilateral agreements
framework
Sustainable and integrated
development in the framework of
multilateral cooperation between
EU27 and MED11
I
II
Decrease of
Increase of
Total Wealth
Total Wealth
III
IV
SUSTAINABLE
DEVELOPMENT
GLOBAL EU-MED
DOWNSIDE SCENARIO
EU-MED
DIVERGENT SCENARIO
Global decline, poor governance
and/or regional conflicts in the
Mediterranean
Sustainable regional developments but
poorly integrated across North and
South of Mediterranean
Lack of cooperation
between EU and MED
countries
The grid is built upon two basic dimensions of growth of the Euro-Mediterranean region:

The cooperation dimension (vertical axis) featured by increasing presence of cooperative games
between the EU27 and MED11 economies and interregional governance structures on the top and
failure of cooperation across the North and the South Mediterranean on the bottom, with an
1
increasing divergence and fragmentation of the pathways of development of EU27 (North-shore)
and MED11 (South-shore) countries.

the sustainable development dimension (horizontal axis), featured by an increase of total wealth
on the right and a decrease of the same accounting concept on the left.
The concept underpinning the sustainable development dimension is that the economic performance of a
country, usually measured with the Gross Domestic Product (GDP) per capita, largely ensures the current
well-being of the population1, but not necessarily that of future generations too. The right way to judge the
sustainable performance of a country (i.e. the improvement of well-being for the current generation
without reducing that of future generations) is to study movements in the total wealth, inclusive of
institutions and capital assets. Institutions are different from capital assets in that the former comprise the
social infrastructure (e.g. laws, property rights, governance structure, beliefs, extent of trust among people,
etc. – which are often labeled as “social capital” and “political capital”) for guiding the allocation of
resources, including the capital assets themselves. Capital assets encompass not only produced capital
(roads, buildings, machines, etc.), but also human capital (education, skills and health), available knowledge
(science and technology, innovation – often labeled as “knowledge capital”) and natural resources
(minerals, oil and natural gas; fisheries; forests, soil resources, or more generally, ecosystems). It can be
shown that an economy enjoys sustainable development if and only if, relative to its population, its total
wealth (at constant prices) does not decline.2
A positive change of total wealth over time, at constant prices, is inclusive investment, whereas a negative
change is inclusive disinvestment. According to this concept, an economy would enjoy sustainable
development if and only if, relative to its population, inclusive investment is not negative: accumulation of
wealth corresponds to sustained development. Of course, being the result of the accumulation of different
assets, even if some assets have decumulated, inclusive wealth would increase if there were compensatory
accumulation of other assets in the economy. Similarly, even if some assets have accumulated (building,
roads, machines), inclusive wealth would decline if there was a substantial decumulation of other forms of
capital assets (wetlands, coastal waters, forests, the atmosphere as a sink for pollutants).
Although the theory underpinning the concept of total wealth is clear, to measure it is difficult. Economists
at the World Bank have estimated inclusive investment in different countries during the past decades. They
have done that by adding net investment in human capital to existing countrywide estimates of investment
in manufactured capital, and then subtracting disinvestments in natural capital from that sum.3 Human
capital was estimated by mean of a proxy – expenditure on education – without entering health into the
calculus, the damage of climate change was taken to be $20 per ton of global carbon emission, which in all
1
More complete measures of well being include also other indicators of the quality of life of the current generation,
e.g. the well known Human Development Index (HDI), which takes into account factors such as life expectancy at
birth, knowledge and education and standard of living.
2
See P. Dasgupta, Measuring Sustainable Development: Theory and Application, Asian Development Review, vol. 24,
no 1, pp. 1-10, 2007
3
See World Bank, Where is the Wealth of Nations? Measuring Capital for the 21 st Century, Washington D.C., 2006
2
probability is a serious underestimate, and the list of natural resources was incomplete, not including water
resources, fisheries, air and water pollutants, soil and ecosystems.4
However, for the purpose of qualitative scenario building in the MEDPRO project, we need a sound concept
of sustainable development, but not necessarily to measure it. What is important is to hold a criteria – that
of accumulation of total wealth – that will help to judge if an envisioned evolution in the EuroMediterranean region is deemed to contribute to sustainable development or not.
The whole picture of the MEDPRO qualitative foresight exercise is provided in the figure below:
Cooperation between
EU and MED countries
Projection of current trends
(without breakthrough policy,
technology and social changes)
Foresight of key changes &
drivers/events conducive to
Sustainable Euro-Med Growth
II
I
Decrease of
THE WHOLE PICTURE
Increase of
CURRENT
TRENDS
Total Wealth
IV
Total Wealth
III
Foresight of key changes &
drivers/events conducive to
divergent/fragmented regional
developments
Foresight of key changes &
drivers/events conducive to
decline and conflicts
Lack of cooperation
between EU and MED
countries
At the centre of the diagram there is the first step of the foresight process, i.e. analyzing the current
historical trends – over the last 20 to 40 years and until 2010. Then, the analysis will look forward to the
2030 and 2050 horizons in four logically different directions. It is important to note that the diagram
represents possible alternatives for the whole/aggregate Euro-Mediterranean region, namely:

In the first quadrant, the continuation of currently still dominant trends towards a “liberalist” and
“hyper-consumism” model of growth, recently entered into a crisis in the Western world, which is
assumed to be unsustainable as it will continue to deplete natural, human and social capital
resources. This can be considered a TREND SCENARIO at the level of the whole region (statu quo),
4
A useful source on wealth accounting can be found at http://siteresources.worldbank.org/INTEEI/2145781110886258964/20748034/All.pdf
3
because it is featured by the projection of current trends without breakthrough policy, technology
and social changes. Euro-MED cooperation in this scenario is dominated by the continuation of the
current bilateral cooperation games, without stepping up into a multilateral framework. The recent
economic prospects for the whole EU27 and MED11 regions do not incorporate the sharp
deterioration of global economic activity due to the worldwide crisis, affecting in particular the
developed world. Factoring in this large deterioration will imply a downward revision of GDP over a
number of years at the beginning of the projections, although it would only have limited effects
over the remainder period up to 2050, at least to the extent that long-run growth potential is only
temporarily affected. However, it is important to remind in relation to any scenario based on the
projections of current trends that projections are not forecast. They are usually established with a
methodology based on a “partial equilibrium” view, looking forward to where we will go next, in
the long run, if the present situation continues without any substantial change in the policy,
technological and social drivers. This may well be the less realistic option, because if the current
trends are not sustainable, we know almost for sure that projections will not materialize.

The continuation of poorly regulated business models may eventually lead to an unmanageable
situation of resource scarcity, ecological degradation and economic and social crisis, falling into a
scenario of decline, depression and even disruptive conflicts in the region, which is represented in
the fourth quadrant (the most negative prospect). In the global decline prospect cooperation is
nullified by continuing/emerging conflicts within the MED11 region – namely the radicalization of
the Arab-Israeli conflict – and the demise of the initiatives of cultural dialogue and policy
integration between the two shores of the Mediterranean. This is shortly labeled as the EU-MED
DOWNSIDE SCENARIO, meaning that it will include the more pessimistic prospects for cooperation
and growth (dystopian changes).

In the second quadrant, the evolution towards a more integrated and sustainable growth of the
whole Euro-Mediterranean region, with an increasing convergence of the development indexes of
the countries of the North and South shores and a better integration of the two sub-regions – EU27
and MED11 – into a coherent multilateral governance framework. This is shortly labeled as the EUMED UPSIDE SCENARIO, meaning that it will include the more optimistic prospects of cooperation,
good policy decisions and favourable socio-economic trends (utopian changes).

Finally, in the third quadrant, the evolution towards a different model of still sustainable growth,
based on a separation and divergence of the two sub-regions, which in this prospect may follow
more self-reliant and fragmented sub-regional patterns of growth, with the development of
finance, trade, migration and cultural linkages orientated more towards other regions of the world
(e.g. Far East Asia, Africa, Latin America) than between the EU27 and MED11 countries. Indeed,
while MEDPRO is clearly orientated to assess the prospects of Euro-Med cooperation and
integration, it is important not to forget a possible scenario of divergence, as up to 2030/2050 the
dynamics in MED11 will not necessarily be limited to and driven by the Euro-Mediterranean
dynamics or the absence thereof. MED11’s options and dynamic choices are wider, and - absent
further integration with the EU – MED11 can make great strides in regional South-South integration
and opening to the world economy, in particular Asia and US, despite the geographical closeness to
Europe.
4
It is important to underline again that the MEDPRO foresight exercise will be focused upon the
whole/aggregate developments of the Euro-Mediterranean area. In this context, the TREND SCENARIO
shown in quadrant 1 is meaningful, as we may assume that the continuation of current trends in the whole
area will not produce a sustainable growth, due to the lack of a multilateral cooperation on key issues of
migration, energy etc., which will reduce the potential development of human capital, potential saving of
energy and natural resources, etc.). Of course, this does not imply that the trend (“business as usual”)
scenario is the same for each single MED11 or EU27 country. Indeed, at the level of single countries, the
business as usual scenario could be the permanence into a situation of conflict and recession (quadrant IV,
e.g. Palestine), or divergent development (quadrant III).
The MEDPRO qualitative foresight process will be articulated in a number of sectoral analyses, which will be
fed by the research and analyses undertaken in the various project WPs:

People and knowledge (demography and human capital development, knowledge capital)

Infrastructure and equipment (physical capital)

Energy, climate change and environment (natural capital)

Governance and Policy (social and political capital)

Economy and Finance
These sectoral analyses are illustrated in the diagrams on the following pages. The relevant historical trends
until 2010 for each sector are mentioned in the central box, and the contribution to the sustainable
development dimension is specified by showing on the horizontal axe which capital asset is affected by
each sector. The contribution to sustainable development of economy and finance – the last in the
sequence – is its sustainable outcome in terms of genuine positive change of total welfare (inclusive
investment). Of course these sectoral views are only partial views of a more complex, interrelated and
endogenous dynamics cross-cutting the different sectors, as for instance the linkage between
infrastructure, economy and climate change adaptation. They are single facets of a more complex
poliedrum – but they are useful insofar as they aim simply to provide multi-lateral views of the same
object, without pretending to show – at least at a first glance – the full complexity of endogenous relations
and causal links.
In order to proceed with the qualitative foresight exercise, we need to develop and coordinate it with:

The prospective analyses undertaken in each MEDPRO thematic WP (WP2 to WP7)

The quantitative scenario building and assessment undertaken in WP8.
For this purpose, we propose to use the attached template to present a synoptic overview of qualitative
scenarios assumptions. The template shows:

Four forward looking dimensions: WP2 - Geopolitical Dimension; WP3 & WP7 – Social Dimension;
WP5 & WP6 Economic and Technology Dimension; WP4 – Energy and Environment Dimension.
5

For each dimension a list of key issues, and the descriptions of worldwide or OECD trends related to
each issue, for comparative focus purpose.5 MEDPRO WPs leaders/researchers are asked to
complete the list of key issues with additional ones, if they think appropriate.

Four columns related to the four scenario alternatives: Quadrant I – Trend scenario6; Quadrant II –
Global EU-MED upside scenario; Quadrant III – EU-MED divergent scenario; Quadrant IV – Global
EU-MED downside scenario. MEDPRO WPs leaders/researchers are asked to provide:
-
The information to be included in the intermediate WP9 qualitative scenario report, due at
month 6 (September 2010), which consists in listing for the single issues indicated in the
template any change, drivers of change and well established causal relations (e.g. ageing linked
to fertility which is linked to income and education levels, etc.) which are relevant for the
different scenarios, as well as any idea about more uncertain circumstances that – if realized –
will make each single scenario more plausible than the others. The latter include “weak
signals”, i.e. still marginal policy, social or technological innovations that may become
predominant in the distant future, as well as “wild cards”, i.e. unexpected and breakthrough
events that may contribute to radically change future prospects (e.g. a nuclear power accident,
the recent oil spill in the Gulf of Mexico, etc.)
-
The final and full description of the four qualitative scenarios, in each forward looking
dimension, as a result of their prospective analyses undertaken all along the duration of the
project, and ensuring that the assumptions underpinning the qualitative scenarios are coherent
with those adopted in the WP8 quantitative scenarios. This information will feed the final WP9
qualitative scenario report, due at month 30.
5
These descriptions are drawn from a state-of-the-art survey of International Forward Looking Studies (2030-2050)
presented in a Synthesis Paper prepared by Annette Braun for the EU Expert Group on Global Europe 2030-2050,
forthcoming.
6
For this option we suggest to produce and compare separate projections for the EU27 and the MED11 countries,
whereas the other scenarios will show more interrelated patterns, referring to the global dynamics between and
within the two regions (North and South Mediterranean countries).
6
Cooperation between
EU and MED countries
PEOPLE & KNOWLEDGE (WP3 & WP7)
Foresight of key changes &
drivers/events conducive to
Sustainable Euro-Med Growth
Projection of current trends
(without breakthrough policy,
technology and social changes)
I
Decrease of
Human & Knowledge
Capital Endowment
IV
•
•
•
•
•
•
•
•
•
CURRENT TRENDS
Population growth and ageing
Migration flows
Education, skills and employability
Labour force participation
Health care and social insurance
Personal income inequalities
R&D expenses (public & private)
Mobility of researchers
Trade of knowledge intensive
products, patents, innovation
Foresight of key changes &
drivers/events conducive to
decline and conflicts
Lack of cooperation
between EU and MED
countries
II
Increase of
Human & Knowledge
Capital Endowment
III
Foresight of key changes &
drivers/events conducive to
divergent/fragmented regional
developments
INFRASTRUCTURE & EQUIPMENT (WP5)
Cooperation between
EU and MED countries
Foresight of key changes &
drivers/events conducive to
Sustainable Euro-Med Growth
Projection of current trends
(without breakthrough policy,
technology and social changes)
I
Decrease of
Physical Capital
Endowment
IV
CURRENT TRENDS
Energy Infrastructure
Transport Infrastructure
IT infrastructure
Urban infrastructure
Civil protection infrastructure (for
adapting to climate change)
• Machines & equipment
II
•
•
•
•
•
Foresight of key changes &
drivers/events conducive to
decline and conflicts
Increase of
Physical Capital
Endowment
III
Lack of cooperation
between EU and MED
countries
7
Foresight of key changes &
drivers/events conducive to
divergent/fragmented regional
developments
ENERGY, CLIMATE CHANGE AND ENVIRONMENT (WP4)
Cooperation between
EU and MED countries
Foresight of key changes &
drivers/events conducive to
Sustainable Euro-Med Growth
Projection of current trends
(without breakthrough policy,
technology and social changes)
•
•
•
•
Decrease of
Natural Resources
Endowment
II
CURRENT TRENDS
I
IV
Oil and Gas supply
Electricity and renewable energy
Energy demand/saving
Climate change pressures on
agriculture, water resources,
biodiversity, coastal ecosystems
Increase of
Natural Resources
Endowment
III
Foresight of key changes &
drivers/events conducive to
decline and conflicts
Lack of cooperation
between EU and MED
countries
Foresight of key changes &
drivers/events conducive to
divergent/fragmented regional
developments
GOVERNANCE AND POLICY (WP2 & WP9)
Cooperation between
EU and MED countries
Foresight of key changes &
drivers/events conducive to
Sustainable Euro-Med Growth
Projection of current trends
(without breakthrough policy,
technology and social changes)
I
Decrease of
Social/Political
Capital Endowment
II
CURRENT TRENDS
•
•
•
•
•
IV
Foresight of key changes &
drivers/events conducive to
decline and conflicts
Political governance
Economic governance
Geopolitical issues (conflicts, etc.)
Fundamental rights
Governance of global issues
(migrations, security, liberalisation
of trade, cultural dialogue)
Lack of cooperation
between EU and MED
countries
8
Increase of
Social/Political
Capital Endowment
III
Foresight of key changes &
drivers/events conducive to
divergent/fragmented regional
developments
Cooperation between
EU and MED countries
Foresight of key changes & drivers
conducive to
Sustainable Euro-Med Growth
Projection of current trends
(without breakthrough policy,
technology and social changes)
I
Genuine Decrease
of Welfare
(Inclusive Disinvestment)
IV
•
•
•
•
•
•
•
•
•
Foresight of key changes &
drivers/events conducive to
decline and conflicts
ECONOMY AND FINANCE (WP5 & WP6)
CURRENT TRENDS
GDP growth (composition)
Investment/consumption
FDI and Remittances
Trade/export diversification
Key sectors (tourism, transport, ICT,
agriculture)
Business development (SMEs)
Public sector privatization
Access to credit
Modernisation of financial markets
Lack of cooperation
between EU and MED
countries
9
II
Genuine Increase
of Welfare
(Inclusive Investment)
III
Foresight of key changes &
drivers/events conducive to
divergent/fragmented regional
developments