The Arab Spring: the Unfinished Story:
Social Conditions and Labor Market
Bottlenecks as Igniting Factors
Paper Presented to
Wiener Institut für Internationale
Wirtschaftsvergleiche
By
Alia El Mahdi
Prof. of Economics/ Cairo University
December 2011
Outline of the Presentation
• 1-Introduction
• 2-The Dire Socio-economic conditions
and Labor market Dilemma
• 3- Future Prospects
1- Introduction
• The Arab uprisings in the different countries
resemble a volcano that was brewing for a long
while, and just decided to erupt finally, sweeping
long standing dictatorships and uprooting them
from their well protected thrones.
• However, the lava is still hot and flowing and its
final stage has not been reached yet.
• What went “Right” this time???????
2- The Dire Socio-economic
Conditions and Labor Market
Dilemma
"What were the socio- economic factors that spurred the
revolution?"
We distinguish three main areas of inherent instability that
must have contributed in triggering the uprisings, namely:
• Economic Growth: Captured by the "Influential Few".
• The Unmet Employment Aspirations
• Modest Human Development, Growing Poverty and
Inequality
A- Economic Growth: Captured by the
"Influential Few".
The implementation of (ERSAP) in the eighties and the
beginning of the nineties, most of the ANOC eventually
started to rely more heavily on the domestic and international
private investors in buying out the public sector companies
and adding new investments.
The cooperation between the domestic businessmen and the
foreign newcomers resulted in a high degree of wealth
concentration in the hands of the "FEW.
In countries like Egypt, Tunis, Yemen, Libya the gravity of the
problem was exacerbated by the role of the presidential
families and their cronies by controlling major economic
deals, and realizing thereby staggering profits.
The GDP growth rates of the Arab
Countries during 2001-2010
Yemen
4
4,6
Tunisia
Syrian
4,8
6,4
Sudan
Morocco
4,9
Libya
4
Lebanon
5,2
Jordan
6,1
Egypt
5,1
Algeria
3,7
0
1
2
3
4
5
6
7
GDP per capita in a selected group of Arab
countries ($PPP)
Yemen
2.595
Tunisia
8.524
Syrian
5.248
Sudan
2.239
Morocco
4.668
16.991
Libya
Lebanon
13.948
Jordan
5.706
Egypt
6.281
Algeria
8.322
2.000
5.000
8.000
11.000
14.000
17.000
Transparency International World Corruption
Perception Index in 2008-2010
Yemen
2,2
Tunisia
4,3
2,5
Syria
Sudan
1,6
Morocco
3,4
Libya
2,2
Lebanon
2,5
4,7
Jordan
3,1
Egypt
Algeria
2,9
0
1
2
3
4
5
B- The Unmet Employment
Aspirations
• Almost all AC are characterized by their high population and
labor force growth rates, young population, and relatively
limited participation rates.
• Unemployment is one of the main chronic problems that
have been encountering those countries during the last two
decades and until the present time.
• The pressure to create employment opportunities is
exacerbated by the fact that the labor force growth rate is
rapid and significantly higher than that of the population
growth rate.
• The relatively high population growth rates during the
eighties and nineties resulted in a youth bulge in the new
millennium.
Unemployment Rates in the Arab
Countries in 2008
Yemen
41
14,6
14,2
Tunisia
16,7
11
11
11,2
Morocco
Syria
6,2
8,9
20,3
8,4
7,8
8,9
Lebanon
14,1
12,6
Jordan
Egypt
6,2
21,4
9,9
22,7
19,9
Algeria
17,7
0
5
10
19,6
15
20
25
Total
Male
Female
30
35
40
45
C- Modest Human Development, Growing
Poverty and Inequality
Despite the efforts by the different governments
in the AC to push the development process
forward, by adopting development agendas and
seeking to comply by the Millennium
Development Goals, the successes achieved in
the financial indicators and the economic
growth rates, was not matched by similar
achievements where human development
indicators, poverty and inequality levels were
concerned.
Inequality-adjusted Human Development Index in
2011
Yemen
0,312
0,462
Tunisia
0,523
Syria
0,503
Sudan
0,632
0,408
Morocco
Libya
0,698
0,409
0,582
0
0,755
Lebanon
0,57
Jordan
0,565
Egypt
Algeria
0,489
0,698
0,644
0
0
0,739
0,698
0,1
0,2
0,3
IHDI
0,4
0,5
HDI
0,6
0,7
0,8
3- Future Prospects
Final Remarks
• The first three countries, Tunisia, Egypt and Libya are
moving through different stages of political change.
Tunisia is by far the most advanced in this respect, while
in Egypt the progress is slower and unstable. Libya is still
at the early stages of its liberation.
• The length of the process of transformation in terms of
time.
• The three models are different in their economic
structures,
• The three first Arab Spring countries share one common
feature in the present time, namely, that the rising powers
in them are basically the Islamic groups.
Finally,,,,,
• The current economic situation in Egypt and
Tunisia, could be described as vulnerable.
• The apparent economic challenges and the
inability of the transitory governments to cope
with the constraints leave the complicated socio
economic situation unresolved and thus the
problems are worsening.
• The future developments depend on the longevity
of the transition phase, the planned and
implemented policies during the transition period
and after the elections.
Thank you.