Source: IMF Finance and Development
The antigovernment uprisings that began in Tunisia in late 2010 and quickly spread across most of the Arab world clearly did not lead to rapid establishment of democratic countries as many had hoped. Nearly all nations have returned to the bad governance that prevailed nearly seven years ago and fed the regionwide revolt.
In Libya, Syria, and Yemen, street protests were not effective tools for state building—and the countries are still struggling with civil strife and war. In Egypt, counterrevolutionary forces have prevailed in a temporary and often deceptive state of stability that has failed to address the difficult socioeconomic conditions of regular Egyptians. Gulf states resisted the wave of change initially through financial means—although their resources are now dwindling—without offering any meaningful voice for citizens eager to participate in their countries’ decision-making process.
In Jordan and Morocco, governments have quieted their citizens through a combination of ad hoc reforms not intended to affect the power structure and stoking public fear that protests might lead to the fate of neighboring countries—Egypt and Libya for Moroccans, and Egypt and Syria for Jordanians. They have reverted to business as usual without fundamentally addressing the pressing challenges facing their countries.
Only in Tunisia did the protests trigger a new phase of state building by moving through a consensual, society-led process of agreement on a new social contract.
A transformation long overdue
But if the so-called Arab Spring failed to quickly change the status quo, it may have set in motion, as in Tunisia, a transformational process that was long overdue. It will undoubtedly take decades to unfold, but if it is managed properly, the process can lead to more open and meritocratic societies across the region.
This is because demands for better governance have not waned. Even as the old regimes continue to hold sway, the social contracts that governed most of the Arab world for generations are fracturing. These contracts—most often imposed by governing authorities rather than a result of consensual agreement among societal groups—were based on the two main pillars of the so-called rentier system. The first pillar stipulated that governments are responsible mainly for providing adequate health and education services, jobs, and subsidies for basic commodities—largesse made possible by oil revenues. In return citizens accepted the second pillar—no meaningful voice in running their affairs.
These social contracts worked in one form or another so long as the first part of this bargain was adequately respected. But once governments became bloated and could no longer provide adequate services and privileges—but still insisted on less than meaningful representation for their citizens—the contracts collapsed. Some governments tried to address the economic problems alone—by pushing through needed economic reforms while continuing to suppress political reform and thwarting development of a system of checks and balances. Unsurprisingly, corruption, which was unchecked, skyrocketed. The situation became too much for many people to bear, and they took to the streets.
Oil prices, which are expected to continue to fall for the foreseeable future, will accelerate the death of the rentier system, which has prolonged inefficient economies over decades. Oil-producing countries can no longer act as welfare states for their citizens, while oil-importing countries can no longer depend on resources coming from grants awarded by oil-producing states—or remittances from their citizens working in these countries—to finance patronage systems. Both the oil producers and the oil importers ignore a transition to merit-based systems and accountable governments at their own peril.
Such a transition to get the Arab world out of its quagmire sounds self-evident, but, of course, is easier to talk about than to achieve. Decades-old rentier systems have created political layers of vested interests that have little desire to adopt merit-based, accountable systems that might rob them of their positions and privileges. Rentier systems also spawned inefficient bureaucracies that are either unwilling or unable to graduate to more productive economic systems. Also problematic is how to empower whole sectors of society—long dependent on the state for jobs, services, and subsidies—to be able to provide for themselves and compete for jobs in the private sector. A sustained political will is needed for a gradual political and economic transition to stable and prosperous societies—and such a will seems to be overwhelmingly lacking in the region today.
The model of Tunisa
Yet Tunisia has shown that change is not impossible. But Tunisia’s unique circumstances—a large middle class, an independent trade union, a history of victories for women’s rights, and a moderate Islamic opposition—probably mean there is little chance that such an experiment will be replicated in another Arab country anytime soon. Tunisia has taken steps that could serve as a guide for an Arab society looking to establish a new discourse that leads to stability and security. Tunisians have shown that the first order of business is agreement on a new social contract that defines and guarantees the rights of all components of society—secular and religious. Tunisia reached agreement through painful negotiations and compromises among these different groups rather than through an unsustainable outcome imposed by governments, the majority, or an outside power—such as the United States in Iraq.
The new Tunisian constitution upholds the rights of all components of society, ensures that no group can impose its lifestyle on other groups, and firmly adopts the principle of transfer of power by peaceful means. In a move made possible by decades of women’s struggle for equal rights in Tunisia, the new constitution awards them equality before the law far more than any other Arab constitution, and paves the way for equal citizenship, crucial for any society’s efforts to develop in a healthy manner. Equally important, Tunisia has demonstrated that Islam and democracy are not contradictory and that secular and religious elements can agree that, in political matters, the guiding framework is a humanly not divinely inspired document.
Tunisia is certainly far from achieving stability or prosperity. It has serious political, economic, and security issues. But the country is addressing them within a solid framework—that is, the new constitution that guides its steps. This is the significance of the Tunisian model, and this is why it must be supported by the international community—in financial and technical ways. The success of the Tunisian model can serve as a guiding light for the rest of the region should it attempt to change its current discourse. Failure will also reverberate far beyond its borders.
The transition from a rentier model to one based on merit and productivity must be gradual. The engines of growth must slowly shift to the private sector, which should be the main job provider, while governments deliver education and health services and regulate economic activity. All citizens must be given the tools to allow them to compete, including a more updated, inclusive, and open education system.
The notion that economic reform can succeed without a process that simultaneously builds political institutions and creates a system of checks and balances must be discarded. The decades-long economics-only approach has failed miserably in the Arab world. The new social contracts must achieve the right balance between economic and political concerns to soften the blow of necessary and painful economic reforms. Giving a meaningful voice to citizens and including them in the decision-making process are essential.
End of the oil era
This painful process is practically mandatory given the end of the oil era in the Arab world. And this is where the role of international financial institutions—such as the World Bank and the IMF—gets tricky. These institutions’ traditional mandates almost forbid them to tackle political issues, yet a focus on gradual and slow economic reforms alone has yielded few positive results. To remain relevant in this transformational era in the Arab world, international financial institutions must find new ways to help countries succeed in their development efforts. The IMF and the World Bank, for example, in recent years have begun to work with civil society, focus on ways to fight corruption, and foster improved education and health systems. They will have to double down on those types of efforts when engaging in economic reform programs with Arab nations.
The Arab uprisings have shown that the region lacks a modern concept of citizenship. The old paradigm that regarded citizens as subjects unfit to have a meaningful say in running their own affairs must change.
The concept of equal citizenship for all, regardless of gender, political orientation, religion, or ethnic origin must be enshrined in any new social contracts. Only by empowering all citizens with the belief that they are equal before the law can a society endow them with their full potential. Many Arab countries have promoted narrow forms of nationalism that emphasize the prominence of certain groups. They must focus instead on building strong national identities that trump all other allegiances. The Arab world’s cultural, ethnic, and religious diversity should be regarded as a strength rather than a weakness if societies are to evolve in a healthy manner.
Religious or secular
The uprisings have reenergized the debate in the Arab world about whether new governing frameworks should be religious or secular. The emergence of radical groups such as the Islamic State (or ISIS) and other nonstate actors has caused more moderate Islamic groups such as the Muslim Brotherhood to declare their strong preference for a “civil” state, to avoid the use of the term “secular.” Most people in the region associate the latter term with atheism and the complete separation of religion from politics. While both secular and religious forces declare their support for a civil state, the devil lies in the details. Except in Tunisia, the debate is still very focused on a winner-take-all approach rather than on a battle for a pluralism that assures all groups the right to operate peacefully and prevents one group from imposing its lifestyle on others.
If the region is to have any hope of achieving pluralistic societies, no issue demands more immediate and sustained effort than education reform. Such reform must reach beyond quantitative measures, such as classroom computers and building schools, to examine the values and skills being taught and the methods used to teach them. New paradigms need to be introduced to teach and encourage critical thinking, to allow questioning of what is being taught, and to encourage students to think logically and inquisitively. Schools must teach the value of diversity and drive home the lesson that truth is not absolute, that tolerance of different views is crucial, and that appreciation for different opinions is the key to innovation and renewal. Needless to say, these values are prerequisites to pluralism, equal citizenship, and civil states.
The uprisings have taken an iron lid off Arab societies, a lid that kept them artificially stable while hiding the real challenges facing the region. The only successful path to natural stability and prosperity is through a long and painful process of institution building, power sharing, and more inclusive growth.
This article was originally published by the IMF’s Finance and Development.