Dr Nasser Saidi...says in the Arab world there is a an absence of road maps, an absence of vision

By Karen Dabrowska

A caterpillar always turns into a butterfly, but countries that have deposed a dictator do not necessarily turn into liberal democracies, is a message delivered by Dr Nasser Saidi when he addressed students at the London School of Economics.

Dr Saidi has been named among the 50 most influential Arabs in the world by The Middle East Magazine. He is a member of the IMF’s Regional Advisory Group for MENA and Co-Chair of the Organisation of Economic Cooperation and Development’s (OECD) MENA Corporate Governance Working Group.

In his lecture: ''Competing Economic Visions in the Arab Uprisings: Navigating without Roadmaps'' Dr Saidi pointed out that in the 1950s and 60s the Arab world also witnessed coups and revolutions but the overthrowing of autocrats and despots inherited from the post colonial world do not result in sustained economic growth and development or democracy and freedom. He warned that this could also be case after the 2011 revolutions.

Dr Saidi said that the greater the degree of inequality before transition, particularly in terms of income and consumption, the greater the likelihood of violence and conflict to resolve those inequalities. Successful transitions which do not end up in failed states may take a decade or more as in the case of Indonesia.

There is a big contrast between Europe when the Berlin Wall fell and the Middle East after the latest revolutions. In Europe there was a roadmap. There was a set of laws, regulations and institutions that had been put together by the countries in Western Europe and which the countries in transition could acquire.

There was also a common market where goods and labour could be sold and there were common institutions that were of assistance. The European Union created the European Bank of Reconstruction and Development that helped finance the transition.

In the Arab world this does not exist. There is a an absence of road maps, an absence of vision. There are no institutions for collective and concretive action. The transition could therefore take longer and there are no certain outcomes.

All the countries that went through transition are going to have elections the outcome of which is unknown. There are two major fault lines: the relationship between Islam and the state and the role of the military and security services.

Dr Saidi went on to describe his ten-point road map - a renaissance and development paradigm for transition countries, which he believes should be on the policy agenda:

(1) Political and governance transformation.

(2) Pluralism.

(3) Educational transformation to remedy the weak link between education and economic growth, income distribution and poverty reduction.

(4) Labour market reforms which are essential with equitable income distribution and poverty reduction.

(5) The empowerment of women in the workforce with women’s participation in the workforce increased to 50%

(6) Fiscal reforms including a shift in trade and investment towards Asia.

(7) Economic diversification from dependence on oil revenues and the development of local currency markets to which small and medium enterprises have access.

(8) Regional economic integration.

(9) The setting up of an Arab Bank for Reconstruction and Development and rebuilding Arab institutions such as the Arab League and the Arab Monetary Fund which has a similar role to the IMF.

(10) Transformation of the role of the state with a greater role for the private sector.

Dr Saidi went on to say that this is the time when the Arabs have to affect their own transformation. “Nobody else can do it for us. This is a battle for the Arab soul.
Concretive action must be taken - not by the Europe or US who are both leaderless and clueless when it comes to dealing with the Arab world.

This is the moment for the Gulf Co-operation Council (GCC) countries. They have every incentive to ensure that there is stability in their neighbourhoods and they have the financial resources to make a difference.”

Dr Saidi believes the GCC countries need to sign free trade agreements with the other countries of the region. The UAE and Qatar could assume leadership roles. The building of central institutions such as the Arab League and creating an Arab Bank for Reconstruction and Development is vital.

He ended his lecture by reciting a poem from an Alexandrian poet : Wise men perceive approaching things.

“Men know what is happening now.
The gods know the things of the future,
the full and sole possessors of all lights.
Of the future things, wise men perceive
approaching things.”