Reforming Arab economies in times of distrust


After the regional slowdown in growth that followed the start of the Arab Spring, authorities in 2011 mostly focused on macroeconomic stabilization efforts that had been delayed until they became inevitable. These policies—which included cuts in consumer subsidies and increased taxes—were deeply unpopular and eroded the purchasing power of the middle class. According to the Arab Barometer, only 26 percent of the surveyed population find the economic situation favorable and 37 percent think it will improve soon. Distrust in government is high: 25 percent of the population has a positive view of government performance, while 84 percent believe there is corruption in state institutions and only 41 percent believe the government is addressing the issue.

The rising aspirations of an overwhelmingly educated and young Arab population contrast with the poor performance of governments to modernize their economies and create jobs. Arab governments’ inability to deliver quality and affordable public services, coupled with the perception of official corruption that enables a crony private sector, exacerbates distrust among citizens. Social media amplifies the discontent. The technology allows citizens to swiftly react to missteps by often-secretive governments and can easily spread anti-government sentiments…

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