The Arab Spring Economy, Revisited
Back in October, I wrote about the need for Egyptians to separate their economic woes from their political ones in the aftermath of the Arab Spring-inspired protest that ousted Hosni Mubarak. In the four months since then, Egypt has not moved very far. Mubarak is still being held by the de-facto military government, protests are still raging in the same square where they originated, and no one in Egypt is happy about the sky-high unemployment and monetary woes that plague the country.
In other North African countries, the situation is much the same. Libya has only been able to recapture a fraction of Gaddafi’s assets (some $6bn out of $150bn), giving the new government a major budget shortfall to deal with. The Libyan government was the country’s largest employer and essentially provided a “welfare state” to the people; the lack of funding will cause great hardship in an already rattled country. Similarly, in Tunisia, where the Arab Spring originated, liquidation is the name of the game. Tourism, a major part of the Tunisian economy, has died off, and many foreign companies are closing up shop. Even without having to constantly pay off officials with bribes, businesses are struggling to stay solvent.
The violence that has wracked these countries is not unusual; indeed, many revolutions have been bloodier and more destructive. However, given that the widespread unrest was fomented in part by widespread unemployment and a poor economic outlook, it should be expected that prosperity is still a long ways away. What the people of these countries ought to do is to focus solely on making sure the political system is righted as soon as possible. With that will come order, both physical and legal, and with order comes foreign investment and tourism revenue. Wiping the political slate clean is a good start, but it shouldn’t be considered an instant, quick fix for long term problems, nor should the people choose a government that promises them easy prosperity.