A view shows the Libyan Oil Refining Company (LERCO) in Ras Lanuf, about 660 km (410 miles) west of Tripoli, November 5, 2011. (photo by REUTERS/Youssef Boudlal)

Downsides of Oil-Rich Economies and how Arab Spring May Weaken Them More

Author: An-Nahar (Lebanon) Posted February 11, 2012

[Across the Arab world] there are only three [countries] in which "opposition forces," as an entity, have played a leading role in [bringing about governmental reform on their own]. This is a fact that highlights the weakness of the internal factors in achieving change. [Recent developments have also offered examples of] three other countries in which the opposition forces failed to play an independent role in [independently effecting change within government].

SummaryPrint Two different types of economies prevail in the Arab world: Those based on oil-rents, and those based on traditional productive sectors. According to Abdel-Amir al-Rikabi, oil-rent economies have fostered weak economies lacking innovation; but in all cases, the Arab Spring is unlikely to produce substantive changes to economic models.
Author Abdel-Amir Al-Rikabi Posted February 11, 2012
Translator(s)Sami-Joe Abboud

In Iraq - if it can be included in the ongoing Arab spring - in Libya and in Syria, the opposition has played a major role in [carrying out changes in the direction of the government]. However, this was not the case in Tunisia, Egypt and Yemen, where the opposition failed to establish any framework. [In these countries], the opposition did not emerge as centers pretending to lead popular movements or represent desires for change.

This was something that the opposition in the first three [countries] did manage to achieve. But it should be noted that in the case of Iraq the opposition was not based on any internal mass movement, whereas in Libya and Syria, the opposition carried out a series of uprisings and popular mass movements across the country [but failed to achieve popular demands]. It is noteworthy that oppositions in all three of [these countries] have been supported by either the US or NATO.

These differences in relations with the West, and the variations in how much [an opposition party] could rely on [Western] intervention points to weaknesses and a lack of internal mechanisms [within opposition] movements to effect change [in their respective countries]. This means that, so to speak, "changes" in a country’s regulations more often result from a caesarean section [than a natural birth]. The result is that these opposition parties then face a much broader list of tasks once change has been brought about [and they are in power]. Therefore, it is not true that revolutions result in democracy by default, and that the claims and promises of the opposition are always right.

Change particularly supported by Western military intervention usually means that the overthrow of governments and regimes was not the result of adequate internal factors. It also infers that this process has not yet politically and socially ripened.  For instance, the Iraqi and Libyan regimes were not toppled in the historical sense of the word. Had it not been for the NATO and the US, [Muammar] Qaddafi and Saddam Hussein would not have been [overthrown]. In other countries, conditions were ripe enough to lead to the overthrow of regimes thanks to popular uprisings alone.

Remarkably, the countries where the people succeeded in bringing down their regimes [without the help of Western interventions] were not oil-producing countries [Tunisia and Egypt].

It is interesting to note the multitude of Persian Gulf states which are immune to uprisings. In fact, [these countries], or some of them - Qatar in particular - contribute to fueling [uprisings] in other countries. Yemen is not an oil-producing country; Rather, it is a half-Gulf country that is surrounded by oil-producing countries. For its part, Syria is in the middle. However, it has another advantage - its status as a "confrontation country." The lesson we can draw from [its experience] is that we should not neglect the weight of [a country's] position on the Arab-Israeli conflict or refrain from considering it a significant factor. This especially holds true for Syria, as it is a country where the state has always engaged in confrontation with foreign powers. During the days of Muawiyah, following the Islamic conquest, the long confrontation with the Byzantine Empire contributed to the unification of Syria [and the establishment of Damascus as the capital of the Ummayad caliphate]. This granted Syria a magnitude of importance that it does not carry on its own, enabling it to [compete for status] with the Rashidun Caliphate. Hafez al-Assad took note of this peculiarity, and [aknowledged that Syria] was a country in which many empires and "city-states" [rose and fell]. He knew that this country lacked the prerequisites to be a viable state, and that the conditions for [the establishment] of national unity were in fact not present. Nation-states has primarily emerged from riverine civilizations. Hafez al-Assad instead employed a rather successful top down approach [to consolidate his rule] and lay the foundations for a state, whose "land" and unity has been based on confrontation with Israel.

Uprisings in poor countries are not based exclusively on the crucial momentum that emanates from demands for freedom and democracy. In fact, an in-depth investigation into the leading factors [of these uprising] demonstrates that the issue of freedom in the Arab world is still off the agenda when one takes into account the momentum that has so far characterized the Arab uprisings.

Leaving the wave of exaggerated, ideological and [detailed] assessments aside, there is a big difference between the images of the current uprisings which are currently being projected - and which are based on contemporary popular assumptions - and the truth concluded from the current conditions. Logically speaking, the issue of "freedom" could have been considered highly urgent, as it is indeed being addressed by [the Arab world at large]. [It would have received much more attention] had the uprisings taken place in oil-rich countries, and not in poor countries, where misery breeds misery.

As far as rentier economies are concerned, the pattern of the current uprisings seems to act as a detector of the distortions within Arab economic structures. Since the energy crisis of the 1970s, the capital surplus in the Gulf strongly affected what might be called "the Arab economy." A terrible imbalance grew between rentier countries - in which subsidies are distributed based on hierarchical tribal divisions, and financial surpluses are used to reduce tension between communities - and other agricultural economies, which found themselves damaged, failed to [adopt the industrial pattern] for structural reasons and lacked the necessary resources to set up rentier systems.

With the current changes in the global economy, there has been confusion about the kinds of options available [to Arab states in order to reconfigure their economic models]. [Arab countries] have failed to balance [between the interests of their various social classes] or ensure a minimal level of [benefits for poor segments of society]. These countries lived under poorly-planned economies and regimes, which failed to yield benefits or provide a positive economic outlook to their peoples. [Problems used to be solved] through people’s primitive and spontaneous measures, or through the state’s immediate intervention backed by a police authority.

Numbers reveal shocking facts about the misery and poverty in these countries and the reality of the state in its corruption and tyranny. These [states] had undoubtedly established mechanisms which led to the current uprisings [e.g. repressive security apparatuses and patronage-based economic systems]. But as regional economic and political visions still suffer the brunt of intellectual poverty, a lack of innovation and the growing tendency to [employ empty political rhetoric], these types of economic systems (and the revolutions that they invariably generate), will never bring about any substantive changes that will change the course of events in the near future. The imbalances within the "Arab economy," and the continued prevalence of the rentier model will now have to contend with the results of the elections, which were organized following the uprisings. The big question is, are we about to witness the triumph of true democracy, which has no real mechanisms [on the ground], or are we on the verge of generalizing the oil-state rentier model?
 

Read More: http://www.al-monitor.com/pulse/business/2012/02/uprisings-and-the-prevailing-eco.html

Published Beirut, Lebanon Established 1933
Language Arabic Frequency daily

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