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A New Approach to Stalled State Transformations in Iraq and Yemen

A New Approach to Stalled State Transformations in Iraq and Yemen

Chatham House in this research paper titled Between Order and Chaos: A New Approach to Stalled State Transformations in Iraq and Yemen, Dr Renad Mansour, Research Fellow, Middle East and North Africa Programme, Chatham House (@renadmansour) and Peter Salisbury, Senior Consulting Fellow, Middle East and North Africa Programme (@peterjsalisbury) say that International policymakers have failed to stabilize states such as Iraq and Yemen, partially because of the assumed binary distinction between state failure and success. This paper advocates for a ‘middle–out’ approach that aims to strengthen the connectivity between the bureaucracy and de facto authorities.

The Summary of this paper dated 9 September 2019 is reproduced for all intents and purposes below and the paper can be read online or as a Download PDF (opens in new window)

  • In the Middle East and North Africa, a growing number of internationally recognized (de jure) states with formal borders and governments lack de facto statehood. Often, governance vacuums are filled by alternative actors that perform state-like functions in place of, or alongside, weakened official institutions. This results in hybrid orders where the distinction between formal and informal actors in the state is blurred, as too are the lines between the formal, informal and illicit economies.
  • International policymakers have struggled to establish political settlements in these contexts. Would-be state-builders have mistakenly assumed a binary distinction between state failure and success. They have sought to recreate an idealized archetype of the ‘orderly’ state, critically failing to recognize the more complex networks of de facto actors on the ground. At times, international policymakers pick or support leaders who lack local legitimacy, capability and power. This stalls and fragments ongoing organic state transformations, and produces hybrid orders as de facto actors adapt by both capturing state institutions and creating parallel ones.
  • We propose a new model for understanding the fragmentary transformations of the state underway in Iraq and Yemen. It involves the concept of a multi-layered state, consisting of the executive, the formal bureaucracy, the de facto authorities and society at large. The gap in legitimacy, capability and power between the middle two layers in this model – the formal bureaucracy and the de facto authorities – is a critical source of instability and an impediment to reform. Bridging that gap is thus the key to effective peacebuilding and/or state-building.
  •  This paper argues that all states lie along a chaos–order spectrum. No state is entirely chaotic or orderly. Even those that display many features of chaos – as in Iraq and Yemen – contain pockets of order that are all too often overlooked. The larger the gap between the formal bureaucracy and the de facto authorities, the more a state slides towards the chaos end of the spectrum. Effective state-building must find a way of institutionalizing improvised governance arrangements.
  •  To achieve this, we advocate a ‘middle–out’ approach that aims to strengthen the connective tissues between the bureaucracy and de facto authorities. Simplified, this more inclusive approach entails reframing international involvement as playing the role of a ‘referee’ to monitor the transformations of the state while enforcing accountability, as opposed to the practice of picking ‘winners’ and integrating unfavoured actors into unpopular political settlements.
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Gulf wealth: all that glitters is not gold

Gulf wealth: all that glitters is not gold

Gulf wealth: all that glitters is not gold

Gulf wealth: all that glitters is not gold. Little suggests that fabulously wealthy Gulf states and their Middle Eastern and North African beneficiaries have recognized what is perhaps the most important lesson of this year’s popular uprisings in Algeria and Sudan and the 2011 Arab revolts: All that glitters is not gold.

Gulf wealth: All that glitters is not gold

by James M. Dorsey, Sep 5

Saudi Arabia, the United Arab Emirates and to a lesser extent Kuwait have in the last decade invested billions of dollars in either reversing or hollowing out the revolts’ achievements in a bid to ensure that political change elsewhere in the region does not come to haunt them.

Qatar, in a counterintuitive strategy that has earned it the ire of the rulers of Saudi Arabia and the UAE, has sought to achieve the same goal by attempting to be on the right side of the region’s forces of change.

The irony is that both approaches, despite also involving huge investments at home in economic diversification, education, and healthcare, could produce the very result Gulf states seek to avoid: a region that has many of the trappings of 21st century knowledge states but that is incapable of catering to the aspirations of a youth bulge expected to annually increase the work force by a million people over the next 12 years.

UNICEF, the United Nations Children’s Fund, concluded earlier this year, that the region’s youth bulge was a double-edged sword. It could either pose a threat to regional stability or be an asset for development.

Turning the youth bulge into an asset “requires urgent and significant investment to create opportunities for meaningful learning, social engagement and work, all of which are currently limited, particularly for young women and the most vulnerable,” the UN agency said in a report entitled MENA (Middle East and North Africa) Generation 2030.

UNICEF arrived at its conclusion even though Gulf states have adopted grandiose plans that envision them becoming within a matter of a decade or two diversified, knowledge-driven economies that enact the social reforms needed to create opportunity for all segments of society.

The group’s conclusion applies as much to the wealthy Gulf states as it does to the Arab beneficiaries of their politically motivated financial largesse.

The problems with the flexing of the Gulf states’ financial muscle as well as the implementation of reform plans are multi-fold.

They relate as much to quality of the upgrading of services such as education as they are about how political intent shapes development efforts and how high domestic debt in countries like Egypt, where 27 percent of government expenditure goes to interest payments, and Lebanon, which spends 38 percent of its budget on debt servicing, benefits Gulf banks and stymies social and economic development.

Credit rating agency Fitch recently downgraded Lebanon’s credit rating to CCC from B- because of “intensifying pressure on Lebanon’s financing model and increasing risks to the government’s debt servicing capacity.”

Gulf scholar Rohan Advani notes that Gulf institutions account for most of the financial sector investment in countries like Algeria, Egypt, Jordan, Iraq, Tunisia, Libya, Syria, and Yemen.

“In Lebanon, just over 50 percent of the country’s bank assets are held by GCC-related banks, in Palestine this figure is 63 per cent, and in Jordan it is as high as 86 percent,” Mr. Advani wrote in a review of political economist Adam Hanieh’s study of Gulf finance, Money, Markets, and Monarchies.

Mr Hanieh argues that the bulk of the debt payments are to financial establishments whose major shareholders include Gulf institutions in a process in which “the Arab state…increasingly mediates the transfer of national wealth to large Gulf-related banks.”

Mr Advani warned that “indebted governments are compelled to intensify a politics of austerity, further trapping these societies in cycles of debt. Investments in social programs or infrastructural developments are often stalled. Popular movements are unable to realize their demands at the state level due to the requirements of foreign creditors and domestic capitalists. The ensuing scenario is one where alternative politics are asphyxiated and increasingly circumscribed by an atrophied status quo.”

That may well be the purpose of the exercise with economic diversification efforts in the Gulf being driven more by the need of autocracies to upgrade their autocratic style and create opportunity for a restive youth in a bid to ensure regime survival rather than by the acknowledgement of a government’s responsibility to serve the people.

The result is a flawed approach to all aspects of reform.

In Saudi Arabia, Crown Prince Mohammed bin Salman’s Vision 2030 economic and social reform plan that calls for greater private sector involvement has turned into a top down effort that emphasizes state control with the government’s Public Investment Fund (PIF) as the key player.

A combination of depressed oil prices and the recent replacement of energy minister Khalid al-Falih as chairman of the board of Aramco by PIF head Yasir al-Rumayyan, a close associate of Prince Mohammed, raises questions about the state oil company’s positioning in advance of a much-touted initial public offering.

Ellen Wald, an energy analyst and author of a history of Aramco, the kingdom’s main source of revenue, noted that at PIF Mr. Al-Rumayyan had overseen investments more geared towards speculative gains than the sustainable growth of Saudi wealth.

Ms Wald said that raised the question whether Mr Al-Rumayyan’s objective with Aramco would be to serve the company’s long-term interests or those of the PIF.

Aramco this year bought a 70 per cent stake in petrochemicals maker Saudi Basic Industries Corp for US$ 69 billion in an effort to raise funds for PIF and delay the Aramco IPO that had originally been scheduled for 2018 but has since been delayed until 2020 or 2021. The megadeal is expected to boost the oil company’s downstream growth plans.

Nonetheless, Ms Wald cautions that Mr Al-Rumayyan’s appointment “doesn’t necessarily bode well for Aramco, which is a different kind of company. It has to make stable decisions for the long term,” she said.

By the same token, UNICEF warned that poverty, violent conflict, restrictive social norms, patriarchy, rights violations and lack of safe spaces for expression and recreation were limiting opportunities as well as civic adolescent and youth engagement.

Gulf emphasis on geopolitical dominance, regime survival and return on financial investment produces short term solutions that often exacerbate conflict, produce little trickle-down effect and few prospects for long-term stability.

“As a result, adolescents and youth in MENA (the Middle East and North Africa) feel disillusioned, with girls and young women, refugees, those with disabilities and the poor being particularly marginalised and underrepresented,” the UNICEF report said.

“Youth unemployment in the region is currently the highest in the world. Education systems are failing to prepare adolescents and youth for the workplace, and markets are not generating urgently needed jobs,” the report warned.

Gulf wealth glitters but if the UNICEF report is anything to go by, it has yet to demonstrate that it can produce the gold of a development that is sustainable and benefits not only all segments of Gulf societies but also of those across the region that have become dependent on it.

Gulf wealth: all that glitters is not gold

James M. Dorsey

Written by James M. Dorsey, an award-winning journalist covering ethnic and religious conflict. He blogs using soccer as a lens on the Middle East and North Africa’s fault lines. The Turbulent World of Middle East Soccer

Dr James M. Dorsey is a senior fellow at Nanyang Technological University’s S. Rajaratnam School of International Studies, an adjunct senior research fellow at the National University of Singapore’s Middle East Institute and co-director of the University of Wuerzburg’s Institute of Fan Culture.

A podcast version of this story is available on Soundcloud, ItunesSpotifyStitcherTuneInSpreakerPocket CastsTumblrPodbean and Castbox.

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Why Syrian refugees have no negative effects on Jordan’s labour market

Why Syrian refugees have no negative effects on Jordan’s labour market

Jackline Wahba, Professor of Economics at the University of Southampton looks at the civil unrest in Syria direct implications on the country’s populations movements on one of the neighbouring countries, i.e. Jordan. Why Syrian refugees have no negative effects on Jordan’s labour market is a question in everybody’s mind since the start of the ensuing multilateral conflicts.

Why Syrian refugees have no negative effects on Jordan's labour market
MikeDotta / Shutterstock.com

Forced displacement is a global challenge. The number of displaced people rose from 43m to 69m between 2007 and 2017, with the highest growth primarily due to the Syrian conflict, which started in 2011. Since then, more than 6.3m Syrians have fled to neighbouring countries and beyond. This humanitarian crisis has generated public sympathy as well as concern about the implications of such a massive flow of people.

Jordan, which shares a border with Syria, has experienced a substantial influx of refugees. Around 1.3m Syrians live in Jordan, which has a total population of just 6.6m. The impact of so many people on members of the host community is a subject of great importance and debate.

One area of particular concern tends to be the job market. Jordan gives a unique insight into this as it signed an agreement with the EU in 2016, agreeing to allow Syrian refugees to enter legal employment in return for humanitarian aid, financial assistance and trade concessions from the EU. Known as the Jordan Compact, I studied its effect on the Jordanian labour market with colleagues Belal Fallah and Caroline Krafft. We found that the compact did not have a negative effect on Jordanian jobs or wages.

Using data that represented the whole country, combined with information on where most refugees live (which is fairly concentrated in certain areas of the country), we were able to identify the effects that Syrians had on Jordanians’ job prospects by comparing Jordanians’ labour market outcomes before and after the Syrian influx.

We found that Jordanians living in areas with high concentrations of refugees had no worse labour market outcomes than Jordanians with less exposure to the refugee influx. This result held across all labour market outcomes, including unemployment levels, hours, wages and characteristics of employment (such as sector, occupation and whether the work was formal or informal).

Our findings contrast with most of the very recent literature on the impact of the Syrian refugee influx, which to date had been limited to evidence from Turkey. Here, research found that natives who were employed informally were affected by Syrian refugees. But the global literature generally finds a similar mix to our findings of refugees having no or small specific negative effects on native job markets. This could be due to the demographics of refugees in Turkey and the fact that refugees aren’t legally allowed to work there, among other reasons.

Little competition

There are several reasons why the massive influx of Syrian refugees has had a minimal impact on the job situation in Jordan. The demographics of the Syrians in Jordan may have played an important role. Almost half are under the age of 15 and only 23% of Syrian refugees in Jordan are in the labour force (45% of men and 4% of women).

The aim of the Jordan Compact was to provide 200,000 Syrian refugees access to work permits and formal work. But the take up of work permits by Syrians has been very low. According to Jordan’s Ministry of Labour, by the end of 2017 only 87,141 work permits to Syrians were issued. This means there are few Syrians competing in Jordan’s (formal) labour market, making their effect on the labour supply relatively small.

Despite the massive inflow of Syrian refugees, the number of non-Syrian immigrants has not decreased in Jordan over the same period of time. According to Jordan’s 2015 population census, Jordan hosted an additional 1.6m non-Syrian foreigners. Other research has shown that Syrians mainly compete with economic immigrants in the informal sector where they don’t get given contracts, such as construction and some sales jobs. Here there is limited competition between refugees and Jordanians.

Demand and supply

The inflow of foreign aid has also been a potential mechanism for creating jobs for Jordanians. To help address the needs of the Syrian refugees, Jordan has received foreign aid from multiple sources. This aid has been channelled to help offset the budget deficit, finance public projects and support public services such as schools, hospitals and transport nationwide. Both direct assistance to refugees and aid to the government can create jobs, the latter disproportionately in the government and public sectors.

Finally, the increase in demand for public services by refugees, in particular education and health, has resulted in the Jordanian government increasing the provision of those services, which in turn increased the demand for workers (almost exclusively Jordanians) in these sectors.

Overall our results suggest that providing legal work opportunities to refugees is not detrimental to the native job market. The inflow of foreign aid to Jordan to assist with some of the needs of refugees, as well as the conditions of the Jordan Compact, which included aid and trade concessions and employment support for Jordanians, may have played an important role in creating labour demand for Jordanians. So it is vital to ensure sufficient resources and public services are in place to support refugees and the host economy.

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Why media performance has declined in the MENA?

Why media performance has declined in the MENA?

Shehab Al Makahleh, a consultant, senior political, media adviser and the executive director of Geostrategic Media Centre-USA, wondered Why media performance has declined in the MENA? He contributed this article dated August 31, 2019, to The Jordan Times.

There are many challenges facing Arab media, starting with national newspapers, news sources, magazines to television stations due to digital incursion, which trespasses geographical boundaries, putting an end to monopoly in the fields of communication that were once the task of giant institutions operating on a global scale. Thus, it is highly recommended to help users and the audience identify false news that has become a phenomenon.

In the past decade, advertising resources for print media fell by two-thirds. The distribution of national newspapers dropped as well, either because of digital copies due to easy access to the Internet by the audience or because many advertisers prefer posting their ads online. Newspapers’ revenues as a result have dropped remarkably. Publishers rely on ads that have now been fully automated and based on traffic volume on news sites.

The question that arises is: Who is responsible for this decline of regional media and lack of professional craftsmanship? The dilemma lies in the collective responsibility of individuals and the media. For example, many people follow social media celebrities, who have millions of followers without providing any useful content. Thus, fame at present does not require people to appear on television and satellite channels, as some Youtubers and Instagrammers have millions of followers; more than TV channels and newspapers due to flip-flopped interests.

A major segment of the deterioration of Arab media lies on recipients or the audience. In other words, some media outlets which respond to audience requests and demands achieve tangible successes. Social media celebrities go by the whims of their followers to secure stardom.

In some countries, there is fear from the media, and this has created a psychological barrier that prevents journalists from dealing with vital issues. Extremist parties and other actors have also contributed to this decline in media and journalism. Lack of journalistic professionalism is a direct outcome of failure of media institutions to provide necessary training for journalists.

Over the past 25 years, the number of media channels, newspapers and websites have mushroomed. In other words, the quantity has not matched the quality due to lack of professional journalists who are well-trained to manage media institutions independently. If we look at the state of journalism now, there are more media outlets, but media independence and freedom of coverage had become less than before. Technological advances on social media have also led people to follow media that are consistent with their views.

Traditional Arab media has lost its role in the industry of opinion and has a marginal contribution to the formation of awareness of the Arab world, while social media has become more powerful and influential. Some media have moved away from traditional means and turned to social media as a better platform to address the public directly. Newspapers have become weak in many Arab countries, even those which are funded, and supported by governments, as the main issue is not related to funding but rather professionalism. Many newspapers do not have remarkable content to grab readers to purchase such newspapers due to citizens’ weak purchase power and absence of real professional journalism.

What these newspapers currently offer depends on news agencies and other sources of content. Very few still have strong journalistic topics that are presented to the reader. Unfortunately, the way such topics are covered and addressed have less freedom of expression and opinion in terms of analysis and prognosis. Since the basis in successful media work relies on science and information, absence of these two elements is one of the major loopholes of media coverage in the whole Middle East and North Africa (MENA) region.

Technological transformation in the world of media industry have raised concerns among the media industry, as this has adversely affected the media spectrum in the MENA.

Thus, we need to improve the horizons of high-level journalism and encourage new media models not only in terms of available technologies, but also in terms of innovation and creativity by hiring national press, digital media and advertising industry figures in order to restore a balance between news publishers and digital platforms that publish what they produce. This comes at a time when many changes in technology and consumer attitudes pose challenges for quality journalism in the region.

Government oversight should be effective from time to time in order for Internet news platforms to adhere to media standards and to enhance confidence in the news such platforms broadcast. The government should also consider direct support for local news sources and provide tax exemptions for media. Information authorities should provide more support to local publishers so that their coverage complements local news. Furthermore, governments concerned should set up independent institutes to provide news of public interest in the future.

Therefore, we should adhere to new standards to restore balance between publishers and online platforms. In addition, Internet platforms must exert an effort to improve their users’ access to news in a good manner.

Pieces of Ramses II obelisk arrive in Cairo for re-assembly

Pieces of Ramses II obelisk arrive in Cairo for re-assembly

Pieces of Ramses II obelisk arrive in Cairo for re-assembly. The obelisk will be restored, assembled and erected in Tahrir Square.

By Nevine El-Aref, Friday 30 Aug 2019

Pieces of Ramses II obelisk arrive in Cairo for re-assembly

In an attempt to develop Tahrir Square and to show the whole world Egypt’s unique civilisation, eight blocks of one of Ramses II’s obelisks, found in his temple at San Al-Haggar archaeological site in Zagazig, arrived in Cairo on Friday.

They will be restored, assembled and erected in Tahrir Square.

Mostafa Waziri, secretary-general of the Supreme Council of Antiquities (SCA), said that the transportation of the parts of the obelisk was carried out under tight security by the tourism and antiquities police, within the framework of the government’s plan to beautify and develop Tahrir Square as part of the Historic Cairo Development project.

Pieces of Ramses II obelisk arrive in Cairo for re-assembly

The obelisk is carved in red granite and decorated with scenes depicting Ramses II standing before the gods with his different titles written alongside. After restoration and assembly, the obelisk will be 17 metres tall and weight 90 tonnes.

Mohamed Al-Saeidy, director of the SCA’s Technical Office, said that the antiquities ministry completed the first phase of the development project at San Al-Haggar archaeological site last September.

A collection of two obelisks, two colossi and two columns from the temple of Ramses II were restored, assembled and re-erected in their original location.

Now, he continued, the ministry has started the second phase of the project, which aims to restore, assemble and re-erect more obelisks, colossi and columns.

Pieces of Ramses II obelisk arrive in Cairo for re-assembly

In collaboration with the French Institute for Oriental Archaeology in Cairo (IFAO), the antiquities ministry has recently launched a project to upgrade the facilities and services provided to the site’s visitors, including the establishment of a visitor centre, the installation of signage, and the development of a website for the site.

Pieces of Ramses II obelisk arrive in Cairo for re-assembly

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Economic uncertainties within the GCC countries

Economic uncertainties within the GCC countries

Travel AND Tour World published on Monday, July 29, 2019, this article elaborating on the current tourism together with other types of related business activities in the Gulf region. Dubai with its impressive urban development, artificial islands and other coastline attractions has been for a time spearheading the regional shopping and business tourism. The recent economic uncertainties within the GCC countries as well as through the political movements of the US, the EU and all other heavyweights vested interests of the world economy seem to be behind this story.

Tourism slowdown in Dubai’s Jumeirah cuts 500 jobs

Economic uncertainties within the GCC countries

Due to a slowdown in the emirate’s tourism industry, Jumeirah Group has cut hundreds of jobs and according to people familiar with the industry, it weighs on the operator of Dubai’s sail-shaped Burj Al Arab hotel.

As per sources hundreds of jobs were slashed recently by the operators of Burj Al Arab along with 24 hotels worldwide.

As the information was private the government-owned luxury hotel chain, which manages 24 properties in eight countries, recently shed about 500 jobs.

Jumeriah has more than 13,500 employees according to its website and most of the cuts were support roles.

The tourism sector is stalled causing Dubai’s hotels to struggle and the occupancy level was found to be the lowest during the second quarter since 2009.

The average daily rates and revenue available per room fell to 2003 levels as stated by STR, a global hotel data provider.

There has been an oversupply due to new opening ahead of the 2020 World Expo.

The geopolitical tensions, relatively low oil prices, the ongoing real estate and the retail slump has caused Dubai-based companies and real estate developer and banks to cut down their staffs.

New measures have been introduced by the Dubai government to stimulate the economy by lowering business fees and providing long-term visas.