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The military started by working on land reclamation - turning deserts into arable land. In the late 1970s, the army led the way in reconstructing cities and infrastructure along the Suez Canal that had been damaged severely during the war with Israel.

The military now manages approximately a quarter of total government spending in housing and public infrastructure

the problem here is that the military’s powerful political position means it doesn’t really have to account for genuine cost-effectiveness; the real problems are being kicked down the road.

He doesn’t understand how the economy works, how to get it going, how to generate jobs and growth, or how to increase revenue in a sustainable way. But the military is following orders. If he tells them to go build a new city in the sand somewhere, that is what happens.

The economic consequences are increasingly negative, because Egypt is borrowing heavily to fund these projects.

The military’s main advantage is political influence. It has officers placed throughout the state apparatus who help get contracts. These officers also dominate the government’s main audit agency, which is instructed to inspect civilians to prevent corruption.

Until the 2013 takeover, the military’s economic activities functioned to keep the senior officer corps happy and loyal to the president, by allowing them perks. Sisi, however, has made a different calculation. He is looking to reinforce the political legitimacy of his regime domestically, and to show Western governments and foreign investors that Egypt means business. He wants to demonstrate credibility. He’s shown his contempt openly for the civilian agencies of his own state. He feels he can only trust the military to do the job on time, within budget.

Egyptian military accounts are not shared with anyone either inside or outside Egypt. This includes the official budget, in addition to the financial books of the various military agencies involved in economic and commercial activities.

the military pays no taxes on any of its activities, and no customs duties on the goods it imports for these purposes

All officers who perform duties on behalf of military agencies undertaking economic activities get paid extra allowances and benefits for each task they undertake, and often get an extra salary if they run a military factory or a military farm. And then there’s a share of profits - or of incomes before profits are calculated, because there’s not always a profit; a certain share of these are distributed to senior officers as well. 

in western economies, low-cost migrant workers are largely unavailable. When the economy booms, wages rise, forcing managers to think judiciously about hiring. During a recession, employment protections for citizens mean that redundancies are complicated and sometimes impossible. Consequently, managers focus a lot more on maximizing worker productivity through investments and employee training; and on developing new technologies that are commercially valuable.

the Gulf countries rank below every region in the world in terms of R&D spending as a percentage of GDP, and the limited spending is almost exclusively funded by the government, and occurs in governmental organizations, such as oil giants Aramco and ADNOC.

the fundamental error made by proponents of restrictions on migrant workers. Rather than making the case I made above, they make the erroneous claim that if Saudi Arabia bans migrant workers, Saudi businesses will hire nationals in their stead. We know that this is false empirically because all of the Gulf countries have tried this and it has failed. The failure was also expected because national and migrant workers are imperfect substitutes. It is tempting to attribute the attractiveness of migrant workers merely to their willingness to work for a lower wage, or to domestic businesses “lacking patriotism”; but this belies the genuine superiority of migrant workers in many relevant domains, including work ethic, willingness to perform jobs that locals are averse to (waiting tables, collecting refuse, etc.), and their possession of skills that nationals often lack.

Saudis are too often educated in the areas that help one get a cushy public sector job, and not in those that serve the private sector needs. This is most starkly seen in the limited success of vocational training, especially when compared to advanced economies such as Germany or Switzerland.

for crude restrictions on the employment of migrant workers to create jobs for Saudi citizens, they must be accompanied by upgrades to the human capital of Saudis that attend to the needs of the private sector

while the new system makes hiring foreign workers “instant”, the results of these comprehensive reforms will be anything but “instant”, requiring many years to bear fruit

Though economics professor Mohsen Hassen echoed Zarouk’s assertion that increasing fuel prices will negatively affect consumers, he said the government’s decision was justified in order to salvage the country’s economy. Hassen told Tunisia Live that the budget deficit grew by 12.6% since the revolution; in 2012, alone it rose by 6.6%. “It is extremely dangerous that the deficit keeps growing,” Hassen said. “That’s why better management of subsidies funding is crucial.” Goods are generally subsidized in order to preserve consumer purchasing power, especially for citizens with low incomes. “Only 12% of the poor are benefiting from the fund…” he stated, adding that a larger proportion of Tunisians with high incomes are the ones gaining the most from subsidies. “Subsidies are serving those who don’t need them most,” Hassen said. “That’s the dilemma that was unveiled by the revolution thanks to transparency in statistics.”

“If you want to protect yourself and your family, you join a militia,” remarked a middle-aged man in the Jazmati neighborhood. “The area is infested with crime associated with the National Defense militias. Each group has control over a certain quarter, and they sometimes fight each other over the distribution of spoils. Shop owners must pay these militias protection. One owner refused, and they torched his store.”

Another resident of the same area explained that he and his family could scrape by thanks to his two sons’ positioning in the Iran-backed Baqir Brigade—which provides not only monthly salaries, but also opportunities to procure household items through looting.

Syrians also dip into precious resources to pay officials for information, for instance on disappeared relatives or their own status on Syria’s sprawling lists of “wanted” individuals. For those wishing to confirm that they won’t be detained upon crossing the border to Lebanon, the going rate is about 10 dollars—most often paid to an employee in the Department of Migration and Passports.

An industrialist in Aleppo put it simply: “I talk with factory owners and they say they want to reopen their factories, but they can’t find male workers. When they do find them, security services or militiamen come and arrest those workers and extort money from the owners for having hired them in the first place.” With no large scale returns on the horizon for local industries, this economic impasse will take years to resolve.

Although virtually every problem that sparked Syria’s 2011 uprising has been exacerbated, society has been beaten down to the point of almost ensuring that no broad-based reformist movement will be able to coalesce for a generation to come

the unraveling of Syria’s productive economy, and its replacement by an economy of systematic cannibalization in which impoverished segments of Syrian society increasingly survive by preying upon one another

a new term—taafeesh—to describe a practice that goes far beyond stealing furniture to include extremes such as stripping houses, streets and factories of plumbing and electrical wiring

“I watched uniformed soldiers using a Syrian army tank to rip out electrical cables from six meters underground,” remarked a fighter with a loyalist Palestinian faction, who was scrambling to retrieve belongings from his apartment before it could be pillaged. “I saw soldiers from elite units looting private hospitals and government offices. This isn’t just looting—it’s sabotage of essential infrastructure.”

I returned to my apartment just to retrieve official documents and some hidden pieces of gold. I did so, and then destroyed my own furniture and appliances because I don’t want these people making money at my expense. I was ready to burn down my own apartment, but my wife stopped me—she didn’t want me to cause harm to other apartments in the building.

micro-economies in their own right—from the recycling of rubble to the proliferation of taafeesh markets, where people buy second-hand goods stolen from fellow Syrians. Many have no choice but to use these markets in order to replace their own stolen belongings

This cannibalistic economy, which encompasses all those who have come to rely on extortion for their own livelihoods, extends to the cohort of lawyers, security officials and civil servants who have positioned themselves as “brokers” in the market for official documents such as birth, marriage and death certificates

Just as Syrians are forced to be more self-reliant, they have also come to depend evermore on vital social support structures. Indeed, extreme circumstances have created a paradox: Even as society has splintered in countless ways, the scale of deprivation arguably renders Syrians more closely interdependent than ever before.

Today, even the most senior lawyers in our practice are working as document brokers. A well-connected broker makes 30 to 40,000 pounds [60 to 80 dollars] per day; this roughly equals the monthly salary of a university-educated civil servant. As a result, many government employees resign and work as brokers to make more money.And this truly is a business, not a charity: Every broker takes money, even from his own brothers and sisters. Last week a colleague brought me his brother-in-law. I asked him why he needed me, when he could make all the papers himself. He explained that he can’t take money from his own brother-in-law, but I can do so and then give him half.

Multiplying forms of predation have accelerated the outflow of Syria’s financial and human capital, leaving behind a country largely populated by an underclass that can aspire to little more than subsistence

Syria’s predatory wartime economy is slowly but surely turning into a predatory economy of peace

As some Syrians put it, Damascus has been particularly effective in reconstructing one thing amidst the immeasurable destruction: the “wall of fear” which characterized the regime before 2011 and which momentarily broke down at the outset of the uprising

active surveillance, intimidation and repression are not the only contributors to this leaden atmosphere. A pervasive exhaustion has settled over Syrians ground down and immiserated by war, disillusioned with all those who purport to lead or protect them, and largely reduced to striving for day-to-day subsistence

At one level, the war has wrenched open social and economic fractures that existed long before the conflict. The city of Homs stands as perhaps the starkest microcosm of this trend. A Sunni majority city with sizable Christian and Alawi minorities, Homs was the first major urban center to rise up and the first to devolve into bitter sectarian bloodletting

While vast swathes of Syria’s Sunni population feel silenced and brutalized, Alawi communities often carry their own narrative of victimhood, which blends legitimate grievances with vindictive impulses vis-à-vis Sunnis whom they regard as having betrayed the country

crude divisions based on sect or class fail to describe a complex and fluid landscape. Some fault lines are less dramatic, all but imperceptible except to those who experience them first-hand. Neighbors, colleagues, friends and kin may have come down on opposing sides, despite having every social marker in common. Each part of the country has its own web of tragic events to untangle.

Many Islamic State fighters swapped clothes and joined the [Kurdish-led] Syrian Democratic Forces to protect themselves and their families. But they haven’t changed; those people are bad, and will always be bad. There will be vengeance. Not now, while everyone is busy putting their lives together. But eventually, everyone who suffered under ISIS, whose brother was killed by ISIS, will take revenge.

A native of a Damascus suburb remarked: “Charities typically want to help those who fled from elsewhere. So, when I go to a charity, I say I’m displaced.”

The divide between conservative and more secular Sunnis has calcified, manifesting itself even in differential treatment at checkpoints. “I have an easier time driving around because I don’t wear the hijab,” remarked a woman from the Damascus suburbs. “If you veil, security assumes you’re with the opposition.”

While dialogue is sorely needed, some Syrians warn against emphasising dialogue for its own sake—even at the cost of burying the most substantive issues at stake. A businessman from Damascus described his own abortive experience with talks proposing to link disparate elements of Syria’s private sector: “There’s this whole industry around ‘mediation,’ including between sides that don’t actually disagree on anything. Meanwhile, all the problems that caused the uprising have gotten worse.”

Most who can afford to leave the country do so; others benefit from an exemption afforded to university students, while another subset enjoys a reprieve due to their status as the sole male of their generation in their nuclear family. Others may pay exorbitant bribes to skirt the draft, or confine themselves within their homes to avoid being detected—making them invisible both to the army and to broader society. Some endure multiple such ordeals, only to remain in an indefinite state of limbo due to the contingent and precarious nature of these solutions

remittances from relatives who live abroad

The country’s middle and upper classes have long extended vital forms of solidarity to their needier compatriots, with Syria’s merchant and religious networks playing a leading role. What is unique, today, is the scale of hardship across the country, which is so vast as to have changed the way that Syrians conceptualize the act of receiving charity. A businessman from central Syria noted the extent to which dependency, which once demanded some degree of discretion, has become a straightforward fact of life. “People used to hide it when they were reliant on charity. Not anymore. Today you might hear workers in a factory wondering, ‘Where is the manager?’ And someone will say that he’s out waiting for his food basket. The whole country is living on handouts.”

People still do charity the Islamic way, based on the premise that you must assist those closest to you. If there’s someone you should help—say, a neighbor—but you’re unable, then it’s your responsibility to find someone else who can. These circles remain very much intact, and the entire society lives on this. Seven years of war didn’t destroy that aspect of Syrian culture, and that’s something Syrians are proud of.

There will be no nationwide recovery, no serious reform, no meaningful reconciliation for the foreseeable future.

the industriousness and ingenuity displayed by the Mashhour crew and their colleagues on the tug boats are the very qualities that allow millions of Egyptians to survive the misrule that has led to rising poverty levels even as limited reforms have primarily benefited the ruling elites and crony capitalists. While the government in Cairo has received kudos for GDP growth, Egypt’s poverty rate has nearly doubled over 20 years, from 16.7% in the year 2000 to 32.5% in 2019.

The patronizing view that the man in the street needs the guiding hand of his betters has often encouraged international partners over the years to direct funding to the elites rather than small and medium-sized enterprises, despite pledges to prioritize those very sectors.

their government provides them with neither the competitive market economy nor the political freedoms that would allow them to demonstrate their readiness.

the waterway is of exceptional value to the government in Cairo: Not only is it a significant source of hard currency for a country with a chronic trade deficit, its strategic importance to global commerce elevates Egypt’s international status

Many who seek the resources — and salaries — commensurate with their skills must leave the country to find them. This is why remittances from abroad dwarf many sectors of the economy. Remittances in 2020 were worth $29.6 billion, over five times the Suez Canal’s revenue of $5.61 billion and more than double the revenues from tourism at its 2019 peak of $13 billion.

there are many stark differences between the conditions of 1977 and those of 2013

Morsi’s rush to secure political power has cost him a lot on the economic front. However, he doesn't have to save the economy to survive as president. He just has to manage its decline well enough to prevent an acute dip toward bankruptcy and default

Mubarak was arguably ousted not because thousands poured into Tahrir Square, but because most elements in society were united against him. If Morsi succeeds in managing a declining economy and securing loyalties, he can avoid the same fate. That is what autocrats in Iran and Sudan have been doing successfully for decades

the economic and social discontent expressed by the desperate demise of Bouazizi and Yahyaoui has only intensified

The character and political role of the Tunisian and Egyptian armies is also a factor

the successful installation of a (highly problematic, to be sure) procedural democracy in Tunisia, in contrast to the establishment of an authoritarian praetorian regime far more vicious than that of Mubarak in Egypt, made it necessary to argue that class and political economy alone do not determine outcomes

In 2010 the national unemployment rate was under thirteen percent. By 2015 the figure rose to 15.3 percent. Unemployment rates in the center-west and southern regions of the country (including Kasserine and Sidi Bouzid) are typically nearly double the national average. In 2015 the OECD estimated national youth unemployment (ages fifteen to twenty-four) at nearly forty percent.

The government understands the problem, but has no solution. On 20 January the cabinet announced that 5,000 unemployed in Kasserine would be hired for new public sector jobs. Another 1,400 were to be hired through an existing employment program. However, on 22 January, Finance Minister Slim Chaker revoked the promise of 5,000 new jobs in Kasserine, claiming that the previous announcement was due to a “communication error.”

“There will be another revolution if the social and economic circumstances do not change,” said President Béji Caïd Essebsi on the fifth anniversary of Tarek Mohamed Bouazizi’s self-immolation. Nidaa Tounes, a big-tent coalition of secularists ranging from former communists to former Ben Ali supporters has split. Over two dozen of its deputies have left, and it is no longer the largest party in the parliament. The terrorist attacks have reduced tourism to a catastrophically low level. The economy is not expected to grow at all in 2016. None of its traditional elite political forces—secular or Islamist—imagine an economic program substantially different than the one Tunisia has pursued since the mid-1980s.

On 19 January, faced with a UGTT threat to call a general strike, the employers’ association (UTICA) agreed to increase wages for about 1.5 million private sector workers. But for the unemployed, the streets are their only recourse.

Erdogan last month called snap elections for June 24, when a victory would consolidate his one-man rule of a country he’s governed since 2003. Since defeating a coup attempt in 2016, Erdogan has used emergency rule to increase his control over the region’s largest economy

A referendum last year weakened the role of parliament and gave the president sweeping authority in the most radical constitutional overhaul since the republic was founded 95 years ago.

Turkey’s relations with its NATO allies fray and its diplomatic focus shifts toward Russia and Iran. The country faces the unprecedented risk of sanctions from the U.S., a risk that Erdogan downplayed

“If we’re allies with the U.S., we need solidarity, not sanctions.”

The rapidity of the changes to Turkey’s economic and foreign policies has shaken investor confidence, which is critical because Turkey’s current-account deficit demands steady inflows from abroad

Erdogan has routinely criticized the central bank for setting interest rates that he says have helped stoke rising prices, an argument that contradicts conventional economic theory

The government is expected to play a "crucial" role in tourism development by injecting $6 billion over 25 years to trigger $43 billion worth of investments from the private sector.

the promises to allocate 223,000 direct tourism jobs to Omani nationals by 2040 does not align with Oman's undersized tourism education sector, which graduates only a few hundred students per year, mainly from the Oman Tourism College

although the number of tourists visiting Oman has doubled since 2008, the industry employs less than 17,000 Omanis.

The country’s ratio of debt to gross domestic product is rated junk by all three major agencies, as it has multiplied by 12 since 2014. Moreover, the Omani economy is ranked the worst performing among Gulf countries

“The concept of SMEs [small and medium enterprises] does not exist in the field of tourism anyway, the whole system is designed for large corporations,” said Christopher Chellapermal, a French entrepreneur. Chellapermal ran a scuba diving business in Oman for 15 years before being forced out of business in 2017.

“Corruption was also an issue since local authorities requested me to pay imaginary taxes," he said. "I am an ordinary man so I had to shut up and comply.”

For Chellapermal, Oman "makes the crazy wager" of luxury tourism by prioritizing premium visitors when the backpacker segment would be a better fit.

“Chinese and Indian tourists are very much interested in culture and heritage destinations," Hollister said. "Oman could focus on this segment to make it their niche, a differentiator.”

wealth of cultural and natural assets. The Ministry of Tourism promotes Oman as a hidden jewel at the tip of the Arabian Peninsula. 

regional tensions had very little impact on tourism

As Sultan Haitham bin Tariq Al Said takes power, analysts worry that Oman’s foreign policy of neutrality could be at stake. Will “any of Oman’s more assertive neighbors seek to sway Haitham to align more closely with their own approach,” Kristian Coates Ulrichsen wrote for Al-Monitor.

The prospect of tensions between Muscat and neighboring states does not please tourism actors, as Saudi Arabia and the United Arab Emirates are Oman’s key source regional markets for tourism. In 2018, Gulf citizens accounted for about half of international arrivals.

Saudi Arabia’s aggressive push to develop its leisure tourism industry and attract 100 million visits by 2030 collides with Oman’s ambitions

Public taxation is also increasing. A sin tax was implemented in June 2019 on products like sugary carbonated drinks and tobacco, and a serially delayed 5% value-added tax is expected in 2021. According to Salmi, electricity and water subsidies could soon be slashed and, in the long term, Omanis could see an income tax.

Above all, reforming the labor market — an unpopular move — would be the cornerstone of a post-Qaboos welfare state. About 43% of Omanis work for public entities. Abousleiman recommended economic diversification to foster private sector job creation and to further "relieve the expectations on the government to provide employment."

Following a field visit to Oman in 2019, the International Monetary Fund (IMF) suggested that the wages and benefits of the private sector need to align more closely with the public sector to make employment in the former more appealing.

Omanis who talked to Al-Monitor, as well as Mukhaini, believe any upcoming austerity measures "should not make the poor poorer and the rich richer," Mukhaini said.

According to rating firm S&P, the new ruler will face “a difficult trade-off” in the coming months to address high unemployment among youths, weak growth, and fiscal and funding pressures

Defense and security expenses account for over a quarter of Oman's annual budge

Oman — rated junk by the three major rating agencies — has several other options to fund its short-term ballooning deficit: Go further into debt; deplete its sovereign wealth fund; sell state assets; devalue its currency; and seek assistance from neighboring countries or international organizations.

Analysts believe Oman should build a model of governance tailored to the post-oil era. Along with a more stringent budget environment, the new leadership pledged to implement structural reforms to diversify the rentier economy and foster private sector-led growth.

To ensure political and social stability, Sultan Qaboos avoided controversial measures that could have triggered short-term political unrest

In 2011, at the height of the Arab uprisings, Sultan Qaboos promised to create 50,000 jobs and institute unemployment benefits in an attempt to defuse unprecedented nationwide protests.

the lack of economic reforms did not stop Omanis from loving the monarch, who built a modern state out of a medieval-like society he inherited in the early 1970s

Sultan Haitham bin Tariq "is already planting the seeds by cutting the royal expenditures tremendously,"

The relationship between state and society that Omanis have known for decades will likely never be the same

less success in cutting back the country’s entrenched crony capitalism

Joblessness among young people is at 30 percent.

The economy is languishing. The gap between rich and poor remains huge — as does the regional disparity between the relatively prosperous northeast and the rest of the country. The rise of Islamist extremist groups, and a series of devastating terrorist attacks, have sown fear and distrust. Small wonder that a recent study by one U.S. think tank concluded that Tunisia’s democratic transition is “stalling.”

most Tunisian businesspeople prefer to operate in the informal economy, which accounts for as much as half of all economic activity

the remarkable power of the country’s national trade union makes it nearly impossible to fire underperforming employees

ultraconservative Salafi groups, some of which — like the notorious Ansar al-Sharia — have forged ties with the Islamic State and other terrorist organizations

lack of substantive reform in the internal security apparatus is also proving corrosive

corruption. Sealing the borders is that much harder when terrorists can simply pay border guards to look the other way. Restoring the health of the economy will be difficult without combating bribery and cronyism (perhaps by enshrining protections for whistleblowers, an issue currently being hotly debated). Ominously enough, even though malfeasance has a long history in the country, those who monitor it say that it’s only been getting worse in the years since the revolution.

“A youth bulge is coming into the labour force at a time when the ability of Gulf societies to continue in the traditional pattern of offering public-sector jobs is diminished,”

In 2019, the World Bank estimated Oman’s youth unemployment rate at 49 percent. The pandemic has almost surely worsened it

Muscat is seeking to improve education and diversify the country’s economy by promoting job growth in sectors like tourism, manufacturing and technology

Like Oman, Saudi Arabia faces an acute problem of creating jobs for young people. Half the population is under the age of 25 and nearly 60 percent of unemployed people are under the age of 30

Oman is a country of just five million, with expats accounting for more than 38 percent of the population. Filling the roughly 80 percent of jobs held by foreigners in the private sector is critical to the government’s economic transformation plans

Muscat has recently passed laws making it more costly to hire foreign workers while also implementing nationwide training programmes to address skills gaps with Omani nationals

A demographic that has been more willing to take jobs in the private sector, particularly in Saudi Arabia, is young women

In February, even before the coronavirus hit, the International Monetary Fund was warning Saudi Arabia and the United Arab Emirates that by 2034 they would be net debtors to the rest of the world. That prediction was based on a 2020 price of $55 per barrel. At a price of $30, that timeline will shorten. And even in the Gulf there are weak links. Bahrain avoids financial crisis only through the financial patronage of Saudi Arabia. Oman is in even worse shape. Its government debt is so heavily discounted that it may soon slip into the distressed debt category

The economic profile of the Gulf states is not, however, typical of most oil-producing states. Most have a much lower ratio of oil reserves to population. Many large oil exporters have large and rapidly growing populations that are hungry for consumption, social spending, subsidies, and investment

Fiscal crises caused by falling prices limit governments’ room for domestic maneuver and force painful political choices

Ecuador is the second Latin American country after Argentina to enter technical default this year.

Populous middle-income countries that depend critically on oil are uniquely vulnerable. Iran is a special case because of the punitive sanctions regime imposed by the United States. But its neighbor Iraq, with a population of 38 million and a government budget that is 90 percent dependent on oil, will struggle to keep civil servants paid.

Algeria—with a population of 44 million and an official unemployment rate of 15 percent—depends on oil and gas imports for 85 percent of its foreign exchange revenue

The oil and gas boom of the early 2000s provided the financial foundation for the subsequent pacification of Algerian society under National Liberation Front President Abdelaziz Bouteflika. Algeria’s giant military, the basic pillar of the regime, was the chief beneficiaries of this largesse, along with its Russian arms suppliers. The country’s foreign currency reserves peaked at $200 billion in 2012. Spending this windfall on assistance programs and subsidies allowed Bouteflika’s government to survive the initial wave of protests during the Arab Spring. But with oil prices trending down, this was not a sustainable long-run course. By 2018 the government’s oil stabilization fund, which once held reserves worth more than one-third of GDP, had been depleted. Given Algeria’s yawning trade deficit, the IMF expects reserves to fall below $13 billion in 2021. A strict COVID-19 lockdown is containing popular protest for now, but given that the fragile government in Algiers is now bracing for budget cuts of 30 percent, do not expect that calm to last.

Before last month’s price collapse, Angola was already spending between one fifth and one third of its export revenues on debt service. That burden is now bound to increase significantly. Ten-year Angolan bonds were this week trading at 44 cents on the dollar. Having been downgraded to a lowly CCC+, it is now widely considered to be at imminent risk of default. Because servicing its debts requires a share of public spending six times larger than that which Angola spends on the health of its citizens, the case for doing so in the face of the COVID-19 crisis is unarguable.

Faced with the price collapse of 2020, Finance Minister Zainab Ahmed has declared that Nigeria is now in “crisis.” In March, the rating agency Standard & Poor’s lowered Nigeria’s sovereign debt rating to B-. This will raise the cost of borrowing and slow economic growth in a country in which more than 86 million people, 47 percent of the population, live in extreme poverty—the largest number in the world. Furthermore, with 65 percent of government revenues devoted to servicing existing debt, the government may have to resort to printing money to pay civil servants, further spurring an already high inflation rate caused by food supply shortages

The price surge of the 1970s and the nationalization of the Middle East oil industry announced the definitive end of the imperial era. The 1980s saw the creation of a market-based global energy economy. The early 2000s seemed to open the door on a new age of state capitalism, in which China was the main driver of demand and titans like Saudi Aramco and Rosneft managed supply

The giants such as Saudi Arabia and Russia will exploit their muscle to survive the crisis. But the same cannot so easily be said for the weaker producers. For states such as Iraq, Algeria, and Angola, the threat is nothing short of existential.

Beijing has so far shown little interest in exploiting the crisis for debt-book diplomacy. It has signaled its willingness to cooperate with the other members of the G-20 in supporting a debt moratorium.

In a century that will be marked by climate change, how useful is it to restore profits and prosperity based on fossil fuel extraction?

The shock of the coronavirus is offering a glimpse of the future and it is harsh. The COVID-19 crisis drives home that high-cost producers are on a dangerously unsustainable path that can’t be resolved by states propping up their uncompetitive oil sectors. Even more important is the need to diversify the economies of the truly vulnerable producers in the Middle East, North Africa, sub-Saharan Africa, and Latin America.

the EAF is able, through the use of land designations and other means, to control much of the public lands (desert, agricultural and urban) that comprise 94 percent of Egypt’s area, through the use of land designations, the ability to auction such lands and to receive compensation from the state treasury when military zones are rezoned to civilian purposes. The army also controls the coastline (officially classed as border territory) and is thus able to profit from tourist developments. As such, the EAF wields enormous influence over the real estate market and the country’s development structure

Estimates as to how much of the total economy is controlled by the EAF range from 40 percent, according to telecoms billionaire Naguib Sawiris (in comments to local media last March) to somewhere between 45 percent and 60 percent, according to Transparency International

the consensus among those asked by Middle East Eye as to the size of the military-economic complex is that the EAF’s reach extends into virtually every economic sector, from foodstuffs like tomato paste and olive oil, to consumer electronics to real estate, construction, transport and services

since the military’s budget - and by extension, its economic fiefdom – is kept secret, EAF-controlled businesses can benefit from subsidies that are kept off the books, as well as having more freedom of manoeuvre amid the lack of oversight.  One example was the decision under the Supreme Council of the Armed Forces to slash fuel subsidies for industrialists. Since the military’s budget (and therefore, its energy costs) are off the books, the rising energy prices disproportionately affected EAF competitors, but not the forces themselves

military involvement in the political economy generally leads to worse performance. Within the region, the examples of Iran and Algeria point to this, while China has taken steps to reduce its armed forces’ commercial exposure over the past few years precisely for this reason

A further effect of the EAF’s economic dominance is a lack of growth opportunities for SMEs, since only favoured insiders can win lucrative contracts and deal with the permit system. In turn, this leads to a large informal economy of insiders, leaving many Egyptians outside, in poverty

While patronage is nothing new in Egyptian politics, since President Abdel Fattah el-Sisi came to power the top brass has expanded intra-military patronage to the extent that they are crowding out other economic actors and failing to bring in key constituencies such as opposition groups, the private sector bourgeoisie and the urban poor. The EAF has expanded its reach so fast that now it has to defend its empire against these groups, sowing seeds of further strife in future.

Oman is desperate to diversify away from its oil and gas dependency. Research by the US Energy Information Administration puts Oman’s known crude oil reserves at 5.6bn barrels. While this is only enough to rank the country 21st in the world, its economy is disproportionately dependent: oil and gas accounts for nearly half of the country’s GDP, 70% of exports and between 68% and 85% of government revenue.

“Several dozen new cities are being constructed in the Middle East, mainly to transition away from the petroleum industry to a variety of other industries, including tourism, manufacturing, education and hi-tech,” says Dr Sarah Moser, a McGill University geography professor and author of an upcoming atlas of new cities.

Duqm sits on the Arabian Sea near the Strait of Hormuz, the gateway to the Persian Gulf – and the world’s most glaring oil supply chokepoint. Nearly a fifth of the world’s oil currently flows through this passage, ever prone to disruption. If the Duqm project succeeds, the shipping industry would be able to dock at the gates of the Middle East without needing to go all the way inside.

attracted the attention of Beijing’s much heralded Maritime Silk Road. More than three-quarters of Oman’s crude oil exports go directly to China.

While Duqm was never very densely populated, around 3,000 Bedouin – mostly fishermen and semi-nomadic herders – called the area home before the bulldozers arrived. These villages have now been demolished and the Oman government has built a new, modern town for them to relocate to. The houses look as if they were copied and pasted from Muscat – bright, white buildings two storeys high with garages and ornate gateways. There is a mosque in the centre. The houses stand empty. The local Bedouin prefer their traditional way of life – and want space to keep camels.

New policies and programs are announced constantly, while the delivery capacity of the sluggish Saudi bureaucracy continues to lag. Below the upper echelons, the Saudi state remains the deeply fragmented, bloated, and slow-moving machine that I described in my 2010 book. The government seems to have no clear strategy for reforming this bureaucracy

While space for political opposition arguably has narrowed, women will soon be allowed to drive and the religious police force that once harassed them has been almost entirely neutered. By relaxing religious controls over the public sphere, the crown prince is seeking to attract more foreign investment and facilitate diversification into tourism and entertainment

Saudi Arabia has tackled fiscal reforms more vigorously than most local and international observers expected, introducing unprecedented tax and energy price measures, including the introduction of a 5 percent value added tax, new levies on foreign workers, and increases in electricity and transport fuel prices. The government is now experimenting with new non-oil sectors with an increased sense of urgency, including information technology and defense manufacturing.

Local economic advisors fear that the majority of private petrochemicals firms — the most developed part of Saudi industry — would lose money if prices of natural gas, their main input, increase to American levels.

public sector employment remains the key means of providing income to Saudi nationals. Cheap foreign labor dominates private sector employment, thereby keeping consumer inflation at bay and business owners happy. Citizens, however, are parked in the overstaffed public sector. Out of every three jobs held by Saudis, roughly two are in government. The average ratio around the world is one in five. Public sector wages account for almost half of total government spending, among the highest shares in the world

As limits on government employment kick in, young Saudis will increasingly have no choice but to seek private jobs. But they will face tough competition on the private labor market where employers have become accustomed to recruiting low-wage workers from poorer Arab and Asian countries

Saudi wage demands will have to drop further if private job creation is to substitute for the erstwhile government employment guarantee. For the time being, private job creation has stalled as the government has pursued moderate austerity since 2015 in response to deficits and falling oil prices

The government has also underestimated how dependent private businesses are on state spending. The share of state spending in the non-oil economy is extremely high compared to other economies. Historically, almost all private sector growth has resulted from increases in public spending

As long as oil prices remain below $70 per barrel, the goal of a balanced budget will cause pain for businesses and limit private job creation. This will pose a major political challenge at a time when an estimated 200,000 Saudis are entering the labor market every year. More than 60 percent of the population is under 30, which means that the citizen labor force will grow rapidly for at least the next two decades.

It would be far more prudent to gently prepare citizens and businesses for a difficult and protracted adjustment period and to focus on a smaller number of priorities

The key structural challenge to non-oil growth is the way the Saudi government currently shares its wealth, most notably through mass public employment — an extremely expensive policy that bloats the bureaucracy, distorts labor markets, and is increasingly inequitable in an era when government jobs can no longer be guaranteed to all citizens. A stagnating economic pie that might even shrink in the coming years must be shared more equitably.

A basic income would not only guarantee a basic livelihood for all citizens, but also serve as a grand political gesture that could justify difficult public sector reforms. A universal wealth-sharing scheme would make it easier to freeze government hiring and send a clear signal that, from now on, Saudis need to seek and acquire the skills for private employment and entrepreneurship. The government could supplement this scheme by charging fees to firms that employ foreigners while subsidizing wages for citizens to fully close the wage gap between the two.

Focusing on such fundamentals might be less exciting than building new cities in the desert or launching the world’s largest-ever IPO — but they are more important for the kingdom’s economic future. No country as dependent on petroleum as Saudi Arabia has ever effectively diversified away from oil

Agricultural cooperatives have also remained active. These provide necessary food, lessening reliance on imports. Northern Syria was the country’s breadbasket prior to the civil war — though centralized governance meant that its people were not able to benefit equitably. The creation of agricultural cooperatives has democratized some of these resources. In total, cooperatives make up an estimated 7% of the economy of Jazira region — with women’s cooperatives contributing to nearly half of that figure.

the presence of existing facilities, materials, and workers has clearly enabled North and East Syria to produce more goods faster than equivalent goods could be imported — and to do so without the need for dangerous international travel.

cooperatives are more attuned to the needs of the communities their members live in, and thus more likely to make decisions based on need than profit.

Recently, the communes have become essential for ensuring that the lockdown can be maintained without undue stress on everyday people. One ANHA report described how the process of food distribution implemented by the Autonomous Administration relies on the local knowledge and small scale of these structures. Communes are responsible for registering lists of names of those who need food assistance — primarily the poor and unemployed. The Social Affairs Commission then supplies food items, which are distributed by the communes.

In Fafin district, for example, food was distributed to about 2,000 families, with commune members going from family to family to distribute aid in order to prevent large groups from congregating. About half of these families are displaced Efrîn residents.

Like cooperatives, communes allow relief efforts to be both centrally coordinated and based on community needs. Commune members do not need to travel beyond their neighborhoods to distribute aid, lessening the number of people traveling from city to city. Reliable, organized distribution also lessens the likelihood that large groups of people will gather in shops out of fear that they may not get the items they need.

democratic confederalist structures with strong popular support have undoubtedly played a key role in helping North and East Syria implement preventative measures

Unlike Qaboos, who was childless and without a male sibling, Haitham has close male relatives. These include two half-brothers, Assad and Shihab bin Tariq, both once viewed as potential successors to Qaboos. Assad’s eldest son, Taimur, has been touted as a leading figure in the next generation of royals. And Haitham himself has two sons: The eldest, Theyazin – who studied at Oxford, joined the Ministry of Foreign Affairs in 2013, and has served at the Omani Embassy in London since 2018 – has returned to Muscat and has been attending key diplomatic functions since his father’s assumption.

In other Gulf ruling families, competition among family members has fueled the expansion of royal control over government, as family demands are accommodated through government sinecures. Even if this competitive dynamic does not take hold in Oman, the royal presence may be felt in other ways. In recent years members of the Al Said family, including the new sultan and his siblings, have been increasing their involvement in business. How this is managed – or not – will affect the critical issue of Oman’s economic growth.

Qaboos incorporated many minorities into the ruling structures, within a strong narrative of interfaith and interethnic tolerance. Yet one clearly favored group emerged from within the leadership: Oman’s merchant families.

political reliance on merchants offered both advantages and risks. Bringing in this class offered a powerful constituency in support of the government and its extensive national development ambitions. But in times of economic downturn, it also left the government susceptible to accusations of conflicts of interests and self-dealing. This is indeed what played out in 2011 as protesters based in the industrial port of Sohar demanded reform of the government with complaints centered on corruption

He nearly doubled the private sector minimum wage and created 50,000 new government jobs, mostly in the security services. He also further developed Oman’s participatory institutions through the establishment of elected municipal councils and granting more powers to the elected Shura Council. A number of the most publicly criticized ministers were removed from office amid a broader campaign of corruption prosecutions that resulted in convictions of some government officials and businessmen over the next few years.

In 2019, the Omani deficit rose to $50 billion contributing to a steep rise in public debt from below 5% of gross domestic product to nearly 50% in just four years. This limits the new sultan’s ability to curry more favor through a repetition of government spending and populist solutions. There is a desperate need to create more jobs for young Omanis. But there is also the need to create conditions favorable to business to attract Omani capital back into the country

Oman has created a means of formal public input through elections for municipal councils and the lower house of Parliament, the Shura Council. While the role of the municipal councils is advisory, the Shura Council can propose and amend legislation drafted by the Council of Ministers and interpolate service ministers regarding violations of the law; this privilege does not extend to the ministers of defense and foreign affairs

these institutions have not demonstrated the ability to impose meaningful accountability

voting participation has been uneven and declining since the very high turnout of 76% in 2011

the status quo – especially regarding the economy – is not sustainable and will press the new leadership to make immediate changes