Capital-intensive investment in mining and industry displays strong resistance to political disturbances, because the large amount of sunk capital encourages resilience, plus generally projects are remote from densely inhabited centres and are not as vulnerable as sometimes believed. It is therefore generally the case that such investment may be slowed down but not reversed; nor is production interrupted should political instability occur, except in extreme cases where the security of company personnel is directly threatened.
In contrast, financial investment and tourism are extremely vulnerable to political instability, and this is the other side of the democratic transition coin. This immediately creates a negative spiral, which a newly elected democratic government or, more likely, a provisional government lacking full democratic legitimation and with a very uncertain life expectancy will find difficult to reverse. The vast majority of potential tourists are not interested in witnessing a revolution. In the time that popular uprisings will take to provoke the fall of the authoritarian regime, the tourist trade will quickly dry up.
Once a democratic transition is underway, tourists will still normally want to be reassured that conditions are stable and security is guaranteed; recovery will be gradual. This means that a newly elected democratic government is likely to be confronted with rapidly deteriorating economic conditions in the tourism sector, depending on the importance of that sector in the national economy.
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Furthermore, even once the democratic transition is well underway, it is not difficult for opponents or extremists to stage terrorist attacks targeting tourists, which will have the immediate effect of precipitating a new crisis or extending the existing one. The damaging economic impact of terrorism is evident and feared even in Europe or the United States, but much more so in MENA, including in such primary tourist destinations as Egypt, Tunisia or Morocco.
A sudden downturn in tourist activity is likely to be immediately felt by a significant share of the population, mostly from relatively low-income or poorer strata. Such regimes have, however, tended to maintain and in some cases even expand entitlements in the form of subsidised or exceedingly low prices for selected necessities primarily basic food items and energy products oil products, gas and electricity.
The latter have mainly a regressive impact on income distribution as documented by El-Katiri and Fattouh, and Hertog—both in this volume while the former are more benign as explained by Woertz and, in the case of Egypt, by Springborg, both in this volume. Nevertheless, it is energy subsidies that have come to absorb an exceedingly important share of government budgets, in part because the price of oil increased rapidly between and and remained very high subsequently.
Newly empowered democratic governments were therefore immediately confronted with the challenge of announcing unpopular measures while their legitimacy and hold on power was still quite shaky. Arab countries, and not just the major oil exporters, experienced a decade or more of rapid growth up to ; growth suffered subsequently because of the negative impact of the Spring, especially on certain sectors.
However, this growth did not benefit all equally: Ghanem a also points to unemployment among educated young entrants to the job market, but also to the worsening or stagnating conditions in marginalised regions e. Upper Egypt or sectors e.
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Finally, Alvaredo and Piketty convincingly argue that data sources that are currently available at the national level in Egypt or other MENA countries are insufficient to derive reliable estimates of top income shares, and that income inequality is extremely large at the level of the Middle East region taken as whole.
It is the perception of such growing inequality, further fuelled by the growing role of regional media and the constant image of Dubai-style success that they project, that ignited the resentment and revolt against incumbent authoritarian regimes. The widening gap in incomes and wealth at the regional level is the key target of popular revolt: True, democratic legitimation is necessary if one is to pursue controversial or unpopular policies, but democracy needs to be well rooted for that.
A country undergoing democratic transition needs both a high degree of consensus to establish a national pact that will underpin a new constitution, and compromises among a broad spectrum of political forces. This does not bode well for potentially unpopular measures. Traditional macroeconomic stabilisation policies go in the opposite direction.
Thus, while reverting to greater isolation from the global economic environment is not an option for any country, and certainly not for a country pursuing democratisation, the rules of globalisation are not helpful Springborg It has become evident that the process of globalisation has had profound consequences for the distribution of income in industrial and in emerging countries, leading to a greater concentration of income and wealth at the global level.
In mature democracies, this trend is viewed as a potential threat to the satisfactory functioning and stability of institutions, but little attention has been paid to the consequences that it might have on democratisation processes. The standard line is that concentration of income and wealth may lead to growing dissatisfaction and eventually revolt: While some minority voices advocate a reversal of the globalisation process and a return to greater national control over the economy to protect a broad range of welfare and rights-related legislation, it is unlikely that the world will go back to protectionism.
In this context, the role of education and of progressive taxation on income and wealth are frequently cited as the appropriate solutions—although fiscal competition constitutes a grave threat to the ability of individual states, even in the European context, to manage or tighten their taxation systems. This means that they are not adapted to conditions prevailing in countries that are undergoing a democratic transition. We therefore face a potential vicious circle: The broad question is: As mentioned already, the literature addressing this question so far has been limited. The first project took place in and led to the publication of a volume by Magdi Amin et al.
The second took place five years after the eruption of the Spring as is self-evident from the title The Arab Spring Five Years Later and led to the publication of two volumes, one entirely written by Hafez Ghanem a and the other edited by the same b. The importance of the regional dimension for both understanding the Arab Spring and defining policies for democratic transitions is also underlined.
There are large intergenerational inequities in the distribution of the benefits of economic growth, in favor of a group of public sector employees, elites, and other rent seekers to the disadvantage of the large youth population in the region. Second, the Arab economies need to modernize their public sectors. There is still a strong demand for a developmental state role in Arab economies and a significant suspicion over the impact of liberal economic reforms that, under the old regimes, served to benefit only a few well-connected private groups. The third transition is in the private sector.
Today, large elements of the private sector are seen as synonymous with corruption. Yet there is no sustainable economic model for the region that does not have the private sector playing a leading role.
Open issues
Will weak governments engaged in transitioning to democracy have the time to pursue them? Is it not necessary to focus on some more immediate benefits? It is possible that, given that the book was the outcome of brainstorming that took place while the Spring was still unfolding, the urgency of stabilising the transition was not yet acutely felt. The answer is obviously no. Democratic transitions take years, even decades to succeed, and there are many twists and turns along the way.
Moreover, they can be costly and require heavy human and economic sacrifices. Ask any Arab today if he or she feels that the region is better off than before the Arab Spring.
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What do you think the answer will be? He continues, telling us about a conversation with a Cairo taxi driver who is happy about President al-Sissi and proud of having overthrown two presidents before him Mubarak and Morsi: Clearly the author believes that the neo-authoritarian regime of al-Sissi may deliver where Mubarak failed: But none of these is new either: How can we expect that newly established authoritarian regimes, whose repressive inclination is only too evident, will behave differently to their predecessors?
He believes that rent formation and circulation is the key explanatory variable of unsatisfactory growth results and the stability of autocratic regimes in the region. He points specifically to the way in which non-tariff barriers, bank lending and freedom of capital movements have been used to favour the formation and enrichment of elites close to the incumbent autocratic regimes.
Introduction. In Search of Economic Policies to Stabilise Democratic Transitions
This also points to the crucial importance of dismantling existing mechanisms for rent circulation and the very sources of internal rents if the door to more inclusive economic development is to be opened. It is clear that the opportunity cost of such outlays—that is to say, the possible alternative ways in which this money could be spent, is extremely significant.
Energy subsidy reform also succeeded in Egypt, but was implemented only after the restoration of authoritarianism and in the context of strong repressive measures. Finally, energy subsidy reform succeeded in Iran, whose case is especially interesting because the increase in energy prices was offset by cash payments to all citizens; 50 per cent of the sums saved were allocated to cover these payments.
The burden of energy subsidies in Iran was even higher than in the Arab countries concerned, but compensation with universal cash payments was undoubtedly a success. This creates a vicious circle whereby new redistribution policies cannot be initiated until the burden of excess employment and subsidies is lifted—yet abandoning the old policies without adequate compensation will be perceived as being profoundly unpopular.
More modern social security policies are not created and put in place overnight, so a deterioration of living conditions may be unavoidable and politically unaffordable. He argues that such a policy would be beneficial for labour markets because it may be tailored to encourage private sector employment excluding government employees from receiving the grants and in this way equilibrate at least in part the attraction of public vs private sector jobs.
Egypt represent the closest approximation of this reality. Instead, it has led to polarization and violence and eventual military usurpation of power under the leadership of General Abdel Fattah el-Sisi. The situation in Libya is worse off. The Western-backed ousting and eventually killing of Muammar Gaddafi in the so-called people-driven revolution for the enthronement of democracy seems to have backfired. The revolutions inspired the hope that these countries could build political systems that fostered national unity by drawing on the contribution of all their citizens.
But developments in recent months in all three countries make that aspiration seem like a distant prospect. The foregoing exposes the different trajectories of democratic transitions with notable successes and setbacks. The he next section offers explanations for the success and failure of democratic transitions in different regions of Africa. The success of democratic transitions in the highlighted cases can be explained by many factors. These include the independence and professionalism of the EMBs, opposition coordination, the growing assertiveness of citizens, increasing accessibility and usage of the social media and new technologies, and the supportive role of international community, among others.
In Ghana and recently Nigeria, the autonomy of the electoral commission, has enabled them to assert some reasonable degree of authority over the electoral cycle and processes. A series of electoral reform initiatives have also boosted the professionalism, administrative capability and efficiency of the EMB in both countries. For example, the implementation of critical recommendations from the report of the Justice Uwais Electoral Reform Committee was particularly pertinent in the Nigerian case. This factor was of great significance in the general election in Nigeria during which leading opposition parties merged and were able to pull resources together, better coordinate the activities, all leading to the electoral success of the opposition.
Also critical to the democratic success in these countries is the rise of an increasingly assertive citizens.
Voters seem no longer contented with just casting their votes, they have also begun to demonstrate keen interest in what happens to their votes. In other words, citizens want to do all within the law to ensure that their votes truly count, unlike what obtained in the past, especially in Nigeria until At least three factors may have contributed to this development.
First, there abound many CSOs devoted to the promotion of democratic values that engage in voter education and critical engagements with core electoral stakeholders such as the electoral commission, political parties and security agencies. Second, there has been a substantial rise in the level of access and use of the social media and new technologies in these countries. Tools such as the internet, mobile phones, facebook, twitter have become powerful mobilization tools in such countries. Also to a very large extent, the international community has been very supportive of the democratization processes through technical and financial assistance to the electoral commissions of these countries.
In North Africa, some of these enabling conditions are either lacking or in short supply, underscoring their limited democratic credentials. More specifically, democratic failures in the Arab countries, particularly Egypt, Libya and Tunisia, is not unconnected with a long legacy of authoritarianism, weak economic foundations, lack of a clear idea by leaders of the revolution, lack of accountability mechanisms, and fragmented opposition, among others.
That North Africa has a long history of authoritarian rule is a settled matter in the literature. For whatever reason, people tolerated the dictatorial dispositions of these regimes. This happened with the Arab spring of The result has been increasing unprecedented fragmentation of society along tribal and religious lines. The failure of some of these transitional regimes to also promote accountability, particularly by addressing the legacies of decades of dictatorships through transitional justice initiatives, has only served to complicate the problem.
Such an initiative would have helped address long-standing human rights abuses and related grievances. Egypt and Libya failed woefully in this respect. Yet, opposition parties would appear not to have learnt any serious lessons from the successful cases elsewhere on the continent. They remain largely fragmented. Granted that uniting the opposition is not self-sufficient, there is strength in unity and that could be a good starting point. This analytical paper has showcased that the history of democratic transition in Africa is varied and chequered, much as the trajectory it has assumed in different places and time are many and complex.
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