As an active observer and a consistent visitor of the Middle East, one asks a simple question: Why does it have to be this way?
I am not talking about Shiite/Sunni divides, the Palestinian/Israeli conflict or Iran’s growing influence in the region, but persistent and unacceptable levels of poverty in a region blessed with nearly half of the world’s oil and gas reserves.
First it was Tunisia, then Egypt, Yemen, Algeria, Libya and stretching into the Gulf with Bahrain.
There are major historical and cultural differences, of course, and even vast differences in per-capita income – Bahrain for example is high at $38,400, Yemen low at $2,500. But a few common threads can be found: the region’s youth lack opportunities, power is concentrated at the top and the inner circle around them, and most waited too long to embrace the winds of change brought on by globalization.
It used to be really simple. When taking a flight you chose your national flag carrier or whichever airline happened to be going from A to B. When there was a choice, braver hearts might be adventurous and fly an unusual airline to add a bit of local color and mystique to the trip!
But individual airlines couldn't fly to all places and suddenly the world was a small place. Code sharing came along and we found ourselves on those unknown airlines whether we liked it or not. Then, in 1997, code sharing went into overdrive and the airline alliances were born.
Protests have now spread far beyond Cairo and Alexandria, labor unrest is boiling over in factories and major port areas and former business titans and parliamentarians are being told not to travel – add it all up and it’s not the ideal backdrop for re-booting the region’s most populous country.
While the business world is looking for key signs of the wheels of commerce starting to move again with the re-opening of banks, core fundamental issues are more worrying by the day.
Initial forecasts from some of the region's leading economists are starting to look at revising their growth figures. From Banque Saudi Fransi-Credit Agricole: economic growth of 5.3% now revised down to 3.7%. To be candid, that seems quite conservative, if this attempt at a controlled transition begins to unravel. The country is currently losing more than $300 million a day in revenues.
We have been watching the surreal scenes of chaos in Egypt: One would think they had been staged on a movie set. Protestors hurl stones at each other. Horses and camels charge in, seemingly from nowhere, and military personnel and their giant tanks sit on the sidelines.
Unfortunately, these are not scenes from an Arab cinema set, but indeed, real events in Tahrir Square, Cairo. I have passed into downtown Cairo on that freeway overpass at least 50 times in the past decade; never would I have thought it would be the site of bedlam, with shots fired and Egyptians attacking one another - and based entirely on a “for-or-against-Mubarak” mentality.
As many Egyptians have said over the phone, while trying to protect their offices and their homes, this is the tipping point. The country of 80 million plus people will mark February 1, 2011 as the beginning of a new chapter, when one man’s time was up and all others needed a voice at the table.
Like a good athlete, picking the correct time to exit is no easy task. It requires calibration of not only the mood on the ground, but also the feeling well beyond Egypt’s borders. In hindsight (which is always 20-20) that period was pre-global crisis, in the second quarter of 2008. Egypt’s stock market was up nearly 350% in the first three years of reform; economic growth was peaking at over 7% and foreign direct investment was flowing in.
(CNN) - It took a few days for Egyptian President Hosni Mubarak to calculate his next moves, and when the decision came the strategy was predictably an "old school" approach to a modern-day governmental challenge sparked by social media.
In power for three decades, no one expected Mubarak to present an "I got it" moment. He chose a right hand man as vice president, Omar Suleiman, who literally saved his life after an assassination attempt. The "big boss," as many in the former government and business community refer to him, sacked his "new school" cabinet of reformers. Then-Prime Minister Ahmed Nazif and his four key ministers representing trade, finance, telecommunications and investment were highly regarded in the global business community and trusted faces at the World Economic Forum each winter in Davos.
The act by the president to sack the "new school" reformers sends the wrong signal to global investors and some of the Egyptian corporate brand names that have become well known beyond their borders. Even if he survives the uprising by Egyptians on the street, nearly all the progress made over the past five years goes out the door - not to mention the impact on the tourism sector which is the country's number one foreign exchange earner.
We have begun. In the coffee bars and salons around the WEF, I am now meeting and greeting people I haven’t seen since last year’s Davos. I am trying desperately to remember names, occupations and titles.
Crucially – any important facts about that person and their life. Who are they? Where are they? What are they doing? Did their company make money or lose a fortune? Is the gossip that they are going to be promoted or fired? Help!!
I am perfecting the smile of recognition when I have no idea. It’s not pretty.
Everyone is talking about the new economies and the role they are playing in the world. It is the only topic in town. But what to do about it and how to handle it? So far, there are few answers about that. Tonight we hear from President Medvedev. It will be a serious, somber reflection on the state of play in Russia I guess, after the airport bombing.
Last night on Quest Means Business, Ben Verwaayen, the CEO of Alcatel Lucent – who I love having on the programme – talked about the need to take real decisions. He is worried about protectionism and wants a conclusion to the Doha round. Good luck, Ben.
Trade ministers are due to meet later this week to try and jump-start the process. If I had a dollar for every time they have done that, I would be able to afford to ski at Davos every year.
It is easy to take pot-shots at the World Economic Forum in Davos. As most of the developed world groans its way back to growth, there is something a bit obscene about rich, famous and powerful people getting together on a Swiss mountain side to talk about how to make things better. It has a ring of “let them eat cake” about it.
This year’s jamboree will add fuel to the fire - with a large new Congress Centre entrance, with oodles of lights.
But as I say every year - that ignores what happens here. I don’t for one moment think that the sometimes pretentiously titled panels are really what this event is about. (Some are without doubt interesting and stimulate thought and debate, but you don’t need to schlep to Switzerland in winter to do that.)
Rather, Davos is about access, meetings, talking and schmoozing, which is why the most important rooms here are not the big halls where tedious panels will take place, but the bilateral rooms where government ministers and CEOs meet each other.
Riyadh: The home to the world’s largest oil reserves and the largest economy in the Middle East seems far removed from the populist youth revolt in Tunis, but government and business leaders in the region are keeping a watchful eye on the events in North Africa.
The fifth annual Global Competitiveness Forum in Riyadh, intentionally positioned just before Davos, is an excellent opportunity to take the pulse of the wealthier Gulf States and those who have an interest in seeing off the domino effect which has touched Algeria, Jordan, Egypt and Yemen.
The GCF is the “sand” component of what has built a reputation for being the “sand to snow” week, where about 100 participants go to both, including the chief executives from Rio Tinto, Alcoa and top cabinet members of the Kingdom.
While Saudi Arabia, Kuwait and the UAE have ample surpluses to dole out food and wage subsidies to calm nerves from the protests in the region, they are mindful that in an era of social media and rapid file sharing, they don’t want to take chances.
Out of work? Looking to find a new job? If you worked in construction, manufacturing or administrative services you may not want to even bother updating your resume. There is a good chance the job you lost during this last recession is never coming back. At least that is what some economists say.
Huge structural forces like globalization and technology mean companies can function without you. Sure, manufacturers still need to get products to market, but they are increasingly choosing to build and assemble them in Asia or India where people work for a fraction of the cost of an American.
Big blue-chip companies still need to do payroll and taxes, but they can now have a computer program do it … rather than a human being.
It is a brave new world out there where companies can be more profitable with less workers and employees need to retrain or get left behind …
Or is it?
The Arab Economic and Development Summit was a venue for taking a longer term view on creating the conditions for pan-Arab integration and job creation. As a result of the Tunisian revolution - as many are labelling the groundswell for change – it quickly morphed into an emergency summit at the Red Sea resort of Sharm El Sheikh.
The secretary general of the Arab League used unusually blunt terms to jump-start a process that, candidly, has taken too long to gather traction.
“The issues causing the revolution in Tunisia are not far from the issue of this summit, which is economic and social development,” said Amr Moussa. “The Arab citizen has entered a stage of anger that is unprecedented.”
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