 |
| Volume XV, Spring 2008, Number 1 |
| |
EXCERPT
Arab Economies at a Tipping Point
|
| |
| Marcus Noland and Howard Pack |
| |
Dr. Noland is senior fellow at the Peterson Institute for International Economics. Dr. Pack is professor of business and public policy, economics and management at the Wharton School, University of Pennsylvania.
The Arab world is experiencing an
economic boom of historic
proportions. The tiny Persian
Gulf emirate of Dubai is emblematic. Boasting the world's only seven-star hotel, its massive land reclamation project, allegedly the only man-made structure visible from the moon, is whimsically creating parcels shaped like continents and palm trees. With oil hovering above $90 a barrel and the Egyptian stock market up 1,800 percent in the last five years, one might ask what problems World Bank President Robert Zoellick perceives that would justify making the economic revitalization of the Arab world one of the cornerstones of his new administration. Look beneath the surface, however, and Zoellick's judgment might not seem so misplaced.
The boom is being felt unevenly across the region. Two-thirds of Arabs do not live in major oil-producing countries. Looking forward, the key issue over the next decade is the ability of these economies to generate jobs and rising living standards for the millions of young people joining the economy. Today the region has the world's lowest employment rate — less than half of adults are formally employed. Yet throughout the region, labor forces are growing at a rate of 3.5-4.0 percent annually, posing a significant challenge for job creation. The World Bank estimates that the Arab world will have to create 55-70 million jobs between now and 2020 to keep pace and bring the rate of unemployment down to the global norm.
|
| |
|
