A “new spring” for Middle East economies – quick summary, April 2012

So after all the changes in the Middle East in the past year or so, regimes collapsing etc, two factors remain as a constant: there are some very rich oil fiefdoms and Israel is an anathema for most of the region’s rulers.

This morning, I read a series of short articles on various economies in the Middle East.

  • Iran may be reaping in the rewards (for now) of soaring world oil prices, but it suffers from 21% inflation and rising. 
  • Egypt’s economy has collapsed and tourism has disappeared. The period of uncertainty leading up to the presidential race will not help.
  • Turkey may be seen by some as a new finance centre, but rising inflation, unequal distribution of wealth and a growing government debt can no longer be hidden from most analysts.
  • As for Syria, the Assad regime is again proving why arms have consistently been a larger priority than alms for decades.

One interesting exception from this trend is Jordan, whose “government is attempting a difficult balancing act, working to boost economic growth while imposing a series of austerity measures intended to curb public spending and debt levels. These measures may prove unpopular with many in the electorate but should serve to strengthen the economy in the longer term.”

Of the five Middle East countries cited here, guess which has neither intrinsic oil wealth nor a central policy of denigrating Israel? And as for Israel’s economy itself, the latest IMF report made several key recommendations, but noted how growth in the difficult year of 2012 will still reach nearly 3%.

You are left wondering why the supporters of Arab Springs do not want to pick up the key lessons from these facts. How long will their supporters suffer from economic want?

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