Revisiting Marshall: Hope for Private Sector Growth in the Middle East

Stimson Spotlight

Revisiting Marshall: Hope for Private Sector Growth in the Middle East

Op-ed by Ellen Laipson and Rob Havers;

Report by Ellen Laipson with Kevin Wheeler: 

The hope for a transformation of the Middle East into more open and dynamic states has foundered on the rocks of extremism and despair.

But that sweeping judgment misses some quiet, positive change in those states where the “Arab spring” remains an inspiration and where greater empowerment of individuals to pursue their economic and political interests is still possible.

However, bloated, rigidly hierarchical public sectors across the region, along with associated risk-averse work cultures, are not conducive to innovation and the development of new economic sectors. The public sector’s instinct for self-preservation often impedes the needed shifts in mindset and culture that allow economic activity to be generated by private citizens, rather than provided by the state. There are segments of the population that embrace risk and work cultures congruent with developed economies, but they are the exception rather than the rule.

Arab leaders in the public and private spheres understand well that economic growth and access to opportunity are vital for the region’s future.  Some are working to dismantle old mindsets and to enable fresh thinking and action to free up the talent and wealth of the region.

Over the past three years, we have tested the proposition that the Marshall Plan—the big idea that transformed post-war Europe sixty years ago—has relevance for today’s Middle East.  Of course the analogy has its limits—there’s no France and Germany to reconcile, and Europe’s task was to rebuild an advanced economic and social system, not build from scratch new institutions and behavior.

But in several key ways, the message of the Marshall plan resonates well.  Arab elites are eager to take new approaches to stimulate their economies.  They know the region has underperformed in generating economic growth because the private sector has been controlled by authoritarian regimes, or by weak states that did not provide the necessary enabling environment.  They know well that youth unemployment is an enormous threat to stability within countries and across the region.  And many in key positions welcome American know-how, entrepreneurial spirit, and experience—even if they may find fault with American policies in other respects.

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Read the full report, Revisiting Marshall: Hope for Private Sector Growth in the Middle East.

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