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By David Rosenberg
The upheavals of the Arab Spring have created clear economic winners and losers in the Middle East and North Africa, with some economies withering in the face of unrest and others prospering on the rise in oil prices that resulted.
But a Gallup Poll of economic optimism among the region's people released on Monday paints a very different picture than the economic reality. In a few countries, confidence or lack thereof mirrors actual conditions but, in many, respondents to the poll expressed views at variance with the economy.
In Egypt, a 42 percent plurality of people see conditions in their country "getting" better, versus 37 percent who said it is "getting worse," according to the survey of 1,000 adults in each of 16 countries covered. The poll was taken between February and June 2011 even as the economy contracted, foreign currency reserves fell and foreign investment dried up.
Egypt's situation hasn't improved since the end of the polling period, with the International Monetary Fund (IMF) forecasting growth of just 1.2 percent this year, a fifth of its level before protestors ousted President Husni Mubarak last February, setting into motion the political and economic gyrations that continue today.
Egyptian shares dropped to the lowest level in more than two years on Monday, a day after clashes between Coptic Christian demonstrators and security forces in Cairo left 24 dead and hundreds wounded. The declines pushed the index's year-to-date losses to over 45 percent so far.
The Gallup survey found Tunisians even more optimistic, with half of the respondents saying the economy is doing better, compared with 20 percent who said it was doing worse and 27 percent saying it was "staying the same." In fact, Tunisia's tourism earnings have dropped 40 percent so far this year while foreign investment plunged 25 percent in the first four months. The IMF projects zero growth for the economy.
Nathan J. Brown, a professor of political science and international affairs at George Washington University in Washington, DC, said the optimism detected in the Gallup survey may have less to do with economic conditions and more with the hope that the oligarchies targeted by Arab Spring protestors are now destined to be replaced by societies with better and more equal access to jobs and other opportunities.
"There was a strong sense in both [Egyptian and Tunisian] societies that resources were concentrated in the hands of a few people at the top, so even if economic indicators were good there were still issues of corruption and accountability," Brown told The Media Line. "The sense now is that if we get things fixed, we'll be better across the board."
The relatively sanguine outlook could be a boost for the two countries' transitional leadership as they struggle to restore order and revive their economies. Tunisians are scheduled to elect a constitutional assembly later this month and Egyptians will go to the polls in November in the first of a series of elections for parliament and president.
More Syrians saw their economy getting worse (34 percent) than getting better (32 percent), according to the Gallup survey, but the margin was relatively small even as President Bashar Al-Assad was fighting to keep power against a rebellion that broke out in March. His crackdown has come at the cost of what the United Nations estimates is over 2,900 lives.
The unrest has not spread to the key Syrian commercial cities of Damascus and Aleppo, but the toll on the economy has gradually emerged as sanctions by the European Union and Turkey go into force. The government recently imposed a ban on imports of most consumer goods in an effort to save foreign currency, but quickly backed down in the face of protests by the country's business elite.
Some of the most optimistic people of the Middle East and North Africa have reason to be smiling at their wallets.
Qatar tops the list for cheeriness, with 92 percent of those surveyed saying the economy is getting better. It is, as gas exports and revenues jump by leaps and bounds. Already the world's richest country as measured by gross domestic product per capita, the Gulf emirate's GDP is forecast to grow about 20 percent this year by the IMF; Qataris are looking forward to a $10 billion investment and building boom ahead of the 2022 World Cup.
Moroccans are also taking a rosy view of the future, with 68 percent saying their economy is getting better. King Mohammed VI has preserved political peace by introducing political reforms while GDP is forecast to grow 4.6 percent this year by the IMF.
But economists have warned that the growth is based on an unsustainable government spending spree. Wage increases for state employees and boosts to food and energy subsidies have come at the expense of public investment, depriving the country of its main engine for long-term economic growth.
The most pessimistic of all the people of the Middle East and North Africa are the Lebanese, Gallup found. Just 13 percent of those asked said their economy was getting better while 65 percent said it was getting worse.
"We still had a vacuum at government level. There was lot of certainty and economy was at standstill, so I'm not at all surprised by the results," Nassib Ghobri, head of economic research and analysis at Beirut's Byblos Bank, told The Media Line.
Last April, as Gallup was conducting its poll, the Economist Intelligence Unit (EIU), forecasted GDP growth of 4.6 percent.for the country even though the Shiite movement Hizbullah had pushed Prime Minister Sa'ad Al-Hariri's government out of power and politicians were in the midst of a lengthy battle over the composition of the next coalition.
In June, a Hizbullah-dominated cabinet took office, but Ghobri said that hasn't done much to restore confidence, especially as neighboring Syria continues to reel from its own unrest.
As it turns out, the gloomier Lebanese public may have been more on target: The EIU last month cut its projected economic growth to 1.3 percent for 2011, citing domestic political unrest and the Arab Spring.
"Confidence has picked up slightly since the government formation, but it hasn't jumped to levels that would bring back to eco growth of 8 percent we saw on average in past four years," he said, adding that Byblos had cut its 2011 GDP forecast to 1.5 percent from a previous 2.5 percent.
Other bears include Iraq, where only 16 percent said the economy looked to be doing better, Yemen (19 percent) and the Palestinian Territories (also 19 percent). All three regions, in fact, have poor economic prognoses.
Brown warned that the optimism reflected in polls like the Gallup may reflect a cultural bias toward expressing confidence in the future so as not to appear defeatist. Recent events may be discouraging people, but that may not show up in poll data. "Numbers on optimism and pessimism are skewed in strange ways," he said.
World - Many Arabs Stay Hopeful Even as Economies Sag | Global Viewpoint