Those attending this Aspen Mediterranean Initiative workshop set out to evaluate the impact of the so-called “Arab spring” on the economies of North Africa and on the wider Mediterranean region. The event, which saw the participation of key political and business figures from the northern and southern shores of the Mediterranean, also marked the launch of Aspen Institute Italia’s Mediterranean Program. This multiyear program forms part of the Aspen Network’s umbrella “Aspen Mediterranean Initiative”, run jointly with Aspen U.S. and Aspen España, and is geared towards establishing direct relations with a new generation of North African leaders, encouraging their international openness and, in so doing, supporting positive transition in the region. In the second half of 2011, the first seminars of the Program are scheduled to be held in Sicily.
The Workshop participants identified several priorities that will underpin the program, starting with the need to intensify exchanges in all directions – not just North-South but also South-South – and to ensure that there is a greater flow of investment towards the area. Measures in support of the Tunisian and Egyptian economies were singled out as being urgently required: the greatest risk to be avoided is one where the high expectations of the people (especially youth) are met with a fall in GDP growth and employment, exacerbated by an increased public deficit. The problem is not primarily the amount (in absolute terms) of resources made available for emergency purposes (given the commitments undertaken in recent months by many international agencies and Western governments), but rather how they are used and their impact, to be measured over years more so than months.
There was a broad consensus among the participants regarding the importance of public-private partnerships as the main avenue for triggering dynamics of growth, innovation and international openness. In this regard, it was felt that agencies such as the European Investment Bank and the World Bank (as well as the European Union itself) could act as crucial catalysts, encouraging business risk-taking even in a rather unstable climate. Moreover, leaving aside the major question marks hanging over the situation in Libya, the anti-government protests in almost all the countries in the region could point to a further spread of the phenomenon and, hence, to the persistence of a high degree of unpredictability over time – even if within the context of changes that are positive as a whole. In this context, it was suggested that Western expertise could also play a crucial role in bolstering a complex transition to more advanced mechanisms of economic governance.
It was further acknowledged that special attention will need to be devoted to small and medium enterprises, which today represent the vast majority of businesses in North Africa, and which suffer from severely restricted access to credit and to markets that are not strictly local.
The crisis in Libya and regional tensions that could involve another major oil producer (such as Algeria) have clearly had an immediate knock-on effect on the energy sector as there continue to be grave concerns over the operation of extraction and refining facilities, as well as of transport infrastructure. The participants observed, however, that it is equally true that, by its very nature, investment in energy has at least a ten-year lifespan, and must therefore be considered relatively stable even in the event of radical political changes, provided that relations of pragmatic cooperation between governments and major operators in the sector are maintained or re-established. Forecasts were cited which, based on current economic growth rates, indicate that the energy demand of countries in North Africa will increase significantly. Given that this trend will add to the global pressure on prices, technology transfer will become essential in order to diversify the energy mix – a process which would have positive economic benefits for everyone.
On a political level, the transitions underway were seen as being far from complete and as requiring the convergence of many factors in order to produce sustainable and democratic outcomes. It was stressed that there is a real possibility of authoritarian (or semi-authoritarian) and populist tendencies emerging, in addition to very familiar scenarios involving the rise of fundamentalist movements – perhaps unwittingly facilitated by too rapidly resorting to elections with non-proportional voting systems in place. By way of conclusion, it was noted that that the arrival of the Arab Spring in strategic nerve centers even beyond the Maghreb (including Syria, the Palestinian territories, and the Gulf countries) is changing the very delicate balance between the actors who, in various ways, exert an indirect influence over the entire region, including Saudi Arabia and Iran, and, in a sense, Israel.