Table Of ContentEconomic Controversies
Innovative and thought-provoking, the Economic Controversies
series strips back the often impenetrable facade of economic
jargon to present bold new ways of looking at pressing issues,
while explaining the hidden mechanics behind them. Concise
and accessible, the books bring a fresh, unorthodox approach to
a variety of controversial subjects.
Also available in the Economic Controversies series:
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Future of the World Economy
Robert R. Locke and J.-C. Spender, Confronting Managerialism:
How the Business Elite and Their Schools Threw Our Lives Out
of Balance
Lorenzo Fioramonti, Gross Domestic Problem: The Politics Behind
the World’s Most Powerful Number
Heikki Patomäki, The Great Eurozone Disaster: From Crisis to
Global New Deal
Lorenzo Fioramonti, How Numbers Rule the World: The Use and
Abuse of Statistics in Global Politics
About the author
Richard Javad Heydarian is a lecturer (political science
and international relations) at Ateneo De Manila
University (ADMU), the Philippines, and consultant to
a number of institutions, including the House of Repre-
sentatives and Friedrich Ebert Stiftung (Manila office).
As an expert on geopolitics and development issues
in the Asia-Pacific and MENA regions, he has written
for or been interviewed by Asia Times, New York Times,
Huffington Post, Bloomberg, The Diplomat and Tehran
Times, among other publications. He has participated
in and/or presented papers at varying regional and
international academic and track II conferences, focus-
ing on regional integration, economic development and
international security. Currently, he is the editor of the
newly launched Socdem Asia Quarterly, which seeks to
bring together views and analyses by leading regional
and international experts and policy-makers on latest
developments in the Asia-Pacific region and beyond.
HOW CAPITALISM FAILED
THE ARAB WORLD
THE ECONOMIC ROOTS AND PRECARIOUS
FUTURE OF THE MIDDLE EAST UPRISINGS
Richard Javad Heydarian
Zed Books
London | new York
How Capitalism Failed the Arab World: the economic roots and precarious
future of the Middle East uprisings was first published in 2014 by Zed
Books Ltd, 7 Cynthia Street, London n1 9JF, Uk and Room 400, 175 Fifth
Avenue, New York, nY 10010, USA
www.zedbooks.co.uk
Copyright © Richard Javad Heydarian 2014
The right of Richard Javad Heydarian to be identified as the author of
this work has been asserted by him in accordance with the Copyright,
Designs and Patents Act, 1988
Set in Monotype Plantin and FFKievit by Ewan Smith, London nw5
Index: [email protected]
Cover designed by www.roguefour.co.uk
All rights reserved. No part of this publication may be reproduced,
stored in a retrieval system or transmitted in any form or by any means,
electronic, mechanical, photocopying or otherwise, without the prior
permission of Zed Books Ltd.
A catalogue record for this book is available from the British Library
Library of Congress Cataloging in Publication Data available
iSbn 978 1 78032 959 8
CONTENTS
Figures and tables | vi Acknowledgements | vii
Abbreviations | ix Foreword by Walden Bello | x
1 A brave new Middle East: the birth of a new era. . . . . . . .1
2 The anti-development state: economic origins of Arab
upheavals . . . . . . . . . . . . . . . . . . . . . . . 34
3 The advent of economic globalization: a prelude to crisis . . 58
4 The Great Recession: the collapse of Arab crony capitalism . 76
5 The new power brokers: political Islam and the Arab
summer . . . . . . . . . . . . . . . . . . . . . . . . 95
6 Gulf exceptionalism: how the monarchies have reshaped
the Arab Spring. . . . . . . . . . . . . . . . . . . . . 128
7 Peering into the abyss: the Arab Spring at the crossroads . .151
8 Where do we go from here? Finding the true path to an
Arab Spring. . . . . . . . . . . . . . . . . . . . . . .172
Notes | 186 References | 190
Index | 203
FIGURES AND TABLES
Figures
4.1 Merchandise exports of selected MENA countries (2008/09). . 84
4.2 Current account balance as percentage of GDP (2008/09). . . 85
5.1 Declining foreign investment during the revolution. . . . . . 119
5.2 Rising budget deficits in post-revolution states. . . . . . . . 120
7.1 Breakdown of external aid to ATCs and Jordan (2012) . . . . .168
Tables
1.1 The Arab world’s dismal political record . . . . . . . . . . . 16
4.1 Average GDP growth in MENA (2000–11) . . . . . . . . . . 83
5.1 Egypt: selected economic indicators (2010–13) . . . . . . . . 121
5.2 Morocco: selected economic indicators (2010–13). . . . . . . 122
5.3 Tunisia: selected economic indicators (2010–13). . . . . . . .123
6.1 GCC key economic indicators (2007–20). . . . . . . . . . . 138
8.1 Main characteristics of the region (2000–07). . . . . . . . . 175
ACKNOWLEDGEMENTS
I would like to thank all of those who helped me throughout the
years to hone my analysis of globalization and development, as
well as the dynamics of Arab politics. While the following people
are only a handful of the many individuals who aided the crafting
of this book, I would like most especially to express my deep
gratitude to my mentors and former academic advisers, starting
with Dr Noel Morada, Executive Director of the Asia-Pacific Centre
for Res ponsibility to Protect (R2P) at the University of Queensland
(UQ), who, since my undergraduate years, has rigorously assessed
my writings on international affairs and development, and gener-
ously encouraged me to present the initial contents of my book
in the paper entitled ‘The economics of the Arab Spring’ at the
2011 ISA International Conference in Brisbane, Australia. I would
also like to thank my long-time adviser Dr Clarita Carlos of the
University of the Philippines (Diliman) for her invaluable critiques
and suggestions upon patiently reviewing my writings on Middle
East politics and international affairs. Her intellectual guidance was
indispensable to my eventual plan to write a full-blown book on the
Arab uprisings.
I would also like to thank John Feffer, co-director of Foreign Policy
in Focus at the Institute for Policy Studies (IPS) in Washington, for
being such a helpful and patient editor, who allowed me to gradu-
ally build a body of writings on Middle East affairs, especially the
Arab uprisings. Above all, I would like to thank Dr Walden Bello,
my long-time mentor, employer and friend, who has been pivotal to
my intellectual development, especially in terms of understanding
the dynamics of economic globalization and its impact on the
developing world. His works on global poverty, food insecurity and
developmental states played a key role in my analysis of the impact
of economic liberalization on Arab societies. It was his initial sug-
gestion of co-authoring a new book on globalization amid the Arab
viii | AcknowLedgementS
uprisings which paved the way for our eventual decision – after
months of evaluating the merits of authoring separate individual
works with common themes as opposed to a joint work – to
write our own books, looking at the dynamics of the 2008 Great
Recession, on the one hand, and the economic roots of the Arab
up risings, on the other.
ABBREVIATIONS
AHDR Arab Human Development Report
AKP Justice and Development Party (Turkey)
AQ Al-Qaeda
ATCs Arab transition countries
BWS Bretton Woods System
FAO Food and Agriculture Organization of the United Nations
FDI foreign direct investment
FJP Freedom and Justice Party
FSA Free Syrian Army
GCC Gulf Cooperation Council
GDP gross domestic product
IFI international financial institution
IMF International Monetary Fund
ISI import-substitution industrialization
MB Muslim Brotherhood
MENA Middle East and North Africa
NATO North Atlantic Treaty Organization
NIC newly industrialized country
NSF National Salvation Front
OECD Organisation for Economic Co-operation and Development
OPEC Organization of the Petroleum Exporting Countries
PJD Justice and Development Party (Morocco)
SME small or medium-sized enterprise
SWF sovereign wealth fund
UAE United Arab Emirates
UN United Nations
UNDP United Nations Development Programme
UNSC United Nations Security Council
WTO World Trade Organization
Description:Economic liberalization has failed in the Arab world. Instead of ushering in economic dynamism and precipitating gradual democratic reform, it has over the last three decades resulted in greater poverty, rising income inequality and sky-rocketing rates of youth unemployment. In How Capitalism Failed
