Roundtable on the Middle East and North Africa

What governments are doing for development

Nizar Baraka

The global crisis and how to get growth and development back on track led the agenda as ministers from MENA and OECD countries gathered at Marrakech in Morocco on 23 November 2009. In our ninth OECD Observer ministers' roundtable, we asked representatives from four MENA countries-Morocco (as hosts of the ministerial meeting), Bahrain, Egypt and Yemen-and from three OECD members-Italy, Korea and Spain: "What action is your government taking to help improve development prospects in the MENA region?"


Modernising and diversifying

Nizar Baraka, Minister Delegate to the Prime Minister in charge of Economic and General Affairs

Over the past ten years, Morocco-under the leadership of His Majesty King Mohammed VI-has been resolutely modernising its economy and setting itself ambitious goals for economic and human development. The quickening pace of growth, in excess of 5%, and the decline in unemployment from 9.1% in the second quarter of 2008 to 8% in the same period of 2009 are signs that this strategy is proving successful.

To build a modern, competitive economy, our focus is on economic diversifi cation, an enhanced business environment and stronger integration into the global economy.

Diversification is crucial if our economy is to be freed from its dependency on the vagaries of climate. Accordingly, Morocco has decided to develop jobs for the future that can generate long-term industrial know-how. Its national economic strategy, drawn up in conjunction with private partners, focuses on high-potential industries such as automobiles, electronics, the digital economy, food processing and offshore services.

The government is also focusing on more traditional industries, such as farming and fisheries. These are benefiting from national development plans aimed at modernizing production methods and improving the quality of Moroccan agricultural and fishery products.

We are endeavouring to reconcile economic growth with sustainable development by opting for renewable energy (with a target of 10% by 2012), given the country's signifi cant potential for solar and wind power in particular. A new environmental charter also serves as a reminder that development should respect all the major ecological balances.

All of this would be in vain without the human capital, infrastructure and business climate that any economy needs to be competitive. We are, for instance, investing a considerable amount of resources in policies on education, refresher courses and vocational training. Our policy agenda includes major infrastructure projects, particularly in the field of transport with the construction of an extensive 1,500 km motorway network, harbor expansion to make Tangier one of the leading ports in Africa and the Mediterranean, and new airports to support our ambitions for tourism. Furthermore, the National Business Environment Committee, chaired by the prime minister, is ensuring that we provide the right environment for corporate development.

Finally, regional integration and international outreach are improving the development prospects of Morocco and its neighbours and partners. From the 1994 Marrakesh Agreement Establishing the World Trade Organization to the free-trade agreements with our Mediterranean partners and the US, or our "advanced status" relations with the EU, Morocco is convinced of the benefits of economic outreach and the freedom to invest and trade.

As host to the MENA-OECD Forum, Morocco is committed to sharing its experience of economic and human development and drawing on approaches that have met with success elsewhere. The increasing flow of foreign direct investment to both Morocco and the MENA region is proof that this joint strategy is working.


See French language video interview with Mr  Baraka  

Forging long-term success

H.E. Shaikh Ahmed bin Mohammed al Khalifa, Minister of Finance

As we were one of the first countries in our region to discover oil, we were also the first to see the need to diversify our economy.

This has been a long-term and steady plan, built on prudent fiscal management and a planned approach to expenditure, coupled with strong financial regulation and a drive for reform. As a government, we have carefully planned and implemented the various policies needed to bring about our country's future prosperity.

We see clearly the need to drive for more productivity and increase the efficiency of our economy, in line with our Economic Vision 2030 and National Economic Strategy, our national blueprint for the future. We also realise the vital role and demand for education, labour reform, partnerships with foreign business, and the need to establish and adhere to the best international standards.

We need foreign businesses to help us achieve our ambition, and to share in our success. We have also witnessed the impact of previous global booms and recessions. We see how this current downturn may herald a shift in economic emphasis towards the MENA region and the East.

However, we do not have any headline-grabbing actions or policies to deal with this specific situation. Instead, we have a steely determination to continue along our long-term path of steady, sustainable growth, with prudent financial management coupled with the adaptability to meet the changing realities of the domestic, regional and global situation.

Building for the future has enabled us to take decisions that are best for us and our partners, ensuring success not just for now but for the years to come. It is the path we set now, and the example we set for our future generations, that will determine how successful we will become.


Towards job creation

Mahmoud Mohieldin, Minister of Investment

The current global crisis poses challenges as well as opportunities to developed and developing economies. The MENA region has seen proposals for reform and stimulus packages, and measures for improving the business environment. We must do this for the emerging generation of entrepreneurs and less privileged small and medium firms that are the hope for a better future.

Egypt has weathered the current global crisis well, thanks mainly to the government's commitment to strengthening the macroeconomic environment through relentless reform efforts. These include enhancing the soundness and stability of the financial sector, strengthening the supervisory and regulatory framework, modernising the institutional infrastructure, liberalizing trade, and overhauling the tax system. These reforms created a friendlier investment climate and a more diversified, private sector-led growth, which reached a 25-year record of 7% in 2006-2008. For the fourth year, Egypt was ranked as a leading reformer in the IFC/World Bank Doing Business Report. With an annual average of US$10 billion in foreign direct investment, Egypt is the leading North African country in attracting foreign investments too.

Egypt's response to the economic crisis included a strong stimulus package, a flexible monetary policy, business support, investment in infrastructure and utilities, and adoption of prudent regulations. Growth of approximately 5% has been maintained during the crisis.

For growth to benefit the wider population, social reforms should be sped up, especially in education. This should be done in partnership with the private sector. With the labour force expanding fast and given persistently high unemployment, the MENA region will need to add some 100 million jobs by 2020. Much of this policy challenge falls on Egypt. The government is dedicated to offering a climate conducive to job creation. We believe it will not only define the MENA region's labour market, but Egypt's social contract will depend greatly on it.

The path to high growth is paved with five fundamentals-openness and integration with the world; macroeconomic stability and controlled budgets; savings for infrastructure and human capital investments; efficient markets that are effectively regulated; and a strong state that protects citizens' rights and is committed to sustainable development.

Such efforts depend on global co-operation to create the benign global environment that the emerging markets of North Africa and the Middle East need to sustain their growth and development.


Regional co-ordination is key

Abdulkarim Al-Arhabi, Deputy Prime Minister for Economic Affairs, Minister of Planning and International Cooperation

With reunification in 1990, Yemen adopted a liberal economic system, democracy and political pluralism, and decentralisation to enhance people's participation in managing their economic and social affairs. Since then, the government has applied several programmes to promote social and economic development, most recently pro-poor growth plans to address economic growth and poverty alleviation.

In addition, the government has adopted national reform programmes to address the internal and external disequilibria, to target better and efficient government, to improve the business environment to attract potential investors, and to enhance the economic opportunity of our people. The series of policies and measures has contributed to economic stabilisation, liberalisation of trade and enhanced private sector participation. At the same time, public investment programmeswere implemented to improve infrastructure, enhance social safety networks, expand the provision of basic social services, and promote micro-finance.

Today, Yemen, along with other countries in the region, is faced with challenges posed by the global financial crisis, climate change, water shortage, and lack of security. The government is extremely concerned about these multi-dimensional challenges, and we ask ourselves: What should we be doing to improve development prospects in the region?

One way to respond is to expedite efforts towards more regional and international co-ordination. Regionally, there is a growing need to draw up a strategy and take bold and practical measures to promote more economic co-operation.

The government of Yemen, together with its neighbouring Gulf states, has been developing a strategic initiative for economic integration. Such an initiative will have not only an economic added value to all parties, through trade, labour and investment prospects, but also will contribute to the region's stability and prosperity.


Strengthening shared roots

Renato Brunetta, Minister for Public Administration and Innovation

For geographical, historical and cultural reasons, the Middle East and North Africa region has always been a high priority for the Italian government.

Since 2002, when the Italian government launched the "e-Government for Development" programme, aimed at transferring information technologies to public administration in developing countries, many projects have been carried out in collaboration with international organisations, including the OECD.

The Italian government firmly believes that substantial structural deficiencies in a country's public sector hamper economic growth and result in inefficiency, delays, and burdensome bureaucratic procedures that affect not only the quality and quantity of services offered to citizens, but also enterprises' productivity. In this view, e-governance, or applying digital technologies for interaction among public administration, citizens, civil society and business, can promote a more efficient, participatory and transparent system.

In particular, we believe that co-operation in the public sector, with a strong focus on diffusion of innovation and modernizing the civil service, is key for recovery and growth in the global economy.

To this end, we have launched the project Distance Learning for innovative Public Sector. It is aimed at delivering high quality e-learning courses to senior civil servants and other public sector officials, to increase their knowledge and skills in the field of public sector innovation, which is one of the key drivers of economic, business, and social development.

This initiative aims at gathering the best e-learning courses available in partner countries on a single platform to support their efforts in public sector modernisation. The learning content is set by partner and beneficiary countries according to their preferences and needs. The project has already attracted wide interest and will be formally presented at the MENA-OECD Ministerial Conference in Marrakech on 23 November.

We believe that the Italian approach towards development in the MENA region provides an opportunity to make the most of our cultural closeness in order to enhance the links between our peoples and cultures and the roots of our shared Mediterranean identity.


A strategic partnership

Chang-sub Jung, Vice Minister of Public Administration and Security

In the past decade, the government of the Republic of Korea has strived for joint development with MENA countries by strengthening cooperation in good governance. From 2005, Korea's role as a co-chair in e-government and administrative simplification, one of the working groups of the Initiative on Governance for Development, has enabled closer co-operative relations between Korea and the MENA region. In this context, Korea has contributed toward modernizing public governance in the region through active investment and collaboration in various areas.

In August and September this year, the Korean government partnered with Morocco and Algeria to build Information Access Centers, which will be utilised to provide IT education. Furthermore, the Africa Digital Opportunity Forum was held in August in Rabat, Morocco, providing a venue for highlevel government offi cials from Korea and Africa to share their experiences in ICT policies and to discuss ways of co-operation going forward.

Korea also actively engages with partner countries to provide assistance through various programmes. The IT Youth Volunteer programme has dispatched volunteers to MENA countries including Jordan, Yemen, Algeria, Egypt, and Tunisia. In addition, the Korea IT Learning programme has invited ICT offi cers from Kuwait, Iraq, Syria, Lebanon and the UAE to participate in training opportunities in Korea.

In order to consolidate the strategic partnership between Korea and the MENA region, bilateral co-operation should also be strengthened along with multilateral co-operation. Hence, continued interest and support of MENA members are needed to develop multilateral co-operation into a bilateral approach in the future.


A commitment to development

Josep Puxeu, Secretary of State for Water and Rural Affairs, Ministry of the Environment and Rural and Marine Affairs

Spain has long experience of development co-operation with countries of the Southern and Eastern Mediterranean. Co-operation has increased considerably over the past 20 years, both in funding and in the diversifi cation of cooperation mechanisms. The net total offi cial development aid allocated to the Middle East and North Africa region rose by a factor of 2.6 between 2004 and 2008, from €202.8 million to €543.7 million in 2008.

The Spanish International Agency for Development Cooperation was restructured in late 2007 to improve the quality and effi cacy of aid, in line with the Paris Declaration principles.

The importance given by Spain to development in the MENA region is reflected in the geographical criteria of successive Development Cooperation Master Plans. The most recent Master Plan, for 2009-2012, gives broad association status to Algeria, Morocco, Mauritania, the Saharan Population and the Palestinian Territories. Lebanon and Iraq are identified as focused attention countries, while Egypt, Jordan, Syria and Tunisia are qualified as association countries for the consolidation of development achievements.

Within the context of the EU's Neighbourhood Policy, Spain's co-operation in these countries aims to strengthen institutions, and improve good governance, sustainable economic development, social development, the status of women and the protection of human rights. At the same time, in accordance with Spain's commitment to the Middle East Peace Process, particular attention is given to ease the humanitarian crises in the Palestinian Territories and Lebanon, while assistance remains in place for the United Nations Agency for Palestinian Refugees in the Middle East.

Spain is committed to the Union for the Mediterranean initiative, involving co-operation and the development of international relationships among a group of 43 countries, home to more than 756 million citizens, including all the member states of the EU and the states of North Africa and the Middle East within the Mediterranean region.


© OECD Observer, No. 275, November 2009

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