Economic and Political Impediments to Middle East Peace: Critical Questions and Alternative Scenarios

277 Pages·2000·1.707 MB·English

by  J. W. Wright Jr., Laura Drake (eds.)

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Economic and Political
Impediments to
Middle East Peace
Critical Questions and
Alternative Scenarios
Edited by
J. W. Wright, Jr.
American Association for the Advancement of Science Diplomacy Fellow and
Trade Policy Advisor, Office of Emerging Markets
United States Agency for International Development
and
Laura Drake
School of International Service
American University
Washington, DC
Foreword by Queen Noor of Jordan
First published in Great Britain 2000 by
MACMILLAN PRESS LTD
Houndmills, Basingstoke, Hampshire RG21 6XS and London
Companies and representatives throughout the world
A catalogue record for this book is available from the British Library.
ISBN 978-1-349-39979-6 ISBN 978-0-333-99426-9 (eBook)
DOI 10.1057/9780333994269
First published in the United States of America 2000 by
ST. MARTIN’S PRESS, INC.,
Scholarly and Reference Division,
175 Fifth Avenue, New York, N.Y. 10010
Library of Congress Cataloging-in-Publication Data
Economic and political impediments to Middle East peace : critical
questions and alternative scenarios / edited by J.W. Wright, Jr. and
Laura Drake ; foreword by Queen Noor of Jordan.
p. cm. — (International political economy series)
Includes bibliographical references and index.
1. Middle East—Economic conditions—1979– 2. Africa, North–
–Economic conditions. 3. Arab–Israeli conflict—1993– —Peace.
I. Wright, J. W., Jr. II. Drake, Laura. III. Series.
HC415.15.E247 1999
330.956—dc21 99–26119
CIP
Selection and editorial matter ©J. W. Wright, Jr., and Laura Drake 2000
Foreword ©Queen Noor of Jordan 2000
Introduction and Chapter 7 ©J. W. Wright, Jr. 2000
Chapter 1 ©Laura Drake 2000
Chapters 2–6, 8–13 and Epilogue ©Macmillan Press Ltd 2000
Softcover reprint of the hardcover 1st edition 2000 978-0-333-67899-2
All rights reserved. No reproduction, copy or transmission of this publication may be made
without written permission.
No paragraph of this publication may be reproduced, copied or transmitted save with
written permission or in accordance with the provisions of the Copyright, Designs and
Patents Act 1988, or under the terms of any licence permitting limited copying issued by
the Copyright Licensing Agency, 90 Tottenham Court Road, London W1P 0LP.
Any person who does any unauthorised act in relation to this publication may be liable to
criminal prosecution and civil claims for damages.
The authors have asserted their rights to be identified as the authors of this work in
accordance with the Copyright, Designs and Patents Act 1988.
This book is printed on paper suitable for recycling and made from fully managed and
sustained forest sources.
10 9 8 7 6 5 4 3 2 1
09 08 07 06 05 04 03 02 01 00
To those uncounted thousands
who have sacrificed their lives or their freedom
to make the Middle East a better place
The editors and contributors to this volume wish to express their condo-
lences to Queen Nour, the Royal Family and the people of Jordan for the
loss of King Hussein. He was a great leader and a real force in the battle to
achieve peace in the Middle East. We further dedicate this book to his
memory.
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Contents
List of Tables ix
List of Figures x
Acknowledgments xi
List of Abbreviations xiii
Notes on the Contributors xv
Foreword: The Face of Daunting Challenges
Queen Noor of Jordan xix
Map of the Middle East xxiv
Introduction: Economic and Political Impediments to
Middle East Peace
J.W. Wright, Jr. 1
1 Implementing Netanyahu’s Political and Economic Programme:
What are Israel’s Strategic Objectives for the Current
Historical Phase?
Laura Drake 10
2 What are the Prospects for Modernizing the Middle East
Economies?
Michael Field 32
3 The Arab–Israeli Peace Process: Can the Region Benefit from
the Economics of Globalization?
Emma C. Murphy 46
4 Is MENA a Region? The Scope for Regional Integration
Mohamed A. El-Erian and Stanley Fischer 70
5 Will an Arab–Israeli Peace Bring a Trade Dividend?
Elias H. Tuma 87
6 The Budgetary Consequences of Middle East Peace: What are
the Economic Impacts and Causal Linkages?
Robert E. Looney 99
vii
viii Contents
7 Would Islamic Banks Help Lessen the Decline of
Palestinian Banking?
J.W. Wright, Jr. 119
8 Will the Arab–Israeli Peace Process Generate Increased
Portfolio Investment in the Middle East?
Rodney Wilson 141
9 The Middle East Peace Process: How is it Affecting Planning
in the Cities and Regions in Jordan?
Peter L. Doan 157
10 External Assistance to the Palestinian Economy: What
Went Wrong?
Barbara Balaj, Ishac Diwan and Bernard Philippe 174
11 The (Very) Political Economy of the West Bank and Gaza:
What Lessons Should We Learn about Peace-building and
Development Assistance?
Rex Brynen 189
12 Civil Society Organizations in the Middle East: Can they
Facilitate Socio-Economic Development during a Time of
Transition?
Peter Gubser 213
13 From Front State to Backyard? Syria and the Risks of
Regional Peace
Volker Perthes 225
Epilogue: Critical Questions and Alternative Scenarios
William Stoltzfus 241
Index 247
List of Tables
3.1 Scientists and technicians per 10 000 Workers 57
3.2 Civilian R&D expenditure as a percentage of GDP 57
3.3 Principal Israeli imports 59
3.4 Value of manufactured exports, 1993 64
4.1 Intra-regional exports, 1990–2 77
4.2 MENA countries: trade patterns, 1989–94 78
5.1 Conceivable economic cooperation sub-groups 98
6.1 Defence spending: Middle East and North Africa, 1985–95 107
6.2 Defence expenditure, causal linkages with the
macroeconomy: Israel, Jordan and Syria 109
6.3 Defence expenditure, causal linkages with the
macroeconomy: Egypt 111
6.4 Defence expenditure, causal linkages with the
macroeconomy: Saudi Arabia 112
8.1 Basic growth and development indicators 142
8.2 United States economic assistance to the Middle East 143
8.3 United States military assistance to the Middle East 144
8.4 Top-20 Middle Eastern companies, by capitalization 146
8.5 Companies listed on the Cairo stock-market 150
9.1 Tourist arrivals in Jordan, by nationality, 1992–5 160
9.2 Increase in tourist expenditures, receipts and percentage
contribution to GNP 161
9.3 Case study: city populations, by year, and growth rates,
by period 166
9.4 Visits by foreign tourists to selected municipalities in
Jordan, 1994–5 167
9.5 Construction since January 1994 168
9.6 Staff assignments of municipal employees 170
10.1 Emergency assistance programme and actual performance 176
11.1 Donor pledges until July 1995 191
11.2 Donor commitments and disbursements 191
ix