Prospects for Middle Eastern and North African Economies

334 Pages·1998·28.396 MB·English

by  Nemat Shafik (eds.)

PROSPECTS FOR
MIDDLE EASTERN AND
NORTH AFRICAN ECONOMIES
Also by N emat Shafik
ECONOMIC CHALLENGES FACING MIDDLE EASTERN AND
NORTII AFRICAN COUNTRIES: Alternative Futures
REVIVING PRIVATE INVESTMENT IN DEVELOPING
COUN1RIES: Empirical Studies and Policy Lessons (editor with
A. Chhibber and M. Dailami)
Prospects for Middle
Eastern and North
African Economies
From Boom to Bust and Back?
Edited by
Nemat Shafik
Foreword by Heba Handoussa
...
...A - in association with
,.... .,-F 1
., Palgrave Macmillan
First published in Great Britain 1998 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 978-0-333-71401-0 ISBN 9 7(e8B-1o-o3k4)9 -26137-6
DOI 10.1007/978-1-349-26137-6
First published in the United States of America 1998 by
ST. MARTIN'S PRESS, INC.,
Scholarly and Reference Division,
175 Fifth Avenue, New York, N.Y. 10010
ISBN 978-0-312-17633-4
Library of Congress Cataloging-in-Publication Data
Prospects for Middle Eastern and North African economies : from boom
to bust and back? I edited by Nemat Shafik ; foreword by Heba
Handoussa.
p. em.
Includes bibliographical references and index.
ISBN 978-0-312-17633-4 (cloth)
I. Middle East-Economic conditions-1979- 2. Africa, North-
-Economic conditions. 3. Economic policy-Middle East. 4. Economic
policy-Africa, North. I. Shafik, Nemat.
HC415.15.P76 1997
330.956-DC21 97-13672
CIP
© Economic Research Forum 1998
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
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the Copyright Licensing Agency, 90 Tottenham Court Road, London WIP 9HE.
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 I
07 06 05 04 03 02 01 00 99 98
The findings, interpretations, and conclusions expressed in this volume are entirely those
of the authors and should not be attributed in any manner to the World Bank, to its
affiliated organizations, or to members of its Board of Executive Directors or the
countries they represent.
To Maissa Hamza
Contents
List of Figures, Tables, and Boxes ix
Foreword
XV
Notes on the Contributors xvii
1 Prospects for Middle Eastern and North Mrican
Economies: An Overview
Nemat Shafik 1
PART I THE CHANGING INTERNATIONAL CONTEXT 13
2 The World Economy and its Implications for the
Middle East and North Mrica, 1995-2010
E. Mick Riordan, Uri Dadush, Jalal Jalali, Shane Streifel,
Milan Brahmbhatt, and Kazue Takagaki 15
3 The Arab Economies, the Uruguay Round Predicament,
and the European Union Wildcard
Ishac Diwan, Chang-Po Yang, and Zhi Wang 47
4 The World Trade Organization, the European Union,
and the Arab World: Trade Policy Priorities and Pitfalls
Bernard Hoekman 96
PART ll ECONOMIC GROWTH, THE STATE,
AND THE PRIVATE SECTOR
5 From Boom to Bust - and Back? The Crisis of Growth
in the Middle East and North Africa
John Page 133
6 The State and Economic Transition in the Middle East
and North Mrica
John Waterbury 159
7 Supporting Private Sector Development in
the Middle East and North Africa
Robert E. Anderson and Albert Martinez 178
V1l
viii Contents
PART ill SECfORAL ISSUES: HUMAN RESOURCES,
POVERTY, AND THE ENVIRONMENT
8 A Human Capital Strategy for Competing in
World Markets
Fredrick L. Golladay, Sue E. Berryman, Jon Avins,
and Laurence Wolff 197
9 Poverty in the Middle East and North Africa
Willem van Eeghen 226
10 Environmentally Sustainable Development in
the Middle East and North Africa
Hamid Mohtadi 262
11 Environmental and Natural Resource Management
in the Middle East and North Africa
Bjorn Larsen 288
Index 313
List of Figures, Tables,
and Boxes
Figures
2.1 Per capita GDP growth, various regions, 1981-90 17
2.2 Volatility of the purchasing power of exports, various
regions, 197~93 20
2.3 Volatility of the purchasing power of exports,
Middle East and North Africa, 197~93 21
2.4 Nonoil exports as a share of total, Middle East
and North Africa, 197~92 26
2.5 Composition of nonoil exports, Middle East and
North Mrica, 197~93 27
2.6 Option for nonoil export growth 33
2.7 Nonoil export growth, 1981-2010 40
2.8 Real effective exchange rates, Middle East and
North Mrica and competitor countries, 198~94 42
3.1 Aggregate welfare impacts and levels of trade under
the three simulations 64
4.1 Per capita nonoil exports from various regions,
1989 and 1995 107
4.2 Per capita nonoil exports from various countries,
1988 and 1995 108
4.3 Intraindustry trade with the European Union, 1989-94 Ill
5.1 GDP growth, 196~85, and GDP per capita, 1960 134
5.2 GDP growth, 1965-89, and income inequality 135
5.3 Investment as a share of GDP, 196~85, and GDP
per capita, 1960 137
5.4 GDP per capita and primary enrollment, 1960 138
5.5 Average education stock, 196~85, and GDP per capita,
1960 139
5.6 Accounting for differences in growth due to
differences in accumulation, 196~91 141
5.7 Investment and GDP growth, Middle East and
North Mrica, 197~89 142
5.8 Total factor productivity FP growth, 196~90, and
GDP per capita, 1960 144
lX
X List of Figures, Tables, and Boxes
5.9 Public and private investment, various regions, 1970-88 146
5.10 Quota coverage, various regions, 1985-88 148
5.11 Total aid, worker remittances, and foreign direct
investment in the Maghreb, 1970-90 149
5.12 Total aid, worker remittances, and foreign direct
investment in the Mashreq, 1970-90 150
5.13 Total factor productivity growth, 1960-89, and
share of manufactured exports in total exports, 1960-85 152
5.14 Changes in real trade, various regions, 1960-94 153
6.1 Pathways to institutional change 165
7.1 Per capita income growth, various regions, 1965-93 179
7.2 Share of public enterprises in economic activity,
various countries, 1986-91 180
7.3 Privatization transactions, various countries, 1983-93 183
7.4 Foreign direct investment inflows, various regions,
1982-93 185
8.1 Earnings gaps between U.S. college graduates and
high school graduates, 1965, 1975, and 1985 203
9.1 Change in poverty and real GDP per capita,
various countries 236
10.1 Environmental indicators at different country
income levels 263
10.2 Economic development and the environment in
the Middle East and North Africa 264
11.1 Net national savings rates in the Middle East
and North Mrica and East Asia, 1972-92 290
11.2 Share of heavy fuel oil in primary energy
consumption, Middle East and North Africa, 1991 297
11.3 Toxic pollution from industry, Middle East and
North Mrica, 1990 299
Tables
2.1 Sources of foreign exchange, Middle East and
North Africa, 1970-93 18
2.2 Population growth, Middle East and North Africa,
1970-2010 19
2.3 Distribution of exports, Middle East and North Africa,
1970-92 25
2.4 Nonoil exports by Standard Industrial Trade
Classification, Middle East and North Africa, 1970-92 27