Thursday, 17 February 2011

It's politics, stupid

A lot of commentators on the recent wave of protests in the region have pointed to socioeconomic factors such as poverty and unemployment. High food prices have been a particular favourite of the more wonkish pundits out there, who have liked to point out that food makes up a very high proportion of household expenditure in Egypt by global standards.

As an aside, to me this is less interesting than it first sounds. Saying that food makes up a large proportion of household expenditure in a given country is to a large degree simply saying that said country is poor. Of course it's a little more complicated than that as other factors such as subsidies, taxes, the degree of national food self-sufficiency and transport costs for imports also affect food prices and how much expenditure they account for. But at the same time, a lot of it boils down to the fact that the poorer a people are, the higher percentage of their income they'll have to spend on basic items such as food and the less they'll have for non-essential items. For example FT Tilt recently published a fancy graph by Goldman Sachs showing that food expenditures in Egypt were the second highest in the region as a proportion of the inflation basket out of 14 countries in the region. But then, based on GDP per capita levels, Egypt is also the third poorest of the 14 countries, so that's not particularly surprising or interesting.

And yet, it's not the poorest countries in the world, or even in the region (eg Mauritania), that have seen the most significant uprisings; nor is it clear why Tunisia should have seen the first major revolt when it's substantially wealthier and exposed to food-price changes (according to the GM graph) than say Syria, which has barely seen a peep. Conversely according to another chart published by the WSJ, Moroccans are even more exposed to food price rises, yet it's been quiet so far too. (That could change given plans for demonstrations in a few days, though I very much doubt it will see an Egyptian-scale uprising).    

Obviously a lot of factors are playing into this, but I think the nail in the coffin for the econo-determinists is the eruption of major unrest in Bahrain and Libya. Libya is by far the wealthiest North African country on a per capita basis. While the GM graph shows it has having a fairly high vulnerability to food price changes (though still lower than say Syria), presumably because it's heavily import-dependent, that still leaves a lot of money in absolute terms to spend on other things given its high per capita GDP. Meanwhile Bahrain is one of the wealthiest countries in the region (and in the non-Western world), as well as (according the GS chart) one of the three regional countries least exposed to food price changes (accounting for less than 20% of expenditure, vs more than 40% in Egypt). Now clearly in spite of overall wealth, there are problems such as uneven distribution of wealth in these countries and other socioeconomic problems such as high unemployment (especially in Libya), but let's be clear that there are also much quieter countries in the region with much more severe overall socioeconomic problems. The King of Bahrain has just announced that he's making a donation to all Bahraini families of an amount greater than the GDP per capita of some other countries in the region. It makes little sense if food prices and the like are the driver of unrest for it to break out in Bahrain while Mauritania and Morocco both stay fairly quiet.

To me, what these protests are about is first and foremost politics, not economics. In particular, what they're about is regime legitimacy, something Presidents-for-life like Ben Ali and Mubarak - and Qadhafi and Ali Abdullah Saleh of Yemen, which has seen significant protests - are particularly lacking in, as are minority-dominated regimes such as Bahrain.

At the same time, I think several other factors affect whether people are willing to come out to protest en masse.

One is  extreme domestic ethno-sectarian or political divisions, which for example make seriously divided countries like Iraq and Lebanon unlikely candidates for national-level uprisings.

Another is fear of renewed violence and instability making people just want to get on with their lives and keep their heads down - lowering the chances of any mass uprising in Iraq and Lebanon again, as well as in an Algeria still traumatised by civil war (as the Moor Next Door has noted, Algeria had a popular uprising in 1988, which set off a chain of events that ended in catastrophe). This also might be a factor in the two countries most affected by the fallout of Iraq (in terms of refugee inflows, Syria - mitigating factors such as its rule by a minority sect - and Jordan.

Given these factors, I think Issandr El Amrani nails it when he says that
the most important protests now taking place in North Africa are those in Libya. [...] Libya shares something important with Egypt and Tunisia: an aging leader (41 years in power) faces a looming succession crisis in which the leading candidates are his own sons. I simply don't think that's an acceptable outcome for any republic in the 21st century, and was a key aspect to the revolt against Hosni Mubarak in Egypt, and to a lesser extent in Tunisia (with the rumored heir apparent being his nephew).
 Qadhafi doesn't have a lot going for him based on these factors. He's the longest-serving ruler in the region (and is a complete clown to boot, something I think is more important than people might think given that it can undermine nationalist legitimacy; I reckon Ahmadinejad's embarrassing outbursts did a lot to help inspire the degree of antipathy shown towards him by many Iranians when he won a second term in 2009, and that increasing publicity surrounding Ben Ali's family's corruption helped undermine him too). He rules over a country that is ethnically and religiously relatively homogenous (though there are important tribal and regional divisions) and that has no recent history of major instability or violence. All he has going for him is oil wealth - which didn't help the Shah of Iran for example - and a particularly repressive and brutal security apparatus. This didn't much help Ben Ali (Tunisia was more open and less violently repressive than Libya, but it was still a very repressive and closed regime) and can backfire by galvanising protests instead of successfully repressing them.

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