Conference Report: Javier Albarracín, IEMed, 12-14 september 2013
By Adriana Karbanova, M1 AlterEurope, Majeure Economie
At the beginning of the academic year 2013/2014, we had the pleasure to participate in Javier Albarracin’s lectures concerning the current situation in the Mediterranean. Mr. Albarracin, Director of Socioeconomic Development at the European Institute of the Mediterranean (IEMed), has extensive experience in this field and is a member of several international organizations.His lectures were divided into the five following parts: Brief Description of the Mediterranean, European Mediterranean Relations, Financial Institutions, Revolts and Islamic Movements and New External Powers in the Mediterranean. I will summarize these lectures in the following paragraphs.
To understand the current situation in the Mediterranean, it is important to realize that there is a rich diversity of cultures, religions, political styles and also many problems linked to this region.
There are four main Mediterranean blocks: the first one is North Africa, which cooperates mainly with the EU1; the second one is the Middle East, where the first investors are Gulf countries; the third one is Turkey that was able to develop its own economic, politic and cultural dynamic; and the last one is Israel whose logic differs completely from other countries. These blocks have different approaches to economic and political issues and there is a lack of cooperation among them, which is one of the main problems of this region.
Another issue is linked to population demographics. 70% of the population in the South Mediterranean is under 30 years old, and according to some estimates, the population will double in 30 years. Young people need jobs, new technologies and places to live, which can be a problem in some countries like Egypt, where only 5-6% of the territory can be used for living. Furthermore, people live mainly in cities, especially in countries like Israel, Lebanon or Libya that are extremely urbanized.
As for European-Mediterranean Relations, there has been an energetic and committed history to negotiations. The first important event, the Barcelona Process, happened in 1995 and the main goals were to establish a political and security dialogue; economic and financial partnership; and lastly social, cultural and human partnership. In 2004, the European Neighborhood Policy was established in response to the adhesion of 10 new members to the EU1. More recently, the Union for the Mediterranean was created in 2008 with the aim of promoting stability and prosperity throughout the Mediterranean region (especially: improving infrastructure, highways, support of small and medium companies, education; obtaining water, etc.) Further to this, in 2011, three major pillars – Support to Partnership, Reform and Inclusive Growth – were created to define socio-economic challenges in the area and support to the transition to the democracy.
Currently, there is a lack of financial means in the EU1 to invest in the region due to the crisis. In addition, we can notice different approaches within the EU in regards to issues concerning the Mediterranean: the Southern members have as their priority economic development in the region, while Northern member are more concerned about issues connected with migration and security. Given this tension, there is the so-called “Mediterranean Fatigue” in some countries (mainly in the North) caused by unsuccessful and costly missions in the area. However, people are starting to realize the importance of assisting the Mediterranean area: its ecosystem is extremely fragile and dynamic and the impact of climate changes will affect both the South and the North, mainly as far as level of sea, lack of water and migration are concerned.
Concerning the Financial Institutions in the Mediterranean, there are no real financial tools, but rather institutional concepts, the majority of which belong to the EU1. One of the most important ones is the European Investment Bank, which supports the area by investing in energy infrastructure; transport and telecoms; environment; and human and social capital. Although 90% of projects financed by the EIB2 are based in EU1 member countries, the bank is funding projects in about 150 other countries. Another important institution is the European Bank of Reconstruction and Development that was founded in 1991 to help the numerous states build market economies. We can also find non-European institutions such as Islamic Development Bank or African Development Bank offering financing, strategic and politic advice towards integration. There is also the Deauville Partnership launched by the G8 to support countries in the Arab world engaged in transitions toward “free, democratic and tolerant societies.”
Unfortunately, economic cooperation does not work very well in the South and there is a lack of economic complementariness and integration. According to an ADB3 study of 2012, if there was greater cooperation between the countries, they would increase their GDP4 by 2-3%. Even though there were efforts to promote free trade among Southern countries (in particular the Close Neighbours Economic and Trade Association Council – Turkey’s initiative, but interrupted because of Syria), some countries, except Turkey and Israel, are still dependent on trading with other countries – particularly EU1 members and Gulf countries.
In the third session concerning Arab revolts, we learnt about the 3Rs, which are regime responses to the civil and political challenges. The 3Rs symbolise: Revolution (e.g. in Tunisia or Egypt), Reform (e.g. Morocco, Jordan) and Repression (e.g. Libya, Syria). One of the main revolutions in the Arab world was the Arab Spring that started in December 2010. It was a series of protests against the regime. This revolution characterised by the slogan “People want to bring down the regime”, is often compared to the one in Eastern Europe in 1989. In some countries the government responses to the demonstrations were very violent.
The Mediterranean needs many reforms, but the problem is that no one can tell us how to make them. The key is managing expectations and building high quality institutions. Many reforms are needed in politics, especially when it comes to democratization process; security and arm forces; media (the prevention of censorship); as well as judiciary and political freedom. Furthermore, reforms are also needed in economics, which concerns employment; education; tax system; subsidies; SMEs5 and the responsible management of the financial system. Last but not least, public administration must be reformed in regards to transparency; professionalization, and; accountability.
For example, ‘crony capitalism’ and corruption are major contemporary problems of the Arab world. In Jordan, the bourgeoisie and businessmen decided to organise a new movement and fight against the corruption. This movement appears to be very powerful. We can also find other Islamic movements like ASTELIS (Tunisia), EBDA (Morocco) or ASMECIS (Egypt) that have the same goal.
As far as new external powers in the Mediterranean are concerned, China is becoming very active in the region. It possesses the majority of construction companies in the region and invested €1,4 billion in countries like Qatar, Kuwait, Jordan and Egypt. Moreover, the trade volume between China and Arab countries doubled from 2009 to 2012. It is easier for Arab countries to get loans from China, because China, unlike the EU1, does not place as much emphasis on human rights.
The Gulf Cooperation Council, which is composed of Saudi Arabia, Kuwait, Bahrain, Qatar, United Arab Emirates and Oman, is also active in the Mediterranean, although its investments decreased since 2009. It was the second main investor in the Mediterranean from 2003 to 2008 after EU1. It supports mainly monarchist states and it financed the Islamic movement in Egypt.
Turkey is a specific case. As some EU1 members are against Turkey’s integration in the EU1, the country is becoming more and more active in its cooperation with Arab countries in order to ‘conquer’ other markets and maintain its competitiveness. It is a country that was able to build its own economy and prove that Islam and democracy can merge. Furthermore, it is the only country in the region that is self-sufficient in water and food. The GDP4 in Turkey grew 3 fold in 11 years, with revenue per capita increasing 4 fold and exports 4.5 times greater. Because of this, many proclaim that Turkey represents the “the missing T in the BRICS6”.
In conclusion, I would like to mention that I found Javier’s Albarracin lectures very enriching, complete and motivating for future tasks in the Altereurope Masters Degree. I am sure that these new pieces of information will be useful for our future studies and employment.
1 – European Union
2 – European Investment Bank
3 – African Development Bank
4 – Gross Domestic Product
5 – Small and Medium Enterprises
6 – Brazil, Russia, India, China and South Africa – rapidly developing countries