By Andy Sambidge
President says crisis in region shows that better governance is crucial for economic development
The crisis engulfing the Middle East and North Africa shows that greater citizen participation and better governance are crucial for economic development, according to World Bank Group President Robert B Zoellick.
Zoellick said the World Bank would not only promote institutional reforms in the region but also look into providing more support for civil society as a way of making government more accountable to people.
“Our message to our clients, whatever their political system, is that you cannot have successful development without good governance and without the participation of your citizens,” Zoellick told an audience in Washington DC.
“We will encourage governments to publish information, enact Freedom of Information Acts, open up their budget and procurement processes, build independent audit functions, and sponsor reforms of justice systems," he added.
"We will not lend directly to finance budgets in countries that do not publish their budgets or, in exceptional cases, at least commit to publish their budgets within twelve months.”
His comments came as the MENA region continues to be affected by political unrest, with protests also hitting Gulf nations Bahrain, Oman and, to a lesser extent, Saudi Arabia.
Zoellick said that issues such as corruption, gender and transparency were in the past not mentioned at the World Bank because they were seen as too political.
But more recently, he said, each had become recognized as crucial for successful development. Likewise, citizen participation and good governance are recognised as must haves for economic success.
”Some of that may be what we think of as politics, but most of it is also what we know is good economics; most of it is what we know is good for fighting corruption; most of it is what we know is good for inclusive and sustainable development,” Zoellick said in a speech entitled The Middle East and North Africa: A New Social Contract for Development.
Zoellick said the World Bank, just as it had moved over the last six decades to supporting the private sector from originally financing just governments, should consider how to provide more support for civil society.
“Now it may be time to invest in the private, not-for-profit sector – civil society - to help strengthen the capacity of organisations working on transparency, accountability, and service delivery,” Zoellick said.
"We could give priority to countries in the Middle East and North Africa, and in Sub-Saharan Africa. We could back this work with seed capital, and with knowledge exchange and research aimed at improving the enabling environment for social accountability.”
Surveying the economic performance in the Middle East and North Africa, Zoellick noted it is the region that is poorly integrated into the global economy.
It also suffers the highest unemployment among developing regions, the highest jobless rates among the best educated, the lowest economic participation rates by women.
He said its governments now faced enormous expectations to provide jobs quickly in a region where the direct opportunity cost of youth unemployment is estimated at up to $50 billion a year.
Noting that the region needed to create 40 million jobs over the next decade, Zoellick said countries had to make policy decisions now about how to boost employment, add to productivity, and better integrate with the global economy.
“There are many roads to prosperity, but one must be taken. Inaction leads nowhere,” Zoellick said.
Summing up the needs in the Middle East and North Africa, Zoellick said: “They want a new social contract. They want dignity. They want respect. And if they are women, they want these same things.”