Académique Documents
Professionnel Documents
Culture Documents
J. Scott Carpenter
Washington Institute for Near East Policy
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July 2010
J. Scott Carpenter*
Washington Institute for Near East Policy
Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Economic reform:A Race Against Time? . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Political Reform: Moving at a Snail’s Pace . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Toward a Transatlantic Response? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Recommendations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
* J. Scott Carpenter is a Keston Family fellow and director of Project Fikra at the Washington Institute for Near East Policy.
Previously Mr. Carpenter served as deputy assistant secretary of state in the Bureau of Near East Affairs from 2004–2007.
Summary
With the Obama administration’s foreign policy Today, European and U.S. policy toward the
team preoccupied with a deteriorating situation region remains diffuse, fragmented, and largely
in Afghanistan, a dead-locked Palestinian- uncoordinated. Each sees the region through its
Israeli peace process, and a recalcitrant Iran own prism and neither has had the diplomatic
determined to have nuclear weapons, it energy to redress root causes of persistent economic
would seem an odd time to encourage a more and political pathology. And yet, four countries
energetic U.S. policy toward Europe and North of North Africa — Morocco, Algeria, Libya, and
Africa. And yet, such a policy could yield Tunisia — together represent an opportunity for
significant results with relatively few inputs. the United States and Europe to collaborate with
the governments, their respective peoples and each
Perceived by most U.S. policymakers as a other to deepen on-going economic reform and
comparatively problem free area, North Africa secure those reforms through better, and hopefully
has been historically ignored by the United more democratic governance. Alternatively,
States, which has seen it as more naturally permitting the status quo to persist risks allowing
Europe’s “backyard.” Only after 9/11, in fact, did a growing legitimacy crisis in each to torpedo
the United States pay any real attention to the inchoate reform and metastasize into full-blown
growing structural risks associated with the region instability, most likely through labor unrest, with
as a whole, developing bilateral, regional, and profound consequences for the United States and its
multilateral frameworks of various seriousness to European partners.
address the challenges it subsequently perceived.
North Africa, however, remained only a small part This paper explores recent economic and political
of the broader Middle East, and was not prioritized developments in each of the four countries and the
as a critical sub-region. mechanisms by which the transatlantic community
has sought to channel social, political, and economic
For the European Union the situation was precisely change in them — for both good and ill. It then
reversed. Priority was given to the countries on the offers recommendations to strengthen U.S.
EU’s Mediterranean border. In 1995, the European engagement with Europe to help secure positive
Union launched the Barcelona Process designed to economic and governance trends.
redress deep economic and social challenges that
risked negatively impacting European security.
Ten years later the European Union recognized
some successes to the approach but concluded that
the regional approach had largely not produced
anything similar to the extraordinary achievements
in the east. Its subsequent policy response has been
an extension of the European Neighborhood Policy
to North Africa, in many ways recognition that
a bilateral approach may offer bigger payoffs. In
2007, yet another policy overlay, the Union of the
Mediterranean, was advanced by French President
Nicolas Sarkozy and later incorporated into the
Barcelona framework at German insistence. The
Union of the Mediterranean’s impact, however, has
yet to be felt.
For most U.S. and European policymakers, Framework Agreements (TIFA) with the United
Morocco, Tunisia, Algeria, and Libya collectively States. Algeria and Morocco both have negotiated
convey a glass half full story. When compared association agreements with the European Union
to the profound challenges confronting the that will lead to open markets by 2012. Libya,
international community in Iraq, Afghanistan, emerging from its international isolation has
Palestine, Pakistan, and Yemen, to name just a few, applied for World Trade Organization (WTO)
the challenges of North Africa1 pale in comparison, membership.
dulling any sense of urgency in confronting its
problems. Together the four countries comprise a potential
market of approximately 82 million people with
The fog of lethargy and violence that seemed to access to markets in both West and sub-Saharan
blanket the region in the 1980s and 1990s has Africa. All have young populations that represent
clearly begun to lift. Algeria’s bloody civil war has a huge reservoir of potential human capital.
ended. Libya is slowly emerging from its decades- Moreover, three of the four countries look as much
long coma. Together, Algeria and Libya have west and north for models of emulation as they
proven oil reserves equivalent to 4.6 percent of the look east. Both Morocco and Tunisia participate
global total or nearly 61.5 billion barrels, of which in NATO’s Mediterranean Dialogue and routinely
Libya alone holds two-thirds. Algeria remains participate in joint exercises. All four cooperate
the largest exporter of natural gas with unknown actively with the United States and Europe on
potential. The recent opening of both countries to counterterrorism efforts and intelligence sharing.
major international oil companies promises to help Morocco has played host to numerous international
Europe diversify its energy supplies away from its meetings on reform in the Arab world and again
current dependency on Russia while at the same hosted the Forum for the Future in 2009, the
time providing significant resources for investment signature meeting of the G8’s Broader Middle East
in human capital. and North Africa Initiative. Not insignificantly, the
pathologies associated with the Palestinian-Israeli
All four countries have experienced modest yet conflict are geographically remote, even if they
significant economic growth in recent years as exert some political influence.
varying degrees of economic reform coupled with
a wave of globalization and a surge in oil prices has These positive aspects of the region are
raised all boats. From 2003 to 2008, average growth counterbalanced, however, by serious, persistent
rates exceeded 5.6 percent. While far slower than challenges. In the two most populous countries,
in the economies of East Asia this trend represents Morocco and Algeria, illiteracy remains stubbornly
solid growth. Apart from a late year spike in 2008, high, exceeding 50 percent and 70 percent,
inflation rates have been falling in all four countries respectively. Among women the rates are even
as has the ratio of debt to GDP. higher. Despite recent economic growth, poverty
remains a serious problem in both countries as well.
Trade has been an important driver of growth. Morocco’s annual per capita income barely exceeds
Morocco has a free trade agreement with the $4,000 and 20 percent of the population lives
United States and all have negotiated or are in below the poverty line. High unemployment and
the process of negotiating Trade Investment underemployment rates plague each country. At
the high end of the spectrum is Algeria with urban
1
For the purposes of this article, North Africa will refer to the
unemployment rates in excess of 30 percent.
four countries of Algeria, Libya, Morocco, and Tunisia.
* Average of political and civil liberties scores; 1 is most free, 7 least free; source: Freedom in the World 2008,
Freedom House
** Number of standard deviations from average, so that nearly all countries fall between –2.5 to 2.5; source: World Bank
Governance Matters 2009
*** The Heritage Foundation Index of Economic Freedom; 1 to 100, with 100 the most free
Since the late 1990s, each country in the region — if disjointed macroeconomic reform program,
even Libya, which emerged from its cocoon in particularly in the financial sector. These reforms
2003–04 — has embarked on a path of economic have won praise from the IMF and others. During
reform, principally as a regime preservation its most recent consultation with Tripoli, the IMF
strategy. At a macroeconomic level these reforms welcomed in particular the ongoing modernization
have had bite and earned the plaudits of the United of the central bank, advances in bank privatization,
States and Europe as well as the World Bank and and the assignment of an asset management
International Monetary Fund (IMF).4 However, the company to handle bad loans. Financial sector During the
sluggishness, even failure, of the reforms to increase reform, at least, has been going moderately well.5 rule of Colonel
the average citizen’s sense of well-being has added Qadafi, Libya’s
to demographic challenges increasing internal Libya has also succeeded in beginning the process
of diversifying its economy away from oil. Revenues small, educated
pressures on the regimes. Whether the macro gains
derived from hydrocarbons continue to make up population was
can trickle down fast enough to prevent broad
nearly 60 percent of Libya’s GDP, but non-oil sector cut off from the
social and labor unrest is one of the key questions
that linger over the region. Without deeper political growth has remained healthy, despite drop offs rest of the world
reform in Morocco and Tunisia economic reforms from double digit growth from an admittedly small over time.
may stall out. In Libya and Algeria, where political base in the early and mid 2000s. However, exports
vision is in shorter supply, the absence of a clear from the non-oil sector remain pitifully small
political direction risks dooming structural reform compared with petroleum exports, accounting for
before it gets solidly underway. only 2 percent of exports in 2008.
Libya: The Transitioner As long as oil prices remain relatively healthy, Libya’s
medium-term prospects for continued economic
Libya’s economic story, while currently promising, stability remain solid. Growth rates have averaged
is the shortest to tell. During the rule of Colonel 6.5 percent per year since 2005 and despite the global
Qadafi, Libya’s small, educated population was recession Libya is expected to experience growth in
cut off from the rest of the world over time. The 2009. Its strong fiscal surplus (25 percent of GDP)
stunning growth of the 1960s and 1970s was reassures the regime it can continue to meet the
replaced with stultification and sharp contraction basic needs of its people while the inflow of Western
in the 1980s and 1990s. Its socialist orientation technology to modernize and increase oil production
meant the government dominated every sector — despite recent OPEC decisions to cut quotas —
of an economy that was and remains heavily will guarantee out-year revenue.
dependent on the oil sector. While literacy rates
in Libya remain comparatively healthy, the Governance, however, will play an increasingly
government disinvested in education that in the important role going forward. Libya’s public
rest of the world was creating skills for the 20th and financial management systems, for instance,
21st centuries. remain extremely weak and are crucially in need
of reform. In the words of the IMF, “modernizing
Since Libya’s decision to rejoin the international the budget’s legal and administrative framework
community in 2003 and the subsequent lifting of to reduce extra-budgetary funds would enhance
UN sanctions, Libya has embarked on an ambitious
5
IMF Executive Board Concludes 2009 Article IV Consultation
4
Economic statistics listed throughout this section come from with the Socialist People’s Libyan Arab Jamahiriya, Public
the World Bank and IMF for the latest year, 2008, unless other- Information Notice (PIN) No. 09/121, September 21, 2009,
wise indicated. http://www.imf.org/external/np/sec/pn/2009/pn09121.htm
16
“Algeria: 2008 Article IV Consultation — Staff Report,”
April 29, 2009, http://www.imf.org/external/pubs/ft/scr/2009/
cr09108.pdf 17
http://www.imf.org/external/pubs/ft/scr/2009/cr09108.pdf
Algeria, Tunisia, and Libya — and Morocco to elections, the establishment of a vibrant press, a
a more limited extent — have sought to pursue legal environment that has led to the formation
economic reform without democratizing. Today, of numerous non-governmental organizations,
however, a shrinking group of elites is becoming including free trade unions, greater religious
dangerously disconnected from their people freedom, and the legal participation of one of
leading to a growing, if varied, legitimacy crisis the largest Islamist political parties in the region.
in each. Individuals and groups are abandoning Following successful elections in 2002, the
“shell democracy” for alternative forms of government passed a revolutionary family code Today, a shrinking
social expression creating a potentially perilous designed to empower women and instituted the group of elites
disconnect between the governing and the Equity and Reconciliation Commission (EIR), is becoming
governed. This may facilitate an authoritarian the most advanced reconciliation process for dangerously
government’s ability to press forward with deeper addressing the abuses of the past of any country in
disconnected
economic reform in the short term but may cause the Arab world.
from their people
broad, if episodic, unrest. The lack of democratic
legitimacy and hence a broad-based constituency Yet, the palace’s incremental reforms, however leading to a
for reform may also imperil the prospects of broad, have not been very deep and there has been growing, if varied,
pushing the process forward by tempting leaders to a marked slowdown, even reversal in some of these legitimacy crisis
accommodate strikers and put off critical subsidy key areas in recent years. There has been a sharp in each country.
and legal reforms. drop off in journalistic freedom, for instance. Since
the submission of the EIR’s final report, moreover,
If Morocco has received the most praise for its few of the structural reforms recommended have
efforts to reform the economy, the monarchy been implemented, and human rights abuses
has also impressed observers with steps taken so persist, though at a lower level than in the past.22
far to open its political system. Though far from The palace’s commitment to devolution of real
being the model democracy some claim for it, power has been fundamentally put into question.
Morocco remains the only country in North Africa As Freedom House concludes in its overview to
considered “partly free” by Freedom House in its this year’s report, “[f]rom all indications, it seems
annual survey of political rights and civil liberties doubtful that authorities plan to make significant
around the world, but just barely.21 institutional reform.”23
On the death of his father King Hassan II in 1999, A key indicator in evaluating the palace’s
Mohamed VI launched a series of incremental commitment to moving forward will be the degree
political reforms that sought to modernize to which the palace devolves real power to the
Morocco’s political system and devolve power parliament in coming years. Today, Morocco’s
away from the palace. In the ten years since then, parliament remains a toothless institution with little
Morocco has witnessed its first reasonably open ability to affect government policy. Opposition is
largely proforma and the 2007 victory of Istiqlal
(Independence Party) reinforced the impression
21
Freedom House gives every country it evaluates two
scores, one for political rights and one for civil rights. In
each, a score of one is the highest degree of freedom while 22
Interview with State Department officials, October 2009.
a score of seven is the least. In 2008, Morocco failed to
budge its score of five in the area of political rights but 23
“Freedom in the World, 2009, Morocco,” Freedom House,
continued to do moderately better in the areas of civil http://www.freedomhouse.org/template.cfm?page=22&year=20
liberties where it has scored a four for the past three years. 09&country=7666
24
It is interesting to compare support of Jordanians for their 26
For a fascinating discussion of this new “social dynamism”
parliament where MPs are empowered at least to hand out some phenomenon, read the transcript of Amr Hamzawy’s presen-
jobs and services. tation at the Carnegie Endowment when launching his and
25
“Final Report on the Moroccan Legislative Elections,” Septem- Marina Otaway’s book “Getting to Pluralism: Political Actors
ber 7, 2007, National Democratic Institute, 2007, p. 2. in the Arab World,” http://www.carnegieendowment.org/
files/0916_transcript_pluralism3.pdf
In the face of these economic and political reform. Europe’s broader regional approach
challenges, Europe and the United States have remained tied in knots related to the vicissitudes of
pursued various strategies designed to tackle the Palestinian-Israeli conflict that many Europeans
the key challenges in North Africa. Each has accepted as an excuse for not making more progress
perceived those challenges through its own prism on reform related issues. The bilateral approach,
and responded accordingly; neither response as pursued through association agreements also
has achieved everything desired and both could had limited impact, except in the area of trade,
be strengthened through improved information where the refusal of the European Union to open its
sharing, cooperation, and, in some cases, agricultural markets curbed broad gains that might
coordination. More importantly, without more have otherwise been achieved.
visionary leadership from the leaders of partner
countries, neither approach will achieve much. After EU enlargement took place in 2004, Brussels
developed the European Neighborhood Policy
From 1995 to 2005, Europe’s primary vehicle Initiative (ENPI) to reassure nervous nations that
for interaction with North Africa was the Euro- did not make it into the European Union that
Mediterranean Partnership, better known at the enhanced cooperation with Europe was still a
Barcelona Process. Launched in part to appease the possibility. Core to ENPI are bilaterally negotiated
southern members of the European Union at a time action plans “with reform-minded governments”
when Germany and Brussels were more focused that offer “a deepening of the political relationship
on the states of Central and Eastern Europe, the and the prospect of a significant measure of
Barcelona Process also came at a time of broad, economic integration through gradual integration
if misplaced, European optimism about the in the EU internal market.” Each action plan sets
prospective end to the Palestinian-Israeli conflict. out agreed reform priorities that once negotiated
are funded by the European Union. Positive
Over the course of ten years, however, Barcelona conditionality theoretically creates the incentive
achieved disappointingly few results, especially mechanism to produce results. Currently, the
when compared to the progress made by Central European Union has action plans with Morocco
European nations. Intraregional trade remained and Tunisia. Algeria has refused to agree to an
extremely low. Economic growth, though positive, action plan, content with the association agreement
was unbalanced and there was actually a regression it signed in 2002.
in governance indicators.30 The vision had been and
remains a good one,31 but implementation failed Last year, yet another layer was added to the
to overcome key obstacles related to the absence of Barcelona Process to incorporate President
regional integration and the even more profound Sarkozy’s notion of establishing a Union for the
absence of visionary leadership committed to Mediterranean. First announced in May 2007,
Sarkozy’s concept paid lip service to the “successes”
of the Barcelona Process, but proposed to scrap it
30
UNDP Arab Human Development Report, 2009, p. 263.
for a completely new arrangement that promised
31
The Barcelona declaration’s political vision states in part, “The closer political ties with the EU’s southern member
general objective of turning the Mediterranean basin into an
area of dialogue, exchange, and cooperation guaranteeing peace, states. The French were forced to back down,
stability, and prosperity requires a strengthening of democracy however, by the Germans, primarily, who rejected
and respect for human rights, sustainable and balanced eco-
nomic and social development, measures to combat poverty, and
the notion that southern member states could
promotion of greater understanding between cultures.” embark on a project of this scale without them,
34
The United States currently has bilateral aid relationships with 35
See among others, “The Greater Middle East Initiative:
Egypt, Jordan, Morocco, Palestine, and Yemen. The largest by far Off to a False Start,” Thomas Carothers, Marina Ottaway,
is Egypt’s, where the first review was conducted and where the Carnegie Policy Brief, no. 29, March 2004, http://www.carnegie
most wholesale change took place. endowment.org/publications/index.cfm?fa=view&id=1480
The United States and Europe should consciously As part of an enhanced relationship, Morocco
embrace the notion of “variable geometry,” so should commit to doing more on its stated
operative within the European Union context, commitment to political reform. Hopefully,
in their approach to North Africa. Rather than demonstrated success in Morocco will lead other
force integration, the United States and Europe countries in the region to follow suit.
should work more closely with those governments
prepared to take steps to improve their economies. The United States and European Union should
The United States recommit to efforts to establish a free trade area
should work with As part of this effort, Europe should seek to educate within North Africa and work together to support
U.S. policymakers on the elements of individual the evolving common market between Morocco,
the European
action plans with an eye to coordinating political Tunisia, Jordon, and Egypt as part of the Agadir
Union and the
messages to the governments of the region. This agreement. Currently, rules of origin between the
rest of the G8 to
could take place shortly after the Brussels biannual United States and Europe differ to an extent that
refashion BMENA assessments of progress within the action plans. the United States is handicapped in doing more
with an eye toward The United States should reciprocate by sharing to help. Domestic political considerations on
enhancing its core elements of its Embassy’s Mission Performance Capitol Hill also impede the current White House’s
political aspects Plan (MPP) objectives for a given country. This enthusiasm for the Middle East Free Trade Area,
for more reform- routine information sharing will be critical to but the atmosphere may become more conducive in
oriented countries. ensuring resources are targeted correctly. Although 2011 after mid-term elections.
it remains unlikely — and perhaps undesirable —
that the respective efforts would ever be integrated, The United States should work with the European
greater coordination should be the ultimate Union and the rest of the G8 to refashion BMENA
objective of such talks. with an eye toward enhancing its political aspects
for more reform-oriented countries. This would
Morocco should be the first test case for more create an additional incentive for those countries
intensive coordination. The United States and looking to go further faster in their reform agendas.
the European Union both need a success story The Sea Island documents establishing BMENA
to point to, and despite its many challenges, clearly allow for this.39
the Moroccan government’s demonstrated
commitment to economic reform recommends The United States and the European Union should
it for more attention. Already, the United States do more to stimulate the demand side of the
and European Union are committing significant reform equation by working together to uphold the
resources to Morocco. The Millennium Challenge principle that nongovernmental organizations can
Corporation (MCC) Compact with Morocco, receive foreign funding so long as it is documented
which entered into force in September 2008, as coming from credible sources. As a corollary,
allocates $697.5 million over a five-year period both should do better at creating a mechanism to
to reduce poverty. Europe’s action plan, although make smaller grants available to such organizations
more comprehensive in approach, works in across the region. A recent USAID Inspector
many of the same sectors and committed an
additional 682 million euros for the period 39
See for example paragraph 1.5 of the G8 Plan for Support,
2007–2010. Clearly, more formal information June 2004, calling for “willing partners” to come together to
form the Democracy Assistance Dialogue (DAD). Currently,
sharing would ensure enhanced impact. Italy, Morocco, Yemen and Turkey are active in the DAD. http://
www.g7.utoronto.ca/summit/2004seaisland/reform.html
While it is unrealistic to expect the United States At the mission level, U.S. ambassadors and USAID
to commit significant resources to addressing the directors should meet regularly with their European
The Obama
challenges of North Africa, modest bureaucratic counterparts to share information and, if possible,
administration
adjustments, coupled with programmatic and coordinate messages, if not efforts, to stimulate
policy tools, could have a real impact. reform. Once the new European External Action
should establish a
Service is in place, following full implementation Deputy Assistant
The Obama administration should establish a of the Lisbon Treaty, EU ambassadors will have Secretary
Deputy Assistant Secretary (DAS) dedicated some ten times the resources of existing European dedicated
exclusively to North Africa within the Bureau of country embassies, according to one account.41 exclusively to
Near East Affairs or the Bureau of African Affairs. The United States should help to galvanize internal North Africa within
Currently, the DAS responsible for North Africa European coordination by prioritizing diplomatic the Bureau of
also oversees both the Office of Gulf Affairs as and development activities with this embassy, Near East Affairs
well as the Office of Regional Affairs. The latter increasing the possibility of greater coherence in or the Bureau of
is responsible for handling all functional and transatlantic cooperation at the country-level.
multilateral issues in the region as a whole and for
African Affairs.
developing the Bureau’s budget for the region each Funding for MEPI projects specific to Algeria,
year. The DAS responsible for MEPI, nominally Libya, and Tunisia should also be increased.
responsible for advancing U.S. reform strategies in Rich oil-producing states are not candidates for
the region, also has an extensive portfolio covering economic assistance but key reform areas critical
all countries from Morocco to Iran, effectively to governance (e.g. judicial reform, independent
barring a concentrated focus on North Africa. media, etc) do not require large amounts of
funding, and are vital to the development of more
This DAS would be responsible for driving policy responsive states.
related to the region as a whole, establishing
41
See “The Lisbon Treaty: Implications for Future Relations
“Audit of USAID/EGYPT’s Democracy and Governance
40 between the European Union and the United States,” Testimony
Activities,” Audit Report No. 6-263-10-001-P October 27, 2009, to the House Committee on Foreign Affairs, Subcommittee on
USAID, Office of the Inspector General, http://www.usatoday. Europe, December 15, 2009, Dr. Daniel S. Hamilton, p. 3.
com/news/pdf/usaidaudit.pdf