Author

Grace Funk

Image from Wikimedia Commons: https://commons.wikimedia.org/wiki/File:Kingdom_Tower_at_night.JPG.

Clouded Vision: The Flawed Economic Policy of Saudi Arabia’s Vision 2030

1. Introduction and Background

Oil is the core of the Saudi Arabian economy. The country is the largest exporter of oil in the world, and it typically derives about 90 percent of its government revenue from it. Thus, Saudi Arabia can be classified as a rentier state – defined by Hossein Mahdavy as a state that derives a majority of revenue from rents on natural resources like oil. Oil rents, as a percentage of gross domestic product (GDP), have typically consisted of between a quarter and two thirds of total Saudi Arabian GDP.

Revenue from oil, however, is not reliable as it once was for Saudi Arabia. Between 2010 and 2014, a barrel of oil sold at an average of 100 dollars, but between 2015 and 2018, the price dropped to an average of 50 dollars per barrel and has only slighted rebounded in 2023 to 70 dollars. The International Monetary Fund (IMF) has warned rich Arab Gulf countries, like Saudi Arabia, about the risks of relying on oil to support citizen and government income. Additionally, the IMF has encouraged the diversification of oil-dependent economies to better support and stabilize economic growth.

In response to the decline in world oil prices and concerns about economic stability, Saudi Arabia’s Crown Prince Mohammed bin Salman bin Abdel-Aziz Al Saud (MBS) launched an economic redevelopment plan in 2016. Based on a report from the American consulting firm McKinsey & Company, this plan – named Vision 2030 – aims to diversify the country’s economy and reduce dependance on oil. Vision 2030 plans to transform the Saudi Arabian oil-based economy to one based on knowledge instead. A knowledge economy recognizes the role that knowledge and technology have in economic development and emphasizes progress in human capital, education, employment, information and communications technology, and innovation. Saudi Arabian citizens would have access to better education and career opportunities without the risk of economic downturn due to fluctuating oil prices.

But, Vision 2030 and its current trajectory will fail. As is, it overpromises and will underdeliver. The plan can be successful, though, if three major components are implemented: greater input from Saudi Arabian citizens, non-exploitative economic roles for women, and extensive education reform. MBS has the power to refine Vision 2030 into a feasible plan – one that can actually be completed by 2030. He can break the failed streak of five previous economic development plans for Saudi Arabia that began in 1970. Furthermore, the Saudi Arabian government has a duty to ensure a stable economy and competitive opportunities for its people in an increasingly globalized world.

2. Vision 2030’s Underwhelming Policies and Progress

Vision 2030 has made little progress since its introduction in 2016. Coupled with this disappointing start, the plan’s budget is ambitious. The projected budget is 2 trillion dollars (a decrease from the initial McKinsey estimate of 4 trillion dollars), which is supposed to double Saudi Arabia’s GDP. However, the ability to raise such an amount of money is “practically next to impossible, unless crude oil prices see a significant appreciation, or Saudi Arabia plans to sell a higher portion of Aramco,” the national oil company. Additionally, the Saudi Arabian budget is notably opaque, ranking 107^th of out 115^th in the world in transparency levels – which does not inspire faith in budget reform or accountability. Saudi Arabia already spent billions of dollars on several failed 5-year reform plans, which resulted in 90 percent of its annual budget still dependent on oil revenues.

The plan’s underwhelming record – and near impossible budget – foretells a corresponding underwhelming outcome for the Saudi Arabian economy and its people. In fact, the three main sections of Vision 2030 – the Privatization Program, the Public Investment Fund Program, and the National Industrial Development and Logistics Program – are particularly behind schedule in their goals. And, the lack of economic growth under these three programs must be interpreted by the Saudi Arabian government as a call to action.

2.1 The Privatization Program

The Privatization Program aims to increase employment in the private sector while reducing the number of citizens reliant on government income. Seventy percent of the Saudi Arabian workforce is employed by the public sector, mainly in bureaucratic positions, where they are accustomed to relatively high and stable salaries. Saudi Arabia has recruited foreign nationals to work in the private sector; they consist of more than 80 percent of the privatized workforce. These private sector jobs are often in the industrial or retail sectors or in private households– jobs that the average Saudi Arabian citizen does not want. Rather, they prefer the security, longevity, and high income of a government post. Paradoxically, greater privatization could actually increase foreign skilled labor, for many Saudi Arabians currently “lack the necessary skills and motivation to do [the private sector’s] manual or strenuous work.” The government has attempted to create “favorable conditions” to encourage private sector job growth through teleworking policies and an online job-seeking platform. But, there is little evidence that these policies have supported growth.

Thus far, the Privatization Program has not met its goal of increasing employment in the private sector. It has, however, privatized four milling companies, finalized agreements for two water desalination projects, and completed Phase 1 of an initiative to “attract private investment to finance the construction of education buildings.” These accomplishments are vague and have not realistically contributed to increasing private employment levels. In 2019 alone, the number of private-sector jobs – both for foreign and domestic workers – dropped by more than 200,000. Moreover, the number of Saudi Arabians employed in the private sector only increased by 36,000 during 2015-2019 even when two million foreign workers left the economy since 2016.

2.2 The Public Investment Fund Program

The goal of the Public Investment Fund (PIF) Program is to become the world’s largest sovereign wealth fund and to transfer ownership shares of Aramco to the Saudi Arabian public. The program plans to reinvest the wealth it has accumulated into the Saudi Arabian economy to fund technology and infrastructure, hopefully creating jobs. For example, it committed to investing 150 billion Saudi Arabian riyals (equal to about 40 billion U.S. dollars) into the economy each year from 2021 to 2025. Yet, no data from the government has been released to substantiate the commitment, and instead, the PIF’s money is instead invested in Uber (3.5 billion dollars) and Softbank’s technology fund (100 billion dollars). Without transparency, the PIF is in danger of becoming a “political tool” rather than an economic one; it can also be vulnerable to corruption if the public cannot check the government’s power.

To raise money for the PIF Program, Saudi Arabia has decided to offer an initial public offering (IPO) of state-owned Aramco. Aramco is valued at 2.5 trillion dollars, and this IPO, at 5 percent, is worth approximately $125 billion dollars. Saudi Arabian policymakers hope that by selling shares of Aramco to the public, the PIF can become the world’s largest sovereign wealth fund and replenish the Saudi Arabian economy with its profits derived from citizens’ personal wealth. To be able to fund Vision 2030, however, the government will likely have to sell up to 49 percent of Aramco’s shares, which is a divergence from its initial 5 percent IPO. No data of Saudi Arabian citizens buying shares has actually been recorded or released. Oil, particularly the Aramco company, is still the backbone of the Saudi Arabian economy because Vision 2030 in its present state has not been successfully implemented. So, Saudi Arabia is unlikely to relinquish almost half its ownership of Aramco.

2.3 The National Industrial Development and Logistics Program

The National Industrial Development and Logistics Program’s objective is to diversify industry through the development of the energy, logistics, manufacturing, and technology sectors. It focuses on “unlocking the full potential” of “local content” and the “Fourth Industrial Revolution,” which is driven by technology advances and digitalization of information. Specifically, it aims to raise gas production, grow renewable energy sources, and improve the local, regional, and international “connectivity of trade and transport networks.” Technology is alluring to Saudi Arabia and its policymakers for modernization purposes. But, the country cannot become a center of industry under its current structure because its citizens do not have many of the necessary skills to adapt to a technology-driven workforce. Because of the underperforming education system, many Saudi citizens are unprepared to take on jobs like these that require training and critical thinking.

Increasing access and quality of education is crucial to economic success. The Saudi Arabian education system, though, is lacking in teaching critical thinking skills that spur innovation in students. Rather, rote learning methods, such as memorization, are implemented. To make the National Industrial Development and Logistics Program successful, the Saudi Arabian government must invest in education reform – and in their citizens.

3. A Tripartite Policy Recommendation

Vision 2030 can be successful. The Saudi Arabian government, however, must address three significant issues: the lack of citizen input, the exploited role of women, and the underachieving education system.

3.1 Input from Citizens: The Saudi Center for Opinion Polling

MBS recruited the American consulting firm McKinsey & Company to construct Saudi Arabia’s economic development plan – notably without input from ordinary Saudi Arabian citizens. McKinsey’s Vision 2030 did not fully account for the people’s reluctance to leave higher-paying, public-sector work. Without understanding Saudi Arabian citizens’ perspective on economic reform, Vision 2030 cannot truly meet their needs. Thus, to make Vision 2030 more achievable, the Saudi Arabian government must survey its people to understand their realistic views.

The Saudi Center for Opinion Polling (SCOP) must adopt a greater role in surveying the Saudi Arabian people for Vision 2030 to reflect their economic needs more accurately. Previously, SCOP polled Saudi Arabian citizens above age 15 through a randomly generated list of phone numbers regarding women’s ability to drive. It was expected that passing a law to allow women to drive would be unpopular with the general public, but it was overwhelmingly popular – with over two-thirds of those surveyed in support. Policymakers were bolstered by the strong response and ultimately passed a law allowing for women to drive.

SCOP’s data has power and should be utilized by policymakers to devise and implement Vision 2030’s economic policy. Citizen engagement is “key to improve trust between government and citizen” and is “vital for improved evidence-based policymaking.” Too often, citizens’ voices are not heard. The anthropologist Fernando Coronil argues in his book The Magical State that oil-rich state planners, such as those from Saudi Arabia, often undertake developmental projects “beyond the limits of reality;” they overestimate their state’s capacity for “wholesale change.” MBS and McKinsey have manufactured an overly ambitious agenda. For example, increased private employment is a foundation of Vision 2030’s Privatization Program, yet many Saudi Arabian citizens do not want to leave their secure public sector jobs. I propose that SCOP must be considered as a crucial tool of the Saudi Arabian government to adapt Vision 2030 into a more realistic vision.

The main barrier to a greater role for SCOP is logistical. The government has already given the program its approval: SCOP was utilized in surveying Saudi Arabian public opinion before on single issues (for example, women and the right to drive). Now, SCOP’s abilities and technology must be expanded to survey Saudi Arabian adults, who comprise 75 percent of the country’s population, on the multitude of issues addressed in Vision 2030. SCOP may need to increase its size and hire more employees, which has the added benefit of adding jobs to the economy, one of Vision 2030’s main goals. The center’s research capability can grow if expanded and given access to greater funding and technology by the government.

3.2 Women as Equal Economic Partners: An Unexploited Role

Vision 2030 is not truly transformative in all respects because it plans to exploit female labor. While Vision 2030 proposes greater access to the public sphere for women, women are still denied agency in other areas of their lives. For example, women cannot open a bank account without permission from a male, thus preventing them from economic independence. Their interests are frequently neglected by Saudi leadership in an attempt to placate the country’s hardline Wahhabi Muslim clerics. From a Wahhabi religious perspective, women are seen as the “guardians of the moral integrity of the nation, producers of the future pious generation, keepers of tribal and Arab purity, and markers of the nation’s commitment to Islam.” Economic participation is not included in their role defined by the powerful religious leadership; the Wahhabi perspective conflicts with Vision 2030’s plans.

Vision 2030 claims that women are an integral part of the economy. It “alludes” to increasing the percentage of women in the workforce from 22 percent to 30 percent by 2030. How, though? Women are often banned from working in unsegregated places, and opponents persistently advocate for placing limits on how late they can work or how they can be employed. Thus, these limits must be repealed by the Saudi Arabian government to allow women to freely exercise their economic power. Women must be treated as equal economic partners rather than an influx to the labor force.

To create sustainable development for women as part of the labor force, Vision 2030 must implement measures to decrease influence of social and religious norms that prevent women from economic participation. The plan must break with traditionally conservative Wahhabi expectations of women as primarily the caretaker of the household.

The Saudi Arabian government can enact several measures to help women achieve their full economic potential. First, it can eliminate the gender pay gap between women and men to demonstrate that it understands the value of women in the workplace. Women currently earn about 56 percent of a man’s wages. The Saudi Arabian government could direct money from the PIF Program to reducing and eliminating the pay gap. Equal pay is an investment in their labor force, after all. Second, it can allow women to be employed in any profession – as of now, certain opportunities, such as becoming a judge, are restricted to men only. Third, it must penalize employers who require a male guardian’s permission for a woman to work, for it is technically legal – although Vision 2030 claims that women are equal economic partners to men.

Increasing female economic participation in Saudi Arabia will receive pushback. Even though MBS’s Vision 2030 aims to modernize the economy (and Saudi Arabia as a whole), Wahhabi doctrine and traditional gender norms are ingrained in the country. For instance, women were only allowed to drive beginning in 2018. And, it is not expected that Saudi Arabia will achieve full gender equality in its economy by 2030. However, the country will achieve no progress if it does not at least try to integrate more women in the workforce. My proposals can be viewed as starting points in the pursuit of economic equity that can one day lead to a long-term solution.

3.3 Education Reform: Implementing Critical Thinking Skills

Saudi Arabia requires a trained and educated citizenry to form a knowledge-based economy. But, there is a lack of knowledge and implementation of critical thinking in the Saudi Arabian education system. Thus, the education system must be reformed by the state to produce skilled workers in a knowledge-based economy and allow its National Industrial Development and Logistics Program to succeed.

The World Bank and the McKinsey Global Institute advised Saudi Arabia even before Vision 2030 was created to reform its education policy to avoid future economic decline. A majority of Saudi Arabian teachers interviewed in a recent study added that there is a “lack of trained professionals [in the system,] and many schools are now staffed by employees ill-equipped to implement reform or improve quality.” Additionally, the education system has been criticized for giving “less importance to the social and hard sciences” while “emphasizing religious studies at all levels of education.” Saudi Arabia was one of the lowest performing countries for mathematics, performing below the low benchmark scores. Vision 2030 needs to make education reform a priority for the country.

Teachers must be trained in depth to replace rote learning methods, common in Saudi Arabia, with a more collaborative, thoughtful, and critical approach to develop students’ higher-order thinking skills. School curricula must include opportunities for students to practice critical thinking, often practiced in liberal arts courses. Schools must teach critical thinking and other higher-order cognitive skills that can encourage creativity. To that end, Saudi Arabia can establish more universities and/or programs that focus on the social and hard sciences and the liberal arts. For example, there are no institutions in Saudi Arabia that teach business or political science, which is deeply hurting the country’s attempt to transform into a knowledge-based, industrious economy. Education is connected to the economy, for a citizen’s education prepares them for their life’s work. Put simply, knowledge is required for a knowledge-based economy.

Education reform in Saudi Arabia is related to Vision 2030’s labor goals. The country wants to strengthen the manufacturing, energy, and technology sectors, among others, and in return needs an educated citizenry to fill those jobs. Reform will also increase employment among Saudi Arabia’s indigenous population and reduce the needs for expatriate labor. The teaching standards in Saudi Arabia must be raised to create a skilled workforce that can strengthen and diversify the economy.

The Saudi Arabian education system cannot be transformed quickly. Like my proposal to increase female economic participation, education reform will be met with criticism, perhaps even disapproval. Teaching critical thinking in schools will lead to an educated public, and an educated public has the power to strategically organize and lobby against the government for increased rights. To an authoritarian government, such as Saudi Arabia, an educated public is a threat, for it can demand reform across society. So, to obtain government support for an education system founded on honing critical thinking skills, reforms must be framed mainly – if not solely – as economically beneficial. Future economic prosperity through a learned citizenry must be at the forefront of the campaign for economic reform.

4. Conclusion

Currently, Vision 2030’s plans to revitalize the economy are unrealistic and have made underwhelming progress thus far. But, Vision 2030 can be made feasible if the tripartite policy solution – greater citizen input, increased female economic participation, and education reform – is implemented by the Saudi Arabian government.

Image source: BroadArrow on English Wikipedia

January 24, 2024 0 comment

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China Economics Featured Print Article The International Economy

The Recession-Proof Luxury Market

written by Grace Funk

The world economy is on the brink of a recession. According to statistics from the research firm Ned Davis, there is a 98 percent chance of a global recession occurring in the next year. (1) The firm has only before recorded such high probabilities twice before: in 2008, during the American financial crash, and in 2020, during the COVID-19 pandemic. Generally, a recession is understood as two consecutive quarters of negative GDP growth, but this definition can neglect other significant factors like employment and income levels. A more developed definition comes from the National Bureau of Economic Research, which states that a recession is “a significant decline in economic activity that is spread across the economy and that lasts more than a few months.” (2) Faced with grim economic prospects, consumers across the world anxiously await 2023.

In periods of economic downturn, discretionary spending, which often includes fashion and travel, is significantly reduced. The average person is often ambushed by the two-headed monster: inflation – which remains high at 9.1 percent – and recession. (3) And, as is happening now, revenge spending–when consumers spend saved money to make up for lost time during tough economic periods–is decreasing, as many parts of the world have (hopefully) passed the height of the pandemic. So, with a looming recession and decreased revenge spending, one would think the luxury market would flounder in 2023 as well.

However, one would be wrong.

The luxury market remains immune to the warning signs of a global recession. Currently, the market is valued at approximately 353 billion euros (377 billion dollars), a figure which is expected to grow at least 3 to 8 percent next year (4). While the International Monetary Fund is projecting that the worst is yet to come regarding economic downturn, conglomerates like Moët Hennessy Louis Vuitton SE (commonly known as LVMH) post strong sales that surpass analyst profit estimates. (5) Ninety-five percent of all luxury brands have in fact achieved “positive sales growth” in 2022, forecasting even greater success in 2023. (6)

Brands like Walmart, Best Buy, and Gap, on the other hand, are all bracing for dismal futures. Many of their consumers are simply not spending because of inflated prices and recession fears. The luxury market, however, does not project a gloomy future, for it is well insulated by its stable and wealthy consumer base. The Chief Financial Officer of LVMH, Jean Jacques Guiony, remarked upon the so-called disconnect between the global economy and the luxury industry. (7) “Luxury is not a proxy for the general economy,” he stated. “We end up selling to affluent people and they have a behavior of their own, which is not necessarily totally aligned with economics.” When Louis Vuitton, for example, raises prices, its average consumer will still be able to afford its products. In stark contrast, much of the world’s population actually feels the effects of inflation and recession and will reduce their consumption as a result.

Many wealthy buyers from Asia and the United States have taken advantage of the dollar trading for more than a euro for the first time in 20 years and have traveled to Europe to buy their luxury goods. (8) Chanel, whose classic flap bags sell for 9,000 euros – 8,850 dollars – has lines out the door on Paris’s Rue Cambon. Leather goods from heritage brands like Hermès and Louis Vuitton are considered investments that will hold value over time. And, this year alone, the average transaction for an American at a luxury goods store in Europe totals about 1300 dollars, significantly greater than the average of about 530 dollars in 2019. (9)

China, once holding a powerful stake in the luxury market, has suffered under Xi Jinping’s zero-Covid policy and its resulting shutdowns of public places like shopping centers. Luxury stores were inaccessible. Because of this, China’s share in the luxury market is estimated by Bloomberg Intelligence to have been halved in 2022. (10) But, as the zero-Covid policy begins to relax, Chinese consumers – potentially poised for revenge spending – will rely on luxury boutiques in second- or third-tier cities like Chengdu or Hainan for their luxury needs because of government restrictions on international travel. Ordinarily, these consumers would travel to London, Paris, Seoul, or Hong Kong to visit luxury boutiques, but they now mostly travel regionally instead of internationally to access luxury goods. Interestingly, the luxury market has not been adversely affected by the decreased spending of Chinese shoppers; this is likely because the American and European markets are booming. And, even though China’s share in the luxury market has dipped in zero-Covid times, it will rebound in the future. In fact, Chinese consumers are expected to comprise 40 percent of all luxury consumers by 2030. (11)

The luxury market has demonstrated its resiliency to recession in 2021 and 2022. While most of the world is currently preparing for a period of economic downturn, money keeps flowing to luxury brands from the very wealthy and ultra-wealthy – about 20 percent of their clientele. (12) This recent success of the market reflects larger class disparities within and between each country. Elite wealthy consumers partake in acts of revenge spending, but the harsh reality is that most of the global population does not have the resources – or luxury – to do so.

In short, as the world economy sinks around it, the luxury market is doing just fine.

Endnotes:

1: Kristopher Fraser. “Is luxury fashion proving itself recession proof?” Fashion United, August 23, 2022. Accessed December 14, 2022, https://fashionunited.uk/news/business/is-luxury-fashion-proving-itself-recession-proof/2022082364782.

2: Jamie Johnson. “Are We in a Recession: the Answer Isn’t That Simple.” Business Insider, October 26, 2022. Accessed December 15, 2022, https://www.businessinsider.com/personal-finance/are-we-in-a-recession.

3: Allison Morrow and Christopher Hickey. “5 signs the world is headed for a recession.” CNN, October 2, 2022. Accessed December 15, 2022, https://www.cnn.com/2022/10/02/business/global-recession-fears-explained/index.html.

4: Lauren Indvik. “Luxury market forecast to grow despite global recession fears.” Financial Times, November 15, 2022. Accessed December 14, 2022, https://www.ft.com/content/8b795dde-cc05-4d2b-b84c-35234e4b47ab.

5: Angelina Rascouet. “Luxury Goods Still Sell Big Even As Recession Fears Grow.” Bloomberg.com, October 20, 2022. Accessed December 15, 2022, https://www.bloomberg.com/news/articles/2022-10-20/luxury-goods-still-sell-big-even-as-recession-fears-grow.

6: Ron Emler. “Luxury sector will be ‘resilient to recession’ in 2023, say consultants.” The Drinks Business, November 22, 2022. Accessed December 15, 2022, https://www.thedrinksbusiness.com/2022/11/luxury-sector-will-be-resilient-to-recession-in-2023-say-consultants/.

7: Angelina Rascouet. “Luxury Goods Still Sell Big Even As Recession Fears Grow.” Bloomberg.com, October 20, 2022. Accessed December 15, 2022, https://www.bloomberg.com/news/articles/2022-10-20/luxury-goods-still-sell-big-even-as-recession-fears-grow.

8: Ibid.

9: Nick Kostov. “Americans Flock to Europe for Holiday Shopping Binge.” The Wall Street Journal, December 12, 2022. Accessed December 14, 2022, https://www.wsj.com/articles/americans-flock-to-europe-for-holiday-shopping-binge-11670797821.

10: Elizabeth Paton. “In China, Luxury Shopping Faces Ongoing Headwinds.” The New York Times, December 7, 2022. Accessed December 16, 2022, https://www.nytimes.com/2022/12/07/business/dealbook/covid-china-luxury-shopping.html.

11: Ibid.

12: Ian Krietzberg. “Ultra-rich still shopping for luxury despite inflation, recession fears.” CNBC, August 13, 2022. Accessed December 14, 2022, https://www.cnbc.com/2022/08/13/ultra-rich-still-shopping-for-luxury-despite-inflation-recession-fears.html.

June 4, 2023 0 comment

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Africa Democracy Elections Featured Youth

Nigeria’s Election: A Test for Democracy?

written by Grace Funk

Democracy has been tested in Nigeria since 1960 when the country won its independence from Great Britain. For almost half its existence, Nigeria has been ruled by military dictators rather than civilian leaders. In fact, three democratically elected republics were overthrown by military coups, and two former presidents – who had also been democratically elected – led those dictatorships. In 1998, one military leader, General Abdulsalami Abubakar, promised a transition to democratic rule because the country was struggling economically and socially under dictatorship. He established the Independent National Electoral Commission to conduct and protect free elections. Since then, Nigeria has stood as Africa’s largest democracy.

Nigeria’s most recent election on February 25 was only its seventh national vote since the transition. It was also the first election in which none of the leading candidates were military commanders. And, most notably for the country’s democratic progress, its largest electoral cohort – and 84 percent of its 10 million newly registered voters – consisted of Nigerians aged 18 to 34. The young people of Nigeria were expected to make their voices heard, specifically against recent corruption, violence, and economic mismanagement in the country. Voters and pundits alike were inspired by hope and confidence in Nigeria as a cornerstone of democracy in West Africa – and the continent itself.

Recently, the youth population has become increasingly disaffected with the country’s floundering economy, lack of employment opportunities, and social immobility. They were thus anticipated to vote in droves to express their discontent. Reports from the country’s statistics agency claim that half of current Nigerians – and two-thirds of young people – are unemployed. In February, before the election took place, the Central Bank recalled banknotes of 200, 500, and 1,000 naira, effectively rendering them worthless. Replacement notes have been sparsely redispersed, but the process has created a cash shortage in an economy where millions depend on cash. Moreover, the country has grappled with a cost of living crisis, which results in young professionals forced to search for better opportunities elsewhere, such as the United States, Canada, or Europe. Fifty-two percent of young Nigerians want to emigrate, according to a 2021 World Bank report.

Even though a substantial turnout by the frustrated youth was predicted, the harsh reality was that this election set the record for the lowest turnout in a Nigerian presidential election. What happened? To understand, one must ascertain the extremely high expectations weighed on young Nigerians to deliver and preserve the fragile democracy.

Opposition to a violent police force called the Special Anti-Robbery Squad energized the youth into activism, setting expectations for a high youth voter turnout. The Special Anti-Robbery Squad, or SARS, was a police unit known for harassing, extorting, and even killing young people. The #EndSARS movement, established in 2020, was led by youth for youth. They were “fed up” with police violence, corruption, and dysfunction and were encouraged to register to vote to make their grievances known to the government. Ikemesit Effiong, head of research at the Lagos-based geopolitical consultancy SBM Intelligence, said, “It [#EndSARS protests] underscored for young people the need for direct engagement with the political and electoral system to reform and get it to be responsive to their needs.”

Because young voters’ turnout was so highly anticipated, some polls had predicted a victory for the third-party candidate, Peter Obi. Mr. Obi, a wealthy businessman, had a reputation for being frugal and accountable, which strongly resonated with the youth frustrated by the economy. He campaigned as a reformer, as a leader who would break free from the decades-long plague of governmental corruption. And, in contrast to other leaders – including the actual winner of the election, Bola Tinubu – he was not a “godfather”-like political figure, according to Joseph Siegle, director of research at the Africa Center for Strategic Studies.

Many Nigerians are surprised at the low turnout of the election – only 29 percent of registered citizens voted. Mr. Tinubu, the establishment candidate, won 8.7 million votes, or 36 percent of the final tally. Because there was such low turnout overall, Mr. Obi and his team are planning to dispute the election results through legal means. Yusuf Datti Baba-Ahmed, Mr. Obi’s running mate, claimed that “violence, voter intimidation, and suppression tainted the election.” But, no presidential election in Nigeria has ever been overturned, and it is unlikely that this election will be overturned, either.

Was it that young Nigerians were so disillusioned with their government or the flawed voting process that they felt their voices did not matter, their votes did not count? Or, were expectations for youth turnout just too high? The election’s low turnout was likely caused by a combination of both. Notwithstanding the low turnout, the potential power of the youth remains – the youth who are frustrated with a stagnant economy, upward social movement, and police violence. They have a voice and can use it, as evidenced by the #EndSARS movement. Yes, democracy was tested in the most recent election, and the turnout was dismal. But, a new generation of active and involved citizens is coming of age and can turn this around by using this low turnout – and its consequences – as motivation for increased activism in future elections.

May 16, 2023 0 comment

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Climate Change Environmental Change Featured Middle East Water

The Rise of Hydro-politics in the Middle East

written by Grace Funk

The Middle East faces an existential water crisis and is running out of time to fix it. According to NASA data, the 2020-2021 rainfall season in the region was the second driest in 40 years. Groundwater storage is at the lowest level ever recorded, and sandstorms have been blanketing much of the region with unprecedented frequency – almost weekly. Not only is there insufficient water for crop irrigation, quite frankly there is often not enough water for household use. Yet despite these grave circumstances, approximately 82 percent of the water in the Middle East continues to be used inefficiently. As a result, and because it is already the world’s most water scarce region with 11 of the 17 driest countries in the world, water scarcity will emerge as the Middle East’s foremost challenge. Unless Middle Eastern countries find a way to build sustainable infrastructure and to cooperate with their neighbors to combat water scarcity, water – and the resulting “hydro-politics” – will become the driving force of conflict in the Middle East in the coming decades. This is evident in the political and environmental repercussions already wrought by the water crisis in the region.

In a 2010 resolution, the United Nations General Assembly declared access to clean water a human right. But water is becoming an increasingly politicized issue in the Middle East. Shortages across the region fuel protests about government mismanagement or hoarding of water. This politicization of water known as hydro-politics aggravates other conflicts in the region like those between Iran and Iraq and between Turkey and Syria.

Take, for example, the “Uprising of the Thirsty” in 2021 led by Iranian citizens frustrated over water shortages. Iran blamed Afghanistan for limiting its water supply through the Kamal Khan Dam on the Helmand River. Ironically, however, Iran built its own dam on the Helmand and Tigris Rivers that limits water supply to its neighbor, Iraq. This illustrates a common practice in the region: shifting the blame to other countries instead of confronting domestic water management.

Iraq is now pointing the finger at Iran and claiming that Iran is not considering Iraq’s own water needs. In recent months, Iraq has declared that it will take its fight to the International Court of Justice in the Hague. It claims that Iran has violated agreements between the countries to allocate Iraq a fair share of water. Iraq further alleges that Iran is using water as a political tool to influence Iraqi presidential elections. Iran in return claims that Iraq has just poorly managed its own water resources.

The political conflict over the Middle Eastern water crisis has sped up the decay of the region’s natural environment. The Iraqi water deficit, heightened by drought and climate change, is expected to only increase in severity. The deficit is estimated at about 11 billion cubic meters a year and will continue to grow as the country’s population grows. Summer temperatures have reached 122 degrees Fahrenheit, making it even harder for crops to grow. Specifically, for the 2021-2022 harvest, 25 percent of about 1,300 households surveyed by the Norwegian Refugee Council observed over 90 percent of wheat crop failure. And, Iraqi experts have announced that if the Iraqi water crisis is not confronted, the Tigris and Euphrates rivers, from which Iraq receives most of its water, will dry up by 2040.

In addition to the lack of water for personal use and farming, the lack of water contributes to dust storms. Salam Abdulrahman, a lecturer at Iraq’s University of Human Development, posits that Iraq’s dust storms are not just caused by lack of water – they lead to a lack of water as well. “After every dust storm,” he said, “people need to wash [the dust from] their house, yard, cars, and gardens.” But, the supply of water is simply not adequate. This vicious cycle has placed Iraqis at a disadvantage to live normal lives. After all, water is a human right, and lack of water has dire consequences.

Conflict between Iran and Iraq is not new – it reaches back to the Iranian Revolution and the Iran-Iraq War in the latter 20^th century. But new water disputes have intensified old tensions, a paradigm that is also witnessed in the nearby Turkey-Syria conflict.

Syria’s north, which is semi-autonomous and controlled by Kurds, receives water from a plant whose power is controlled by Kurdish forces. The Kurds claim that Turkey interferes in management of the plant, specifically by cutting off its power. Turkey, with its long-standing animosity toward the Kurdish people, claims in turn that the Kurdish forces cut off power to the plant to pursue a political agenda.

Tens of thousands of Syrians in this region do not have access to tap water or even enough water to irrigate crops because of the contentious and unreliable operation of the plant. In Raqqa, for example, the flow of water has decreased from 600 cubic meters a second to under 200. This means that the 400,000 people living in Raqqa do not have access to enough water.

Along with Turkey’s alleged interference in northern Syrian water infrastructure, the Syrian water crisis is exacerbated by drought, poor maintenance of infrastructure, and lack of thoughtful planning for future water-related complications. Syria’s crisis is representative of other nations in the region that, left as is, can only get worse. Abetting this forthcoming disaster is the violent civil war that has been ravaging Syria for the last decade, and such destruction has not spared the infrastructure that regulated water use.

The Middle Eastern water crisis must be addressed to avoid a catastrophic future. And, based on examples from other countries, it can and should be addressed. Nearby, India and Pakistan collaborated to form the Indus Water Treaty in 1960, which annually allocates water of the countries’ shared rivers to each country. The two countries continued to collaborate even when nuclear war between them was imminent. In Eastern Europe, Balkan countries formed an agreement regarding shared water resources of the Danube, which helped create stability in the region after the Yugoslav Wars ended in 2001. The agreement launched trade activities between countries as well as inspired reconstruction of resources after war.

Hydro-politics, in short, is nothing if not existential. If not confronted and addressed, the Middle East cannot thrive or even survive. Climate change, drought, resource mismanagement, and political skirmishes all contribute to the current water crisis. Thankfully, some countries have begun to take this issue seriously.

Iraq has decided to rehabilitate ten oases in its Western Desert to help combat dust storms. It has even launched The Iraq Vision for Sustainable Development 2030 to protect its environment from climate change, according to a spokesman for its Ministry of Planning. Saudi Arabia announced that it will plant 10 billion trees in the region during the next decade and will collaborate with other Arab nations to plant 40 billion more. These trees will break up the mostly flat landscape of the region and supposedly hinder the path of the sandstorms.

It is possible for the water crisis to be addressed. The Middle East, however, does not have limitless time. Climate change looms now. Water infrastructure is being mishandled now. The sharing of water has become a political game now. Thus, now is the time to confront the water crisis. If not – and if the region stays as is – the Middle East’s biggest problem in the future will surely be its scarcity of water.

November 17, 2022 3 comments