Tuesday, January 18, 2011

Tunisia: Beyond the Optimism

The sensational buzz surrounding Tunisia’s revolution is the small country’s prospects for creating a regional domino effect, disrupting oppressive governments across Northern Africa and throughout the Middle East.  The Jasmine Revolution is the first popular street rising to topple an Arab regime.  Although many copycat “burning men” are attempting to jolt similar uprisings in Egypt, Algeria, and Mauritania, neighbor populations patiently await the aftermath of the new Unity Government and promised free elections once the dust (and tear gas) settles.

Protestors condemn President Ben Ali and
his family for excessive corruption.
In Tunisia widespread optimism hopes that purging the country of its corrupt ruling family will create jobs.  During the Ben Ali rule, rampant expropriations discouraged domestic investment.  Companies wishing to enter local markets had to give (gift wrapped, not sold) large stakes in any successful enterprise to a well-connected member of the Ben Ali fiefdom.  Santander, in order to enter the private banking market, reportedly paid “an off the books premium” to the President’s son-in-law.  Additionally, businessmen tied to the government avoided repaying bank loans, thus high interest rates passed onto common Tunisians reached 25%.

Dampening of investment and poor “private”-sector management from self-promoted family members contributed to high inflation and an unemployment rate of 14%.  The World Bank estimated that with Ben Ali corruption removed from the economy, Tunisia’s growth rate could reach 6% or 7% annually.

However, projected India-like growth is not assured.  Difficulty establishing systems to sell, auction, and return family shares in businesses cause uncertainty.  And although the Central Bank denies reports that the exiled family fled with 1.5 tons ($66 million worth) of treasury gold, lingering problems with the Ben Ali clan ransacking the economy will surely come to light.

Proposed development in Tunisia's capital:
Tunis Financial Harbor
Optimists still cite Tunisia’s free trade treaty with the European Union and the large presence of French, Italian, and US firms as signs of confidence. The manufacturing, agriculture, mining, and tourism sectors flourish.  Tunisia’s GDP is $100 billion.  Large portions of the population are professionally educated (Tunisia spends 7.2% of GDP on education. Comparatively, the US only directs 5.5% of GDP to education).  And, in absence of the ruling family's unscrupulous influence, Tunisia hopes to reconvert seized assets into profitable job stimulators.

Regardless, much of Tunisia’s future success hinges on the emergence of the new government.  Before mimicking Tunisia’s uprising, neighboring nations' politicians, community leaders, and other influential spokesmen wait for the Jasmine Revolution to prove successful.  That means not just exchanging one police state for another.  Tunisia must accomplish its pledge for full democracy and free elections without stumbling during the transition between governments.

In 1988 similar mass protests forced Algerian President Chadi Bendjedid to resign and Algeria earned its right to hold its first multi-party elections.  But when the Islamic Salvation Front won the first round of balloting, the military intervened, negated voting results, and caused a bloody, ten-year civil war. 

For Tunisia to provoke a regional domino effect overthrowing tyrants, the country must prove that after emerging from a longstanding dictatorship, an Arab nation can achieve democracy.  “Tunisia could become a shining model for the Arab world if it manages to avoid the pitfalls of its neighbor’s experience,” writes Algerian journalist Muhammad Ya‘qouby.  “The Algerians took to the streets in 1988 to demand lower prices, an end to corruption, and an end to discrimination. Twenty three years later, they are still seeking the same things.”  

Tunisia must now begin its fight against history.

For more on Tunisia's Jasmine Revolution, see Saturday's Post, "Revolution in Tunisia Is Like a Disneyland Vacation for the Ruling Family."