A Balancing Act toward Economic Reconstruction

There is widespread understanding that social and economic reconstruction in the immediate post conflict phase is not only a key to preventing a recurrence of conflict, but is also a critical step toward long-term development. Despite the importance of foreign aid in this endeavor, ultimately, effective and sustainable reconstruction is largely determined by the commitment and capacities of local populations, including civil society and grassroots groups that are at the front lines of recovery, to maintain and cultivate the process.

In an in-depth look at the reconstruction of war-torn economies, CIPE Middle East and Africa Regional Director Abdulwahab Alkebsi appeared on Counting the Cost, Al Jazeera’s weekly television program that highlights business and economic news from around the world, to discuss how nations can begin “picking up the pieces” and restore economic prosperity.

[youtube:”http://www.youtube.com/watch?v=jTWi6x-fAHM”]

The instability that conflict brings to a nation often leaves the economy crippled, with the Middle East being no exception. The program notes, however, that economic conditions are beginning to change for the West Bank city of Nablus. A few weeks ago, local businessmen rarely attempted the journey from their tiny village to the market stall in Nablus—Israeli roadblocks made the trip almost impossible. But these days, business is booming. In June, Israel decided to remove checkpoints across the city as part of a plan for “economic peace” with Palestinians to boost the local economy. Up until just a few weeks ago, Israeli checkpoints surrounding Nablus had put a stranglehold on business development and sustenance in the region. Now a steady stream of vehicles flows through the main Hawarra roadblock just outside the city, most provoking no more than a cursory nod from the Israeli troops on guard. The International Monetary Fund (IMF) chief of mission in the West Bank and Gaza, Oussama Kanaan, said last month the West Bank economy could grow by seven percent this year if Israel continues easing the massive web of restrictions on the movement of goods and people that it imposed in the wake of the 2000 Palestinian uprising.

These are all promising signs, but kick-starting an economy after a period of conflict is not always as clear-cut. The process is complex and there are no universal prescriptions or panacean solutions. So, where does one start? Despite the varying contexts of each country’s reconstruction efforts, there are common approaches that have proven effective.

Alkebsi notes that one way to approach the complex challenges of post-conflict reconstruction is to view the process as a “balancing act” of providing sufficient humanitarian relief without compromising longer-term development objectives. These longer-term objectives include the development of institutions—both physical infrastructure and social structures and mechanisms—that allow free market democracy to take root. The success of countries in building democratic governance and providing economic opportunities will ultimately be the determining factor in achieving prosperity, peace, and sustainability. Building the reconstruction process around local groups gives credibility to the development effort and introduces a sense of accountability, as reformers eventually become responsible for successes and failures. While it may be more of an art than a science, those involved in a country’s post-conflict recovery must identify an effective way to utilize the expertise and commitment of local groups to achieve lasting peace and prosperity.

Published Date: August 25, 2009