Tag Archives: private sector

A Way Forward for a Viable Syria

From left to right: Abdulwahab Alkebsi, Ayman Tabba, Ellen Laipson, and Geneive Abdo discussing the role  of private sector and civil society democrats in reshaping Syria and countering extremism.

From left to right: Abdulwahab Alkebsi, Ayman Tabba, Ellen Laipson, and Geneive Abdo discussing the role of private sector and civil society democrats in reshaping Syria and countering extremism.

By Peako Jenkins, CIPE Program Assistant for Middle East and North Africa

“We hear a lot about Syria— we hear the narrative of the Syrian government, we hear the narrative of ISIS, we hear the narrative of some of the opposition groups, but we don’t usually hear from the private sector, about what’s going on.”  

With this introduction, CIPE Regional Director for the Middle East and North Africa Abdulwahab Alkebsi opened a panel discussion on May 21 co-hosted by CIPE and the Stimson Center entitled “A Way Forward for a Viable Syria: An Insider Perspective from the Private Sector and Civil Society.” The panel featured Chairman on CIPE partner, the Syrian Economic Forum (SEF) Ayman Tabbaa, President and Chief Executive Officer of the Stimon Center Ellen Laipson, and Middle East Fellow at the Stimson Center Geneive Abdo. The panelists discussed the role of democrats from the private sector and civil society in reshaping Syria and countering extremism.

Tabbaa spoke of SEF’s role as the first independent economic think tank in Syria working to change the trajectory of the conflict and rebuild a better Syria for the future. “We have to go back to the roots of this conflict,” he told the audience. Under the regime of Bashar Al Assad, citizens are oppressed and disenfranchised— they lack opportunity for meaningful political and economic participation. But after four years of war, people are wondering what it means to be a Syrian anymore. It is crucial, in this context, to redefine the social contract and the relationship between the citizen and state. As a think tank, SEF is playing a leading role in doing so.

“…after four years of war, people are wondering what it means to be a Syrian anymore.”

Syrians are looking for democratic alternatives to the forces tearing the country apart. Every day we see news about atrocities and violence in Syria. Much of the media focuses on sectarian violence and ISIS-created mayhem. But, even with the chaos and human suffering, Tabbaa offered signs of hope through examples of SEF’s work during the conflict.

He spoke about the recent memorandum of understanding (MOU) that SEF signed with the Ministry in Local Administration of the Syrian Interim Government (SIG). SEF has a network of liaisons inside Syria who provide the SIG and Local Councils with economic data, analysis, and recommendations. Providing this on-the-ground information to decision-makers supports improvement of local governance and enhances the democratic legitimacy of the Councils

Another SEF project helps Syrian youth develop solutions to the challenges in their communities through civic education. SEF has provided 600 young Syrian high school graduates with training in entrepreneurship, leadership, and civic skills. The course offers an alternative to the regime’s propaganda and the empty promises of extremist ideology.

Syrian Economic Forum students learning civic education in Syria.

Syrian Economic Forum students learning civic education in Syria.

Tabbaa recounted the day a businessman from Aleppo—Syria’s industrial heartland—came to him distraught because a bomb dropped by the regime hit his factory and destroyed the machines in which he had invested substantial sums. Many other businesspeople had similar stories, as SEF discovered by conducting a survey of over 1,000 factories in the northeast of Syria (a two part report). The statistics were bleak—88.7% of factory workers were out of work; 82.4% of factory owners faced danger of artillery fire; 62.3% of factories faced danger of aerial bombardment. Rather than wait for Syria’s industry to face further destruction, SEF searched for solutions. It advocated with the Turkish Government and other stakeholders to open up to Syrian investment the free economic zone in Gaziantep, Turkey, which was at the time only operating at 30% capacity. The first two factories will be moved from Aleppo in the coming weeks. Other factories are preparing to follow their lead. One day, the businesspeople hope to reopen their factories back in Syria and rebuild the country. But for now, they will remain safe and productive.

This type of private sector-led economic activity is a prerequisite to tackling the long-term trauma of Syria’s war. The UN estimates that it will take the economy over 30 years to return to pre-war levels. Syria’s 2013 GDP dropped by 20.6 percent; inflation increased by 68%; foreign trade volume has decreased by 95%; and 57% of the population is unemployed, with 7.9 million people living below the poverty line. Syria’s future requires private sector solutions and the creativity of entrepreneurs for reconstruction and employment generation. The good news is that the Syrian people have retained their entrepreneurial spirit. Tabbaa spoke of hundreds of Syrian restaurant owners opening franchises in Turkey, Dubai, and Jordan. In Turkey, now you will see newspapers with business advertisements all in Arabic. It is the small and medium businesses like the ones opening in Turkey and across the region—not the elite crony capitalists that dominated the economy under the Assad regime—that are key to economic growth and recovery for Syria.

A destroyed factory in Syria.

A destroyed factory in Syria.

Ellen Laipson of the Stimson Center described these business relations in the context of regional economic integration. She spoke of applying to the Middle East the big ideas of the Marshall Plan, which the United States launched after World War II to rebuild economic activity in a devastated Europe. The Marshall Plan promoted private sector development and entrepreneurship alongside intraregional economic cooperation to achieve greater economies of scale and interdependence. Formal regional economic integration remains low in the Middle East after the Arab Spring.

Laipson also pointed out that, paradoxically, the turbulence of the Syrian crisis has formed a type of informal regional economic integration that could serve as a precursor to more ambitious schemes in the future. Rather than top-down integration, the conflict-driven migration has precipitated a bottom-up integration driven by practical requirements and market forces. As she notes in her Stimson Center and George C. Marshall Foundation report Revisiting Marshall: Private Sector Development in the Middle East, “While far short of formal government-to-government planned integration, it may be a more practical approach to integration, and suggests more agile, adaptive polices to achieve mutually beneficial economic activity.” The private sector activity that is happening naturally and spontaneously may open up markets and lead to long-term, positive economic effects.

Economic growth and development can also have positive effects for regional security. Geneive Abdo stated that while she did not subscribe to the theory that extremism is a result of economic conditions, she does feel that economic development can serve as an effective counternarrative in terms of curbing extremism once it develops. ISIS has an appeal because it offers resources such as money and employment. Economic development with the involvement of the private sector is therefore key to offering an alternative to extremism. Tabbaa spoke of the young Syrians that joined the Free Syrian Army during the beginning of the revolution with a $100 per month salary. Then Jabhat Al-Nusra offered $150 per month. Then ISIS offered $400 per month, plus a food basket, laptop, and phone. While economic drivers may not be the only factor, they constitute an important part of the picture. Even within Islamist groups, businesspeople can act as a moderating force. For example, Abdo spoke of meeting with entrepreneurs from the Muslim Brotherhood who recognized the potential for economic development as an alternative to political fragmentation.

In closing, Alkebsi pointed out that the business community tends to act as an integrative force capable of working across sectarian and political lines. He noted, “The existing political structures are not integrative in nature; meanwhile our (CIPE’s) partners in the business community are looking for ways to work together because they want to make money!” In the midst of the devastation caused by the Syrian civil war, it is crucial to work with the business sector as a moderate, unifying constituency offering a democratic alternative to competing forms of tyranny in the country. Organizations like SEF give that constituency a voice.

Watch the full discussion here.

Economic Inclusion: Leveraging Markets and Entrepreneurship to Extend Opportunity

fs-inclusionBurgeoning youth populations across the developing world emphasize the importance of achieving sustainable economic growth and providing widespread employment opportunities. Economic inclusion refers to equality of opportunity for all members of society to participate in the economic life of their country as employers, entrepreneurs, consumers and citizens — and the private sector is a central partner in fostering economic growth.

CIPE’s latest Economic Reform Feature Service article outlines strategies to build a more inclusive entrepreneurial ecosystem by engaging traditionally under-represented groups in economic and political life. The article focuses on approaches to promote entrepreneurship opportunities among women and youth as well as informal sector operators. The article also illustrates successful approaches employed in CIPE projects around the world. Read the full article here.

Teodora Mihaylova is Research Coordinator at CIPE.

What’s Stopping Pakistan from Reaping its Demographic Dividend?

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Photo: Dawn

“In the absence of adequate job creation by the public or private sectors, it is more important to enhance financial inclusion, which can help create greater opportunities for self-employment instead of salaried employment.” Tameer Microfinance Bank CEO Nadeem Hussain

Pakistan is one of the top ten most populous countries in the world. Youth make up over 36 percent of the Pakistani labor force, and that proportion is projected to rise to 50 percent by 2050. According to the World Bank there will be 1.7 million Pakistanis entering the country’s labor force every year, yet, worryingly, the Pakistan labor force survey also finds that over 3.7 million people are currently unemployed. The yearly upsurge in the unemployment rate is putting additional weight on the shoulders of the Pakistan government. The government must reassess and make needed reforms in order to change the current trajectory and allow Pakistan to reap the benefits of its demographic dividend.

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The Moldovan National Business Agenda Goes to the Regions

A national business agenda (NBA) is a powerful tool and platform for business people to engage in a proactive dialogue with policy-makers on issues affecting the private sector in a given country. Developing an NBA requires the private sector to collaborate to identify issues that constrain business activity, offer proposals and solutions to address the issues, and present them in an open and transparent manner to public officials. This private-sector led approach has been instrumental in advancing economic reform agendas in countries around the world.

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Public Procurement: The Nexus of Public and Corporate Governance in Combating Corruption

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Governments around the world spend trillions on public procurement each year for everything from office supplies to military equipment to infrastructure megaprojects like this $5 billion Panama Canal expansion.

 

By Kirby Bryan

For over a decade, the World Bank Group’s Doing Business index has served as quintessential tool for determining how well a country’s institutional infrastructure is suited to the promotion of a productive business environment. But something was missing. Businesses and governments interact on levels beyond permitting and regulation: the public sector can also be a client.

Public procurement can provide opportunities for corruption. When seeking lucrative public contracts, companies look for any opportunity they can take advantage of that will improve their ability to secure a successful bid. Unscrupulous government officials can use their influential positions to attain favors and gifts from businesses pursuing public procurement tenders.

In March 2015, the World Bank Group, in conjunction with the George Washington University Law School, held a release event for the first installment of its Benchmarking Public Procurement Index

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Trade Capacity Building and Private Sector Engagement

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By Kirby Bryan

For sustainable economic growth, developing countries must have the capacity to functionally interact with the global market. Much of the onus for building that capacity rests on a domestic commitment to reforms compatible with global trade. Many emerging markets have lofty aspirations that are unachievable given the current state of affairs, but are determined to rectify the situation. Access to foreign markets can cement reform efforts aimed at improving the local economy and sustaining economic growth.

In late February, the Center for Strategic International Studies (CSIS) released a report from their Congressional Task Force on Trade Capacity Building (TCB) on “Opportunities in Strengthening Trade Assistance.” While the report focuses primarily on US efforts to improve the effectiveness and relevance of its TCB programs, it signals a shift in international engagement and understanding of the role trade plays on the growth of a developing economy.

The shift is also indicative of a growing global development trend toward incorporating the voice of the recipient country from the beginning stages of negotiations through agreement ratification. What is interesting about the current TCB discussions is the recognition by major players in the development world of including the knowledge and expertise of the private sector. Ultimately, it is the private sector in the developing and developed countries that will bear the fruits of economic growth and trade.

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Public-Private Dialogue: The Key to Good Governance and Development

An increasing number of policy and governance challenges around the world demand private sector participation to generate viable solutions. Such challenges include poverty reduction, inclusive growth, government accountability, business integrity, national competitiveness, innovation, and access to opportunity. Although the obstacles to dialogue can be high, the value of dialogue is now widely recognized by governments and business leaders alike. Notably, the 4th High Level Forum on Aid Effectiveness in Busan, Korea, recommended that countries embrace “inclusive dialogue for building a policy environment conducive to sustainable development.”

In CIPE’s latest Economic Reform Feature Service article, Benjamin Herzberg, Program Lead, Leadership, Learning and Innovation at the World Bank Group, my colleague Kim Bettcher, Senior Knowledge Manager at CIPE, and I explore the importance of PPD and discuss its practical applications around the world. 

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