Update from North Africa
Like every other region in the world, North Africa is bracing for a difficult period with an unclear time table as to when the global economic recovery will take place. In this issue we report that for the three central Maghreb nations, GDP expanded between a low of 4.9% and a high of 6.2% in 2008, and expectations for 2009 look for reduced economic growth in general. Part of the weakening economies comes from the own doing of North Africans themselves. The financial and banking sectors remain largely underdeveloped. The tax regimes are still below the norms. The grey or black markets are enormous and never counted in GDP calculations. The services industry, although promising has been neglected. And, more importantly, the deep impact of bureaucracy and cumbersome administrative processes is such that business creation is stifled. As a result, North Africans have focused their energy and resources on creating incentives for foreign investors, largely neglecting their own domestic entrepreneurs, a situation that is likely help drag their economies further down.
This state of affairs is more magnified in Libya where there is no culture of private entrepreneurship. In this issue we argue that while Libya has an abundance of cash, it suffers from the lack of business projects, unlike its neighbors who face an opposite situation.
On the human front, this issue looks at how North African nations deal with their Amazigh ethnic populations, also known as Berbers. Recent events in the Algerian Mzab country and in the Libyan town of Yefren underscore the continued harassment of the Berbers, whose fate and future remain uncertain. In Morocco, poverty continues to impact the lives of millions. This winter has been particularly harsh that dozens of poor villagers have lost their lives, a situation that underscores the weaknesses in the country’s social economic development.
But events from the Maghreb are not all negative. We continue to see economic investments being committed despite the tough global economy. Among the most promising areas of growth are the region’s port infrastructures that are growing and expected to compete with some of the world’s best ports. As this year evolves, the region will continue to be an important hub of events, politically and economically. And so we look forward to providing more insight on what we see and what we think. To reade the issue, visit the Journal’s 213th issue at http://www.north-africa.com/premium/
