Report: Arab Spring upheaval cost $55bn
Libyan exception: Where other oil producers have gained, Libyan revenues have fallen by 84%
The popular protests this
year in North Africa and the Middle East - known as the Arab Spring -
have cost the region more than $50bn, a new report says.
The report, by consultancy group Geopolicity, says Egypt, Syria and Libya paid the highest financial price. It warns that without a regional support programme, the effects of the Arab Spring could be regressive.
But oil-producing nations that have avoided or suppressed rebellions have benefited most, it says.
Using data from the International Monetary Fund, the group says countries that have experienced intensive civil disturbances or conflict during the Arab Spring, are expected to lose the most in the short term.
However, the report makes clear that costing the Arab Spring in 2011 cannot be done precisely. "Many critical economic indicators are unavailable, and the situation is highly fluid," it says.
Overall gain Libya, Syria, Egypt, Tunisia, Bahrain and Yemen have all been hit hard economically. Their costs to GDP amount to $20.56bn while costs to public finance total $35.28bn.
DEFINING THE COSTS
- Costs to GDP are productivity lost as result of conflict/uprising
- Costs to public finances are the impact on fiscal balance from changes in public spending or government revenues
- Not counted: human loss, loss and damage to infrastructure
In Yemen and Libya public
expenditures have fallen alongside public revenues as government
collapsed. There has been a 77% fall in revenues in Yemen and an 84%
fall in Libya.
These figures do not take into account losses to human life,
infrastructure damage and business and foreign direct investment losses.However, the region as a whole, is benefiting economically from the Arab Spring. Oil rich countries that have suppressed or avoided uprisings are set to gain the most.
Geopolicity highlights the fact that the UAE, Kuwait, and Saudi Arabia in particular, have all increased public revenues.
In Saudi Arabia the impact on public revenues is positive, increasing by 25%. In UAE public revenues have risen by 31%.
On the political front, it says that whatever the outcome of the fighting in Sirte, the National Transitional Council faces a long-term struggle to convince tribal leaders and ethnic separatists of its right to rule.
Assessing Libya's costs so far, it concludes: "The conflict in Libya has halted economic activity with a cost to GDP of $7.67bn.
"More than 740,000 people have fled the country since the start of the conflict, and the severe disruption in the hydrocarbon sector has devastated the economy."
Support needed The report says: "There will be both winners and losers between countries and within countries… Largely this is a story of oil, the health of public balance sheets and domestic trouble."
It goes on to say that, with the exception of Libya, "Oil exporters were winners and oil importers were losers."
Geopolicity's Managing Director, Peter Middlebrook, says the research has taken many months and will be of major assistance as a roadmap for the G20, the UN, as well as regional groupings such as the Arab League, and the countries affected by the Arab Spring.
The past few months are described as the greatest period of regional turbulence in the Arab world since the 1950s. The report recommends that the Arab League and the Gulf Co-operation Council need to drive the reform process internally, with co-ordinated external support.
However, it also points out that international assistance has fallen well short of expectations.
"The support promised by the G8 in Deauville in May 2011 has to a large extent not materialised. And the impact of the $100bn provided by the G20 will be 'trickle down' at best, with the risk that those who took to the streets see little direct benefit, over the short to medium term," the report says.
Source: BBC
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