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Youth crucial to Middle East economy

Marketplace Staff Jun 4, 2009

Youth crucial to Middle East economy

Marketplace Staff Jun 4, 2009


Kai Ryssdal: President Obama was in Cairo today, where he gave a much anticipated speech about America’s relationship with the Middle East. A little more than a year ago Marketplace was in Cairo as well for a series we called “The Middle East at Work.” A lot of things in that part of the world have changed since then with an international recession. But one thing in particular has not. The problems presented by huge numbers of chronically unemployed young people.

Navtej Dhillon is the director of the Middle East Youth Initiative at the Brookings Institution. And he points out that 60 percent of the people who live in the region are less than 30 years old. In Egypt alone he told me there are a million-and-a-half young people out of work and another million entering the labor market, at a time when the global economy is in shreds.

Navtej Dhillon: So you have peaking youth population, and you have a slumping economy. The combination of the two is particularly bad. Imagine a typical Middle Eastern family where there are two parents, and three young adults. The two parents are retiring. And unfortunately, the three young adults who should be working, they’re not working, and they’re living with their parents because they have no jobs, they can’t get married, they don’t have access to housing, they have no savings. And therefore, they really aren’t able to contribute to the economy of the nation as well as the economy of the household.

Ryssdal: And then there becomes eventually a political and a social problem with this as well, as you have these 20-somethings who still live with their parents.

DHILLON: Certainly, I think that unemployment early on in one’s career can have life-long impacts in terms of reduced earnings. It can lead to a sense of alienation within society. But I would say the stakes are even larger. Imagine the baby boomers growing up in the Great Depression. Because they’re able to grow up at a time of relative prosperity in the U.S., they’re able to both contribute to that prosperity and maximize it. I think in the Middle East this generation hasn’t had that opportunity. So will this generation be better off than their parents? And if not, then that regressive trend I think really imperils the prosperity of the Middle East and its place in the global economy.

Ryssdal: You mentioned Egypt, and some of the problems it’s having. Are there countries in the region, either in the Gulf region, or elsewhere in the Middle East, that are doing this well, that are managing this problem?

DHILLON: The good news here is that many countries have made tremendous investments in health and education. So you have young people who are more educated and healthier than their parents. But I would argue that it’s really hard to point to a single country where we have achieved success. I think this problem has been a challenge for almost all countries. And it has been in the past, it’s the challenge of the moment, and it will be the challenge of the future.

Ryssdal: Is there something that a Middle Eastern government can do? I mean, what are the steps that they ought to be taking as they try to solve this problem?

DHILLON: I think that they also need to be investing in new sectors. Particularly the social sector, I would argue. The Middle East needs more qualified teachers, social workers, nurses. These are all areas that can be invested in to create opportunities. And, of course, I think there needs to be a larger reform agenda, where business costs are reduced, deregulation is promoted in certain areas, so that greater private investment can come to the region that can lead to creation of more jobs. And, of course, I think that there also needs to be more of a dialogue between the citizens and the states about where the Middle East is currently at, and really realigning the expectations of the citizens.

Ryssdal: What about a stimulus plan? Are they considering that? Would that work?

DHILLON: Some countries certainly are. I think there are countries that have large amounts of money as a result of the oil boom in the last six, seven years. Countries like Saudi Arabia and Kuwait certainly have the resources to pursue stimulus packages and some of them have been. On the other extreme, there are vulnerable countries, which do not have the resources, such as Yemen but are also being hit by the economic crisis that are going to need assistance.

Ryssdal: If this generation — the current young generation — over there is lost, is not given these opportunities, then what happens to their kids, and the kids after that?

DHILLON: I think that it heightens the possibility of greater poverty, social discontent, and I would argue that in places such as West Bank, and Gaza and Yemen, parts of Lebanon which have experienced conflict, it also makes the efforts of peacebuilding much harder.

Ryssdal: Navtej Dhillon at the Brookings Institution. Thanks for your time.

DHILLON: Thank you so much. It was a pleasure.

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