The rewards and costs of democracy in the Middle East
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Kai Ryssdal: Anti-government protesters everywhere, especially in the Middle East, have been cheering the news of Hosni Mubarak’s departure. It’s fair to assume that the fall of the man sometimes called The Last Pharaoh will inspire other pro-democracy movements in the region.
But you know what happens when you assume, right? Change — even change that people want — can bring instability. And businesses, no matter where they are, hate instability.
Marketplace’s Stephen Beard reports from the Jordanian capital of Amman.
Stephen Beard: I’m inside Amman’s somewhat shabby, down-at-heel stock exchange. In a dingy room, a dozen or so men sit looking at stock prices on a large flickering screen. As the prices fall, they watch their wealth dwindle further.
Viktor Dabbouk: Things are very bad. Not only in our stock market. The whole area is suffering.
Viktor Dabbouk is 66. He’s a retired hotel manager; he’s been investing for his retirement for more than 30 years. Since the Amman stock market peaked in 2006, his portfolio has taken a hammering.
Dabbouk: My capital used to be about $1 million. I’m left here with about $200,000.
Beard: That’s a very big hit.
Dabbouk: It is. I lost a lot here.
Ruefully he admits that his wife always told him to put their money into real estate, not shares. But he blames the latest downward lurch in his fortune on political instability.
Dabbouk: If we keep calling for democracy, we’ll never have stability. We’re not ready for democracy.
Much further down the income scale, among the street vendors of Amman, there seems even less enthusiasm for the pro-democracy protests. Mohammed ekes out a meager living for his wife and six children by selling knick-knacks to tourists. He fears that that the wave of unrest across the Arab world will drive the tourists away. He says democracy is a luxury he can’t afford.
Mohammed: You need to food first. Yeah? You need food to eat.
Beard: You want stability before democracy?
Mohammed: Yeah before democracy, stability. You need food before democracy, yeah?
Since the political turmoil in Egypt began, tourism to the whole region seems to be suffering. Hotel occupancy in the Jordanian city of Petra alone has dropped from 70 to just 10 percent. Other businesses could be affected soon.
Faris Bagaeen runs a medium-size architectural firm, designing office blocks, hotels and villas. He’s bracing for a downturn.
Faris Bagaeen: There would be disruptions. There’d be probably cancellations of projects. There’d be disruptions in financing for some projects. There would be delays.
He says his country and his business have suffered many shocks before. In recent years, for example, the first and second Gulf wars. But this time — for once — he welcomes the instability.
Bagaeen: Change does not come easy, does not come without a price. But I feel personally that it’s worth it. At the end of the day, with democracy and with transparency, it’s better for business.
He hopes that a democratic revolution will finally curb or kill the corruption that is throttling the economy of the Middle East. No, he says, democracy is not bad for business.
In Amman, I’m Stephen Beard for Marketplace.
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