Documento(s) 11 de 16

1. Socioeconomic development in the Arab world: challenges for the next century — Galal Amin
2. The politics of MSME development in the Middle East and North Africa — Tamer El-Meehy
3. Change and the transition to democracy: issues in the Moroccan context — Mohamed Tozy
4. IDRC current programming concerning employment and socioeconomic development in the region — Brent Herbert-Copley
5. Discussion notes

1. Socioeconomic development in the Arab world: challenges for the next century

Galal Amin

I will address socioeconomic development from a research perspective, from a current as well as with a future outlook. There are a lot of reasons to be unhappy about the state of social and economic research in the Arab world today — or even as it has been for the last few decades. This does require soul searching, especially because we are at the end of the century, the end of the millennium — and the start of a new era.

In looking back at the last 50 years we can see that research on Arab economic and social development has gone in and out of fashion from one decade to the next. These fashions are not justified by changes in real need; they have largely originated from outside the region and we have been merely following them.

Let me very quickly demonstrate how this happened. Consider the realities at the London School of Economics in 1957. As an Egyptian studying economics at LSE, I had no option but to study economic development. This may seem innocent enough, but "economic development" at that time was defined in a particular way to raise per capita income. Worse, countries were judged as underdeveloped according to certain criteria. The implicit logic was that the goal of these underdeveloped countries should be to catch up. And "catching up" really meant raising per capita income. If the criteria were defined in terms of human development, per capita income would not have been an appropriate goal or subject for study. This is because one can raise per capita income without solving the problems of the underprivileged, or one can solve the problems of the underprivileged without necessarily achieving high rates of per capita income.

Now let me remind you also that the most important obstacle to development was the shortage of capital. This means that economic development was considered almost synonymous with capital accumulation and industrialization. And there was the fashion of the stages of growth, where every student was trying to decide whether their country had reached the take-off stage or not.

In the 1950s and 1960s, economic integration among underdeveloped countries was a very popular fashion. Now this is no longer the case. The reason is, that in the 1970s the emphasis shifted from capital to labor productivity and education, from foreign aid to issues of self-reliance. Here, the dependency theories became quite fashionable. Suddenly, basic needs became important and distribution was linked to growth. The causes of such change range from the detente of the 1970s, the lessons learned from the Chinese experience, to the declining rates of the rapid growth of the West in the 25 years after the war.

In the 1980s, we sang completely different tunes. Multinational corporations became the subject; foreign aid gave way to private foreign investment; import substitution saw its popularity enjoyed in the 1950s and 1960s decline; and economic integration among underdeveloped countries almost completely went out of fashion.

In the Arab world, we just followed what was happening to the extent that the same economists — who sang the praises of import substitution and Arab socialism in the 1950s and 1960s — are now writing books and articles about the necessity of trade liberalization and export promotion.

In the 1990s, structural adjustment, macroeconomic stabilization, and privatization became the fashion. Of course, researchers quickly realized that we should not forget social impacts, but this was mainly out of fear that social consequences might create instabilities, that structural adjustment would fail and that privatization would come to a stop, and not out of any real concern for the poor.

How one can explain this? Let me suggest the following. Research must start from some implicit goals or value premises, but this is rarely made clear. The goals have been changing over the years, the value premises have been changing over the years, and as a result the subject of interest in research had also changed. But unfortunately, the change in goals and value premises have occurred outside of us. I can spot two major value premises which are dominating our research now.

1. Economism

The first value premise is "economism." We are very economistic in our outlook on development. For example, the delay in the peace process is seen as delaying the regional integration or the flow of trade between Arab countries. But development does not necessarily have to be economic even when one talks about the Palestinian question. Another example is that governmental corruption is criticized because it is a threat to growth. When the military is studied, the question becomes how to incorporate the people who used to work in the military in the economic mainstream, as if the problem of the militarization of the society is again only economic. Even the subject of women is often discussed mainly from the point of view of the role of women in the labor force and in the labor market. Very basic human subjects are discussed from a very narrow economistic point of view. Economics is not the whole of life, there is much more to life than that.

2. Social integration to the outside world

The other value premise, which has been dominating our research agendas for the last two decades, is an assumption that the more the society is integrated in the outside world the better. But is it better? Of course, having contact with the outside world has a lot of advantages — but it is not true that openness has no limits. Bernard Russell once said, "a mind which is perpetually open is perpetually empty." That precisely defines the problem with openness. To be completely empty is to have nothing inside. So by all means one should integrate the outside world, but it is imperative to preserve some identity when doing so.

These two value premises affect our research agendas. They not only affect the choice of research subjects, they also influence the meanings we give to the subjects.

Whether from Western or Arab writers, the phenomenon of Islamic revival has been mainly examined from the point of view of its threat to internationalism. This phenomenon, however, has many aspects and dimensions to it. One aspect is pure religiosity. Terrorism or fanaticism are certainly a threat to internationalism, but the phenomenon of people becoming more pious or religious is no threat to anybody. Actually, this is the most interesting aspect of the so-called religious revivals. People who are becoming more pious are innocent people; those people reading the Koran in the train are not carrying guns and they are not even fanatic. This ingrown religiosity has been relatively ignored because it is not of concern to people who are concerned about how open the society is and how ready it is to accept Western values.

I will give another example. Human rights are such a vague illusive concept, which can be understood in several ways. However, human rights are given one meaning only — and mainly a Western one. Consider women’s emancipation: there are so many aspects to the freedom of women, and so many ways in which women can be enslaved other than the oriental way of enslaving them. Women have also all sorts of restrictions on their humanity in the Western society. But women are mainly studied from the point of view of the numbers working outside the home. There are so many ways of enslaving a woman other than preventing her from working, such as using her in advertisements or as a sex symbol for instance — and this is more a phenomenon of Western societies.

I could stop here, but I think it is inappropriate to end on a negative tone. I propose opposite value premises and subjects that could be suggested by different value premises. Here are a few examples.

One phenomenon worries me immensely. In university colleges in Egypt, English and French are slowly replacing the Arabic language as languages of instruction. Even subjects that have long been taught in Arabic, like economics, political science, or business, are now being taught in English. In three or four decades, this could mean a great decline for Arabic. I believe that one indicator of a nation’s progress is what happens to its mother tongue. People cannot be really innovative except in their mother tongue. You can get a PhD but I would not call that really innovative. To be really innovative, you have to write or think in your mother tongue. So what is happening in Egyptian universities is worth a research topic. But of course, nobody is worried about that because of the economism I have been talking about. Arabic is not good for business right now. The economistic and internationalistic view has prevented this from taking enough attention.

The other example concerns regional disparities in Egypt. You can deal with it from a purely economic point of view, but the oppressive effect of Cairo on the rest of Egypt is not only economic. It brings out all sorts of issues: cultural, intellectual, social, and psychological. But undertaking research on regional disparities by making some calculations on per capita income will not go into the heart of the matter.

And finally, the last example concerns the family as a support system. In a country like Egypt — and like the rest of the Arab world — the family has a support system that addresses failed formal policies of the state. In a country with a high rate of unemployment as in Egypt, without this family support system, people would have died a long time ago. Proper research on this is not evident — yet this is undeniably science: it is not literature; it is not fiction. Tremendous scientific, objective work on this topic can and needs to be done.

2. The politics of MSME development in the Middle East and North Africa

Tamer El-Meehy

A few years ago, during a study of households headed by women in the district of Al-Gawaber in Boulaq, Cairo, a case was asked to define poverty. Her answer was "illet elheelah" (powerlessness, lack of capacity). According to Fergany (1998), poverty

is not about low income, or even the failure to meet basic needs, but about human-capability failure … in this perspective, poverty is almost synonymous to ‘powerlessness.’ Powerlessness manifests itself in a lower level of satisfaction of basic needs, and more importantly, in lack of access to, and control over, capital: physical, human, financial and social.

Defining poverty and inequality with reference to the political (as powerlessness) is naturally consistent with an important characteristic of the societies of the region, whereby the political (the state) continues to play a major role in all aspects of life. Accordingly, political power becomes an asset in itself. In this context, poverty and inequality gain new meanings that are related to such concepts as exclusion, marginalization, illegality, and powerlessness. Here, it should be noted that the "political" is used in the broad sense to denote power relationships permeating society at large. Institutions, policies and practices materialize and reflect socio-political (power) relations between groups and classes in society each in its own way.

In its essence, development is the progressive mastery and control of individuals over assets with the purpose of attaining the greatest good for members of society. In other words, overcoming the powerlessness of human beings. Nevertheless, little emphasis is placed by our governments, donors, experts, and academics on the political determinants of development. Despite the emphasis donor organizations and development experts place on micro, small and medium-sized enterprise (MSME) development, the issue of the political determinants of their development has largely been neglected. Rather, emphasis is laid on the extension of financial and non-financial services to them. While sustainability is of major concern to the development process, it has consistently been reduced to the practice of advanced and more sophisticated forms of cost-recovery. Little emphasis if any was delegated to the concept of sustainability in the broad sense — the creation and maintenance of a macroenvironment that is favorable to the development process.

One cannot tackle the issue of the political determinants of MSME development in isolation from the larger contexts of political development — and development at large. MENA countries have been witnessing a lopsided development process. This has focused on the development of the economy to the neglect of the development of adequate political structures, or of practices that can provide for the sustainability of economic development, as well as steer the development process. On the political level, we can detect two main traits that are characteristic of MENA. Those traits are underdevelopment and unequal development. Historically, the dissolution of the pre-modern state, and political structures and practices, was not accompanied with the rise of modern institutional arrangements that embody the modern democratic values, deepens citizenship and modern democratic values, and represents the interests of the various social classes and groups in society. Only an educated urban minority was (and still is) actively involved in the modern political processes. Civil society institutions and other forms of associational life were historically largely created by the foreign minorities and the Westernized local urban elite. In fact, it can be argued that even their continued existence until now is closely related to Western influence, whether material or ideological. Similarly, political consciousness in MENA is, with minor exceptions, largely underdeveloped. In general, this gave rise to an underdeveloped political context that is reflected in the region’s current state of political structures and practices.

Unequal development manifests itself in various forms. One form is the blatant duality MENA societies suffer from. On the one hand, rich powerful minorities enjoy the fruits of the development process in terms of strong ties or access to the West, education, wealth, and services. But on the other end of the spectrum, we have the great sea of the disadvantaged, the illiterate, the uneducated, the poor and the informal. Politically, this duality is reflected in the coexistence of the modern political institutions and trends that are mainly related to the same more-sophisticated and privileged sects of society. These coexist with more traditional sectors of society — such as the mosque and fundamentalist movements — with which the uneducated and the disadvantaged sympathize.

Those two trends of underdevelopment and unequal development are expressed in the functioning of our institutions today. Taking the above into consideration, we can approach the issue of the political determinants of MSME development. First, however, we must identify certain qualitative attributes of the MSME sector. This is best done by juxtaposing MSMEs to large enterprises, as in Table 1. It focuses on attributes of relevance to our topic, rather than focusing on the narrow definitions that use fixed criteria (such as number of workers, or size of capital).

Table 1. Qualitative features of small and large enterprises.

Source: This table was designed by the Technical Office of the Minister of Economy; see the Ministry’s "A Draft National Policy on Small and Medium Enterprise Development in Egypt". 1998. Cairo (June).

Institutional under-representation of MSMEs

In pre-modern times, the very institutional setup of society organized artisans and the traditional micro-entrepreneurs in "tawa’if" or "asnaf" (groups) that served to intermediate between the state and the artisan. Unfortunately, the modern counterpart (such as the "ta’aweniyat," or cooperatives, in Egypt) are largely controlled by the state and are far from being effective as an intermediary body. As a social group, contrary to the case with large businesses, MSMEs do not have the institutional presence that would guarantee them access to policymakers. Industrial federations, business associations and similar institutions are mainly dominated by large businesses.

The effects of such under-representation are obvious. Large businesses in MENA are, in many respects, organically connected to top officials. For example, in Egypt, consultations with businessmen are widespread prior to a particular form of legislation being passed that affects economic life. On the other hand, while 84% of Egyptian MSMEs operate from rented space, no similar consultations were held with them prior to issuing the law on non-residential rents.

This under-representation of MSMEs is due to two factors. The first is the underdevelopment of representative bodies in MENA in general. The second is the unequal development of the collective consciousness of the various social classes and groups in the region. On the one hand, large entrepreneurs are typically more conscious of their social status and of their economic and political interests than small ones. Research has shown that only an estimated 9% of MSME owners and operators in Egypt have university degrees. Accordingly, no autonomous MSME organizations have evolved in the region. Their under-representation has consistently served to place MSMEs at the mercy of the government as well as other market institutions such as the formal financial sector.

The regulatory environment

While regulatory constraints may face all private-sector firms, they weigh significantly more heavily against MSMEs. This is primarily due to the latter’s lack of adequate education, sufficient institutional mass, as well as its limited ability to utilize the legal and other pertinent consulting services that large firms can easily employ. Although legal and regulatory constraints vary by sub-sector, it is a well-known fact that MSMEs face significant and numerous problems with regards to establishment and licensing, operation, taxes, registration, export and import permits, and compliance with directives of various governmental entities. In Morocco, per late-1997 estimates, the establishment of a company "requires a plethora of documents, and the process often takes up to six months" (Hamdouch 1997, p.14). In Egypt, an enterprise has to prove compliance with at least 11 laws and deal with what amounts to 30 government entities before market entry. Moreover, one alarming indicator with regards to the cost of licensing alone is that the average cost for a licensed shop is 30% higher than in the case of an un-licensed shop. Payment is usually made ahead of time, in order for existing tenants to leave. This 30% is, in effect, the market value of the costs associated with just the workshop licensing process (Ministry of Economy 1998, p.22). Similar obstacles were reported in other Arab countries, for instance in Syria, where there also exists a multiplicity of governmental entities with which MSMEs have to interact during their establishment and operation.

The complexity of the regulatory system is further exacerbated by several other problems. These include the overlapping jurisdictions across the government institutions as well as central and local government codes; the lack of coordination among government entities and the inconvenient location of some of these entities; the low quality of information available to officials; inadequate filing and record-keeping; and rudimentary data-processing equipment. Because they have access to state officials, financial resources, as well as legal and technical resources, large businesses find little difficulty in surviving these hurdles.

Such a situation, coupled with an underpaid bureaucracy and a deteriorating economy, constitute a fertile ground for corrupt practices that became widespread in the bureaucracies of MENA. While there are no comparable data for other MENA countries, per the Transparency International Corruption Perception Index for 1996, only 14 out of 54 countries exceeded Egypt in terms of corruption (Moody-Stuart 1997). The corruption scandal involving some members of the last Palestinian cabinet is another indicator of the seriousness of the problem. For the larger and wealthier firms, corruption is a way out of the legal and regulatory maze we have created and nurtured. For the smaller informal firms, corruption is a burden they have learned to carry in order to survive.

Faced with this situation, it is only natural for the small entrepreneur to choose informality. The huge size of the informal sector in MENA (30%-45%) is a reflection of the complexities posed by the legal and regulatory environment to MSMEs. Formal compliance with the legal and regulatory environment is both size- and sector-sensitive. [1] To a great extent, a firm’s decision to remain small or informal is a result of the trade-off between the costs of abiding by regulations and the benefits associated with formality and economies of scale. MSMEs are particularly affected by over-regulation. As MSMEs try to expand, they can be faced with regulatory requirements that they managed to avoid while remaining small - and, in most cases, informal. Such regulations provide disincentive to growth. Graduation into a larger size and more formal entities can be a relatively expensive undertaking when compared to the costs of remaining small or informal.

Finally, it should be noted that while there are several attempts at regulatory reform in several countries (such as Morocco and Egypt), the process has been largely focused on large enterprises. In Palestine, where an entire body of laws is being created from scratch, reports indicate that the entire process is aimed at large businesses. This takes place at a time when at least 90% of Palestinian enterprises employ less than 5 workers.[2] Rather than learning from the mistakes of the other countries in the region, it is interesting to note how the Palestinian government is replicating the same patterns that are widespread among the regimes of the region.

The importance of the legal and regulatory environment is that it ideally acts as the regulator to the functioning of the market. It is the state’s tool to affirm that a level-playing field (if there is ever such a thing) is available for all. It also determines who gets access to what and how. It defines the borders between illegal (or criminal) and legal behavior. If anything, it regulates access. However, in its present state, as Assaad and Rouchdy noted in 1998, "the state’s rules and regulations are conceived in such a way to make it virtually impossible for large segments of society to secure their livelihoods, thus forcing them to operate outside these rules." The second logical step is to incriminate the "outlaws" and confirm their denial of access to resources; hence reproducing their poverty or powerlessness.

Institutional finance

The financial constraints faced by MSMEs are another manifestation of how the unequal development and underdevelopment patterns are reflected in the institutional setup of the region’s societies. In Egypt, for example, the banking industry is severely underdeveloped in several aspects in comparison to advanced countries, in such ways as branching, the range of services offered, and (above all) the quality of these services. The formal banking sector in most MENA countries is oriented to corporate banking, for instance in servicing large enterprises that enjoy a sufficient institutional mass. Unlike its counterpart in developed countries, MENA banks have not developed their retail banking skills, whether in loan extension or in savings mobilization. In Egypt, only 6% of the total banks’ credit goes to MSMEs. Ninety-five percent of small enterprises do not hold bank accounts, and 92% of these enterprises never obtained a loan from a bank. In Morocco, at least 1.2 million micro-entrepreneurs do not have access to institutional finance.

Even in richer countries like Saudi Arabia, the Industrial Development Fund (which extends soft loans to industrial enterprises) targets only those establishments licensed by the Ministry of Industry and Electricity. The latter only licenses those enterprises whose capital is more than one million SR. MSMEs in the Kingdom of Saudi Arabia lacked access to the investment incentives provided by the government including access to industrial parks, electricity, and relaxed custom duties on imported inputs (Commercial Industrial Chamber of Riyadh/Research and Studies Center 1998).

The financing required for microenterprises in the MENA region is valued at $1.4 billion, representing less than 1% of the total lending of banks in the region and less than 0.5% of their total assets. This 0.5% would meet the needs of some 4.6 million poor beneficiaries. However, MENA’s financial sector is not interested in attempting to close this gap. The above picture should be contrasted with the sizeable increase in credit delivered to the region’s private sector. In 1995 credit extended to the private sector exceeded 70% of the country’s GDP. The same percentage was 68% in Tunisia, and 64% in the Kingdom of Saudi Arabia.

This orientation towards bigger business does not only reflect an underdevelopment on the part of the banking sector. It also denotes the power relationship between MSMEs and large businesses reflected in the financial institutions in society, and in the regulations and practices followed by such institutions. It is this relationship that affirms the widespread conviction that banks are created by and for the rich. Faced with the above situation, MSMEs are again pushed to informality. They rely almost entirely on private, informal credit sources, advances from customers; and suppliers’ credit. While the interest rate for MSMEs in the informal credit market is reported to reach 100%, if not more, this market is in many respects more reliable. Among other things, the informal credit market is more accessible, offers more flexible loan terms, requires little documentation, if any, and has low transaction costs for the entrepreneur. It is, nevertheless, very expensive, limited in resources, and beyond the reach of most MSMEs (Ministry of Economy 1998, p.14-15).

Conclusion

MSME development, like other development issues, is an institutional issue. The challenge is to have institutional arrangements conducive to sustainable MSME development. Programs, schemes, and mechanisms cannot be established except over a solid institutional infrastructure. Of relevance to this point is the challenge of re-engineering the whole institutional setup. The current institutional setup and the macroenvironment favor big businesses and corporate actors, and serves to further marginalize the disadvantaged sectors of society. The already privileged in a social setting thus possess an unequal distribution of wealth and power.

One view worth examining is that of Nader Fergany (1998; p.18), who argues that

the crux of the process of poor enabling development is institutional reform of major proportions that radically raises the share of the poor in the power structure of society. Institutional reform is the path to maximizing the social capital of the poor. As such it is institutional reform, rather than economic growth per se, that constitutes the heart of poor-enabling development. Without it, growth is likely to be slow. More importantly, growth is doomed, in the context of unrestrained and uncompetitive markets, to grossly favor the rich and penalize the poor.

Another related challenge is the creation and maintenance of consultative mechanisms that actively engage the MSME sector, the decision-maker, and other stakeholders in a continuous and fruitful dialogue on MSME development. In an un-participatory context where top-down approaches to planning and implementation are the norm, and where the adequately informed decision-maker is a rarity, this might require serious effort. This is especially the case since such a mechanism presupposes the existence of an adequate institutional infrastructure. At minimum, it requires strong and capable institutions representing both the MSME sector and subject matter experts.

Bibliography

Assaad, R.; Rouchdy, M. 1998. Poverty and Poverty Alleviation Strategies in Egypt. Report presented to the Ford Foundation. New York, NY, USA.

Commercial Industrial Chamber of Riyadh/Research and Studies Center. 1998. Role of the Commercial-Industrial Chamber of Riyadh in Supporting and Encouraging MSMEs. Paper presented to the First Arab Gathering on the Role of Small and Medium Industries in Industrial Development, 15-17 February, Cairo, Egypt.

Fergany, N. 1998. The Growth of Poverty in Egypt. Al-Mishkat, 1. Cairo, Egypt.

Hamdouch, B. 1997. Development and the Problems of the Moroccan Private Sector. Forum, 4(2), 14.

Moody-Stuart, G. 1997. "The Costs of Grand Corruption." Forum, 4(2), 10.

Technical Office of the Ministry of Economy. 1998. A Draft National Policy on Small and Medium Enterprise Development in Egypt. Cairo, Egypt.

3. Change and the transition to democracy: issues in the Moroccan context

Mohamed Tozy

What conditions must be in place in order for a country to successfully embrace deep political change such as transition from autocracy to democracy?

Any debate on this topic must include how such change can effect public policy. And, will the change improve the management of resources, the reduction of social disparities or poverty? Will change guarantee civil freedoms?

Such questions defy quick answers or analysis. Nor is it fair to conclude that if political transition works for one country, it would be appropriate for others in MENA. Any debate of this nature is compounded by a lack of reliable data — particularly on cultural aspects of society — or even of balanced information that could provide a basis for analysis and comparison.

This paper focuses on Morocco. It identifies the main changes underway in that country’s political system, outlines their limitations, and assesses their chances of success. First of all, I present a brief analysis of the historical and philosophical prerequisites needed for transition, making a comparison with the rest of the Arab world. Secondly, I review the reforms underway — both in Morocco’s institutions and in its political culture — and discuss the ways in which the country is managing the processes of democratic transition. Finally, I end with an analysis of the challenges that the system must assume if it hopes to successfully achieve this historic turning-point, and cope with the forces that have emerged over the last nine months. The latter are discussed in the context of how the socialist government manages its conduct of public affairs (i.e., how it has achieved credibility for civil society, and started a debate on governance).

The prerequisites

Morocco’s current political experiment with democracy could only take place after two needed changes occurred: a political non-aggression pact and a negotiated process for constitutional reform. Extending the notion of democracy to the rest of the Arab world involves analyzing which of the MENA countries have already achieved these two preconditions.

A political pact is defined by the authors of the series Transition from Authoritarian Rule (O’Donnell, Schmitter, Whitehead, 1986). They suggest it is an explicit — if not always publicly interpreted or justified - agreement among a given group of players, that redefines the rules that govern the exercise of power, mutually guaranteeing the vital interests of each party. Central to such a pact is a negotiated compromise. Each party agrees not to use — or exploit — its ability to attack either the organizational autonomy or the vital interests of the others.

If we proceed from this theoretical basis and review the rest of the Arab world, we realize that very few are ready for a transition to democracy. In the 1990s, Morocco — the country I know best — has achieved a political culture of compromise and negotiation, both in union affairs and in public life in general. Working out the details of the negotiation has been a drawn-out, laborious process involving a number of protagonists: the national movement (Koutla) parties, the monarchy, and in an indirect and minor way, the Islamists.

The pact did not require a national conference (as in Black Africa). Memorandums (Istiqlal and USFP, 9 October 1991, and Koutla, 19 June 1992 and April 1996) have been the main medium of communication with the Palace. This type of communication offers two advantages: the adversary is not designated, and a response is not required. Beyond the deference they imply, memorandums convey the imbalance among the political players. Leaders of the political parties are always supplicants, rather than being competing alternatives. Thus, the implied debate on how to accomplish constitutional revision is both begun and developed by the national movement parties through their congresses and memorandums. All parties limit themselves to commenting on the content of the revision: but what is implicitly sought is the establishment of a "contractual" constitution.

The Palace’s vigilance is focused primarily on the forms of exchange, although major concessions have been made on matters of substance. Whatever the means of exchange, a deal has been made. Although the King always stresses the consultative character of such realistic and contradictory concepts as "consensual alternance", the government alternance that the King seeks is the very purpose of the pact.

Constitutionalism demands that the law must protect specific spheres of authority against the discretionary — or arbitrary — power of the state even if it does express the will of the majority. For such protection to exist, the political power structure must favour a division, allowing "power to offset power." As well, contitutionalism has to be based on a common agreement — or pact — in which rules are created that are difficult to challenge. As well, a constitution must guarantee that its rules take precedence over political expediency.

Thus, constitutionalism is an essential element in any political transition. It must not be assimilated by populist groups or traditional theocracies. Instead, constitutionalism is part of a world view that embraces competition among a variety of interests and values; it represents a polyarchic compromise between strategic elites that represent powerful social imperatives to varying degrees.

Morocco has had five constitutions in thirty years — in other words, a new one every 6 years. This fact reveals the tensions that are associated with the emergence of a constitutionalist culture, as well as the difficulties that are inherent in building a political pact that is permanent. However, those changes that are now underway, the reforms that the most recent constitutions have brought, and the political conditions that have made them possible, are all bringing in new political viewpoints and new ways of doing politics.

This reform process began in the very early 1990s. The relationship between the monarchy and the "opposition" underwent a profound change, in both form and content. For instance, "coups" are no longer an acceptable way to achieve change; as well, a parliamentary monarchy has been created. Hence, such changes made it possible for the opposition and monarchy to eliminate certain misunderstandings and to create a common basis of understanding — a pact.

Writing the constitution was no a single act. It was revised on 4 September 1992; and in 1996. It expressed a political will consistent with the expectations voiced both by funding agencies and Western partners. But it was also, in part, a reflection of the profound changes affecting Moroccan society.

It was against this background that the following institutional reforms took place:

• the establishment of the Conseil Consultatif des droits de l’Homme [consultative council on human rights] by order 1-90-12 of 24 Ramadan 1410 (20 April 1990);
• the establishment of administrative tribunals under Law 41-90, proclaimed by order 1-91-225 of 10 September 1993;
• the establishment of the Ministère chargé des Droits de l’Homme [ministry of human rights] in 1993;
• the establishment of the Conseil Constitutionnel [constitutional council] by Law 29-93 and the order of 25 February 1994; and
• the establishment of the Conseil Consultatif pour le Suivi du Dialogue Social [consultative council on the continuance of social dialogue], 24 November 1994.

Apart from the main features of this constitutional reform, it is important to stress the consensual atmosphere in which the current stage of reform is proceeding. What is new, is that for the first time in recent Moroccan history, the proposals won a broad consensus that included the USFP and Istiqlal parties. Until now, politics had been governed by rules that had been rejected by a significant number of players. The government’s accountability to both Houses, along with the unstated requirement that the King must appoint a prime minister who will represent the majority of the people are confirmations of the main innovation of democracy in the last constitution.

The bicameral approach, the constitutionalization of the Conseil Économique et Social [economic and social council], and the constitutional recognition of regional concerns are integral features of the constitution. Another important feature is a key provision that ties national legislation to the international body of law. Politically, the Kingdom of Morocco aligns its actions with several international agencies, of which the country is an active partner. Therefore, the preamble to the constitution confirms that the Kingdom subscribes to the principles, rights and obligations flowing from the charters of those agencies. It also confirms that human rights will be recognized.

The watchwords of recent months have been "consensus" and "dialogue." These express a genuine desire for political change which, over and above the manipulative culture of the makhzen, indicates a new equilibrium and a consolidation of advances in political maturity. A few short months ago, it would have been unimaginable for the Minister of the Interior to drop by the CDT congress, as he did last March. This is particularly true for anyone who is aware of the history of tumult in relations between that union and the authorities. It would have been equally unimaginable for the legislation on the forthcoming election and on regionalization to pass unanimously. Only the coming months will offer confirmation of this trend, which has defused the atmosphere and created a place for the Islamists within the opposition.

Two major questions arise with respect to the political pact in the Arab world and the possibility of constitutionalism.

1. Political forces have polarized. One camp is comprised of those whose allegiance to Islam is explicit. This group includes those who subscribe to a political Islam as well as those who embrace an archaic, traditional Islam that has a clear opinion of — and makes a clear statement — on social issues.
2. The other camp is comprised of those who evoke Islam as the wellspring of their politics. Here we find the political intelligentsia made up of nationalists, old-line Marxists, democrats and so on. In other words, this group represents an amalgam of elites, bureaucrats (both military and civilian), and family clans. In many Arab countries, this group constitutes a distinct political force. It can either be institutionalized (as in some countries of the Gulf), or non-institutional.

Political change comes about as a result of deals between these various factions. Islam is a good example of this. Some commentators identify three main components of political Islam:

1. the rural and urban marginalized elements, or hetestes, as they are called in Algeria (these are young people who filled the ranks of the member groups of the Islamic Salvation Front, the FIS);
2. the bourgeoisie pieuse, or middle-class faithful; and
3. the Islam of the ulamas, the religious traditionalists in various countries.

The balance between these three elements defines political transition in the Arab world. In Morocco, a form of compromise exists that has made change not only feasible, but just. But unfortunately, in Algeria, hope for such a compromise was shattered because the bourgeoisie pieuse could not restrain the hetestes.

Morocco teaches us that a change is possible. Given the possible alliances, and if political figures can break free of the traditional culture of servitude, and above all build a constitutionalist political pact based on the balances between the political elements of Arab society, then change in other MENA countries is possible. Indeed, this is the research imperative for the future. A thorough understanding of these structures, elements, possibilities and capabilities is strategically important, not only so that the process will be intelligible, but also, so that we can identify the fields in which it will be effective.

The manifestations of political change

Very few commentators doubt the innovative character of some aspects of the new legislation. Particularly welcome are those changes directly related to the operation of the political system, or those designed to upgrade the legal framework governing the economic sector (for example, the business and labour codes). Three phenomena illustrate the political transformations now underway in Morocco:

1. the partial involvement of the moderate Islamist movement in the political arena;
2. the advent of a gouvernement d’alternance, or changeover government; and
3. the stronger sense of community.

The fact that Islamists were present and actually within the walls of the Ministry of the Interior the evening of 14 November 1997, was the crystallizing event of that year’s election. It captured the attention of the international media, who took great pains to analyze the string-pulling by the regime. Such media also speculated about the new system’s chances of surviving the "green peril" and of refuting the assumption of an Algerian-style scenario. Very few of them had noted, however, that this was not the first time the Islamists had taken to the hustings. They were involved in popular consultations on three previous occasions: the constitutional referenda of 1992, 1996 and 1997. In 1992 and 1996 they campaigned for the "yes" side. During the local elections of June 1997 they forced the hand of their ally, the Mouvement populaire démocratique et constitutionnel (MPDC), and run as candidates with no political allegiance.

During the November 1997 election, the Islamists’ participation was official. For the first time, the authorities recognized the MPDC-Islah axis. Admittedly, the party was not invited to the various preparatory meetings. But it did receive its share of public funding: the Ministry of the Interior paid the first 20% to the MPDC.

A quick survey of the 142 candidates fielded by the MPDC shows a direct connection with the sociological profile of the entire political class, particularly the opposition. They are not drawn from a single segment of society, a new social or occupational category, or a region represented only by Islamists. Like the Koutla candidates, they are predominantly teachers (49%) and other professionals (17%). Their average age is over forty. Nearly all of the Islah members — who accounted for fewer than half of the MPDC candidates — ran in urban districts.

The profiles of the MPDC candidates did not greatly differ from those of their opponents. However, their political professionalism and communication skills that were honed by years of religious proselytizing, did surprise observers.

A statement by Moroccan Prime Minister Youssoufi in the newspaper Jeune Afrique on the eve of the 14 November election of 1997 intimated that the Islamists might be admitted to the very closed circle of the opposition. This acknowledgment was received with great enthusiasm by the Islamists. It established their credibility and opened the door to their admittance to the official political arena. It also enabled them to envisage a range of scenarios for participation in, and support for, the future government. But it had the drawback of making them vulnerable to the Sheikh Yacine’s faction and requiring them to adopt a process of constant adjustment. In the universities, for instance, they had to continue support for Al Adl members and maintain a hardline political stance. This was the price to be paid for their participation in order to get Sheikh Yacine’s tacit consent — which was only given after lengthy discussions with his followers.

In that election, the only successful operation was this tightly controlled integration of moderate Islamism. It was then possible, for a time, to redirect the attention of Sheikh Yacine and stress the dissension within his own movement. This does not mean that the Islamist issue is closed. The existence within the parliamentary precinct may reshuffle the political deck by requiring the parties to take a clear stand on the proposals that they will surely propose. The danger is that parliamentarians may be lured into a holier-than-thou contest.

Beyond the political significance of the 1997 election, there were two major societal achievements. For the very first time, credibility was given to a career in politics; secondly, civil society had been reinforced. Prior to 1997, anyone who became active politically was regarded with suspicion. In fact, political involvement was considered taboo, and getting involved could damage a person’s career. This negative perception is being corrected. Now, working in the social and political realm is appealing to people, which is allowing Morocco to move beyond its former state of chronic depoliticization. There is no denying the impact of this change on the emergence and reinforcement of civil society.

Morocco has witnessed many serious hardships during the past several decades. There was a period of mourning after the "Year of the Gun," when the government published a list of victims who died during the repression of the 1970s. At that time, the government made a solemn commitment to the rule of law and the defence of civil liberties. In later years, the country has coped with an environment marked by macroeconomic constraints and financial weakness - as well as a declared openness to the global economy. Now, Morocco must meet the simultaneous challenges of population growth and accelerating urbanization.

Since the late 1980s, NGOs organizations have experienced a spectacular growth in Morocco. Official documents indicate anything from 17 000 to 35 000 associations. As well, the attitude of the Moroccan government towards them has changed. The administration says very positive things about the benefits of the association movement, which is recognized as being a clear sign of open democracy in Morocco and of the vigour of a civil society that is taking shape. A few political NGOs are having difficulty acquiring legal status. But for the most part, the government is now relying openly on support from most of these associations, in order to make progress on a number of ventures. Work is proceeding on a contract basis in the areas of electrification, highway construction and the like. This represents a revolution in official thinking that would be hard to overstate.

While not denying the real strength of the association movement, it does possess inherent limitations; otherwise, it would be easy to subscribe to the idea of a civil society acting as the alter-ego of the administration. A field survey quickly reveals the gap between the inventory of NGOs published in certain studies, and their real operational effectiveness. For example, in the field of rural development, there are only a few truly active NGOs. Official announcements cover a wide range of realities. One proposal put forward by the administration is to form ad hocassociations — such as an irrigation association — that formalize a partnership with local people and a highly structured NGO with a direct role in the decision-making process. However, the latter type of NGO is far from common.

Looking more closely at the NGOs’ many manifestations in the countryside, one is tempted to explain this phenomenon further. It is important to dissociate between the contractual bond associated with a citizen and the state’s abdication of its own responsibilities as a provider. Traditional loyalties and modes of organization are being reshaped in the new political environment, both in the marginal zones and on the periphery of what might be called the former bled siba.

In conclusion, the unshackling of political life resulting from the change of government has had an immense impact on the consolidation of civil society and upon the networks and communications between associations. The current government has explicitly demonstrated its desire for a partnership with the NGOs. On 13 January 1999, the prime minister received an NGO collective to discuss how to reform the code of civil liberties, and how to overhaul the rules governing associations. The path for reform has been prepared by the collective. On the same day, the prime minister entertained members of an association known as Transparency. For some years it had been prevented from conducting its full range of activities. But now it is directly involved in debates on how to introduce new rules that can simplify governance in Morocco.

The limitations of the Moroccan experience

Political limitations still exist in Moroccan, such that sharing power remains symbolic. As well, almost by definition, the effects of the experience mean a slow, albeit reversible transformation of the political culture. Notwithstanding this, the real challenge facing Morocco and other Arab countries that are undergoing transition is an economic one.

In the case of Morocco, despite the government’s efforts to improve basic infrastructure, housing, health, and employment, large deficits are accumulating. Indeed, they are this is accelerating the process of impoverishment and marginalization.

A quantitative analysis of poverty in Morocco, carried out in 1997 as part of a study of vulnerable populations (Centre d’Études et de Recherches Démographiques1997) using national survey data on the family (ENF 1995) and on household living standards (ENNVM 1990/91), showed that today, the socially marginalized population is estimated at 5.4% of the total population (1.4 million) and the vulnerability to relative poverty at 47.3% (13 million). Based on a grouping of socioeconomic categories by household expenditure as compared to a common poverty threshold, this recent study also sheds significant light on the characteristics of socially marginalized and vulnerable populations. Deprived of a proper source of income, the socially marginalized are, by definition, the poor people of Morocco; their sources of subsistence are unofficial transfers, national welfare and donations.

While analysis of the spatial distribution of poverty shows that it is predominantly rural, rural/urban marginalization is urban in character: of 10 socially marginalized people, 7 are city-dwellers. Analysis of household characteristics further reveals that:

• 70.5% of marginalized urban households are headed by a person born in the countryside;
• More than one marginalized household in two is headed by a woman, compared with 15.6% nationally;
• one-third of these heads-of-household are widowed or divorced;
• almost one-in-five marginalized household consists of a person living alone, versus 3.9% nationally, and almost half are 60 or older; and
• heads of marginalized households have a 100% unemployment rate.

Furthermore, vulnerability to poverty is characteristic of a broad social stratum, whose living standard or level of consumption approaches the poverty threshold. Vulnerability to poverty affects one-third of city dwellers and half the rural population, and the condition is strongly associated with both an individual’s residential surroundings and living conditions. Vulnerability to poverty in urban environments is characteristic of those sectors that are most deprived of social and economic infrastructures, housing projects (50.9%), and former medinas (45.5%) — as well as both clandestine (43.5%) and makeshift (43.2%) dwellings.

Furthermore, analysis of social and economic data on vulnerable households shows that the poor still have limited access to schooling and family planning, since:

• 62.5% of them are headed by people with no schooling, versus 16.3% in the wealthiest class; and
• those under 15 years of age represent 2.37 members per household in vulnerable populations, versus 1.91 for the wealthy class.

Thus, the limitations of Morocco’s political experience are known. They are related to the Arab world with regard to poverty, but other limitations also exist. These include administrative resistance, bureaucracy, and a strongly authoritarian culture in the political class. The latter is also shared, unfortunately, by a large part of society, which possesses a widespread culture of "servitude" in its social fabric.

The relationship between political change and new development practices

It is very difficult to consider the Moroccan experience as a model of its kind. Morocco is ranked 123rd (UNDP 1997), but it is difficult to deny that the country has made symbolic progress on several fronts. After nine months of socialist government, it can be said that:

• civil society is widely acknowledged as representing special interests and being capable of contributing to the development process as a full partner;
• the Islamist movement has been largely accepted and recognized as possessing special sensibilities that enrich Moroccan politics;
• there is more political acceptance now, expressed as a recognition of those great social evils that had been largely suppressed and ignored in the past. These conditions include poverty, illiteracy, street children, poor distribution of resources, the drift away from agriculture, corruption, drugs and the cultivation of cannabis; and
• the political agenda includes the issues of governance, desertification control, and unemployment among young graduates.

Morocco’s political transition is a new dynamic. While it is too early to evaluate fully, we can make comparisons with the different political roadmap being followed by other Arab countries, which are getting better results without following the same route. Tunisia is one such example: it is getting good economic results and making inroads against poverty. But, it has used a Singapore-style approach to "resolve" the issue of political freedom. Nonetheless, it faces a thorny question in the matter of political change.

Bibliography

Centre d’Études et de Recherches Démographiques. Ministère délégué auprès du Premier ministre chargé de la Prévision Économique et du Plan. 1997. Populations vulnérables: profil socio-démographique et répartition spatiale.

ENF. 1995. Enquête nationale sur la famille.

ENNVM. 1990-91. Enquête nationale sur les niveaux de vie des ménages.

UNDP.1997. Human Development Report 1997. Oxford University Press.

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