How The Jasmine Revolution Has Affected Business

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The middle east was already a boiling pot before the revolution. It took just one spark and the whole Arab world turned upside down. This one spark was in Tunisia and the spark came in the form of a man called MohammedBouazazi. He was just an ordinary villager in a village called SidiBouzid where he made an income by selling vegetables. One fine day, a municipal officer known as FaidaHamdi came and confiscated Bouazizi’s wares and his cart. It is alleged that Hamdi slapped him and swore at his deceased father. After bearing such bitter humiliation, he goes to the governor to voice this injustice done to him and when the governor paid no heed, he poured gasoline on himself and just lit himself on fire in front of the governor’s house.

What seemed like a local affair, turned out to be a national affair. Protests initially was from SidiBouzid, then the entire country erupted in protests demanding that their ruler of 23 years, Zine El Abidine Ben Ali step down from power. At the end of the day, it ended up in his ouster.

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The word spread out and then the entire middle east decided that it was time for some in-house clean-up. Egypt came next, and they crowded at Tahrir square till their ruler of 30 years, Hosni Mubarak stepped down. In the meantime, there were protests all over the middle east demanding the ouster of their dictators. Violence was reported in many parts. Jordan, Syria, Yemen, Saudi Arabia and even Oman came under threat of protests by their citizens.

The Egyptian protests were successful. Inspired by the success, this new “Arab awakening” or the “Jasmine Revolution” gained momentum. The entire middle east erupted in protests and demanded their dictators or monarchs be thrown out and freedom and democracy be granted to the people.

When protests hit Libya, things turned out to be very bad. Their maniacal leader, Col. MuammarGaddafi, resorted to killing the protestors without a conscience. A big faction of the Libyan Army, disgusted by the orders given by Gaddafi, defied and joined the rebels. They decided to get rid of Gaddafi. The problem was that it had resulted in such large-scale clashes. Gaddafi started using the airforce against protestors and bombing them with warplanes. The minute he did that, the war turned ugly. This now became an international humanitarian problem. The United Nations began discussing on what to do. Finally it was decided to have a no-fly zone over Libya. The Air-Forces from France, US and UK coordinated and brought down Libyan planes that were being used to fire at protestors. The war has progressed with the rebels enjoying support from the other countries and world opinion being turned against Col. Gaddafi.

As the war in Libya progresses, there are protests going on in Yemen, Syria and other countries. The revolution is not yet over. The strength of the revolution is not exactly very high either, but nevertheless, it is still on. People are demanding freedom. The very fact that the dictators of the middle east are getting worried about the issue shows that the Revolution is a big success.

Now, the problem is that the revolution has come at a certain cost. Especially in terms of the economy.

To begin with, the middle eastern economy is not that big. Apart from the 6 Gulf-Cooperation Council countries which are Saudi Arabia, United Arab Emirates, Kuwait, Qatar, Bahrain and Oman respectively, the other Arab countries are not very rich. In fact, countries like Syria, Jordan, Lebanon, Iraq and Yemen are poor. The same goes with countries in North Africa like Egypt, Algeria, Libya, Morocco and Tunisia. The resource which gives the middle east its money happens to be fossil fuels like Oil and natural gas. And even on these, the GCC countries happen to have a monopoly on it.

The other middle eastern countries have very few other resources. Countries like Syria and Jordan depend on agriculture and in the middle east, agriculture is not very profitable. Therefore there is a lot of poverty in these places.

So the revolution has hit incomes badly as they have taken time off their work and put it into the revolution wasting lot of working hours in the process.

Fields were seen without people working in them, factories were empty, shops were closed, offices were closed. There was very little work done. And this happens in a region where you can’t afford to waste man-hours.

Due to the unrest, tourists virtually decided to skip the middle east altogether and go to other tourists spots in Europe and Asia. For countries like Egypt and Lebanon, tourism forms a major part of their income. And the revolution has cut that off. The problem is that when the image of the middle east was already so bad and on top of that if the revolution signifies that there is something wrong going on in the middle east, it could be dangerous for long term prospects in tourism. Besides, recovery from the economy part of the revolution is bound to be slow.

The lack of diversification in the middle-eastern economy will prove to be a deterrent in the healing process. There are very few industries otherwise in the middle east. There is agriculture. There will be fewer jobs, lesser money and when the revolution strikes, even lesser healing.

Fearing the political situation in the middle east, the stock markets in the middle east will plummet. People, especially foreigners will be on a selling frenzy. When people will think about investing in the middle-east, people will now think twice. People are quick in withdrawing their investments in the middle eastern economy.

Even the backbone of the middle-eastern economy, oil, has suffered setbacks. During the protests in Egypt, oil wells were torched. That is a major loss of income as well as resources. Libya also had the same problem. Gaddafi set oil wells on fire so that the rebels wouldn’t be able to use them. Production of oil should not be hindered in any way. The supply of fuel needs to keep coming. The minute it is hit, even if it is a little bit, it can strike the world economy very badly.

Due to the protests, the oil prices around the world just sky-rocketed to over a $100 a barrel. These prices are phenomenally high. And the prolonged protests means that less and less people are attending to their jobs pumping oil and the pumping of oil to various sectors of the economy is seriously hindered. This can destabilize the economy, especially in places where oil is the backbone of the economy and there is no diversification of the industries there. Saudi Arabia must take note.

In short, the situation in the middle-east and the Arab awakening has shook up the political image of the middle-east, but it needs to somehow understand that any prolonging of the protests may severely impact the economy and hamper its growth. The middle-east can’t afford to prolong the protests for too long. It can’t shut shop for so long.

Copyright © 2011 AshwathKomath

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