Conclusion

Obviously the old social contract can no longer deliver the needs of new generations in MENA even though it delivered results in the past. Like before, the public sector can/should no longer be the main employer. Politically connected private sector cannot render any adequate solution to fundamentally create jobs either. And public service delivery has been organized in such a way that citizens in particular the poor ones don’t have the possibility to keep providers accountable.¹⁶⁷

Moreover, because of the vicious circle or “low level equilibria”, incremental reforms just in one particular area would not be able to dislodge the system. For example, if we improve the quality of education while the job creation is intact, we may not find a way out. What is needed therefore is a series of changes at all institutional levels without having to resort to revolution or nor even “shock therapy.”

Put it differently, a new set of changes need to be introduced to define the relationships between citizens and the state; in short a new social contract.¹⁶⁸ And to reach that social contract the best way to start up would be working simultaneously on institutions by commencing the process of institutional change that can affect the economies and social status of the citizens in an incremental fashion. In return, forming the social contract would also have a positive impact on the formation of these institutions thus helping achieve institutional change more swiftly and adequately.

At the first glance, what should such a new social contract look like? Instead of having the public sector

167 The World Bank. By Devarajan, Shatayanan; and Mottaghi, Lili. “MENA Economic Monitor: Towards a New Social Contract.” The World Bank Middle East and North Africa Region, April 2015, p. 21.

168 Ibid.

as the sole provider of the jobs in society, the spirit of competition in an atmosphere away from corruption ought to be mandated to the private sector while promoting the “equality of opportunities for all entrepreneurs”. This would in fact dictate a new role for both the government and the private sector.

Secondly, it would be better to provide subsidies with targeted cash transfers for everybody instead of free or subsidized low quality public services. Thus, poor people would also be able to have access to the private services that are being exclusively consumed by the non-poor. As well, public expenditures would be used for the purpose of financing public goods including infrastructure and cash transfers.¹⁶⁹

Thirdly, an attempt should be made towards the liberalization and openness of economies in a regional context thus making the region susceptible for a more regional cooperation and integration. Obviously such changes would not happen overnight. Nor should they necessarily look like the same in all countries.

For example, countries in conflict will firstly need to resolve the conflict. In other words, the regional conflicts through political or diplomatic means ought to be settled.

Moreover, a strategy like security at all costs would not properly work as it would put the country towards a low-level equilibrium with lower growth. Iran would be a good example to show this case as well as those countries directly involved in conflicts. In fact, changes and reforms should take place in such countries away from any situation destabilizing the country or the region. While security and stability might be the short-run priorities for such nations, the need for job creation, poverty reduction as well as better public services would be of paramount importance.

Oil-rich countries in view of their reserves can construct long term plans for incremental change within a longer time horizon. Getting there would not be easy because of persistent institutions, the path independency, and interests in the status quo that would all resist the change. As such, a coalition may be built by reform champions for change mainly because the people in the region are demanding for change, for jobs and better service delivery. After all the philosophy behind the Arab Spring was that the peoples’

voices would be heard.

Accordingly, in case of the MENA region, the purpose of the old social contract has been served.¹⁷⁰ Solving the long standing political and economic problems in the Middle East and North Africa region (MENA) would seem quite difficult without embarking on a new social contract. In view of the fact that

169 The World Bank. By Devarajan, Shatayanan; and Mottaghi, Lili. “MENA Economic Monitor: Towards a New Social Contract.” The World Bank Middle East and North Africa Region, April 2015, p. 21.

170 Ibid, p. 22.

many countries in MENA have been able to deliver substantial progress to their citizens within the framework of the old social contract, they prove to be able to do the same with the new social contract as well.

Only after taking the above serious and progressive steps, we may feel an odor of amity and cooperation in the region with the hope of creating better ties towards economic prosperity under the banner of regional cooperation and deeper integration. This latter would be the main subject of this dissertation throughout the coming chapters as we delve into it with more details.

The Part (I) of this dissertation illustrated the significance of Civil Society and the necessity to reach a new set of social contract susceptible to the needs and aptitudes of the regional societies in MENA. Then the importance of “institutions” and the necessity of “institutional change” to reach that destiny were stressed so as to achieve an adequate social contract. What offered here is in fact a logical step-by-step incremental change of institutions as the key component of success and development through which the goal of attaining a proper social contract can be achieved along with emerging regional cooperation and integration that are to be elaborated more in the chapters to come.

In fact, once the above steps have been taken, in a tranquil atmosphere away from today’s regional conflicts and civil wars; regionalism would be the flickering light of hope at the end of the tunnel for a stronger cooperation and deeper integration to be the voice resounding security and hope in reaching out to a harmonious region filled with peace and prosperity. These are mainly the subjects of the upcoming Chapters. But in the next step, the best would be firstly to learn from other regional experiences, and to that effect, an overall global outlook is presented on integration as a solution by rendering some major examples that include legal aspects of economic integration within MERCOSUR, NAFTA, ASEAN, and AFRICA that all comprise the second part of this dissertation.