2013…The year of the economy

As we enter a new year it is customary for people to hope it will be better than the last one, especially if the past year was full of turmoil and unrest. When we look back on 2012 it was a year full of horrors, especially in the Middle East, whilst globally it was a tough year economically. The truth is that the last three years have witnessed unprecedented events globally and regionally, beginning with the collapse of financial institutions. These institutions were worth more than several countries, and no one thought could simply tumble like a house of cards. Yet the crisis, having stemmed from the irrational speculation and risks taken on the international financial scene, soon extended to the states themselves, and thus we saw the major economies of the Western world in recession, with fears of a great depression similar to the one in the 1930s. Likewise we saw the countries of the EU, the second largest economic bloc in the world, borrowing and succumbing to the conditions of the IMF in order to get out of their crises, and questions began to be raised about the status of the Euro. In the Middle East, 2012 was an extension of the events of 2011 and the uprisings that took place in major Arab republics. The transitional phase has so far been full of turmoil and has yet to settle down, and this has added pressure on economies which are already suffering from structural defects including high unemployment. In addition to this there is the unique case of the Syrian crisis, which last year took on a serious bloody dimension, and as the fog of war continues it is hard to see the political future in 2013, let alone the economic vision. Controversy is still at its peak in the Arab states that witnessed changes in their ruling regimes, such as Egypt, Tunisia, Libya and Yemen. Meanwhile, Syria continues to wait for a military or political solution but this is expected to change at the very least in the first quarter of 2013. Yet the economic world is increasing its pressure on the living conditions of the people and even the entities of the Syrian state itself, and this is what we must give our focus and attention to in the coming period because that will determine the course of events in the coming year. 2013 is the year of the economy, not just regionally but also internationally. If the Arab transitional phase needs to get its house in order to stop the deterioration and revitalize the economy, then global economies must also take into account the overlapping nature of global finance and the mutual influence of one region on another. It was not surprising that the entire world was watching until late last night whether or not President Obama would be able to reach a financial agreement on the “fiscal cliff” issue, to save the US government budget in the new year. The road in 2013 does not seem easy; recent international expectations indicate that the major Western economies may not emerge from recession and restore their activities until 2017, which of course will reflect upon the crisis-stricken economies of other countries that are seeking funding and foreign investment. The major challenge facing governments, whether Western or those embroiled in the Arab transitional phase, is that the patience of the ordinary citizen is short when they cannot find a job or maintain a decent standard of living. We have already seen this in countries with far better economies than some of those in the Middle East, such as Greece, Spain and Italy, which all witnessed widespread protests last year against austerity policies. --- The views expressed by the author do not necessarily represent or reflect the editorial policy of Arabstoday.