Executive Summary

In the aftermath of the Arab Spring, Egypt, Tunisia and Libya are confronted with major structural adjustment challenges that cannot be solved without the help of regional and international donors and private investment. After decades of one-man rule, their economies are in tatters, political institutions are fragile, civic society is underdeveloped, and security has yet to be firmly established. Progressive minded secularists are engaged in an uneven battle with conservative Islamists intent on consolidating power. The situation in all three countries is fluid, dynamic and dangerous. Violence is never far from the surface, and when it flares up regimes are shaken and unable to mount an effective response. These close neighbours are entering new territory with an untested leadership and with an administrative apparatus sorely in need of technical assistance. Only Libya possesses sufficient natural resource wealth that properly managed can help it recover without international financial assistance. The military takeover in Egypt has quieted the street for the moment, it remains to be seen if in its aftermath the country can be put on a sounder political and economic footing. Like Egypt, Tunisia requires substantial foreign aid and investment to right its economy. Security, education, employment, all must figure prominently in national development strategies. Support for secularist parties is essential to balance political power and to avoid the rise of religious tyranny. In all cases, international actors should be supportive of locally generated solutions, and highly attentive to sensitivities about foreign intervention. Outside engagement should be broad-based, and include regional intergovernmental organizations such as the Arab League. Such engagement must be sustained over a sufficient period of time to increase the likelihood that there will not be political and economic backsliding.

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