Western waters

photo: Masraff
Western waters
Independent vision or pressure to westenise? In the first of a two-part study, Galal Amin* delves into the factors that have shaped Arab economic development for the past half century
DOMESTIC DEBATES AND FOREIGN PRESSURE: It was almost 50 years ago that I had my first experience of a debate related to the political economy of the Arab World. It was a debate between those for and those against private foreign investment in Egypt. Those in favour mentioned familiar arguments, such as the need for a country as poor as Egypt to supplement its meagre savings capacity by importing foreign capital, and the advantages of modern technology and management. Those against warned of the loss of economic and political independence. The former called upon the latter to free themselves from the sad memories of the last few decades of the 19th century, when the importation of foreign capital did indeed lead to the loss of independence and brought with it the British occupation. The world now was very different, they said, and for a fully independent country, such as Egypt had become in the mid-20th century, foreign capital could only be an advantage.
That was in 1953. But only three years later, the whole issue suddenly became irrelevant. With Nasser's nationalisation of the Suez Canal in 1956, there was no longer any hope of private foreign investment coming to Egypt in any significant amount. With the new Egyptian regime now thoroughly discredited in the eyes of Western governments and financial institutions, Egypt had to adopt policies that could bring about rapid economic development without foreign investment. Foreign aid was accepted, but not private capital, and Nasser was able to mobilise one of the fastest rates of inflow of foreign aid in the whole of the Third World, (as we now came to be called), not only from the socialist bloc but in almost equal proportions from both East and West.
With the government taking responsibility for achieving rapid economic development, largely because a major source of finance had come to be official transfers of capital, the government declared itself "socialist," and a very different kind of debate emerged: whether our socialism was like any other socialism or if it was a special type which deserved the label "Arab Socialism." As was the case with the debate on private foreign investment, the issue of what kind of socialism to apply was decided not on ideological, but on practical grounds. While the Egyptian government was more inclined to give concessions to the "nationalist" or "Islamic" socialists before 1964, once it had reached a reconciliation with the Soviet Union in that year, "true" socialism came to be seen as of only one type, namely "scientific socialism."
But even this was to be very short-lived, since socialism, of whatever variety, could not survive the military defeat of 1967, particularly after Nasser's death in 1970. With the launching by Sadat of the new "Open Door Policy" in 1974, a new debate, more heated than any preceding it, arose on whether it really was right for Egypt to dismantle Nasser's economic policies. The debate between supporters and opponents of open-door policies still, in a way, continues, although it has taken different forms, and the aspects emphasised have changed significantly over the years. In the mid 1970s, the main issues of disagreement were exchange-rate regimes, trade liberalisation and the subsidy system. In the mid 1980s, the main issue became the privatisation of public enterprises to which was added, by the mid-1990s, the debate over what was called "The Middle East Market," which was another name for having economic dealings with Israel. Again, as with all previous debates, the Egyptian government allowed the people to argue but did not allow this to influence policy. This was not decided on the basis of election results, nor from a cool consideration of the relative merits of each side of the debate, nor even on the basis of the balance of economic power of vested interests within the country. We might all have saved our breath. For Egypt was too significant a country in the world economic system for its major economic policy decisions to be left to the mercy of domestic influences alone. It should not therefore be surprising that the same figures in Egyptian politics who championed the case of socialism in the early 1960s, played an important role in implementing open-door policies in the 1970s, or that some of the most outspoken politicians in the Arab-Israeli conflict in the 1950s and the 1960s, advocated, in the 1980s and 1990s, a "Middle East Market", implying "normal" economic relations with Israel. Egypt's policy positions on major issues of political economy were shaped, not only in reaction to changes in the international environment, but often as a result of direct external pressure that left Egypt little room for manoeuvre. Trying to find domestic explanations for such important shifts in Egypt's economic and political history may be useful in so far as it may uncover some interesting detail of Egyptian political and economic life, or in enabling a student to get a university degree. But is often as useless in explaining important turning points in Egyptian economic or political history as the most unrealistic work of fiction. A more fruitful pursuit is to search for the impact of interaction between Egypt and the outside world and particularly the impact of external pressure on Egypt's economy and politics.
ECONOMIC DEVELOPMENT AS WESTERNISATION: After following two apparently opposite paths of economic development, each occupying about 25 years of Egyptian history, Egypt is now a much more "westernised" country than it was 50 years ago. Both Nasser's "socialism" and the "Open-Door" policies of Sadat and Mubarak had a profoundly westernising influence, with foreign aid playing no less an important role in westernising Egypt than private foreign investment. Nasser may have used strong language criticising the West, but it was its economic and political dominance that he objected to, not its civilisation. He was at least as anxious to borrow this as were his two successors. Whether Nasser's socialism was to be like other socialisms or a particular brand of socialism, it had the same ultimate goal of maximising the rate of growth, of even the same types of goods and services. And of course it made little difference, in this respect, whether the foreign experts resorted to were Russian or American. Nasser had of course no independent "cultural" or "civilisational" project, given his temperament, his mental build up and educational background, but even if he had possessed the intellectual sophistication of India's Nehru or of Yugoslavia's Tito, he would have left Egypt the same kinds of factories, and the same kind of economic and social infrastructure, producing the same kind of goods and services, and of course the same modern army that those two leaders have bequeathed their countries. Nasser sought no inspiration in his own people's traditional culture, whether in deciding what goods to produce, what arts to encourage or what kind of education to provide. Private motor cars and air-conditioning units were produced, the homes built for the poor followed Western designs for low-cost housing and school curricula continued to be copied from the Western school system. When Nasser "reformed" Al-Azhar, the "reform" consisted mainly of westernising it and of introducing some modern subjects taught in English. The teaching of the Arabic language suffered because it was not deemed essential for "economic progress." The introduction of television in the early 1960s was of course inevitable, and its programmes, although containing "revolutionary" stuff, were essentially a replica, albeit a poor one, of Western programmes.
Sadat could hardly improve upon Nasser's westernisation except by accelerating it. What under Nasser was westernisation from above, became under Sadat mainly westernisation from below, and hence it became a little less orderly and considerably more vulgar. For now, the importation of Western goods and patterns of consumption were no longer the monopoly of the state, and everyone was now free to westernise at their own pace. Foreigners were now welcomed, whether as investors, traders, consultants or tourists and they also helped accelerate the process of westernisation, through the goods and services they brought with them and the goods and services they demanded, as well as by sheer contact and by inviting emulation. The highly accelerated rate of migration from Egypt to the Arab oil-rich countries added new strength to this process by providing the financial means for satisfying previously suppressed desires.
Sadat left Mubarak two legacies which limited the ways in which Mubarak could engage with the West: heavy external debt and the Camp David agreement with Israel. Nothing in Mubarak's temperament or background suggests that he would have chosen a different path, but the burden of accumulated debt of the Sadat years forced him to implement the IMF/World Bank recipes of economic stabilisation and structural adjustment, policies which meant greater opening to the West. Sadat had also already put Egypt far on the road to reconciliation with Israel which also meant much less hostility from the West.
Comparing the state of the Egyptian economy and society at the end of the century to what it was like 50 years earlier, it is not difficult to see how much more westernised it has become in so many important ways. Economists like to label this change "economic growth" or "economic development," while sociologists and political scientists prefer to call it "modernisation." But both terms miss an important part of what happened and may therefore mislead. The terms "development" and "modernisation," refer to the fact of change but not to its content; they therefore imply that there was no other path to take but that which was actually taken. The careless use of both terms therefore presumes that only change of a certain type is "modernisation." But one of course may achieve "economic development" by increasing the quantity of clean water available without multiplying the output of soft drinks, and can be more "modern" without listening to a news bulletin every half hour or less. What has happened in Egypt over the past 50 years is therefore not merely economic development and modernisation but development and modernisation of a very special kind.
It is in this sense that one can describe what occurred in Egypt during these 50 years as a thorough process of westernisation. The same can be said of all Arab countries, though in varying degrees. Some Arab countries, notably Lebanon and Egypt, had already travelled far along that road before 1950, but those who came late, like Yemen and the Gulf States, quickly made up for it by acquiring western habits of consumption, education and social and political organisation at a much greater speed. This has happened under a greater variety of economic and political systems, sometimes under army rule and at other times under the same ruling family as held the throne at the beginning of the century. But whether under the banner of socialism or free enterprise, the results were amazingly similar.
WESTERNISATION AND THE GROWTH OF THE MIDDLE CLASS: Hand in hand with the process of rapid westernisation came a rapid growth of the middle class. For Egypt, I estimate that between 1952 and 1990, what I have defined as the "middle class," grew in size by more than six times, and its proportion of the total population of Egypt grew from less than one fifth to about one half. Similar observations could be made of most other Arab countries as could be gauged from rates of growth of urbanisation, education and from the change in occupational structure, in addition to whatever meagre data that may exist on changes in income distribution and expenditure patterns.
It is interesting to contemplate the relationship between the growth of the middle class and the increasing westernisation of Arab societies. Some of the most important channels of the growth of the middle class, such as education, urbanisation and economic development, are themselves channels of westernisation. For education is never a neutral process of transmission of knowledge, and both urbanisation and economic development open new doors for the importation of new patterns of consumption and ways of thinking. Under ambitious socialist governments, where rapid modernisation is pursued at the same time as a radical programme of income redistribution, the outcome is bound to be greater westernisation catering mainly to a much larger middle class. Similarly, the growth of the westernisation and the growth of the middle class are linked. For example, individuals and families migrate to some oil-rich countries in the hope of increasing their income. This inevitably raises them up the social ladder and allows them to acquire, in the process, new and largely western habits of consumption and modes of behaviour.
Arnold Toynbee, in his "A Study of History", remarked that "modern Western civilisation" is itself a "middle class phenomenon" because Western communities had become "modern" as soon as they had produced a bourgeoisie capable of becoming the predominant element in society. We think of the new chapter of western history that opened at the end of the fifteenth century as being "modern" because then the middle class began to take control. It follows that, during the currency of the Modern Age of Western history, the ability of aliens to become Westernised depended on their capacity for entering into the middle-class Western way of life.
The Egyptian experience in economic and social change in the past 50 years (as well as those of many other Arab countries), is merely one of a large number of instances of what Toynbee was talking about: westernisation through a middle-class revolution, or a middle class revolution through westernisation, as the two processes fed into and supported each other. This may also be one of the best characterisations of what happened to many so-called "Third World" countries over the same period. By calling what happened a revolution, I do not, of course, mean to confine this characterisation to countries like Egypt, Syria and Iraq, which have experienced military coups and used the term "revolution" extravagantly. For similar radical changes were experienced by the so called "conservative" Arab countries like Jordan and Gulf states. The main agent of change was not the kinds of policies taken at the top but rather the degree of economic, political and social openness to the West, and was dramatic in both groups of countries in spite of so much rhetoric used to imply the opposite.
But it is also interesting to note that in this important respect, namely the growth of a westernised middle class, the differences between Nasser's era in Egypt and those of his successors were relatively marginal. These differences related mainly to the speed of the process (and in this respect, Sadat's westernisation was much faster) and the dominant types of economic activities. Many people are inclined to call those types which flourished under Sadat "parasitic," in contrast to the growth of more "productive" activities under Nasser. This distinction may prove to have been much more important in the short rather than the long run, for looking back at the whole period of the past 50 years, both eras look as if they were pouring the same kind of water on the same plant. And looking at the end result in the present state of Egyptian society, it is difficult to disentangle the impact of one era from that of the other.
* The writer is professor of economics at the American University in Cairo.
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