Youth Ambassador Think Tank: Economic Life in the Middle East: A “High-Trust” or “Low-Trust” Environment?
9 Jan 2009 in Employment, Housing and Credit, Civic Participation
MEYI’s Youth Ambassador Think Tank is a forum to encourage active discussion on topics of timely relevance to Middle Eastern youth. Our fourth topic draws on the context of the current global economic crisis and asks participants if economic life in their country takes place in a “high-trust” or “low-trust” setting, how they anticipate this setting might change in the future, and what the effects of these changes will mean for young people.
The Think Tank shares brief perspectives from MEYI's Youth Ambassadors on a current issue or topic relevant to MEYI's research. The primary goal is to stimulate an exchange of ideas between youth in the region and the wider public, and for emerging research concepts to be defined and evaluated by youth – the very population whose lives this research hopes to impact. Youth Ambassadors will provide initial responses to the topic, which will rotate on a regular basis.
We encourage you to visit our facebook discussion board to participate in the discussion, or to submit your comments through the "Write to the Editor" form below.
THINK TANK DISCUSSION #4: ECONOMIC LIFE IN THE MIDDLE EAST: A “HIGH-TRUST” OR “LOW-TRUST” ENVIRONMENT?
Would you characterize your country as a “high-trust” or “low-trust” culture? What do you see as the advantages and disadvantages of each? With the current upheavals in today’s financial markets, Washington Post columnist Anne Applebaum predicts that “American capitalism will become slower, more cautious, less productive and less entrepreneurial.” Do you predict the same for your country? If so, what will this “more cautious” economic model mean for young people?[1]
ABDULLAH AL-THAWR (Sana'a, Yemen):
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"Yemen is definitely a low-trust culture, a problem that is affecting businesses and development. For instance, on the level of small transactions and purchases, a person needs to provide an identity card and even fingerprint imprints when buying a cellular SIM card. When installing a new ADSL internet connection into a household, a company employee must come to the house to ensure that it is not used for commercial or business activities. When purchasing a car or applying for a big bank loan, a surety must be provided, an extra step that is difficult for many people, especially the poor. A low-trust environment even inhibits large development projects where the public, because of their distrust of those individuals or entities with enough wealth to sponsor such projects, is discouraged from supporting them. In this environment, individuals may even engage in illegal or immoral behavior to increase their own personal wealth: either driven by hidden, private agendas or, simply, by their deprived needs. This comes at the expense of the public good.
"With the effects of the world financial crisis looming in the region, the situation does not look likely to improve soon. A high-trust culture is essential for Yemen to overcome the boundaries that restrict investments and business expansions. While a change soon is highly unlikely, today’s youth – who will be the future’s leaders and businessmen – will look tomorrow into a repetitive reality if trust is not built. A reality of cautious businesses, slow progress, and a high degree of corruption. A reality that is, with each day that passes, becoming bitterly different from Yemen’s neighboring Gulf countries. However, building trust takes time and needs to be introduced to the economic system step by step. It is necessary to take precautionary measures against the pitfalls of the extreme high-trust culture that is currently threatening the American capitalist system."
Read More: Abdullah's Point of View>>
ALAA AL-MIZYEN (Jeddah, Saudi Arabia):
"While most of the world's economies are on hold or in recession, Saudi Arabia continues to push forth, investing heavily in mega development projects and expansion of its private sector. Characterized as a 'high-trust' culture, one whose political, social and economic assets are statutes of Shariah (Islamic) Law, Saudi Arabia's financial conflicts are more or less rooted in the instability of oil prices rather than upheavals in investment securities and the global market. Contrary to 'low-trust' countries that have halted development and expansion projects, the Kingdom continues to take great strides in diminishing deficiencies in infrastructure through vast projects allocated by the central government. Abundance in financial resources cushions any financial deficits, breaking the Kingdom out from the staggering loans other countries are struggling to pay back. This current economic model has youth reassured while, at the same time, aware of local and global market trends, leaving them wary and somewhat repelled from the risk-taking involved in entrepreneurialism."
Read More: Alaa's Point of View>>
JOULAN ABDULKHALEK (Beirut, Lebanon):
"Systems, by definition, are meant to evolve: there is some inaccuracy in positioning ‘high-trust’ cultures as a strong example of capitalism and ‘low-trust’ cultures as less capitalistic. The idea of trust is directly related to market regulations that are imposed by law. Capitalist thought has waxed and waned between schools that have different views on the degree of regulation governments should impose. Thus the nature of capitalism, like any other system, is in a constant state of change. While increased regulation might imply a lower trust culture, it is wrong to think of regulation as necessarily detrimental to the interests of those who want to live in a free market society. The free market economy has not failed as long as we still believe in it. The crisis infecting the world is actually serving to bring the world closer. The future holds potential for increased global cooperation, market integration, and global standardization of economic policy. If all this increases the free flow of economic activity, it may also add better organization to such global flows. However, looking ahead, we might predict that the economic crisis will spark more social crises and conflicts across the world. But one thing is for certain: the world has geared up for significant change, and with change comes opportunity. So to all the youth in the Middle East and the world: we must be ready to shape the new rules of the game."
Read More: Joulan's Point of View>>
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