Business Magazine

The Many Voices of the Arab Private Sector

Posted on the 12 October 2011 by Center For International Private Enterprise @CIPEglobal
The many voices of the Arab private sector

Members of the Iraqi Business Council, a diverse private sector coalition, meet to discuss policy issues. (photo: CIPE)

As we mark the passing of eight months since the start of the historic Arab Spring in Sidi Bouzid, to many people in the region the term “private sector” invokes the image of a group of indistinguishable wealthy oligarchs connected to the state, not Mohammed Bouazizi, the struggling vegetable vendor whose self-immolation literally sparked the riots that toppled leaders across the region and continues to do so.

This skewed view leads one to believe the private sector is a monolith, and that when it pushes for something, it pushes in one direction with all its weight. That view, however, overlooks the fact that the private sector is a diverse segment of society with many different players and opinions.

I was reminded of this at a recent meeting in Iraq. The meeting included members of Iraq’s manufacturing sectors and Iraqi merchants making their living importing and selling foreign goods. The topic was customs fees that the Iraqi government levies on imports, and the participants wanted to reach a consensus so that they could effectively advocate policy to public officials.

The importers spoke first. “Deregulate. Facilitate the entry of goods. Allow Iraqis to benefit from affordable products,” they cried out. Anybody who caught those sound bites might have concluded that the Iraqi private sector opposes all import duties.

“Competition must be fair,” the manufacturers retorted. “If foreign governments insist on subsidizing their goods in order to flood our markets, our government must prevent the people from drowning.” According to this perspective, the private sector has shifted its stance and become an advocate for protective tariffs.

Back-and-forth the argument swung as these business leaders tried to weld their diametrically opposed views together to form a consensus. In the end, they could only agree that keeping tariffs on raw materials low would benefit them all. Beyond that, consensus on this issue remained impossible.

The implementation of customs duties is not a superficial wedge issue. Nor are Iraqi business leaders the first in history to be pitted against each other by it. In reality, the private sector, like the society it reflects, rarely achieves anything approaching unanimous consensus.

The futility of private sector consensus does not mean that businessmen and women should avoid advocating policy, however. While policies can create winners and losers, they do not do so in the same proportions. Only when the many diverse elements of the private sector effectively engage their officials to make their needs known can the government implement policy that positively impacts society on the whole.

Too long has the Arab private sector’s channel of communication to its governments been limited to its well connected sliver. For the recent uprisings to succeed in delivering better lives to citizens across Arab nations, the private sector in all its diversity – from big manufacturers and merchants to the vegetable and fruit sellers peddling their produce on carts – will have to effectively assess its needs and communicate them to policymakers. As countries across the Arab world transition to democracy, policymakers must take those needs into account.

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