Leading Indicators of Revolt in the Middle East and Northern Africa: Corruption, Unemployment and Percentage of Household Money Spent on Food

→ Washington’s Blog

What determines which Middle Eastern or North African (MENA) countries will face revolt?

On February 3rd, the Economist came up with a list of "vulnerable" countries based upon the amount of democracy, corruption and press freedom:

Unemployment

But the Economist index doesn't take unemployment into account unemployment.

As Alternet notes:

Arab Labour Organisation (ALO) figures show that Arab countries have among the highest unemployment rates in the world -- an average of 14.5 percent in fiscal year 2007/08 compared with the international average of 5.7 percent. The rates may even be higher if one accepts unofficial estimates.

Global risk specialist Mi2g notes:

There are a lot of “orphans” and most are young – 65 percent of the population of the Arab League is under the age of 30. Youth unemployment rates are exorbitantly high – as high as 75 percent in some countries like Algeria. While the informal economy provides partial compensation, this does not provide security; the Jasmine Revolution was triggered by the self-immolation of a young man, Mohamed Bouazizi, unemployed after police confiscated his wheelbarrow, used to make ends meet by selling fruits and vegetables.

On February 2nd, Nomura published a report written by Steven Cook of the Council on Foreign Relations, arguing that youth unemployment and underemployment - along with a large proportion of youth - are primary factors driving revolt in the Middle East:

In both Tunisia and Egypt factors were at play which are also to be found in other economies in the region, notably:–An autocratic and corrupt regime [and] A significant - youth bulge and related unemployment and under-employment....

In other words, when there alot of young, unemployed (or under-employed) people, they might revolt.

Here are statistics from Nomura showing the percentage of youth under 15 years old and median age in years in the Middle East and Northern Africa:

Country	Population Aged <15>	Median Age (2010)
Algeria	27.0%	26.2%
Egypt	32.1%	23.9%
Iran	23.8%	26.8%
Iraq	40.7%	19.3%
Jordan	34.0%	22.8%
Libya	30.1%	26.2 %
Morocco	28.0%	26.2%
Saudi Arabia	32.0 %	24.6%
Syria	34.7%	22.5%
Tunisia	22.9%	29.1%
Yemen	43.4%	17.8%

On February 9th, the Economist came up with a revised index, which they call the "shoe thrower's index" (throwing one's shoes at someone is the ultimate sign of disrespect in the Arab world).

The index gives a 35% weighting for the share of the population that is under 25; 15% for the number of years the government has been in power; 15% for both corruption and lack of democracy as measured by existing indices; 10% for GDP per person; 5% for an index of censorship and 5% for the absolute number of people younger than 25:

As a side note, youth unemployment is rising globally. As the New York Times reported last August:

Youth unemployment across the world has climbed to a new high and is likely to climb further this year, a United Nations agency said Thursday, while warning of a “lost generation” as more young people give up the search for work.

The agency, the International Labor Organization, said in a report that of some 620 million young people ages 15 to 24 in the work force, about 81 million were unemployed at the end of 2009 — the highest level in two decades of record-keeping by the organization, which is based in Geneva.

The youth unemployment rate increased to 13 percent in 2009 from 11.9 percent in the last assessment in 2007.

“There’s never been an increase of this magnitude — both in terms of the rate and the level — since we’ve been tracking the data,” said Steven Kapsos, an economist with the organization. The agency forecast that the global youth unemployment rate would continue to increase through 2010, to 13.1 percent, as the effects of the economic downturn continue. It should then decline to 12.7 percent in 2011.

***

In some especially strained European countries, including Spain and Britain, many young people have become discouraged and given up the job hunt, it said. The trend will have “significant consequences for young people,” as more and more join the ranks of the already unemployed, it said. That has the potential to create a “ ‘lost generation’ comprised of young people who have dropped out of the labor market, having lost all hope of being able to work for a decent living.

***

Data from Eurostat, the European Union’s statistical agency, show Spain had a jobless rate of 40.5 percent in May for people under 25.

Indeed, as I have previously pointed out, youth unemployment is also very high in the U.S. And when those who have given up looking for work and those who are underemployed are taken into account (i.e. using the U-6 measure of unemployment), it is clear that the youth of much of the world are suffering Depression-level unemployment.

Food

As many have noted, soaring food prices are also one of the main reasons for the revolts in Tunisia, Egypt, Bahrain, Yemen, Libya and elsewhere.

Nomura pointed out last September:

The World Bank (2009, p.11) estimates that nearly two-thirds of total income
is spent on food in the poor urban population of the developing world. High food prices reduce the ability to meet even basic needs and can lead to increased poverty and become a potential source of protests, riots and political tension ....

Alternet notes:

"Tunisians and Algerians are hungry. The Egyptians and Yemenis are right behind them," Emirati commentator Mishaal Al Gergawi wrote in the Dubai- based newspaper Gulf News. "Mohammad Bouazizi didn't set himself on fire because he couldn't blog or vote. People set themselves on fire because they can't stand seeing their family wither away slowly, not of sorrow, but of cold stark hunger."

While Americans spend less than 15 percent of household expenditures on food, Egyptians spend 50%.

As UPI reports:

Just as in Tunisia, the spark was skyrocketing food prices -- increasing at a brisk 17 percent annually in Egypt. That's unhealthy in any economy but particularly one in which, as estimated by the investment house Nomura, on average 50 percent of household expenditures goes toward food. (In the United States, by comparison, food costs represent 14 percent -- and falling -- of the Consumer Price Index.)

For that, Egyptians may in no small way thank the U.S. Federal Reserve and its policies of "quantitative easing" -- known by most as "printing money."

Nomura prepared the following chart showing household spending on food as a percentage of income and per capita GDP (I've bolded information on the MENA countries):

Rank	Country	Nomura’s Food Vulnerability Index (NFVI)	GDP  per  capita Current prices US$	Household  spending  on  food  % of total  consumption	Net food  exports  (%   of   GDP)
1	Bangladesh	101.5	497	53.8	-3.3
2	Morocco	101.3	2,769	63.0	-2.1
3	Algeria	101.3	4,845	53.0	-2.8
4	Nigeria	101.2	1,370	73.0	-0.9
5	Lebanon	101.2	6,978	34.0	-3.9
6	Egypt	101.0	1,991	48.1	-2.1
7	Sri Lanka	101.0	2,013	39.6	-2.7
8	Sudan	100.9	1,353	52.9	-1.3
9	Hong Kong	100.9	30,863	25.8	-4.4
10	Azerbaijan	100.8	5,315	60.2	-0.6
11	Angola	100.8	4,714	46.1	-1.4
12	Romania	100.7	9,300	49.4	-1.1
13	Philippines	100.7	1,847	45.6	-1.0
14	Kenya	100.7	783	45.8	-0.8
15	Pakistan	100.6	991	47.6	-0.4
16	Libya	100.6	14,802	37.2	-1.7
17	Dominican Rep	100.6	4,576	38.3	-1.1
18	Tunisia	100.5	3,903	36.0	-1.1
19	Bulgaria	100.5	6,546	49.5	-0.1
20	Ukraine	100.5	3,899	61.0	0.9
21	India	100.4	1,017	49.5	0.3
22	China	100.4	3,267	39.8	-0.3
23	Latvia	100.4	14,908	34.3	-1.1
24	Vietnam	100.4	1,051	50.7	0.8
25	Venezuela	100.4	11,246	32.6	-1.0
26	Portugal	100.4	22,923	28.6	-1.8
27	Saudi Arabia	100.3	19,022	25.1	-1.8
28	Kazakhstan	100.3	8,513	44.7	0.1
29	Uzbekistan	100.3	1,023	34.7	-0.3
30	Russia	100.3	11,832	34.4	-0.7
31	Mexico	100.3	10,232	34.0	-0.5
32	Indonesia	100.2	2,246	47.9	1.0
33	Croatia	100.2	15,637	30.1	-0.9
34	Peru	100.2	4,477	31.8	-0.3
35	Greece	100.2	31,670	38.3	-0.7
36	Belarus	100.1	6,230	42.3	0.8
37	Slovenia	100.1	27,019	25.8	-1.3
38	Syria	100.1	2,682	47.9	1.5
39	Turkey	100.1	9,942	35.2	0.2
40	South Korea	100.1	19,115	23.1	-0.9
41	Colombia	100.1	5,416	28.0	0.0
42	South Africa	100.0	5,678	25.0	-0.1
43	Serbia	100.0	6,811	44.8	1.4
44	Czech Republic	100.0	20,673	27.4	-0.4
45	Lithuania	100.0	14,098	41.1	1.1
46	Guatemala	99.9	2,848	37.1	1.3
47	Slovakia	99.9	18,212	22.3	-0.4
48	Poland	99.9	13,845	32.1	0.7
49	Singapore	99.9	37,597	21.9	-1.0
50	Kuwait	99.9	54,260	30.0	-1.1
51	UK	99.8	43,541	22.5	-1.0
52	Israel	99.8	27,652	17.7	-0.5
53	Japan	99.7	38,455	19.8	-0.6
54	Italy	99.7	38,492	22.1	-0.3
55	Thailand	99.6	4,043	39.0	2.7
56	Hungary	99.6	15,408	29.4	1.6
57	Sweden	99.5	51,950	17.4	-0.7
58	Finland	99.5	51,323	20.5	-0.5
59	Germany	99.5	44,446	18.5	-0.3
60	Spain	99.5	35,215	21.8	0.4
61	Austria	99.5	49,599	19.5	-0.3
62	Ecuador	99.5	4,056	30.6	2.5
63	Switzerland	99.5	64,327	24.0	-0.5
64	Malaysia	99.5	8,209	37.1	2.9
65	France	99.5	44,508	22.0	0.2
66	Brazil	99.5	8,205	20.8	1.8
67	United States	99.3	46,350	13.7	0.2
68	Canada	99.3	45,070	18.0	0.6
69	Australia	99.2	47,370	19.7	1.1
70	Belgium	99.2	47,085	15.9	0.9
71	Chile	99.1	10,084	22.5	3.1
72	Ireland	99.1	60,460	25.8	1.5
73	Norway	99.0	94,759	16.9	-0.6
74	Luxembourg	99.0	109,903	19.1	-1.0
75	Costa Rica	98.9	6,564	30.6	4.7
76	Netherlands	98.9	52,963	13.3	1.6`
77	Denmark	98.8	62,118	16.8	1.8
78	Argentina	98.7	8,236	33.4	5.6
79	Uruguay	98.5	9,654	25.3	5.6
80	New Zealand	97.7	30,439	18.8	7.5

As should be noted, there are countries outside of MENA with extremely high percentages of spending on food.

Comments

[AnAnonymous]

The article does not go deep enough.

Instead of focusing on the countries area where revolts are happening, it would be better to get an all encompassing view to understand why it is not happening elsewhere.

Nigeria does not look in a better shape than any other country still, there is little going on there.

And they are not alone...

So why nothing?

[malek]

Good read, just one note:

The number for Morocco showing Household spending on food being 63% of total consumption seems out of whack.
I've been there several times and have friends there, and from my point of voiew that can't be right - and I can't see how comparable countries like Algeria or Tunisia spend so much less in comparison.

[TruthHunter]

It would be interesting to see the deterioration of

these countries' currencies over the last year against the big three:

Dollar, Euro, and Yen.

I suspect that unrest would correlate very closely.

What would it take to bring riots to a Freedom square

near you?  $7 $9 bread?

[falak pema]

Such a scheme would nullify the rising tide of current popular revolt. I don't think anybody in the West has the gall, the balls, to do it right now. But if the impending economic tsunami unfurls its inexorable rage, then all options become open as anarchy will replace pseudo, nascent democracy. But a deflationary reaction of assets destruction could send the inflationary spiral back to square one. Oil could be at $30. As for food and water... 

[Rick64]

It wouldn't surprise me if the Powers that be come up with a ME union with our allies and occupied countries holding majority control.

[falak pema]

It's amusing to see the West rank its ex-surrogate Mid-east regimes on a hastily concocted scale of corruption. Whereas, for the time being, no villainous Banksta has been jailed, the ancient partners to these very nefarious bands of smelly front-men in their oil/bullion stealing schemes, those  very whistle blowers permit themselves to judge sanctimoniously these still running oligarchic regimes which are falling like bowling alley ducks in the face of Internet induced popular change. For those internally silenced sources to now deride those who rowed like galley slaves for western corporates, all the while stringing their own fortunes like eager squirrels, has a taste of the obscene. Now as the rats flee the sinking middle-east ship, all pre-fabricated by the american imperium, the stupendous decision of history deploying like an unbelievable nightmare (dream for others), obliges those in power in the West  to run to safety, swearing on every holy book known and even those unknown, that they never supported these very corrupt vermin, as they sink so ominously into beckoning oblivion.

Its a strange ballet, one that Julian Assange must be watching with a sense of hardly hidden satisfaction. The fallen angel has destroyed yesterday's gods. With a vengeance to take your breath away.

[earnulf]

Just out of curiosity, where does Iran fit on the household food list, either I missed it or it's not included.   I understand why they are not counted in the arab lists, but the food list they are absent?

[dick cheneys ghost]

something is wrong when the worlds richest man is from a 3rd world country and america's banker is communist china.

http://nakedempire.wordpress.com/

[ZackAttack]

Well, according to western central banksters, high food prices are simply a sign of increasing demand in developing markets for a high-quality diet. It's all China's fault, you see.

And if they don't like food inflation, why, they have the monetary and fiscal policy tools available to control it.  

[AnAnonymous]

And if they don't like food inflation, why, they have the monetary and fiscal policy tools available to control it.  

Too bad they did not receive the memo. Instead of fleeing their countries, all these dictators could have unpegged from the USD and remained in power, would have been so much easier...

[Popo]

WTF? Hong Kong ranks high up on the %-spent on food consumption list?

Very surprising indeed. Can that be right???

[Arch Duke Ferdinand]

Ladies and gentlemen,

Oil, gold and silver have value but, but, but...

Water and Food are the necesseties of life.

Watch the Arab countries turmoil continue...then note the process begin of  citizens starving for water and food.

After one month, begin counting how many Arab citizens have passed on to their heaven.

This is the plan of the NWO.

[10kby2k]

25.8% is moderate.  These are not ranked in consumption order...read the actual data.

[Popo]

Ah. Right. Thx.

Skimmed too quickly...

[High Plains Drifter]

I hope people understand that they stripped all of the national guard armories in this country of heavy weapons a long time ago. I wonder why.

[Rick64]

  When you have the IMF, World Bank, USAID, EU, U.S. all working together with corporations to exploit these countries what do you expect. The corporations take the natural resources (minerals, oil, agriculture, ect..) while exploiting the labor force then sell those resources to the highest bidder leaving that country with a shortage. On top of that the money made from the exploitation is taken out of that country (except for the bribes paid to the regime) and very little reinvested.

[piceridu]

As usual an excellent read; I appreciate your time and effort on all the topics you continue to disect.

[Zero Govt]

Yes but George Washington missed the No.1 indicator of revolt and corruption: GOVERNMENT

Yes George the number one cause of war, poverty, wealth destruction, corruption, slow progress, food problems and revolt (because of its authoritarism) is that most ignorant and corrupt monopoly power structure and institution for societies parasites, Government.

Isn't that so George 'progressive' Washington?

The problem is Govt, the solution is to end Govt

[johnQpublic]

just for comparisons sake, where do we fit on these charts, in both phallical and real numbers?

[10kby2k]

see number 67 above

[TBT or not TBT]

Wow, this constitution thingy works great.