Foreign Aid and Economic Development in the Middle East: Egypt, Syria, and Jordan

by Victor Lavy, Eliezer Sheffer

Overview

The acquisition of large amounts of foreign aid, handled improperly by a struggling economy, can weaken rather than strengthen it. This study reaches this sobering conclusion by examining how the economic boom enjoyed by Egypt, Syria, and Jordan in the 1970s turbaned into financial crisis by the 1980s. The analysis involves the political, economic, and social similarities and differences among the three countries and pinpoints both the internal and external factors that contributed most significantly to their economic declines. Particular attention focuses on the huge influx of foreign aid thay reached the region from 1978 to 1981 and was used to advance purposes such as military buildups rather than to enhance future economic growth potential. This left all three countries, regardless of their unique political structures, in economic chaos when outside funds ran out.

The work outlines the economic developments and policies of Egypt, Syria, and Jordan during the years of prosperity and crisis. Central to the discussion are the short- and long-term ramifications of both this downturban and the countries' refusal to restrict military expenditures. After illustrating how foreign aid should, therefore, not be used, this volume then urges that countries not depend on outside capital for their economic well-being, and demonstrates how economic reform can be achieved only by initiating responsible economic programs. The hardships associated with such a reversal in policy are considered, especially in light of the current Gulf conflict, but scholars of economic development and Middle East studies will agree that the extended benefits of such an approach far outweigh any temporary setbacks.

Product Details

ISBN-13:	9780275938277
Publisher:	Bloomsbury Academic
Publication date:	07/19/1991
Pages:	184
Product dimensions:	5.50(w) x 8.50(h) x 0.56(d)

About the Author

VICTOR LAVY is a Senior Lecturer in the Department of Economics at The Hebrew University of Jerusalem. He has taught extensively in the United States and Israel, and has published many academic papers in such jourbanals as Middle Eastern Studies, The Economic Jourbanal, European Economic Review, and The World Bank Economic Review.

ELIEZER SHEFFER is a Teaching Associate Professor in the Department of Economics at The Hebrew University of Jerusalem. He contributed a chapter to the book Economic Cooperation in the Middle East.

Table of Contents

Introduction
From Prosperity to Decline
Inappropriate Policy Responses to Inflows of Foreign Funds
From Boom—to Decline
The Inadequacy of Domestic Policy
Constraints on Growth
Human Resources
The Tradables
Defense's Drain on Growth and Development
Outlook for Reform and Adjustment
Recommended Policy Reform and Structural Change
Promoting Sustained Growth with Foreign Aid
External Resource Flows
References
Index

Editorial Reviews

Argues that the enormous influx of foreign aid into Egypt, Syria, and Jodan, 1978-81, was used for such purposes as military buildups rather than to enhance economic growth, and thereby actually precipitated the economic crises in the three countries in the 1980s. Annotation c. Book News, Inc., Portland, OR (booknews.com)

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