Transparency- the Endless Work in Progress

A few recent interviews by local leaders in Egypt and UAE have confirmed for me how far even the region's most promising economic stars still have to go before truly reaching the "big league." Transparency and honesty before the public is something that most Arab rulers just don't get and, IMHO, it's an issue that will hold them back from further economic development even more than their lack of or progress towards democracy. Perhaps even sadder than the interviews themselves was that both Shaykh Muhammad bin Rashid of UAE and Gamal Mubarak of Egypt gave the interviews with the explicit idea that they [the interviews] were moves towards transparency. But in today's world, investors and consumers don't want to hear platitudes about local markets- they expect rulers to own up to problems and scope out solutions. Talking for the sake of talking does little these days.

UAE first since it's perhaps the more egregious case. On Sunday, Shaykh Mohammad sat down for an online interview (linked here is only part 1 of the interview) about the current global crisis and its impact on UAE through his website, UAEPM.ae. Billed as a landmark move in transparency, the questions and answers were all clearly scripted and carefully vetted. When asked about the crisis in Dubai, the questioners (attributed as members of the media) were always careful to lay the blame for the bad press UAE was receiving on the doorstep of "foreign media." Case in point- "Foreign media are reporting on "the bubble that burst". What would you tell the people who are endorsing this view?" Media reporting was also referred to in the questions as the "media campaign" with the clear implication being that a campaign was unfair. Shaykh Mohammad certainly didn't shy away from any questions and was, as to be expected, fairly effusive in his praise for Dubai and his country in general. He acknowledged the downturn but was upbeat time and again about his sense of the future.

The most offensive part of this exercise was not that Shaykh Mohammad didn't "own up" to any of his mistakes in developing Dubai or that he failed to acknowledge the deep hole his emirate was left in thanks to his ambitions. Overzealous honesty by those in charge is usually a bad thing- just ask Tim Geithner. More offensive was that the Shaykh's handlers believed that he could only handle the softest of softball questions. Even those that were designed to be tough were fluff- "Dubai has been recently criticised for its development strategy in the light of the global financial crisis. How do you perceive this campaign and how are you dealing with it?" And, "The media campaign has focused on pointing that Dubai is facing an economic crisis threatening the foundations of its economic development. What is the actual impact of the crisis on Dubai economically and socially?" If it's a scripted environment, let at least one question be hard hitting. Worse still, apparently believing this little show of ankle was too much for most people and might undermine confidence in the UAE, the interview was followed by a "reaction" piece in one of Dubai's daily business papers. The reactions were from local businessmen, explicitly in the pay of the Dubai government or probably paid off by MBR's office given the level of effusive praise for the exercise. It reminded me of the bad old days of the Saudi press when the King or Al Saud couldn't pass a dumpster without some rag commenting on how wonderful they were.

Second on the hit list is the interview Gamal Mubarak gave to the Wall Street Journal that was published yesterday. As a rule, I generally respect the quality of reporting out of the Journal but talk about buying into the demagoguery of the Mubarak family. The article prominently notes that Gamal once worked for Bank of America and attributes most, if not all, of Egypt's recent economic success to his leadership. Gamal acknowledges some recent weakness and the forecasted drop in GDP growth to 4 percent from recent highs of seven-plus percent growth, but he glibly brushes off criticism of the country's turnaround, including the lack of impact of growth on Egypt's lower classes, noting that there has been "some trickle down" effect. Of course, he gives no actual examples of this. Gamal also dismissed questions about his succeeding his father saying that such discussions as "good media stuff devoid from the issues of the day." In total, the article served as a ringing endorsement of Gamal and gave little, sometimes no, acknowledgement to the hard work and occasional setbacks of the country's prime minister, widely considered the architect of the country's turnaround.

Perhaps Roula Khalaf encapsulates this backwards/forwards movement of Arab leaders in her article in today's FT on government censorship of the media. The article focuses on a new media law in UAE that has yet to be signed by the country's ruler, Shaykh Khalifa. While liberalizing some aspects of the current UAE law on media, a central tenant of the new law- that is, that information that is deemed harmful to the country's economy or that disparages national leaders is off limits- is causing an uproar even among the local media outlets. (Clearly not among those who responded to MBR's interview, however.)

Learning to work with the media and developing a thick enough skin to tolerate the occasional critical article or editorial is a fundamental lesson that most Middle East leaders have yet to master. Until they do, sadly, most of the real progress and growth achieved by regimes will constantly be second-guessed.