The International Labour Organization (ILO) yesterday called for a new development model for the Arab world, as it warned the region was likely to remain beset by sluggish growth, high unemployment and surging commodity prices.
Levels of governance had to improve to attract higher rates of investment and propel reforms, the ILO and the United Nations Development Programme said in a joint report looking at the region.
"Arabs need an inclusive development model that is grounded in social justice," said Nada Al Nashif, the Palestinian who is regional director for the Arab states at the ILO.
"This requires macro-policy coherence that can enhance productivity and wages, reformed labour relations to enable workers and employers to participate effectively in decision-making and expanded social protection systems that provide employment and livelihoods security," the report stated.
More than two years on from instability that uprooted leaders in Tunisia, Egypt, Libya and Yemen, economic growth had yet to return to pre-unrest levels, while unemployment had swelled.
Public-sector finances had also dwindled as bills to subsidise high prices of food and oil had surged.
The report warned that unemployment was likely to remain elevated as a forecast for sluggish growth up to 2015 meant insufficient jobs would be created for fast-rising populations.
It was also not enough to raise low levels of per-capita income. The report said the scale of the challenge facing governments meant the case for a development model was compelling.
The report called for better migration management, employment policies and active labour programmes, along with greater access to quality education and training relevant to labour market needs.
The report also examined some of the underlying causes of the Arab Spring. Poorly managed steps to liberalise economies during the 1990s and 2000s were at the heart of the instability, the report said.
Inefficient government spending, job creation focused around low productivity sectors and an uncompetitive private sector all stopped citizens from benefiting from pro-market reforms, the report said.
"In 2010, Arabs were more likely to find work than they were two decades ago," said Zafiris Tzannatos, the lead author of the report. "But the question is what type of work? Workers were increasingly educated but the jobs being created were low skilled and low paid.
"In most countries workers could not make their voices heard through trade unions or the ballot box."