Over the last few years, the Middle East and
North Africa (MENA) region has witnessed
unprecedented transformation. In the Arab
Uprisings, thousands of young people took to the
streets to voice their frustration with the lack of
economic and social opportunities. These events
reflected demands for improvements in living conditions,
infrastructure, job quality, education, and
healthcare services, as well as better governance.
The Arab Uprisings were a response to the failure
of the region’s economic models to satisfy people’s
needs and expectations. These models typically featured
strong protectionism, lack of integration into
international markets, misguided state intervention,
and inadequate support for a business environment
that fosters innovation, entrepreneurship, and good
management practices.
Enhancing the prospects for more inclusive
growth—with accessible opportunities for sustainable
employment, particularly for young people
and women—is vital to raise living standards, to
underpin stability, and to offer an alternative to
economic migration out of the region. There is
an overwhelming consensus among economists
that the development of a vibrant private sector
is essential for delivering that growth. Creating an
environment that is conducive to private sector
development depends on a detailed understanding
of the key drivers of private firms’ performance and
the major challenges of the business environment in
which they operate.