UN Report Says Arab Nations Squandered Oil Wealth

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LONDON - The United Nations accused a host of Arab nations Tuesday of squandering the wealth generated by oil and depriving most of their people of basic political freedoms.

A top Arab official warned leaders in the Arab world to heed the hard-hitting findings of the UN Development Program's Arab Development Report 2002 to avoid social upheaval.

"There have to be improvements in the life of young people, because the repercussions of such negligence would be serious socially," said Arab League Secretary General Amr Moussa. "And I'm not thinking in terms of international terrorism, or American policy, but of social repercussions."

Moussa, a former Egyptian foreign minister, was speaking after the report was officially released at the Arab League's headquarters in Cairo. The UN survey focused on the bloc's 22 member nations.

The report, compiled by Arab experts over the past 18 months, said growth in per capita income in the Arab region in the past 20 years - at an average of just 0.5 percent - was the lowest in the world except for sub-Saharan Africa.

Labor productivity had declined at an annual average of 0.2 percent, it said.

Even added together, the gross domestic product (GDP) of the 22 nations combined was less than a medium-sized European country such as Spain.

"A very large investment in fixed capital formation of over $3,000 billion over the past 20 years has had poor returns in per capita income," the report said.

"Oil revenues are not always reinvested productively in the country let alone the region. And when such revenues are used in physical capital formation they contribute little to growth," it added.

The report praised the Arab nations for raising the life expectancy of their peoples, cutting infant mortality and reducing extreme poverty, but it was critical of the lack of freedoms and opportunity.

"The three main deficits are freedom, gender and knowledge," said Rima Khalaf Hunaidi, head of the UN's Arab section and leader of the team which wrote the report - the first UN survey of Arabs by Arabs.

The report accused many of the nations from the Maghreb to the Gulf of allowing scant political freedom, keeping women subjugated and letting education standards drop sharply.

While more people had entered the educational system, the quality of that education was crumbling, leading to what the report described as deficits in opportunity and capability.

"Given the political commitment, Arab countries have the resources to eradicate absolute poverty in less than a generation," the report said. "Commitment, not resources, is the binding constraint."

Some 65 million adults, mostly women, remained illiterate, 10 million children were not enrolled in schools and unemployment of an average 15 percent across the region was three times the world average.

"The report aims to start a dialogue in the region - it won't make many friends there but that wasn't the intention," Hunaidi said.

The way forward involved "promoting systems of good governance, those that promote, support and sustain human well-being, based on expanding human capabilities, choices, opportunities and freedoms."

Clovis Maksoud - a former Arab League ambassador to the United Nations and a member of the report's advisory board - said the report was intended to be the keystone for renewal of the Arab nations.

"We make it clear the Arab region is a candidate for development provided it takes the measures proposed in the report," he said. "This is the introduction to the future. This is the nucleus of a blueprint for the Arab Renaissance."