Overview

CHAPTER 2

Human Advancement and Sustainable Natural Capital Use in the Middle East and North Africa

OVERVIEW

Even though the Middle East and North Africa is a region of diverse economies, it has on aggregate achieved impressive gains in human and economic development. This chapter adopts a capital accounting framework whose results show that most of the region’s economies have enhanced both produced capital and human capital in recent decades but have seen deterioration of their natural capital.

Except in economies affected by conflict, the Middle East and North Africa’s advances in human capital over the past 30 years have included increased years of children’s formal education and overall life expectancy as well as reductions in young child and maternal mortality. Many challenges persist, including high levels of inequality and economic and social vulnerability, low rates of female participation in the workforce, high youth unemployment, and public health issues related to unhealthy lifestyles. Nonetheless, overall human capital has improved.

Likewise, the region has made advances in produced capital, including in access to water and sanitation, access to electricity, transportation infrastructure, and digitalization. Urbanization has facilitated structural changes in the economy in a number of the region’s economies. And there has been income growth, even if—within the World Bank’s green, resilient, and inclusive development (GRID) framework (World Bank and IMF 2021)—it has not always been particularly inclusive.

Opposed to this human and economic progress, the region’s natural capital has deteriorated. Poorly planned and executed urban development and high dependence on fossil fuels—especially for transportation but also for heating, cooling, and industry—have increased air pollution, with impacts on human health, productivity, and broader urban livability. Coastlines are eroding in some key areas whose economies depend on beach tourism, and plastic is increasingly flowing into the region’s seas.

These stresses are interdependent in several respects and are exacerbated by climate change. Periods of extreme heat are becoming more frequent, increasing the vulnerability of those exposed to air pollution. Rainfall is becoming sparser and less predictable. Global warming is contributing to sea level rise, making the region’s coastlines more vulnerable to erosion. And even though the region is water-stressed, it does not manage its resources sustainably: Riverine and coastal ecosystems are threatened by poorly planned urban development and pollution, including plastic pollution. Poor land and watershed management contribute to loss of productive agriculture, to downstream riverine and coastal degradation, and to outdoor air pollution. The degradation has spread throughout terrestrial, coastal, and marine ecosystems, resulting in substantial biodiversity loss.

Insofar as both COVID-19 and climate change stem from inappropriate interaction with nature, they are both symptoms of inadequate management of natural capital, and both have economic and social consequences. Tackling climate change and ensuring inclusive and resilient growth will require restoration of this natural capital.

In the Middle East and North Africa, development overall has not been green or sustainable. A past pattern of “brown growth” threatens the longer-term regional goals of lasting prosperity and well-being. During the COVID-19 recovery period, economies have an opportunity to make a transformational change toward a GRID trajectory, which will improve their residents’ quality of life. Such a transformation would, at the same time, address the challenge of climate change and conserve and restore the natural capital that is the foundation of longer-term prosperity and resilience.

This premise of transformation and improving resilience forms the foundation of this report, which focuses on three key challenges: improving air quality (blue skies) and addressing coastal and marine degradation (blue seas) stemming from marine plastic pollution and coastal erosion. This chapter sets these three key challenges in context by summarizing some of the region’s broader economic, human development, and environmental trends.