The Silicon Valley of the Arab World?
In June 2009, President Obama called for “a new beginning” between the United States and the Muslim world in a historic speech at Cairo University. No one present—including Obama—had any sense of the sweeping changes about to be unleashed across the region.
In his speech, Obama called for mutual respect, the spread of democracy, and peace between Israelis and Palestinians. As millions of Arabs watched, he also promised revitalized economic aid.
“On economic development, we will create a new corps of business volunteers to partner with counterparts in Muslim-majority countries,” Obama said. “And I will host a Summit on Entrepreneurship this year to identify how we can deepen ties between business leaders, foundations, and social entrepreneurs in the United States and Muslim communities around the world.”
In April 2010, the administration held the promised summit in Washington and launched a series of programs to send American businessmen, investors, and scientists to the Middle East. Eight months later, a twenty-six-year-old Tunisian street vendor named Mohamed Bouazizi doused himself in gasoline on December 10, set himself on fire, and sparked the Arab Spring.
The protests, though, were not as spontaneous as they seemed. For months, unemployment and food prices had been rising in Tunisia as the global economy slowed. And the November 2010 release by WikiLeaks of secret American diplomatic cables detailing staggering corruption by Tunisian President Zine el-Abidine Ben Ali stoked popular anger as well. The cables also gave protesters the sense that American support for Ben Ali was waning.
Twenty-eight days after the largely peaceful protests began, Ben Ali fled the country. Obama, who felt that he had been too passive during the June 2009 uprising in Iran, made no effort to help Ben Ali. The president’s move was both courageous and practical. Tunisia, a small country that was not strategically important to the United States, was a low-risk place to support a revolution. Few American officials thought the uprisings would spread.
Secretary of State Hillary Clinton and European diplomats praised the revolution but offered limited financial support to the country’s new government. European Union countries pledged $300 million in direct assistance. The Obama administration, which saw Tunisia as Europe’s responsibility, offered roughly the same amount.
Ten months after Ben Ali’s ouster, the American embassy announced that a delegation of American high-tech entrepreneurs and angel investors would be visiting Tunisia. American officials, it seemed, were delivering on Obama’s promise in Cairo to bring U.S. entrepreneurs to the region. The group would hold a workshop on launching start-ups, listen to attendees’ business proposals, and then choose one Tunisian for training and mentoring in the United States.
The response was overwhelming. Dozens of Tunisian entrepreneurs, programmers, and engineers applied to attend the session. Each applicant submitted a written proposal for a new start-up. The organizers then invited the authors of the fifty best proposals to attend.
From beginning to end, the workshop overflowed with energy. Young Tunisians clamored to speak with the American entrepreneurs and investors. When a young woman’s proposal for a biotech start-up was finally chosen as the winner, other attendees were disappointed. Privately, members of the American delegation were disappointed as well.
In truth, the post-Cairo initiative that brought them to Tunisia operated on a shoestring. The program—Partners for a New Beginning—was so poorly funded that members of the delegation had to pay their own airfare and hotel bills. The U.S. government did not propose, fund, or carry out the training of the winning entrepreneur. Members of the delegation did. And the prize? Three months in the TechTown incubator in Detroit, Michigan, courtesy of TechTown, Wayne State University, and the American Arab Chamber of Commerce in Detroit.
One member of the delegation, Sami Ben Romdhane, a Tunisian American eBay executive, was shocked by the lack of funding. A founder of two Silicon Valley start-ups and former Apple and Oracle employee, Ben Romdhane was impressed by the talent pool in Tunisia.
“There is a lot of potential,” Ben Romdhane said in a telephone interview after his visit. “I don’t see any difference between students who are graduating there and students who are graduating here and in Europe.”
The administration’s tepid effort showed how the United States was missing an opportunity in Tunisia to create a post–Arab Spring success story. More broadly, it was evidence that the administration was taking the wrong lessons from Afghanistan, Iraq, and Pakistan and squandering the opportunity that the Arab Spring created.
In interviews, Tunisians embraced Obama’s message in Cairo. Asked what the United States could do to help Tunisia, they called for increased American business investment, tourism, and educational exchange programs, not traditional foreign aid.
Without prompting, they disparaged hard-line Salafists who had emerged since the toppling of Ben Ali in January 2011. Declaring themselves a model for the rest of the Middle East, Tunisians said they yearned for prosperity, modernity, and a place in the global economy.
Public opinion polls showed a mixed view of the United States. A 2012 survey found that 90 percent of Tunisians wanted democracy in their country but believed that the United States had not supported their revolution. A year after Obama’s Cairo speech, only 40 percent of Tunisians had a positive view of the U.S. president. In Washington, Obama himself was disappointed by how few of his promises in Cairo had been turned into functioning programs. The government’s weak civilian institutions had again failed at implementation.
“Obama later conceded that the speech was longer on promises than on deliverables,” journalist David E. Sanger wrote in his 2012 book, Confront and Conceal. “A year later, when he asked for an assessment of how well the administration had implemented the ideas he announced in Cairo, he was, in the words of one aide, “deeply disappointed in how little got done.”
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In Tunisia, meanwhile, the country’s postrevolution economy collapsed. In 2011, the growth rate dropped from 3 percent to -1.8 percent, inflation nearly doubled to 5 percent, foreign investment declined by 30 percent, and the country’s tourism industry disappered. In 2012, the economy improved somewhat, growing at 2.7 percent, but Tunisia’s growth remained half the 5 percent growth it enjoyed between 1997 and 2007.
The Islamist political party that won the country’s first post–Ben Ali elections—Ennahda, or the “Renaissance Party”—struggled to effectively run the government after decades in exile. The party’s charismatic leader was Rached Ghannouchi, a seventy-year-old Sorbonne-educated Islamist intellectual who had spent fourteen years in Tunisian prisons and twenty-two years in exile in London.
In an interview, Ghannouchi described his Ennahda party as a moderate Islamist movement modeled after Turkish Prime Minister Erdogan’s AKP party. He said he fervently supported democracy, a stand that put him at odds with radical Salafists who consider democracy an affront to God’s authority. Echoing Turkish moderates, he said democracy and Islam were not only compatible, they follow the same traditions.
“The real spokesman of Islam is public opinion, which is the high authority, the highest authority,” he said. “Legislation, represented by the assembly, the national assembly.”
Ghannouchi said the prophet Muhammad’s use of shuras—or councils—to make nonreligious decisions showed that democracy had existed in Islam since its birth. Government affairs should be decided by democratic vote, he said, not fatwas from religious autocrats. And he embraced free-market capitalism, full rights for women and minorities, and international human rights treaties.
Secular Tunisians, though, say that Ghannouchi’s party has not followed those ideals since gaining power. The country’s new draft constitution has a blasphemy law in it that makes insulting any of the three Abrahamic faiths a crime. To secular Tunisians, this is a clear limit on free speech.
In February 2012, the party stood by when a Tunisian judge jailed a newspaper editor for eight days after he published a photograph of a soccer player and his nude girlfriend on the cover of a local tabloid. And in April 2012, two young men were sentenced to seven years in jail for posting cartoons of a nude prophet Muhammad on Facebook.
Secular Tunisians said they no longer trust Ennahda. Ahmed Ounaies, a Tunisian politician who briefly served as foreign minister in the country’s postrevolutionary unity government, was typical. In an interview, he said he no longer believed Ghannouchi. He believed that purportedly moderate Muslim leaders were, in fact, aligned with hard-line Islamists.
“We believe that Mr. Ghannouchi is a Salafist,” Ounaies said. “He is a real supporter of those groups.”
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Amid the political and economic turmoil, hard-line Tunisian Salafists have became increasingly emboldened. In 2011, they attacked a television station in Tunis after it aired the animated film Persepolis, which featured what they considered a blasphemous portrayal of God. They attacked liquor stores and art galleries. They held protests that paralyzed the country’s leading university for a month. And in the capital they climbed a historic bell tower and waved jihadist flags from its spire—an image that unnerved Tunisian moderates and foreign investors.
Clashes and demonstrations have continued in 2012. In May, one of the country’s new Salafist groups, Ansar al-Shariah, held a rally in the religious city of Kairouan. At the event, Salafists dressed in the style of Afghan Taliban staged martial arts demonstrations and horsemen brandished swords.
In June, they attacked an art exhibit in Tunis, setting off clashes across the country and a three-day curfew. And after the amateur video insulting the prophet Muhammad emerged in September 2012, several thousand Salafists attacked the American embassy in Tunis and burned down the adjacent American school. The following day, the State Department announced that the families of all American diplomats and other nonessential personnel would be evacuated from the country.
The news devastated secular Tunisians. They were furious at Tunisia’s new government for failing to deploy enough police to protect the embassy. And they were surprised that the United States reacted so drastically to a protest by a small faction of Tunisians.
Sami Ben Romdhane, the Tunisian American eBay executive, said Tunisians who prided themselves on being one of the most liberal societies in the Middle East felt abandoned.
“Now it’s official,” Ben Romdhane told me. “We are being treated as a terrorist country and a place where Americans are not safe. That hurt a lot of people in the country.”
Tunisian moderates argued that the United States was missing an opportunity in Tunisia. America’s strongest weapons against militancy were engagement, investment, and technology, they said. Young Tunisians yearned to work in the new, high-tech offices that Hewlett-Packard, Fidelity, Microsoft, and Cisco opened in Tunisia in recent years. They dreamed of turning their country into a regional hub for cloud, big-data, and open-government computing.
Leila Charfi, the head of the Microsoft Innovation Center in Tunis, helped organize the visit by the American high-tech delegation. She said Facebook and Twitter had facilitated the street protests that toppled Ben Ali, and that Tunisians now embraced technology. “People are hungry to use new technology and develop a new country with IT,” she said.
But after the attack on the American embassy, investors from Silicon Valley and Europe saw Tunisia as unstable and anti-American, according to Ben Romdhane.
“They’re asking, ‘What happened? How come this country changed in eighteen months and became like Libya?’” Ben Romdhane said. “I keep saying, ‘This is not representative. This is a fraction of a percent of people.’”
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The shift in perception is tragic. Prior to the embassy attack, American diplomats declared that Tunisia had the brightest long-term prospects of any Arab Spring country. It has an ethnically homogeneous population of only 10 million, a long history of moderation, and centuries of trade with Europe that have created a strong business class and millions of bilingual Arabic and French speakers.
Most important, the country’s lack of oil forced it to develop a multifaceted economy after it achieved independence from France in 1956. Its universities graduate six thousand engineers a year, and Tunisian entrepreneurs managed to develop niche markets in Europe. Inspired by Jean Touitou, the Tunisian-born designer and founder of the French clothing line A.P.C., Tunisian factories cornered the market on rush orders from Europe for high-quality clothes. Tunisian auto-parts factories produced high-quality components for Mercedes-Benz and other elite car manufacturers. And the country’s farms provided Europe with everything from fresh vegetables to olive oil.
Like that of Turkey, Tunisia’s economy eventually became closely tied to that of Europe. France, the former colonial power, was Tunisia’s largest foreign investor. As a result, when the European sovereign debt crisis exploded in 2010, Tunisia was one of the victims. As European orders and investment dropped, unemployment and food prices rose in Tunisia. Europe offered little aid to Tunisia as well. The tepid postrevolutionary economy exacerbated a festering economic divide between Tunisia’s wealthy coast and impoverished interior. When I visited Tunisia fourteen months after the revolution, in March 2012, I found pockets of simmering anger and a deep sense of unmet expectations. Tunisians who had expected a postrevolutionary gold rush held protests and wildcat strikes on a daily basis.
In the southern town of Gafsa, unemployed people blocked roads to the town’s phosphate mine, the fifth largest in the world, and demanded jobs. Production had dropped by 40 percent. After wildcat strikes by local workers, a Japanese company shut down its local factory. A German company threatened to do the same.
Even in Sidi Bouzid, the farming town where Tunisia’s uprising began, the luster of the revolution had faded. The manager of a call center that a French investor had opened to help support the revolution complained of constant confrontations with workers. Whenever she tried to fire someone, their parents came to the office and berated her. Strikes occurred constantly at other businesses, she said, sowing chaos.
On a dusty street, eighty-five-year-old Ahmad Kadachi said he was also disillusioned. The dean of the town’s street vendors, Kadachi had been astonished when Bouazizi, the local vendor, had set himself on fire and sparked the Arab Spring.
As Kadachi sold tea from his ramshackle wooden cart, he called Bouazizi a hothead, but thanked him for the freedom he had brought. Now, Kadachi said, he was frustrated with postrevolutionary Tunisia. He said Tunisians, Egyptians, and Libyans enjoyed being able to choose their leaders and express their opinions, but a primary goal of their revolutions eluded them: prosperity.
“Everybody is talking and talking,” Kadachi told me. “No one is doing anything.”
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In Tunis, the country’s cosmopolitan capital, the verdict on the revolution was more positive. Khalil Zahouani, a thirty-four-year-old Tunisian entrepreneur, said the ouster of Ben Ali had perfectly positioned Tunisia to follow India’s example and become an outsourcing hub for the region. With millions of well-educated French speakers, Tunisia could become the French-speaking world’s back office, Zahouani said. In Tunisia, software companies, call centers, and engineering firms could perform tasks at a fraction of the cost of Europe.
Zahouani’s own experience was an example. After graduating from a Swiss university and working in Geneva for several years, he returned to Tunisia to start his own business. Like Monis Rahman, the American-educated Pakistani entrepreneur who returned home to start Pakistan’s first online dating site, Zahouani believed that his chances of creating a fast-growing technology company were higher in Tunisia than in Europe. When I met him in Tunis, Zahouani ran a seventy-person start-up that provided computing services to European and Arab phone conglomerates.
His firm, Dot IT, is based in Les Berges du Lac, one of Tunis’s priciest neighborhoods. It felt global. Young, cigarette-smoking Tunisian couples clad in stylish French clothes filled a nearby bistro. A sushi restaurant was a few blocks away.
As Zahouani spoke excitedly of his business plan, several dozen young men and women clad in Western clothes worked intently at their computers. Some women wore headscarves. Some did not.
“We can have centers for excellence for IBM, Apple, and Google for the region,” Zahouani predicted. “It could be an outsourcing hub.”
A few miles away, Hewlett-Packard, the Palo Alto, California–based computing giant, and SunGard, a Wayne, Pennsylvania–based software company, share a sparkling new office building. With subsidies from the Ben Ali government, the two companies built an ultramodern office complex several years ago. On the building’s ground floor was a gym with yoga classes, a gleaming new cafeteria, and an employee lounge with a large-screen television. Workers were dressed casually in jeans and button-down shirts. Young Tunisians from across the country competed fiercely to work at the two firms. Both were seen as doorways to the global economy.
In SunGard’s lobby, clocks displayed the current time in the company’s Tunis, New York, and Pune, India, offices. Worldwide, SunGard had seventeen thousand employees in seventy countries. Last year, it earned roughly $4.5 billion providing software and processing services for financial companies, governments, and educational institutions.
In Tunis, its five hundred employees performed back-office work for French- and English-speaking customers in Europe, Asia, and North America. It was also a beachhead for the company in the 200-million-strong Middle Eastern market.
Adel Torjmen, SunGard’s managing director in Tunisia, said private investment from American companies was much more valuable than American government development aid.
“What the U.S. can bring is very clear,” he said. “The savior of Tunisia cannot be the government of the United States. It is the private sector.”
Torjmen, a Tunisian engineer educated in France, said the problem was not that Tunisia had a negative image in the United States. It was that it had no image at all in the United States. American companies do not think of the Middle East, he said, when they consider outsourcing. If IBM moved only 15 percent of its 150,000 employees in India to Tunisia, he said, it would make a vast difference in the country’s economy.
“Tunisia can be yet another Dubai but addressing Europe and Africa,” he said. “Our cost structure is better than Morocco and we are close to India. Try to give us a kind of privilege, a kind of chance.”
Radhi Meddeb, a French- and Italian-educated Tunisian engineer who heads the Action and Solidarity Development Association, a leading Tunisian nonprofit development group, said American business expertise was needed as well. Meddeb said Tunisia needed help restructuring its banking sector, creating a microfinance system, forming public-private partnerships to build infrastructure, and creating a private equity fund.
He called for a $25 billion American investment over the next seven to ten years in modernizing Tunisia’s infrastructure. Someday, he hoped, Tunisia and the United States could sign a free-trade agreement.
Regarding Europe, Meddeb said Tunisia should voluntarily enact the reforms mandated in the EU accession process but not expect admission, given Europe’s financial crisis. The United States and Europe had promised $20 billion in aid to Tunisia and Egypt at the 2011 G8 summit in Deauville, he said, but little of that money had arrived.
Meddeb and other Tunisians complained as the economy sputtered that the Ennahda-led government was spending enormous amounts of time debating the status of religion in the country’s new constitution. Unlike Erdogan, who managed the Turkish economy deftly, Ennahda seems overwhelmed. Secular Tunisians said Ennahda needed to crack down on the Salafists immediately.
Ghannouchi, Ennahda’s leader, played down the country’s divisions and called for patience.
“I am not pessimistic,” he said in the interview. “There is a chance to reach a compromise.”
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In the United States, many Americans simply do not trust the Islamists. They believe that after gaining power, Ennahda and other Islamist parties will insert Islam into school curriculums, roll back women’s rights, and reduce individual freedoms. Some Israelis fear that Ennahda will follow the route of Hamas, the Islamist movement that won elections in Gaza and Islamized local institutions after years of relatively secular Fatah rule.
The United States needs to engage more with Tunisia’s Islamists, not less. So far, the Obama administration has provided $300 million in aid to Tunisia—and $100 million of it is for Tunisian government budget support since the January 2011 revolution. The American effort should be larger and more innovative.
Compared with Iraq and Afghanistan, the American civilian aid effort in Tunisia is minuscule. State Department officials are overreacting to their expensive failures in Afghanistan, Iraq, and Pakistan and shifting to a minimalist extreme.
In conversations, American diplomats in Tunis focused on limiting their aid efforts and engaging in only traditional diplomacy. Many of them had served in Iraq or Afghanistan and apparently saw the aid programs there as wasteful aberrations that departed from the State Department’s true diplomatic mission.
They are wrong. The State Department and other civilian agencies must learn how to devise, properly fund, and implement programs like the one that brought Ben Romdhane and the other Arab American entrepreneurs to Tunis. Facilitating investment, entrepreneurship, and educational exchanges on a vast scale should be a core element of the State Department’s mission. The Tunisian businessmen I spoke with were correct. American investment, consumerism, and technology are our most powerful tools against militancy. The United States should be confident of those weapons and not fear Ennahda and other moderate Islamist parties.
In interviews, Tunisian Islamists said they did not want American meddling in their political affairs, but they were eager to be part of the world economy. Becoming Hamas-like international pariahs seemed to hold little appeal for them. They too know that a by-product of a globalized economy is that isolation now carries a staggering economic cost.
Asked what U.S. policies would most help Muslim moderates, Ennahda founder Ghannouchi echoed secular Tunisians. He called for the U.S. government to “encourage investment,” “encourage tourism,” and sharply expand training and educational exchange programs. Asked what U.S. policies were most destructive, he said that unilateral U.S. military interventions undermine Muslim moderates.
A week after I visited Tunisia, three hundred people packed a Carnegie Endowment conference in Washington where Islamists from Tunisia, Egypt, Libya, Morocco, and Jordan tried to explain their views and goals. Americans asked Islamists if their commitment to democracy was real. Islamists asked the same question back. Some exchanges were tense, but an awkward dialogue began.