Now China may face the anger of its youth



A strictly economic interpretation of events in Tunisia and Egypt is too simplistic an exercise, however tempting it may be for an economist.

But there is no question the upheavals in both countries and elsewhere in the Arab world largely reflect government failure to share the wealth.

The problem is not an inability to deliver economic growth. In both Tunisia and Egypt, the authorities have strengthened macroeconomic policy and moved to open the economy. Their reforms have produced strong results. Annual growth since 1999 has averaged 5.1 per cent in Egypt, and 4.6 per cent in Tunisia, not Chinese-style growth rates, to be sure, but comparable nonetheless to emerging market countries such as Brazil and Indonesia, which are now widely viewed as economic successes.

The problem is that the benefits of growth have failed to trickle down to disaffected youth. The share of workers under the age of 30 is higher in north Africa and the Middle East than anywhere else. Their economic prospects are correspondingly more limited.

University graduates find few opportunities outside banking and finance. Anyone who has travelled to the region will have had an experience with a highly literate, overeducated tour guide.

With modern manufacturing underdeveloped, many young workers with fewer skills and less education are consigned to the grey economy. Getting ahead depends on personal connections of the sort enjoyed by the sons of military officers and political officials - but few others.

It may stretch credulity to think that a high-growth economy such as China might soon be facing similar problems. But the warning signs are there. Given the lack of political freedoms, the Chinese government's legitimacy rests on its ability to deliver improved living standards and increased economic opportunity to the masses. So far those masses have little to complain about. But that could change, and suddenly.

First, there is the growing problem of unemployment and underemployment among graduates. Since 1999, when the Chinese government began a push to increase university education, the number of graduates has risen sevenfold, but the number of high-skilled, high-paying jobs has not kept pace.

China is rife with reports of desperate university graduates unable to find productive employment. Newspapers and blogs speak of the "ant tribe" of recent graduates living in cramped basements in the country's big cities while futilely searching for work.

In part, these unfortunate outcomes reflect the inflexibility of China's education system. Students spend their entire four years at university studying a single subject, be it accounting or computer science. As a result, they have few skills that can be applied elsewhere if the job they expect fails to materialise. There has also been a tendency to push students into fields such as engineering, even though the Chinese economy is now beginning to shift from manufacturing to services.

China needs to move quickly on education reform. It needs to provide its university students with more flexible skills, more general training and more encouragement to think critically and creatively.

There is also the problem of less-skilled and less-educated migrants from the countryside, who are consigned to second-class jobs in the cities. Not possessing urban residency permits, they lack even the limited job protections and benefits of workers who do. Because they may be here today but gone tomorrow, they receive little in the way of meaningful on-the-job training.

The migrants' predicament underscores the need to reform hukou, China's system of residency permits. A handful of provinces and cities have gone so far as to abolish it, without catastrophic consequences. Others could usefully follow their lead.

China has another priority - it needs to get serious about tackling corruption. Personal connections, or guanxi, remain critical for getting ahead. Recent migrants from the countryside and graduates with degrees from second-tier universities sorely lack such connections. If they continue to see the children of high government officials doing better, their disaffection will grow.

The ability of disaffected youth - university-educated youth in particular - to use social media to organise themselves has been on powerful display in Tunisia, Egypt and elsewhere.

It was still possible last month for the Egyptian government to halt all internet traffic and for the Chinese authorities to block the Chinese word for "Egypt" from its Twitter-like service Sina. But in social media, as in banking, the regulated tend to stay one step ahead of the regulators. Such shutdowns will be increasingly difficult to enforce.

If Chinese officials do not move faster to channel popular grievances and head off potential sources of disaffection, they could eventually be confronted with an uprising of their own - an uprising far broader and more determined than the student protest that they crushed in Tiananmen Square in 1989.

Barry Eichengreen is professor of economics and political science at the University of California, Berkeley. His most recent book is Exorbitant Privilege: The Rise and Fall of the Dollar.

* Project Syndicate

Profile of Hala Insurance

Date Started: September 2018

Founders: Walid and Karim Dib

Based: Abu Dhabi

Employees: Nine

Amount raised: $1.2 million

Funders: Oman Technology Fund, AB Accelerator, 500 Startups, private backers

 

How much sugar is in chocolate Easter eggs?
  • The 169g Crunchie egg has 15.9g of sugar per 25g serving, working out at around 107g of sugar per egg
  • The 190g Maltesers Teasers egg contains 58g of sugar per 100g for the egg and 19.6g of sugar in each of the two Teasers bars that come with it
  • The 188g Smarties egg has 113g of sugar per egg and 22.8g in the tube of Smarties it contains
  • The Milky Bar white chocolate Egg Hunt Pack contains eight eggs at 7.7g of sugar per egg
  • The Cadbury Creme Egg contains 26g of sugar per 40g egg
COMPANY PROFILE
Name: Kumulus Water
 
Started: 2021
 
Founders: Iheb Triki and Mohamed Ali Abid
 
Based: Tunisia 
 
Sector: Water technology 
 
Number of staff: 22 
 
Investment raised: $4 million 
Results

Catchweight 60kg: Mohammed Al Katheeri (UAE) beat Mostafa El Hamy (EGY) TKO round 3

Light Heavyweight: Ibrahim El Sawi (EGY) no contest Kevin Oumar (COM) Unintentional knee by Oumer

Catchweight 73kg:  Yazid Chouchane (ALG) beat Ahmad Al Boussairy (KUW) Unanimous decision

Featherweight: Faris Khaleel Asha (JOR) beat Yousef Al Housani (UAE) TKO in round 2 through foot injury

Welterweight: Omar Hussein (JOR) beat Yassin Najid (MAR); Split decision

Middleweight: Yousri Belgaroui (TUN) beat Sallah Eddine Dekhissi (MAR); Round-1 TKO

Lightweight: Abdullah Mohammed Ali Musalim (UAE) beat Medhat Hussein (EGY); Triangle choke submission

Welterweight: Abdulla Al Bousheiri (KUW) beat Sofiane Oudina (ALG); Triangle choke Round-1

Lightweight: Mohammad Yahya (UAE) beat Saleem Al Bakri (JOR); Unanimous decision

Bantamweight: Ali Taleb (IRQ) beat Nawras Abzakh (JOR); TKO round-2

Catchweight 63kg: Rany Saadeh (PAL) beat Abdel Ali Hariri (MAR); Unanimous decision

At a glance

Global events: Much of the UK’s economic woes were blamed on “increased global uncertainty”, which can be interpreted as the economic impact of the Ukraine war and the uncertainty over Donald Trump’s tariffs.

 

Growth forecasts: Cut for 2025 from 2 per cent to 1 per cent. The OBR watchdog also estimated inflation will average 3.2 per cent this year

 

Welfare: Universal credit health element cut by 50 per cent and frozen for new claimants, building on cuts to the disability and incapacity bill set out earlier this month

 

Spending cuts: Overall day-to day-spending across government cut by £6.1bn in 2029-30 

 

Tax evasion: Steps to crack down on tax evasion to raise “£6.5bn per year” for the public purse

 

Defence: New high-tech weaponry, upgrading HM Naval Base in Portsmouth

 

Housing: Housebuilding to reach its highest in 40 years, with planning reforms helping generate an extra £3.4bn for public finances

Director: Laxman Utekar

Cast: Vicky Kaushal, Akshaye Khanna, Diana Penty, Vineet Kumar Singh, Rashmika Mandanna

Rating: 1/5

The biog

Siblings: five brothers and one sister

Education: Bachelors in Political Science at the University of Minnesota

Interests: Swimming, tennis and the gym

Favourite place: UAE

Favourite packet food on the trip: pasta primavera

What he did to pass the time during the trip: listen to audio books

The smuggler

Eldarir had arrived at JFK in January 2020 with three suitcases, containing goods he valued at $300, when he was directed to a search area.
Officers found 41 gold artefacts among the bags, including amulets from a funerary set which prepared the deceased for the afterlife.
Also found was a cartouche of a Ptolemaic king on a relief that was originally part of a royal building or temple. 
The largest single group of items found in Eldarir’s cases were 400 shabtis, or figurines.

Khouli conviction

Khouli smuggled items into the US by making false declarations to customs about the country of origin and value of the items.
According to Immigration and Customs Enforcement, he provided “false provenances which stated that [two] Egyptian antiquities were part of a collection assembled by Khouli's father in Israel in the 1960s” when in fact “Khouli acquired the Egyptian antiquities from other dealers”.
He was sentenced to one year of probation, six months of home confinement and 200 hours of community service in 2012 after admitting buying and smuggling Egyptian antiquities, including coffins, funerary boats and limestone figures.

For sale

A number of other items said to come from the collection of Ezeldeen Taha Eldarir are currently or recently for sale.
Their provenance is described in near identical terms as the British Museum shabti: bought from Salahaddin Sirmali, "authenticated and appraised" by Hossen Rashed, then imported to the US in 1948.

- An Egyptian Mummy mask dating from 700BC-30BC, is on offer for £11,807 ($15,275) online by a seller in Mexico

- A coffin lid dating back to 664BC-332BC was offered for sale by a Colorado-based art dealer, with a starting price of $65,000

- A shabti that was on sale through a Chicago-based coin dealer, dating from 1567BC-1085BC, is up for $1,950