Economic and Trade Relations between North Africa and the Leading Players in the Mediterranean Basin: What can be Expected after the Arab Spring

In general, all of the countries of the Arab Spring have taken an economic hit, to some degree, from the consequences of the drastic reduction in production and foreign direct investment (FDI), the collapse of tourism, and the upward surge of international prices on raw materials. All the governments have intervened to dampen unrest stemming from the higher costs of food by increasing public wages and subsidies for food and fuel. Governments have broken with the old authoritarian regimes; they are now in an inevitable transition phase away from high youth unemployment, crony capitalism, an inefficient welfare state, and even food shortages. This policy brief examines the situations in Tunisia, Libya, and Egypt, among others.