Liberalism and Socialism In the Arab World

Liberalism and socialism have had profound effects in the Arabian states and, with the development of the Arab Spring, there has been much debate on the types of government that will emerge. Given the current climate, this short paper will give a brief history on some of the effects that these two ideologies have had in this region, with the intention of giving some insight on possible government types that Arabs may adopt.


Forms of liberalism have existed in the Arab World for centuries and even in early Islamic history. Islam, a religion which has many of its roots in the modern day Arabian states, advocates trade and business among its worshippers. The Quran states “do not consume one another’s wealth unjustly but only [in lawful] business by mutual consent”. Here, it is interesting to note how individualism comes into play, where individuals are encouraged to engage in trade by mutual consent. In a paper documenting Islamic influence on capitalism in the Middle East and Mediterranean, Banaji notes that “capitalism was able to develop much earlier in the Islamic regions than in the Occident”, given that Islamic entrepreneurs practiced “Islamic commercial law”, which covered areas such as “commenda agreements [mu∂āraba, qirād] and investment partnerships [mufāwa∂a]” (Banaji, 2003). Therefore, with Islam being the predominant religion in much of the Arab World, it is important to note the context in which liberalism finds itself in this part of the world.

Moving into the 20th century and one critical element that can be accredited to helping embed liberalism in the Arab World is the discovery of oil. This key finding has led several nations of the Arab World to actively embrace liberalism, especially in the form of trade. Since the first discovery of oil in Bahrain in 1931, the exportation of oil has seen the Arab World engage in trade, especially with great powers such as the United States and the United Kingdom. Building on top of this, other liberal tenets were adopted such as the formation of the Organisation for Petroleum Exporting Countries in 1960, designed to direct oil investment, regulate production and pricing as well as resolve conflicts (Shihata, 1972). Moving to the Gulf States, the revenue from oil has spurred foreign investment in other sectors, such as “construction, food and transportation, simple manufacturing (pipes, wires etc.) and security”, with funds also coming from foreign investment (Hanieh, 2011). As such, the discovery of oil helped initiate liberal concepts such as institutionalism, trade liberalisation and deregulation.

In order to become liberal economies, development is important so that the infrastructure to facilitate business and commerce is available. In Dr Razeen Sally’s book “Classical Liberalism and the International Economic Order”, the importance of such a structure is emphasised. Dr Sally notes that in order to implement liberalism, a state needs “government fiscal and administrative systems, legal systems of property rights and contract enforcement, as well as the full development of social infrastructure of communications and transport”. Therefore, one method to assess whether the Arab World has embraced liberalism is to examine the capacity and infrastructure of those countries. The International Finance Corporation, a subgroup of the World Bank, annually publishes an “Ease of Doing Business” Index, which examines factors such as contract enforcement, insolvency resolution and access to electricity. The following table shows the positions of some of the top performing Arab countries in the global Ease of Doing Business index for 2011:

Figure One: Arab nations from the international Ease of Doing Business index for 2011 (IMF, 2011)

As can be seen from the table above, several of the Arab countries scored well in certain areas relating to capacity and infrastructure. In terms of a necessity, all the Arab countries above are noted as having good provision of electricity. In terms of registering property, three Arab countries feature in the top 30, with Saudi Arabia earning top spot. Of course, there are areas in which the Arab countries lag behind, in particular in the field of contract enforcement. However, given the respectable ranking of Arab countries in the index, it could be said that Arab countries have the capacity in place to foster liberalism or at least they are taking strides to improve their capacity to implement such a system of government.


The development of socialism in the Arab World can be traced to the growing anti-colonial and anti-imperial sentiment that was fostered after the Second World War. In his book Capitalism and Class In The Gulf Arab States, Haneih attributes the growth of socialism to the events of the Cold War coupled with independence movements, arguing that “in many cases, the anticolonial movements allied with the USSR or China as a means to manoeuvre against the major capitalist powers” (Hanieh, 2011). As such, it appears there may have been an element of coincidence that socialism took root in the region, given the state of play in the world at the time.

A name synonymous with socialism in the Arab World is Gamal Abdel Nasser. President of Egypt from 1956-1970, Nasser took a leading role in promulgating socialist policies in Egypt, nationalising previously private industries, repealing Western capitalism in the country and denouncing Western interference and colonialism. His embrace of socialism was fuelled by his resentment to British occupation of Egypt, and his Arab-centric vision of socialism came to be termed Nasserism.

The most evident presence of socialism and of Nasserism in particular in the Arab World was during the time of the United Arab Republic. This union brought together Egypt, Syria and the Gaza Strip as one nation in 1958, founded on socialist principles. During this time, secularism was implemented, where “provisions concerning a state religion or the president’s religion were repealed” (Baer, 2003). While secularisation is not an inherent part of socialism, it has become a stance that many socialists have adopted, most notably by Marx and Lenin. One reason for this is given by Isaiah Berlin, who believed that such thinkers wanted “to find in art or science the path to salvation which the orthodox Christian churches seemed no longer capable of providing for critical minds” (Muravchik, 2002). Given the wave of Pan Arabism that swept the region at the time, new approaches were sought, which led to the embracing of socialism. Though the United Arab Republic has since been dissolved, it has left a legacy behind, with both Egypt and Syria continuing as secular countries as a result of their socialist experiment.

Socialism has taken on an unfortunate stigma throughout the Arab World. What was once seen as a movement to unite the Arab peoples has been tainted and viewed as an instrument by oppressive dictators in order to enforce their brutal regimes. This is largely attributed to the Baath Parties that began to surface in 1947. Like Marx’s socialist views, the Baath party also promoted the idea of a vanguard party, whereby a group of hardened and loyal activists are tasked with vigilantly defending the interests of the working classes and that the creation of a vanguard was essential for a successful socialist revolution (Salem, 1994). This harmonises with Marx’s intentions for a vanguard, where he advocates the formation of “the most advanced and resolute section of the working-class parties…to push forward all others” (Marx & Engels, 1848). As a result, with such ostensibly socialist policies being implemented by regimes known for their brutality, Arabs are wary of political parties that advocate socialism.


As Arabs seek freedoms and rights, it appears likely that the new governments that emerge will hold to liberal tenets, with its emphasis on trade to bring prosperity and institutions to enforce commercial and individual rights. Furthermore, given that Islam and liberalism have similar concepts in terms of commerce, liberalism appears to have a bright future in this region. However, this is in contrast to socialism which, due to its tainted history, does not appear to be an option that Arabs would turn to as they seek to create a new, fairer government.

Osama Al Haddad is an undergraduate student at Bond University. He is currently studying Law and International Relations.

Works Cited

Baer, G., 2003. Population and Society in the Arab East. 1 ed. s.l.:Routledge.

Banaji, J., 2003. Islam, the Mediterranean and the Rise of Capitalism. Amsterdam, Historical Materialism.

Hanieh, A., 2011. Capitalism And Class In The Gulf Arab States. 1 ed. New York: Macmillan.

Heard-Bey, 1982. From Trucial States to United Arab Emirates. 1 ed. Abu Dhabi: Motivate Publishing.

IMF, 2011. Economy Rankings. [Online]
Available at: http://www.doingbusiness.org/rankings
[Accessed 20 March 2012].

IMF, 2011. World Economic Outlook Database, September 2011. [Online]
Available at: http://www.imf.org/external/pubs/ft/weo/2011/02/weodata/weorept.aspx
[Accessed 1 March 2012].

Marx, K., 1850. Address of the Central Committee to the Communist League. London, s.n.

Marx, K. & Engels, F., 1848. The Communist Manifesto. London: s.n.

Muravchik, J., 2002. Socialism vs. Religion. The American Enterprise, 13(2), pp. 32-36.

Salem, P., 1994. Bitter Legacy: Ideology and Politics in the Arab World. 1 ed. New York: Syracuse University Press.