The summer 2022 issue of Middle East Report, “Currencies of Power,” examines the contemporary global economy to highlight how global capital is suffocating the region’s working classes.

A billboard displays an image of Egyptian President Abd al-Fattah al-Sisi and Chinese President Xi Jinping in the central business district of Egypt’s New Administrative Capital under construction east of Cairo, July 27, 2022. Islam Safwat/Bloomberg via Getty Images

MERIP has always been dedicated to issues of justice in the Middle East and North Africa—in Palestine, for gay and trans people and for victims of US imperialism and its dependent dictatorial regimes. But when it began in 1971 MERIP was also committed to a materialist political economy perspective and Marxist frames of analysis. Articles covered regional relations with the Soviet bloc and the (often largely symbolic) socialist features of the postcolonial Arab governments.

The emphasis on material conditions is especially visible in the 1986 Wealth & Power issue, which profiled the rise of a new bourgeoisie that siphoned wealth from the dismantling of state assets and capitalized on financial inflows from the United States and international banks. By this time the region’s post-independence experimentation with “land to the tiller” redistribution programs and sizable investments in social infrastructure were being reversed, catalyzing its slide into greater and greater levels of inequality. The increasing divide between the beneficiaries of surplus capital and those who produce it is, of course, not restricted to the Middle East. The imperative to grasp the global nature of capitalism’s evolution and how its modes of exploitation emerge in geographically specific ways suggests, however, that the region should be more central to how these processes are understood.

The authors of issue 303 make a significant contribution to the understanding of these regional specificities and how they inform our current capitalist moment. Among their topics is the role played by the unprecedented flood of Arab Gulf petrodollars into US and European banks in the 1970s that drove the development of exotic financial instruments at the heart of contemporary financial crises. The almost-but-not-quite-mutually assured destruction that now characterizes US and Gulf financial entanglements is the subject of David Wight’s article in this issue. Financialization enabled many forms of socially un-productive development in the region, notably through mega-projects like Egypt’s Media Production City. Mariz Kelada’s article demonstrates that although these projects offer opportunities for land speculators and investors to accumulate capital, it is the subcontracted, precarious and so-called informal labor operating outside this sphere that produces the authenticity critical to the cinema and film industry.

Anna Simone Reumert writes of Sudanese laborers forced to trace and re-trace the erratic and unpredictable flows of regional capital, another form of precarity experienced by workers throughout the region. The speed and ease with which huge sums of capital can move (in this case, out of Lebanon) stands in stark contrast to the laborious relocation that migrant workers must constantly negotiate in both space and social position. Their movement creates new channels for extraction and accumulation in existing centers of capital, becoming part of the work itself, and perhaps suggesting new dimensions for defining labor in the twenty-first century.

Capital’s need to intensify the rate of exploitation and widen its field of extraction continues to produce novel and disturbing arrangements that generate seemingly endless returns to holders of capital and worsening conditions and declining wages for labor. Grotesquely, these novelties are often peddled as emancipatory innovations that will empower workers, but in fact they are vehicles for intensifying inequality. Ali Rıza Güngen examines how “financial inclusion,” a development strategy to assist the poor by increasing their access to formal financial institutions, has unfolded in Turkey. Technocratic calls for “banking the un-banked,” establishing financial literacy programs and expanding consumer lending mostly just generates revenue for financial services firms and professional NGOs that purport to deliver these services to the poor. The underlying problems of widespread stagnant wages, wage theft, exploitation and the erosion of public safety nets will require formal schemes for wealth redistribution and social provision, not farming out service contracts to banks and private firms.

Grandiose claims of economic liberation and populist utopia are perhaps strongest in discussions of cryptocurrencies (Bitcoin, Ethereum, Terra and thousands of others), although this narrative has deflated as the values of these speculative assets continue their steep decline. Author Hadas Thier pushes back against crypto advocates who claim these products can liberate populations cut off from the broader financial system (Palestinians and Iranians in particular). Any emancipatory potential would require decentralized ownership of crypto reserves, but the vast majority are held by so-called whales that use them as a speculative investment asset to earn revenues based on global economic volatility. They only rarely function as actual currencies—and even then, the major sanctioning entities (intelligence agencies, global financial institutions, insurance companies) often have unacknowledged access to the encrypted blockchain technologies, ensuring that cryptocurrencies are subject to the same imperial checks as the traditional financial system.

Like alternative currencies, we also see the limitations that capitalism places on non-Western development models, specifically China’s activities in Egypt and throughout the African continent. Safa Joudeh demonstrates that although Beijing is praised for its less extractive forms of overseas investment, the underlying motivation is to accommodate the capitalist imperatives that are putting pressure on China’s own economy. As it seeks to increase the levels of technology involved in its domestic production processes, and to establish supply chain links that give it faster access to global markets, China is outsourcing the simplest phases in the production process to enclave zones in Egypt and elsewhere. The linkages that mainstream economists claim will organically emerge from these forms of overseas investment—bringing more jobs and diversified production—remain unrealized.

This issue also includes a review by Gilad Wenig of Kyle Anderson’s new book The Egyptian Labor Corps: Race, Space, and Place in the First World War. Anderson’s book investigates the wide array of coercive forms of labor control that made possible the expansion of capitalism in the Middle East, specifically the extent to which racial classifications were central to imperial British policies in Egypt during the First World War. The book also shows how, in turn, these policies helped produce a form of racial nationalism in the country, one that pronounced itself in the 1919 Revolution and efforts to resist British control.

All the pieces in this issue highlight the ways that our current iteration of capitalism shapes (and is shaped by) the political economy of the Middle East. Despite its contributions to understanding empire, the Middle East is rarely considered a locus for the development of ideas about material political economy, much less histories of capitalism. But the near-incomprehensible rise in global inequality and proximate ecological collapse caused by capitalism has prompted a return to class analysis and the agents that drive inequality. We should take advantage of this moment to expand scholarship that addresses the unique capital formations and working class struggles that define the region. A better understanding of how the political economy of the Middle East and North Africa is central to the forms and dynamics of global capitalism will not only help observers theorize the end of capitalism but can also lead to greater solidarity with the people whose lives are most at risk in this revolutionary process.

[The editors of issue #303, “Currencies of Power,” are Shana Marshall, Najib Hourani and Hesham Sallam with Guest Editor Kevan Harris.]


How to cite this article:

The Editors of Issue #303 "Currencies of Power," Middle East Report 303 (Summer 2022).

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