In this year’s prize, the Norwegian Nobel Committee has placed the critical issue of the environment and its linkage to democracy and peace before the world. For their visionary action, I am profoundly grateful. Recognizing that sustainable development, democracy and peace are indivisible is an idea whose time has come. Our work over the past 30 years has always appreciated and engaged these linkages.

My fellow Africans, as we embrace this recognition, let us use it to intensify our commitment to our people, to reduce conflicts and poverty and thereby improve their quality of life. Let us embrace democratic governance, protect human rights and protect our environment. I am confident that we shall rise to the occasion. I have always believed that solutions to most of our problems must come from us.

My inspiration partly comes from my childhood experiences and observations of nature in rural Kenya. As I was growing up, I witnessed forests being cleared and replaced by commercial plantations, which destroyed local biodiversity and the capacity of the forests to conserve water.

In 1977, when we started the Green Belt Movement, I was partly responding to needs identified by rural women, namely lack of firewood, clean drinking water, balanced diets, shelter and income.

Throughout Africa, women are the primary caretakers, holding significant responsibility for tilling the land and feeding their families. As a result, they are often the first to become aware of environmental damage as resources become scarce and incapable of sustaining their families.

The holistic approach

The women we worked with recounted that, unlike in the past, they were unable to meet their basic needs. This was due to the degradation of their immediate environment as well as the introduction of commercial farming, which replaced the growing of household food crops. But international trade controlled the price of the exports from these small-scale farmers and a reasonable and just income could not be guaranteed. I came to understand that when the environment is destroyed, plundered or mismanaged, we undermine our quality of life and that of future generations.

Tree planting became a natural choice to address some of the initial basic needs identified by women. Also, tree planting is simple, attainable and guarantees quick, successful results within a reasonable amount of time. This sustains interest and commitment.

So, together, we have planted more than 30 million trees that provide fuel, food, shelter, and income to support their children’s education and household needs. The activity also creates employment and improves soils and watersheds. Through their involvement, women gain some degree of power over their lives, especially their social and economic position and relevance in the family. This work continues.

Initially, the work was difficult because historically our people have been persuaded to believe that because they are poor, they lack not only capital, but also knowledge and skills to address their challenges. Instead they are conditioned to believe that solutions to their problems must come from ‘outside’. Further, women did not realize that meeting their needs depended on their environment being healthy and well managed. They were unaware that a degraded environment leads to a scramble for scarce resources and may culminate in poverty and even conflict. They also knew nothing of the injustices of international economic arrangements.

Understanding the linkages

In order to assist communities to understand these linkages, we developed a citizen education programme, during which people identify their problems, the causes and possible solutions. They then make connections between their own personal actions and the problems they witness in the environment and in society. They learn that our world is confronted with a litany of woes: corruption, violence against women and children, disruption and breakdown of families, and disintegration of cultures and communities. They also identify the abuse of drugs and chemical substances, especially among young people. There are also devastating diseases that are defying cures or occurring in epidemic proportions. Of particular concern are HIV/AIDS, malaria and diseases associated with malnutrition.

On the environment front, they are exposed to many human activities that are devastating to the environment and societies. These include widespread destruction of ecosystems, especially through deforestation, climatic instability, and contamination in the soils and waters that all contribute to excruciating poverty.

In the process, the participants discover that they must be part of the solutions. They realize their hidden potential and are empowered to overcome inertia and take action. They come to recognize that they are the primary custodians and beneficiaries of the environment that sustains them.

Entire communities also come to understand that while it is necessary to hold their governments accountable, it is equally important that in their own relationships with each other, they exemplify the leadership values they wish to see in their own leaders: justice, integrity and trust.

Although initially the Green Belt Movement’s tree planting activities did not address issues of democracy and peace, it soon became clear that responsible governance of the environment was impossible without democratic space. Therefore, the tree became a symbol for the democratic struggle in Kenya. Citizens were mobilised to challenge widespread abuses of power, corruption and environmental mismanagement. In Nairobi’s Uhuru Park, at Freedom Corner, and in many parts of the country, trees of peace were planted to demand the release of prisoners of conscience and a peaceful transition to democracy.

Through the Green Belt Movement, thousands of ordinary citizens were mobilized and empowered to take action and effect change. They learned to overcome fear and a sense of helplessness and moved to defend democratic rights.

Trees as a symbol of peace

In time, the tree also became a symbol for peace and conflict resolution, especially during ethnic conflicts in Kenya when the Green Belt Movement used peace trees to reconcile disputing communities. During the ongoing rewriting of the Kenyan constitution, similar trees of peace were planted in many parts of the country to promote a culture of peace. Using trees as a symbol of peace is in keeping with a widespread African tradition. For example, the elders of the Kikuyu carried a staff from the thigi tree that, when placed between two disputing sides, caused them to stop fighting and seek reconciliation. Many communities in Africa have these traditions.

Such practices are part of an extensive cultural heritage, which contributes both to the conservation of habitats and to cultures of peace. With the destruction of these cultures and the introduction of new values, local biodiversity is no longer valued or protected and as a result, it is quickly degraded and disappears. For this reason, The Green Belt Movement explores the concept of cultural biodiversity, especially with respect to indigenous seeds and medicinal plants.

As we progressively understood the causes of environmental degradation, we saw the need for good governance. Indeed, the state of any county’s environment is a reflection of the kind of governance in place, and without good governance there can be no peace. Many countries, which have poor governance systems, are also likely to have conflicts and poor laws protecting the environment.

In 2002, the courage, resilience, patience and commitment of members of the Green Belt Movement, other civil society organizations, and the Kenyan public culminated in the peaceful transition to a democratic government and laid the foundation for a more stable society.

It is 30 years since we started this work. Activities that devastate the environment and societies continue unabated. Today we are faced with a challenge that calls for a shift in our thinking, so that humanity stops threatening its life-support system. We are called to assist the Earth to heal her wounds and in the process heal our own – indeed, to embrace the whole creation in all its diversity, beauty and wonder. This will happen if we see the need to revive our sense of belonging to a larger family of life, with which we have shared our evolutionary process.

In the course of history, there comes a time when humanity is called to shift to a new level of consciousness, to reach a higher moral ground. A time when we have to shed our fear and give hope to each other.

That time is now.

The Norwegian Nobel Committee has challenged the world to broaden the understanding of peace: there can be no peace without equitable development; and there can be no development without sustainable management of the environment in a democratic and peaceful space. This shift is an idea whose time has come.

I call on leaders, especially from Africa, to expand democratic space and build fair and just societies that allow the creativity and energy of their citizens to flourish. Those of us who have been privileged to receive education, skills, and experiences and even power must be role models for the next generation of leadership. In this regard, I would also like to appeal for the freedom of my fellow laureate Aung San Suu Kyi so that she can continue her work for peace and democracy for the people of Burma and the world at large.

Culture plays a central role in the political, economic and social life of communities. Indeed, culture may be the missing link in the development of Africa. Culture is dynamic and evolves over time, consciously discarding retrogressive traditions, like female genital mutilation, and embracing aspects that are good and useful.

Africans, especially, should rediscover positive aspects of their culture. In accepting them, they would give themselves a sense of belonging, identity and self-confidence.

There is also need to galvanize civil society and grassroots movements to catalyse change. I call upon governments to recognize the role of these social movements in building a critical mass of responsible citizens, who help maintain checks and balances in society. On their part, civil society should embrace not only their rights but also their responsibilities.

Further, industry and global institutions must appreciate that ensuring economic justice, equity and ecological integrity are of greater value than profits at any cost. The extreme global inequities and prevailing consumption patterns continue at the expense of the environment and peaceful coexistence. The choice is ours.

I would like to call on young people to commit themselves to activities that contribute toward achieving their long-term dreams. They have the energy and creativity to shape a sustainable future. To the young people I say, you are a gift to your communities and indeed the world. You are our hope and our future.

The holistic approach to development, as exemplified by the Green Belt Movement, could be embraced and replicated in more parts of Africa and beyond. It is for this reason that I have established the Wangari Maathai Foundation to ensure the continuation and expansion of these activities. Although a lot has been achieved, much remains to be done.

© The Nobel Foundation, Stockholm, 2004.

This article has been adapted by Global Agenda from Professor Wangari Maathai’s Nobel Peace Prize Lecture, with thanks to Professor Maathai and the Norwegian Nobel Institute. A full text can be found on www.wangarimaathai.com.

Wangari Muta Maathai
Wangari Muta Maathai is a Kenyan member of parliament and assistant minister for the environment. She was awarded the Nobel Peace Prize in 2004 in recognition of her work for the Green Belt Movement.

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Do we live in riskier times than humans have faced before? It is a common question in these days of terrorism, snipers and weapons of mass destruction, of genetically modified food, climate change and HIV/AIDS.

The answer is both yes and no. The evidence is mixed but people all over the world at least think – and it is perception that is important – that the risks we modern humans face are greater than ever before.

The implications of this apprehension are immense for public and environmental health and for the global economy. It is necessary to shed light on human risk perception and to offer some insight into why the public’s fears often seem not to match the facts.

Empowered by such insight, governments can do a more effective job of risk communication, both through their policies and through what they say about them, which will help citizens keep their fears in perspective.

This, in turn, will not only help individuals make wiser, healthier decisions for themselves, it will also help focus citizen pressure on protection from the relatively greater risks. And that will allow governments, businesses and other social institutions to invest in the optimal protection of public and environmental health with the most efficient use of limited resources.

So just how risky is the world in which we live? Consider some data from the United States which reflect similar trends in developed nations worldwide. In 1900 the average life expectancy was about 45 years of age. Today it is nearing 80. In just the past 40 years, infant mortality has dropped from 26 per thousand live births to seven. In 1918 the influenza epidemic killed 600,000 Americans. In 1999 influenza killed about 2,000 Americans.

By major measures, this is a far healthier, safer world. But new risks have arisen. Worldwide more than 22 million people have died of AIDS since 1984. The postwar industrial/technological/information age has given us both the benefits and the risks of nuclear power, pesticides and now the genetic modification of food.

Under the burden of a global population that in the last 100 years has exploded from 1.65 billion to more than 6 billion, environmental risks such as climate change, water and air pollution and the mass extinction of species have added to a growing litany of new perils.

On top of this host of new hazards, we live in a time of unsurpassed media availability and immediacy of information. Whenever something is discovered that is even possibly a peril, we learn of it, worldwide, within days.

It is also a new phenomenon that the majority of our sources of information are owned by a small number of large corporations. These corporations are interested in profits, and so their media outlets often make new risks sound as dramatic as possible in order to grab our attention and attract us to buy their next newspaper, magazine or television broadcast.

These are the modern realities of what seems to be a risky world, but they overlay what appear to be ancient ways in which we perceive and respond to danger. Several decades of research on risk perception have found that humans tend to fear similar things for similar reasons. These patterns of risk perception are less often based on facts and more often on affective and intuitive factors.

To understand these risk perception characteristics is to gain some insight into why people are commonly more afraid of some relatively small risks and less afraid of others which in certain ways cause greater harm. Here are some of these characteristics.

Control

Do you feel pretty safe when you drive? Most people do. Having the wheel in your hand gives you the feeling that you can control what happens. But switch to the passenger seat and you are a little more nervous because you are no longer in control.

This applies to any number of things. If you feel as though you have some control over any process determining a risk you will face, the risk will probably not seem as big as if it was decided by a process over which you felt you had no control.

The dread factor

What is worse – being eaten by a shark or dying of heart disease? Both kill you and heart problems are by far the risk more likely to do you in. But the dreadful death often evokes more fear. Cancer is perceived as a dreadful way to die, and so hazards that might cause cancer evoke strong fears. Dying in a plane crash is also perceived as dreadful, which helps explain why so many people fear this relatively low risk.

Do we also distinguish between natural risks and those that are man-made? Artificial sources of radiation such as nuclear power, mobile phones and electrical or magnetic fields frequently evoke greater concern than radiation from the sun. The sun poses a vastly greater risk, causing 1.3 million cases of skin cancer and 7,800 melanoma deaths per year in the United States, but is less worrisome because it is natural. This factor helps explain widespread concern about many technologies and products.

Choice

A risk that we choose seems less risky than one imposed on us. If you have used a mobile phone while driving, you may on occasion have noticed a driver next to you, also using his mobile. You may have felt upset about the risk that the other driver was imposing on you, even though you voluntarily took the same risk, albeit with less concern. (Of course, you also think you can control your car, and so the perception factor of control also contributes in this example.)

Children

In addition to the genetic imperative to survive, which is, after all, the underlying impetus of our risk perceptions and responses, humans are genetically driven to reproduce. Survival of the species depends on the survival of our progeny. Thus a risk to children, such as asbestos in a school or the abduction of a youngster, seems worse than the same risk when applied to adults, as with asbestos in the workplace or the kidnapping of an adult.

After the murders of five adults during the recent sniper attacks in Washington, DC, the sniper shot a 13-year-old boy. The local police chief, tears in his eyes, declared of the sniper: “He’s really getting personal now.”

Is the risk new?

When BSE first appeared in Germany, an opinion survey found that 85% of the public thought mad cow disease was a serious threat to public health. But the same poll conducted at the same time in the UK, where BSE had been around for years, found that only 40% of the public thought mad cow disease was a serious threat. This was so although many more animals and people had died in the UK than in Germany.

New risks, including new technologies or products, are always more frightening than the same risks after we have lived with them for a while, when our experience allows us to put them into perspective.

Awareness

The more aware of a risk we are, the more available it is to our consciousness, and the more concerned about it we are likely to be. In the Washington, DC, area last October, fear of being shot by a sniper was much higher than fear of the greater risks of heart disease, cancer or stroke. These other risks had not disappeared, but conscious concern about them was lower because awareness of them had been reduced.

Are we personally vulnerable?

Any risk seems greater if you think you or someone you care about could be a victim. Consider terrorism in the United States. Before September 11, 2001, any Americans who were victims of terrorism were thought of as “someone else”. Yes, they were Americans, but they were in foreign embassies or on foreign military assignments. After 9/11, however, Americans at home felt that they, too, were possible targets, and the fear of terrorism grew.

This helps explain why statistical probability is often irrelevant to people. Imagine that someone hands out a million bottles of water, one of which contains poison. You get one of these bottles. Now imagine taking a drink from it. Your risk of dying from that water is only one in a million, but it still feels risky to drink it because you could be that one.

The risk-benefit trade-off

When measles and polio were prevalent, the benefits of vaccination were perceived to outweigh the risk of side effects. But now, when these diseases are rare, the perception of some parents is that the risk of side effects, low as they are, outweigh the benefits of vaccination.

Many risk perception researchers believe that the risk-benefit trade-off is a major factor in making us more or less afraid of a given risk.

Trust

Finally, there is the issue of trust. Research has found that the less we trust the people who are supposed to protect us, the more afraid we will be. The same applies to the degree of trust or otherwise we place in the people exposing us to the risk in the first place or to the people telling us about the risk.

The more we trust, the less concern we will feel about a given risk. Imagine you are in a desert, nearly dead of thirst, and someone appears and offers you two glasses of a clear liquid. He will not tell you what is in either glass, only that one comes from Pope John Paul II and one from Saddam Hussein. Which would you take?

But what are we to make of all this? Of what good is it to understand the underpinnings of our fears or lack of them? And if these risk perception characteristics are intrinsic, as they may well be, what can be done about them?

By understanding these characteristics, and by accepting that they are intrinsic, policy-makers can incorporate risk perception values, as well as careful fact-based analysis, into their risk management decisions. Furthermore, by understanding why people perceive risk as they do, policy-makers can communicate with various audiences about these issues in terms and language relevant to people’s concerns.

Risk communication – in a way which acknowledges and respects the emotional component of people’s concerns, rather than dismissing such perceptions as “irrational” because they are not solely fact-based – is likely to be more successful in helping people bring their sense of risk into closer perspective with what the actual risk may be.

And why does this matter to policy-makers in government, business and public health? Because people who misperceive risk – who are either too afraid of relatively low risks or not afraid enough of relatively big ones – make dangerous mistakes. People afraid of flying choose instead to drive, which is much riskier. The fear itself poses a risk.

On the other hand, people unafraid of natural risks such as solar radiation, or risks they think they can control, such as smoking, alcohol consumption or diet, fail to take adequate precautions and they, too, face a greater likelihood of premature death. A lack of appropriate caution can be dangerous, too.

Furthermore, when risk perception characteristics trigger high concern about a relatively low risk among large groups of people, those people pressure government for protection from that lesser risk. This forces government to allocate resources in a less than optimal way.

Time and money spent on protecting people from relatively low risks because they evoke high concern are not available to protect people from greater risks which do not trigger as much worry. As a result, some of the people left unprotected from the greater risks will suffer. Some will surely die.

The solution is at hand and is urgently needed in this world which is seemingly riskier than ever. Risk communication, informed and empowered by an understanding of risk perception, must become a priority at the highest levels of policy-making in government, business and international affairs.

More must be done to help people keep their sense of risk in perspective. Decision-makers must realize and accept that the danger of misperception of risk is real. It is both a significant threat to public health and an impediment to thoughtful and efficient policy-making.

In terms of risk communication, policy-makers must consider the implications of what they do, not just of what they say and how they say it. Setting an acceptable exposure threshold, allowing or disallowing a particular product or process, requiring or not requiring labelling – indeed any risk management decision – has meaning and impact in terms of risk communication.

The most senior officials must consider the risk communication implications of their actions as policy choices are made. Risk communication, then, must be thought of as more than just press releases, news conferences and public service campaigns. Risk communication is walking the walk, not just talking the talk.

Some call this pandering to irrationality and emotion, and suggest that a benevolent technocracy should be empowered to manage societal risk in order to ensure the development of the most intelligent, rational and effective policies. But this fails to recognize that fear itself – either too much of it or not enough – poses a significant risk which must also be factored into decisions about public and environmental protection.

Risk communication, informed by the insights of risk perception, is a vital and too often neglected tool for helping people make more informed, thoughtful and safer choices for themselves. It will free the leaders of social institutions to make more rational, fact-based risk management choices in order to maximize public and environmental health with the most efficient use of limited resources.

David Ropeik/Paul Slovic
David Ropeik, MSJ, is director of risk communication at The Harvard Center for Risk Analysis.

Paul Slovic, PhD, is president of Decision Research.

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A slice of a market inhabited by 300 million people sharing a common language and similar cultures should whet the appetite of businesses seeking to supply information and communications technology (ICT) goods and services. But the barriers to companies looking to enter the Arab ICT market are high. And they come in a variety of shapes and sizes across the region.

“No-one provides the real information that’s needed for making a decision,” says Sheikh Khaled bin Zayed al-Nahayen, chairman of the UAE-based Bin Zayed Group (BZG).

Lack of market information has impaired business planning and decision-making in Arab ICT markets, he says. “Here, when we present business plans, they are based on nothing,” he says. He hopes that the market data for the ICT sector and firms in the knowledge economy provided by his newly created Madar Research Group will go some way to filling this void.

Market data may do more than that, says Abdul Kader Kamli, president and research director of Madar Research Journal. “A better understanding of these markets will encourage both global and Arab investors to become more engaged in the region,” he says. “And it will help existing companies map out properly prepared business plans for the future.”

Even major ICT players such as HP (formerly Hewlett-Packard & Compaq) are unsure of their positions in certain market segments. “Based on market data we are number one [in the region] in terms of Intel products, PCs, notebooks and servers,” says Joseph Hanania, general manager of HP Middle East. He believes HP is “also leading the business critical” sector of the market, but notes that “there’s no independent data” to guarantee his claim.

A variety of ICT market perspectives are portrayed in Madar Research Journal – from comprehensive data on the depth of internet penetration across Arab states to the lowdown on internet cafés in Saudi Arabia and Libya.

Sheikh Khaled’s diverse BZG portfolio, with interests in several sectors from furniture trading to construction, includes seven technology companies. He is visibly more excited by ventures in what he describes as the “wild, wild west” of technology than more traditional local business pursuits in oil and real estate.

But he also seems genuine in his concern that the ICT facilities that his technology businesses deliver should improve the competitiveness of the small businesses that are so critical to the region’s economic buoyancy.

“In the GCC [Gulf Cooperation Council] there are not so many large companies,” Sheikh Khaled notes. Thus a central aim of BZG’s technology businesses is to fit products to the region’s enterprise stock by designing and delivering “full service” offerings to small and medium-size enterprises (SMEs). These products provide SMEs with technologies they could not otherwise afford to buy or replace because of lack of capital, or could not service because of the cost or lack of relevant expertise.

Local partnerships

Another entrepreneur concerned with harnessing SME potential from a different angle to gain positions in Arab markets is Sheikh Alawi Baharoon, CEO of Baharoon Development Corporation, the holding company behind one of Saudi Arabia’s largest business-to-business enterprises, Integrated Visions (IV).

He believes that Arab markets are too tough for the world’s major ICT names to handle alone. “It is expensive for [major ICT] companies to come into a region where per capita income is much lower than in the UK or Germany,” says Sheikh Alawi. He believes the world’s global ICT players would be hard pressed to obtain the economies of scale necessary for profitable operations in the region. They cannot pay high expatriate wages in several Arab states, he suggests, so “to do something meaningful, IV integrates small [local] companies to achieve that economy of scale”.

Until recently, Oracle adapted its products in and for the local market. However, according to Husam Dejani, vice-president of Middle East operations, the software company has changed tack. “Oracle is a global company and a few years back, we took the decision to have one global strategy. We implement this with zero modifications,” he explains.

As far as Dejani is concerned, “no company has the bandwidth to create local programmes [and] there’s a big question mark over the returns they would get from these programmes”. Today Oracle employs no local IT staff. “All I have is a global network – 42,000 globally and 300 in the Middle East,” says Dejani.

This may sound like bad news for Oracle’s customers but apparently it is not. What has happened is that while product localization used to be performed after the software was written, today there is no need for that tinkering.

“Localization has moved behind the product,” says Dejani. This means that if you are using Oracle software and you need Arabic, it is already loaded in the background waiting to be called up. “We are strong advocates of centralization – the software has to function in all languages at all times,” he says.

Dejani claims that this has distinct advantages for users, including some of the region’s largest businesses. “Emirates Airlines implemented our software for all their functions, and they had an interesting ERP [enterprise resource planning] challenge,” he says. Emirates’ Indian-based, UK-based and Dubai-based employees are subject to their homeland’s tax and social security conditions. A couple of years ago, about 30 software variations would have been needed to cope with the airline’s payroll but now it runs from one piece of software. “This is what I call global software as opposed to local software,” he says.

Another aspect of Oracle’s global strategy has reduced the corporation’s need to employ local people. Oracle’s online partner network enables users to raise software queries over the web.

Emirates used to approach its local Oracle support organization to get problems resolved. Now a query is logged onto computer and then sent to the support provider in the Oracle support network who is most competent to deal with the problem, regardless of where the support person is located.

Dejani said that at first he was sceptical about the likely effectiveness of a reduced number of employees and reduction in face-to-face contacts. Now he is convinced it works.

Integrating Arabic

Oracle’s global approach does not exclude it from playing a key role in local product development. “Microsoft and Oracle are building platforms that offer the base for Arabic products,” explains Sakhr Software’s business development director, Fahad al-Sharekh.

Sakhr’s collaboration with Intel demonstrates that “the integration between Arab and international technologies has become a firm reality,” says al-Sharekh. The Kuwait-based company, which specializes in the use of Arabic-language ICT contexts, has recently launched software that uses Intel’s Pentium 4 3GHz processor to transform Arabic written text into speech quickly and accurately.

“Previously the software was able to recognize 400 characters a second but with the new Pentium 4 processor this number has increased to 1,000 characters per second,” al-Sharekh says.

Sakhr claims that its optical character recognition system is 99% accurate. “The joint path Sakhr has taken with Intel sets the example for the cooperation between regional and international companies,” says al-Sharekh.

Local offices and staff remain important in some major ICT players’ regional strategies. Major ICT products, technologies, solutions and services company HP has established offices in several countries to gain its position as “the largest IT company in the area in terms of presence and revenue”, says Hanania.

“Compaq has had a direct presence since 1994. Dubai-based with multiple offices in Saudi Arabia and Egypt it also has employees in Kuwait, Oman, Bahrain, Qatar, Lebanon and Jordan, as well as an office in Abu Dhabi. Hewlett-Packard has been in Dubai since 1998 and has opened since in Saudi Arabia and Egypt,” he says.

“Employees and individuals in certain countries sell the entire [HP] portfolio – from handheld [products] to fully tolerant non-stop systems,” says Hanania. He adds that regional staff also play an important part in providing product and service feedback to HP’s research and development team. This means that, in common with Oracle, “Arabization is designed into products – the basic design does not change” specifically for the market.

Growing the Arab market

The world’s largest ICT companies know they have to help grow the Arab ICT market and must work hard with governments to promote ICT literacy across Arab states. “We are ready to make investments,” says Hanania, who thinks there is “responsibility on all players, including suppliers, to help in the spread of technology.”

“With large organizations there is little difference – for example, between Middle Eastern airlines and those elsewhere,” Hanania says. But he does see issues for SMEs in terms of ICT literacy and usage. He thinks this is a matter for both private and public sectors. “HP works with governments to improve technology reach. In education, governments tend to take a leadership role, so HP may invest in products, services or knowledge transfer,” he says.

Microsoft has worked with several Arab governments to promote ICT usage. In September 2002, Microsoft Arabia said one of its partners had concluded an agreement with Saudi Arabia’s ministry of the interior to provide technology solutions in the kingdom’s “e-government’ initiative.

This promises a good local market position for Microsoft and its partners. Such partnerships should also help to grow the market. Sheikha Lubna al-Qasimi, chief executive of the Dubai-based Tejari online business-to-business marketplace, is one of several industry participants convinced that government involvement in ICT contexts deepens ICT penetration and stimulates ICT literacy.

Microsoft is committed to working with the Saudi government “for the future of computing… [and] to create a positive social and economic impact”, according to Microsoft Middle East’s managing director, Mohammed Kateeb.

The Thuraya experience

Saudi Arabia’s promotion of ICT literacy faces particular difficulties in its remote areas. This is a challenge across large parts of the Arab market for most companies and governments but it is an opportunity for others.

Thuraya Satellite Telecommunications Company has a “vision for the utilization of satellites to build an infrastructure and bridge the digital gap”, says chairman Mohammed Hassan Omran.

He talks with passion about Arabia’s rugged and sparsely peopled deserts. He believes his business has some real and practical answers to the question of how to provide telephone and internet access at a reasonable cost in developing countries.

Particular problems are encountered in remote areas, notably that of low incomes and the high costs of building and maintaining infrastructure. Thuraya nevertheless pursues its work with multinational and national companies as well as governments to achieve the goal of “universal access”. In some areas this means constructing fully resourced “telecentres” where people can drop in to access reasonable-cost telephone and internet links to the rest of the world.

Some of the challenges of establishing telecommunications networks in remote areas are not a result of factors of nature or demography. Omran says that establishing partnerships with providers of the terrestrial infrastructure that is required to deliver satellite services to the end-user can be time-consuming. “Thuraya may have problems with the distributors and local partners who maintain those parts of the infrastructure,” he says. The company is sometimes also obliged to use the main telecommunications provider.

Rollout of services can be slowed by the negotiations required before each market entry. With governments in some countries “it takes months and months to establish regulations, licences, fees and subsidies”, Omran says.

Despite his experiences of the trials and tribulations in growing the Arab ICT market, Omran supplies the simplest yet most compelling reason why a market will emerge across Arabia. “People want to be connected,” he says.

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Gathered together in a room at the top of the world’s tallest hotel is a group of ministers, each holding a brief for information and communications technologies (ICT) in Arab states. Crown prince of Dubai and UAE defence minister Sheikh Mohammed Bin Rashid al-Maktoum puts a simple question to them: “Is it too much for Arab countries to find a way forward through technology?”

The building in which they are gathered answers the question. The billowing sail-shaped Burj al-Arab testifies to how Dubai, an emirate that 30 years ago comprised little more than parched desert, has harnessed the latest architectural and civil engineering technologies to put up several spectacular structures – including the 321-metre-high hotel on a man-made island 280 metres offshore.

The architecture of this extraordinarily opulent monument makes reference to Dubai’s seafaring heritage and offers some of the most spectacular views of the Gulf.

To achieve this, the Burj al-Arab does employ technology to capture creativity, displayed in the indoor and outdoor choreographed landscapes of waterfalls and fountains that spout fire as well as water.

About 3,500 jobs were created during construction of the building. Since completion it has stimulated many thousands more direct and indirect employment opportunities. It is an asset in Dubai’s hotel stock, and strengthens the emirate’s claim to be the Gulf’s business and financial hub in the global marketplace. It stands as a record of state-of-the-art architectural and engineering technologies.

Less opulent but no less impressive examples of Arab employment of technology are found across North Africa, on the eastern shores of the Mediterranean and elsewhere in the Gulf.

Some show how technologies are employed as tools to develop local resources or traditional industries. Some demonstrate how Arab states have used technology to build a stock of producing firms capable of winning business from competitors based in more mature manufacturing nations. Some show how technology has spawned economic opportunities for a new generation of Arab entrepreneurs.

So the answer to Sheikh Mohammed’s question is “no”. It is not too much for Arab countries to find a way forward through technology. But, sadly, it is all too rare that they are doing so.

If the speeches delivered by representatives at the October 2002 ministerial Arab ICT Summit at Burj al-Arab are anything to go by, governments are bogged down by a wide range of problems, which many officials blame for the lack of a framework within which technology can be employed to release a host of social and economic benefits.

Masters of problem diagnosis

The catalogue of problems faced by Arab policy makers concerned with technology can be placed in dozens of perspectives. In November 1999, the United Nations Industrial Development Organization (UNIDO) held in Cairo an Arab regional forum on industry entitled “Adoption of new technologies and industrial policies: linking the Arab regional markets with the industrialized world”.

It summarized the problems by concluding that the Arab region faced a “wide milieu of problems due to underdeveloped science and technology infrastructure, lack of large private industries with their own research and development (R&D;) activities, insufficient numbers of trained personnel and tested strategies for technological development”.

The forum added: “It also has insufficient economic diversity for stable growth and inadequate capacity to handle the technological growth in competitive areas. Part of the problems result from the lack of knowledge on adaptation of available science and technology potential to the needs of their economies.”

Very little seems to have changed since then – except perhaps that there is greater recognition that the problems restricting the development of technical knowledge in the Arab world are rooted much more deeply than in the higher education and industrial sectors.

“Illiteracy is a catastrophe,” says Raafat Radwan, chairman of Egypt’s Cabinet Information and Decision Support Centre. He argues that the inability to read or write prevents people from using, let alone creating, technology and automatically puts them on the wrong side of the “digital divide” that separates those who are ICT literate from those who are not.

“Infrastructure is no good without people,” says Farid Metwaly, general manager of IBM for the Middle East, Egypt and Pakistan. He believes that “developing the human element is the most important aspect” in promoting ICT literacy.

But there is a conundrum. Technology has a habit of spawning new devices and processes and making others redundant. So a skill acquired today might be of no value tomorrow. Yet while it is impossible to predict what technologies will be used in the future, it is certain that all professions and trades will increasingly rely on technology.

“How do we qualify our children for skills that do not exist?” asks Jordan’s minister of ICT, Dr Fawaz Zu’bi. He believes that an “emphasis on learning, not teaching” is required to ensure that future generations will be equipped to compete in the modern world and emphasizes that “teaching and learning are not two sides of the same coin”.

Continuous learning should therefore be considered the primary skill while the second most important competence is “thinking” according to Zu’bi. The ability to change will also be required since “each child will need to learn a new profession five times – or every 10 years – in its career”.

Incubators not importers

Sheikh Abdullah bin Zayed al-Nayan, the United Arab Emirates’ minister for information and culture, is also concerned about the development of human resources in an educational framework that extends to postgraduate level and in job training.

What seems to irk him particularly in this area, however, is the failure of the Arab world to build its own incubators and stores of technologies and technological skills.

“We have to do away with the idea of importing technology,” he says. The Arab world is losing out because, unlike the more technologically advanced economies, it has failed to establish research bodies that work to develop technologies, often in close association with business. “This is a cultural issue, not a technical issue,” he says.

Sheikh Abdullah forcefully insisted at the ICT summit that women must be included in the knowledge economy – a sentiment shared by several speakers, including Zu’bi, who reckons that women are better at managing small and medium-size enterprises than men.

Sheikh Mohammed notes that 38.7% of all Arabs and 51% of Arab women are illiterate and describes “women’s hesitation to work” as a fundamental social issue that wastes a valuable resource. “We have to tap into this,” he says.

The problem was well demonstrated at the Burj al-Arab. The first woman to address the mainly male delegates did so at 3.20pm, more than six hours after the summit began – by which time the conference hall was half empty.

“Unfortunately, we are still focused on side issues,” says Sheikh Abdullah, who maintains that apart from human resource development, only two other issues seriously stand in the way of Arab ICT development.

He believes in “information empowerment”, which, among other things, means no compulsory state censorship of internet access. He also believes technology costs should be cut by reducing call charges and by abolishing tax and duty on technology equipment.

Side issues, according to Sheikh Abdullah, include perceptions of vulnerability to cybercrime, the role of government in the ICT sector and the failure of Arab states to adopt intellectual property rights legislation.

“We want you to ask us to help you,” is Sheikh Abdullah’s invitation to other Arab states. Given the UAE’s stellar growth in terms of ICT over just a few years, Arab policymakers should consider that invitation carefully. Some of the suggestions and sentiments expressed by Sheikh Abdullah made uneasy listening for some delegates, including his apparently sceptical view of a pan-Arab quest for a solution to the region’s ICT challenges.

He is “not optimistic about an Arab solution” and calls into question the efficacy of pan-Arab meetings, which in his view are characterized by “hot air” and “spent podiums” and much debate about problems.

“I believe that applies to all Arab meetings. Working at GCC [Gulf Cooperation Council] level is better than working at an Arab level. At an Arab level you will not achieve a lot in the near future,” he says. “We are masters of problem diagnosis – we have to move on.”

Commercial perspectives

Businesses have moved on in Dubai, where Sheikh Mohammed’s ability to deliver world-class commercial ICT facilities is manifest in the purpose-built complexes of Dubai Internet City (DIC).

But facilitating business development in the knowledge economy requires more than physical infrastructure, according to Sheikha Lubna al-Qasimi, chief executive of online business-to-business marketplace Tejari.

Training facilities such as the IT academy – established in partnership with IBM – are critical components in the environment that has enabled new-economy businesses in DIC to mushroom.

“Practise what you preach” is Sheikha Lubna’s message to policymakers. She is convinced that the examples set by the UAE authorities are important. Initiatives such as “e-government”, which makes public services available online, through to an “e-college” that promotes quality management have stimulated internet penetration in the UAE, thus stimulating ICT literacy.

But businesses encounter very different experiences as they look to establish positions across the region, according to Husam Dejani, Oracle’s vice-president of Middle East operations. He describes the issue of ICT literacy as “not a single problem, but multi-layered”.

He suggests: “You can start with children if you can wait a generation, or you can start with the business community [since] these are the people who would use them [computers] most.”

Another layer of the problem is about which side of the supply and demand equation is tackled first. Dejani shares Sheikh Abdullah’s view that a pan-Arab solution would be hard to find. “Countries are different: Egypt and Jordan have capabilities but no money while Saudi Arabia has money and is short on capabilities. I don’t know of any country in the Middle East that could address both issues at the same time,” he says.

Dejani notes that governmental approaches to technology are very different. In the Gulf, he says, there is no aim to protect local labour, while technology is seen as a vehicle for job creation in Jordan and Lebanon, where it might be difficult to recruit expatriate labour.

Private partnerships are widely regarded as a good way to stimulate new economic activity. But for the private sector to be involved in technology initiatives it has to understand the objectives of government. The problem, says Dejani, is that “often the government does not know what its objectives are – or at least they are not clearly stated”.

Some governments are taking a practical approach to involving the private sector in areas traditionally reserved for the states. The Omani and Qatari governments have each apparently opted to spend about $2,000 per graduate on Oracle training.

They view this sum as a drop in the ocean when compared with funding a child’s education from kindergarten through to university, only to find there is no job at the end of it all.

Connecting the Arab world

Internet access must be recognized by now as key to a country’s participation in the world economy and a global society. But while internet penetration in Korea, Singapore, Australia, North America and parts of Europe sits comfortably above 50%, overall penetration in Arab states was just 2.54% by the end of the third quarter of 2002, according to UAE-based Madar Research Group.

There are distinct differences in penetration rates among Arab states. Madar estimates that the UAE’s and Bahrain’s end-2002 penetration rates were 27.69% and 22.06%, respectively. Saudi Arabia hosts the single largest online Arab community, with 1.6 million internet users, while 1.5 million Egyptians are connected, according to Madar. At the other end of the scale, Yemen, Sudan and Iraq have penetration rates of less than 1%.

Strong growth is expected in some countries. The UAE will have achieved 38% internet penetration and Bahrain 32% by 2005, according to Madar. But while much more connectivity is forecast across most Arab states, the researchers expect Syria, Iraq, Yemen and Sudan to lag well behind the pack. This means that by 2005 about 25 million Arabs will be connected out of a total population of around 300 million.

“The role of technology and know-how in creating value added has become crucial,” argues Abdel Latif Youssef El Hamed, chairman and director general of the Kuwait-based Arab Fund for Economic and Social Development (AFESD), in his foreword to the United Nations Development Programme’s Arab Human Development Report 2002.

“Central to these huge developments in any society are the capabilities of people and the extent of scientific and cultural progress. All development starts with human development,” Hamed writes.

Hindrances to performance

Knowledge and women’s empowerment – both of which should be vibrant constituents of a country’s pool of capabilities – were identified in the report as two of the three key Arab institutional structures that hinder performance and cripple human development. The third area is governance. An earlier UNDP report questioned how effectively countries develop technological capabilities throughout the population.

The UNDP’s Human Development Report 2001 introduced the technology achievement index (TAI) – a composite index based on eight indicators in four dimensions: technology creation, diffusion of recent innovations, diffusion of old innovations and human skills.

That report makes gloomy reading for those concerned with Arab technology strategies. It found that most Arab countries were not employing technology and technical know-how nearly so well as many other countries.

Four groups of countries are distinguished in the report. These are categorized as leaders, potential leaders, dynamic adopters and those that are marginalized.

Leaders – topped by Finland, the US, Sweden and Japan – are at the cutting edge of technological innovation. Israel is included in this group, as are two countries that have advanced rapidly in technology – South Korea, ranked fifth, and tenth-placed Singapore Casinos. There are no Arab states in this group.

Potential leaders have skills levels comparable to those in the top group but while they have diffused old technologies widely they innovate little. This group consists mainly of European and south and central American countries. There are no Arab states in this group either.

Countries in the third group are dynamic users of new technology. Most are developing countries with significantly higher human skills than the fourth group. Many of these countries have important high-technology industries and technology hubs but the diffusion of old inventions is slow and incomplete. At number 51 in the world, Tunisia is the leading Arab state by TAI rankings. Only three other Arab states – Syria, Egypt and Algeria – join Tunisia in the dynamic adaptor category.

Sudan is categorized as a marginalized country that has been unable to diffuse old or new technologies. The majority of Arab states feature alongside other countries where a lack of data prevented a TAI estimate.

“We should give our children what they need – the capability to compete in the modern world,” says Jordan’s minister of information and communication technology, Fawaz Zu’bi. “Technology itself is not the goal, it’s the tool for empowering Arab nations,” he argues.

The consequences of a country not developing technological capabilities – in terms of its competitiveness compared with other nations – may be more costly than doing so.

“The basic challenge is to encourage students to become life-long learners,” argues Rasha al-Sabah, under-secretary at Kuwait’s ministry of education.

Every policymaker says capabilities are important, even if they are still pondering strategies and frameworks for developing them. “Arab countries lack legislative frameworks and lack innovation and creativity in technology,” says Ebrahim al-Dossary, director general for information affairs and follow-up at the Bahraini prime minister’s court.

“We have to match educational outcomes to demands,” he argues.

The inter-relatedness of technology, education and the economy are clear, but a technological knowledge gap may be even more dangerous for countries that fail to develop capabilities, says major-general Zakaria Hussain, adviser to the president at the Arab Academy for Science and Technology and professor of strategic sciences.

“Any backwardness and non-commitment to science and technology constitutes a serious threat to the national security,” he said in an address to the influential Zayed Centre for Coordination and Follow-Up in Abu Dhabi.

Hussain argues that a soundly structured scientific and technological base has become one of the most significant pivots of economic development, and capabilities have become a systematic part of a productive process and one of the integrated stages of production.

“We have to match educational outcomes to demand,” says al-Dossary. He points out that 15 million Arabs have emigrated, along with their skills, to the US and Europe to compete in the global economy.

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Nanotechnology deals with objects on the nanometre size scale, typically more than 1,000 times smaller than a human hair (one nanometre is one-billionth of a metre).

Despite their small size, nano-objects have been sparking huge excitement among scientists in the past few years. That excitement is starting to spread – to school children, to the business community and to government planners.

Since the nano-field is at such an early stage of development and is moving so rapidly, there are many views on how it started, why it is happening, and where it is all going.

It is difficult to make cast-iron predictions about practical outcomes for this infant technology, or on how these outcomes might affect our lives. But one thing is certain: it will trigger major changes in the next decade.

Nanotechnology is the application of nanoscience, which deals with objects and physical phenomena on such a minuscule scale that new physical principles apply – those governed largely by quantum mechanical phenomena.

The era of nanoscience and nanotechnology emerged in the past few years because of three factors: the push of industrial progress; the availability of scientific know-how to fabricate, measure, model and manipulate objects of nanometre size; and the almost daily discovery of new phenomena on the nanoscale, which fuel new discoveries and enable new levels of control of molecular self-assembly.

Many people imagine nanotechnology as a remote field, but it is already here and all around us.

Consider, for example, the magnetic information storage system in your computer. Here, magnetic heads move at great speed just eight nanometres (nm) above the disk as they read and write information at a density approaching 100 gigabits per square inch, and where the magnetically active film thickness is only about 25nm.

Even more amazing is the low cost of this huge functionality and the speed at which manufacturers are compelled to develop the next generation system (less than one year), or face obsolescence.

Nanotechnology was ushered in by what is called Moore’s law in the semiconductor electronics, magnetic recording and optoelectronics industries. This says that the functionality of chips will increase exponentially over time, while their size and cost will decrease exponentially.

The size of some elements of devices in these industries have already reached nanoscale because technology has been able to produce objects of this size in a controllable way.

Techniques such as scanning-probe microscopes and high-resolution electron microscopes have been developed to measure and manipulate objects down to molecular and atomic levels (1nm and below in scale).

This “top-down” approach continues to dominate industrial progress at the same relentless pace, pushing down the size of devices year by year, increasing their functionality and lowering their cost.

But this is not where the real excitement lies. What people are drawn to increasingly is the “bottom-up” approach. This means starting from new systems that can be controlled at the nanoscale then seeing what can be built up from these objects and what they can be used for.

This approach does not set out to look for a replacement for the integrated circuit as such, or for a new type of magnetic information storage bit, but rather looks for new properties and functions not previously envisaged.

One of the most celebrated examples of the new “building blocks” resulting from the bottom-up method is the single-wall carbon nanotube. This is a single layer of a graphite crystal rolled up into a seamless cylinder one atom in thickness, typically about one nanometre in diameter, and with length to diameter ratios that can be a thousand or more.

The prediction that these objects would be semiconducting or metallic depending on their precise geometry – and the detailed experimental verification of this prediction – was an early triumph for nanoscience.

The modelling capability and ability to carry out quantitative measurements has led to the carbon nanotube becoming a model system for understanding new phenomena at the nanoscale. Carbon nanotubes were shown not only to have a variety of remarkable scientific properties, but also to possess attributes of practical interest.

Besides being extremely tiny the tubes are also excellent electron emitters, with high potential for flat panel display applications – which is already under commercial development in Korea.

In the electronics field, early demonstration of a field-effect transistor based on a single carbon nanotube, one nanometre in diameter, created much excitement and enthusiasm.

So did the early illustration of the full range of basic logic functions that nanotubes could provide.

The ability to grow a single nanotube at a desired location and in a desired direction showed great promise for control at the nanoscale.

The solubility of nanotubes in aqueous solutions and their ability to be used as individual sensors and actuators have also attracted attention, with regard to miniaturization as well as high spatial and temporal sensitivity.

A great challenge in the development of nanotubes for electronics applications has been finding a way to control the growth process.

It is necessary to produce nanotubes that have the same diameter and chirality (left or right handedness), so that they have reproducible semiconducting or metallic properties.

Other areas of application, such as providing structural reinforcement to processible polymeric composites are not hampered as much by the need for controlled nanotubes.

Another remarkable building block that offers more control for electronic applications has been the nanowire. Using the vapour-liquid-solid approach, a nanometre-sized molten gold catalyst particle provides the active region to which semiconductor constituents are supplied in the vapor phase.

This produces a supersaturated active region from which single crystal wires are precipitated under highly controlled conditions.

The development of nanowire building blocks over the past five years has proceeded at a phenomenal pace. This is because developers’ ability to control the growth process to produce nanowires of controlled diameter, down to 2nm, has allowed them to generalize the growth technique to produce nanowires covering a large variety of semiconducting materials, including group IV, III-V and II-VI semiconducting wires, and to dope the nanowire over a wide range of n- and p-type carrier concentrations.

Nanowire properties have provided incredible possibilities for use in electronics, opto-electronics, sensors and actuators, both at the individual nanowire level or in concert with one another. For example, there have been demonstrations of: transistor action from individual nanowires; superior p-type carrier mobility in single nanowire devices; nanowires with superlattices of constituents along the length and with the possibility of different chemical species in radial shells; the controlled preparation of p-n junctions; and light emission at p-n junctions and of single nanowire.

In addition to nanotubes and nanowires there are many more building blocks under development. There is, for example, great promise in nanosystems that bridge the organic and inorganic worlds. This offers the control that is possible with semiconducting nanowires plus the processibility and low costs that can be provided with organic constituents.

Nanostructures could also provide the necessary short transport lengths for the low mobility carriers typically associated with organic constituents.

Nanosystems bridging inorganic nanowires with nanoscale biological constituents with high binding specificity likewise offer great promise for using the direct electronic readout possibilities of the nanowires and the multifunctional sensor arrays that can be assembled by this route.

Already small companies are growing up around many universities and research institutes to develop the commercial potential of these recent developments. These activities are likely to lead to miniature and portable devices and instruments with high sensitivity and speed; new categories of sensors, actuators and detectors; greater coupling between the inorganic and organic worlds, as well as between the inorganic and bio-worlds; and more extensive use of simulation and design to optimize nanosystem performance.

Many conferences are being organized by the venture capital community and by government research funding organizations to look at what has been achieved in the laboratory.

Since the initial major advances in nanoscience, research funding to explore new ideas has become increasingly available worldwide for individual and team activities at universities or small commercial organizations.

Some of the nanotechnology claims are hype, but the demonstration of so many real achievements in the laboratory and the excitement of young people working in the field suggest that there is substance beyond the puff.

Mildred dresselhaus
Mildred Dresselhaus is professor of physics and electrical engineering at the Massachusets Institute of Technology.

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For nearly 100 years the medical community has been aware of heredity’s powerful role in human health and disease. Yet a wide chasm filled with scientific uncertainties has stood between that understanding of the principles of human genetics and medicine’s ultimate aim of alleviating human suffering. A bridge is now on the horizon. Equipped with our new-found knowledge of the genetic Book of Life – the human genome – the world’s leading scientists are laying the foundation for a genomics revolution that will change the face of medicine in the 21st century.

This is one revolution that should take no one by surprise. In contrast to most other ambitious scientific undertakings, the Human Genome Project (HGP) has been international since its inception. Although the US invested the largest amount in HGP, many nations – including the UK, France, China, Germany and Japan – have made critical contributions.

HGP leaders also agreed at the outset to release all mapping and sequencing data into the public domain immediately, making the information freely available to the worldwide scientific and pharmaceutical communities without restrictions on access or use.

Furthermore, in a highly unusual step for a basic science enterprise, the US HGP set aside 3-5% of its budget for research on the ethical, legal and social implications of this exponential increase in knowledge about humans’ genetic make-up. In the past, analysis of the ethical, legal and social consequences of a scientific revolution were often not addressed until after a crisis had arisen.

Taking full advantage of this multidisciplinary, multi-institutional, international approach, the HGP has attained historic milestones, while consistently running ahead of schedule and under budget. HGP scientists are currently on target to finish the sequence of all 3 billion base pairs of human DNA by April 2003 – more than two years ahead of schedule and coinciding with the 50th anniversary of James Watson and Francis Crick’s seminal publication of the double-helix structure of DNA.

However, now is not the time for leaders in the scientific, economic and political arenas to rest upon the HGP’s monumental achievements. Obtaining the sequence of the human genome is not an end in itself, merely the end of the beginning – and the start of the next exciting chapter in genomics and genetics.

Already the availability of genetic and physical maps produced by the HGP has dramatically accelerated the successful identification of genes involved in relatively rare, single-gene disorders. The next challenge is to apply information about the human genome sequence and its variants to identify genes that play a significant role in common human diseases, such as cancer, diabetes, heart disease and schizophrenia.

Although humans around the globe are 99.9% identical in their genetic make-up, the 0.1% difference is thought to hold key clues to individual differences in susceptibility to disease. Taking aim at that critical 0.1%, a five-nation coalition recently launched a highly ambitious, $100 million public-private venture, called the International HapMap Project, to construct a catalogue of human genetic variations and how they are organized along chromosomes.

Among those playing a pivotal role in that endeavour is The SNP Consortium (TSC), a collaborative genomics effort of major pharmaceutical companies, the Wellcome Trust and academic centres. TSC was the major force behind the creation of an existing public database (dbSNP) which describes 2.8 million genetic variants called single nucleotide polymorphisms (SNPs).

Following the lead of the Human Genome Project, the HapMap team has enlisted the help of ethical, legal and social experts to maintain and strengthen the delicate threads of societal trust, which are likely to come under strain as genetic and genomic research begin to intersect with the daily lives of people worldwide.

When completed, the HapMap will serve as a tool for researchers trying to discover the genetic variations associated with common diseases, as well as variations associated with differences in drug metabolism and with hallmarks of good health, such as longevity.

The development of new technologies and strategies for the large-scale, high-throughput generation of biological data at relatively low cost has been crucial to the success of genomics research in the past 15 years. However, there is still an urgent need to improve and add to our existing tool kit of technologies for performing high-throughput analysis of the human genome, along with the wide array of proteins produced by these genes. Indeed, one of my institution’s most audacious goals for the next decade is to establish technologies that will allow us to sequence a person’s entire genome for $1,000 or less.

Bear in mind that it will do people little good to learn about the genetic variations that predispose them to illness if medicine can offer no assistance in averting or treating such suffering. Identification of a gene or collection of genes that contributes to disease represents the initial step in a multipronged process of moving basic genetic and genomic knowledge into the medical mainstream (see diagram, right).

Typically, the first practical payoffs of a genetic discovery are new or improved diagnostic tests. By 2010 it is expected that validated, predictive genetic tests will be available for as many as a dozen common conditions. These tests will enable individuals who wish to learn more about their personal disease susceptibilities to take preventive steps to reduce the risk of their developing a condition.

Such steps could take the form of close medical surveillance such as more frequent mammography or colonoscopy screening, lifestyle modifications such as changing diet, avoiding environmental triggers or increasing exercise, or preventive drug therapy similar to the current use of cholesterol-lowering agents in people at risk of coronary artery disease.

Beyond diagnosis and screening

Gene-based tests will by no means be limited to diagnosing disease or screening for disease susceptibility. The discovery of genes for drug responsiveness is likely to lead to predictive tests to determine whether a person is likely to have a good or bad reaction to a specific pharmaceutical agent.

The expectation is that many such gene-drug correlations will be found over the next decades, fuelling the growth of a rapidly emerging field known as pharmacogenomics and eventually enabling doctors to tailor their prescribing practices to each person’s genetic profile. In short, medicine’s current “one size fits all” approach to managing patients will become a thing of the past.

One much-publicized application of genetic knowledge – gene therapy – burst on to the scene in the early 1990s, generating hope among patients that it could provide quick solutions to a long list of medical problems.

However, this strategy, which uses genetically engineered viruses* or other vectors to insert a “healthy” copy of the gene into an affected person’s cells, has suffered a series of disappointments over the past few years. These included the death of a young man in a US medical trial in 1999 and the development of vector-induced cancer in a child in a French trial in 2002.

Still, it remains likely – after researchers have spent more time at the bench answering basic science questions more thoroughly and developing safer, more effective vectors – that gene therapy will re-emerge to play a significant role in the treatment of some diseases.

Although grabbing fewer headlines than gene therapy, an equally promising or even more promising therapeutic approach is grounded in using new-found genetic and genomic knowledge to gain a better understanding of the underlying biology of disease.

Identification of each genetic variant conferring disease risk will point towards a critical pathway for that illness, often immediately suggesting targets for pharmaceutical therapy. Many of these pathways will come as a surprise, given our limited understanding of the molecular basis of most common diseases.

In response to the dominant role that genomics is likely to play in future drug development, the pharmaceutical industry is already gearing up to put in place efficient, high-volume methods of developing and designing the small-molecule drugs needed to target biological pathways.

At the same time, basic scientists are contemplating ways of using small-molecule compounds as probes in their efforts to chart more precisely the complex pathways affected by different genetic variations and gene mutations.

This area of activity is just one of several examples that highlight the potential for increased interactions between academic scientists and the private sector in the genome era.

Such efforts are already starting to pay off, as indicated by the development in 2000 of the targeted drug STI-571, or Gleevec, which has produced dramatic responses in people suffering from otherwise untreatable chronic myelogenous leukaemia.

Gleevec was discovered using information about an abnormal protein produced because of a genomic rearrangement found to occur in leukaemic cells.

Given the large amount of genetic and genomic information already collected about various types of cancer, it is likely that within the next two decades all cancer patients will have their malignancies genetically “fingerprinted” and their therapies will be individually targeted to those fingerprints.

In fact, by 2020 the impact of genetics and genomics on medicine is likely to be far more sweeping than any of us can envisage today. Among the developments we can expect are the introduction of new gene-based designer drugs for diabetes, high blood pressure, mental illness and many other conditions that currently take such a high toll on individual lives, as well as economic productivity.

We can also expect that the pharmacogenomics approach for predicting drug responsiveness will be standard practice for many common drugs and disorders. More predictive genetic tests for disease susceptibility will become available, to be used not only for people with a strong family history of a disorder but also for healthy people who are seeking to enhance their chances of staying well.

Despite these exciting projections, there will be tensions. Antitechnology movements, already active in the US and elsewhere, are likely to gain momentum as the focus of genetics turns even more intensely towards human applications. Efforts at public education need to start now to explain the potential benefits of genetic medicine and to be honest about the risks.

The public also remains deeply concerned ,about the possibility that genetic information will be misused in a discriminatory manner – an issue that must be dealt with effectively by governments worldwide. Even the most exciting clinical breakthroughs generated by genomic science will come to nought if they are met with a societal backlash.

As is the case with most other hi-tech medical advances, access to health care is a major issue. It is clear that millions of people in both industrial and developing nations will be deprived of new genetics and genomics advances unless many medical care systems change in significant ways.

Some observers also discount the importance of genomics to the developing world. However, a better understanding of the genetic factors that influence susceptibility and/or response to various infectious diseases, including malaria, tuberculosis and AIDS, could have a great impact on health in the developing world.

Furthermore, genomics holds the promise of reducing the research and development costs of vaccines and pharmaceutical agents, which should help make such products more available throughout the world. The continued vigorous support of science is critical to realizing this promise of a revolution in medical practice.

But science alone is no match for all these daunting global challenges. Sustained partnerships must be developed between leaders in the field of genetics and their counterparts in all realms of society – from public policy to international economics, from corporate decision-making to elementary education.

The World Economic Forum provides a strategic opportunity for such partnerships to be formed and strengthened.

Francis Collins
Francis Collins, MD, PhD is director of the US National Human Genome Research Institute.

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During the late 1990s it seemed as if there was an unlimited supply of capital, in both the private and public markets, to support technology innovation of virtually any sort. Today, with the collapse of sales and profits in the technology sector, it seems just the opposite. Entrepreneurs can be forgiven for wondering if anyone will step up to fund the next wave.

How can they, and we, tell how the capital markets will behave over the coming decade? And what can we expect from the technology industry in this changed environment?

To start with, there is no lack of venture capital in the market today. Nor is there any reluctance on the part of venture capitalists to invest. But there are several issues that are causing confusion.

The first is that the valuation of early-stage companies has plummeted from the normal levels of a few years ago. The reason is simple. The public markets have drastically devalued equities in the technology sector, meaning that venture exit valuations – be they at IPO or from acquisition – are dramatically lower.

Since venture capital’s willingness to put capital at risk is a direct function of expected return on investment, it must in turn lower its going-in valuations.

Pulling in the punters

Venture capital, in short, has not become scarce but it has become expensive, and entrepreneurs have to rethink their planning assumptions accordingly. We are back to the era of the early 1990s and before, when the key entrepreneurial talents were thrifty creativity boosted by a good dose of boot-strapping – a willingness to substitute time or “sweat equity” for money. It has become harder and harder to impress venture capitalists with just a great business plan: now they want to see some customer traction as well.

This ties into a second issue that has created confusion. The devaluation in the public financial markets is sending a message to the technology sector as a whole: there has been too much emphasis on discontinuous, “disruptive” innovation and too little on innovation that builds continuously and organically onto existing platforms.

In particular, the market would like to see more of the following:

• application innovation (which seeks out new uses for existing infrastructure);
• performance innovation (which enhances the effectiveness of existing applications);
• process innovation (which improves the efficiency of existing applications and of infrastructure);
• experiential innovation (which increases the value experienced by users and consumers of existing applications and infrastructure).

All forms of innovation create economic value. In an economic downturn, however, the less capital required to create the differentiation and the faster it can be translated into increased sales and earnings, the better.

In this context, innovation that leverages existing institutions will far outperform disruptive innovation. And so proportionately more and more capital will move out of the venture sector to fund continuous innovation until equilibrium is restored.

The world, in short, has overallocated capital to the asset class of disruptive innovation and it is now undergoing a portfolio-rebalancing exercise.

But that leads to a third area of confusion. How can venture capital be treated as a scarce resource when so many venture funds are awash with committed capital? The answer, I believe, is that current commitments are illusory. I base this view on the hypothesis that there is only so much disruptive innovation that can be economically absorbed in any given community over any given period. That in turn implies that there are only so many winning venture returns to be had.

Most venture capitalists I talk to believe that the total of winning ventures is far fewer than the number that could be funded by the capital currently allocated. Investing money beyond this limit is increasingly more likely to raise the denominator of the venture spend, but not the numerator of the venture return. The odds get worse and worse as the plays become more and more marginal.

It is critical, therefore, for venture capitalists to maintain strict deal discipline. Even more so in an era when disruptive innovations are getting a cold reception from the end customers they are intended to help. That is why the capital from top-tier venture funds will remain expensive and hard to get.

So what will happen to all the rest of the money? Much will be returned to the limited partners for allocation to other asset classes, and some will be put into non-venture investments (which will dilute overall returns, fudging the asset class and potentially corrupting the relationship with the limited partners).

The rest will be unwisely invested by indiscreet investors in unqualified start-ups (often, ironically, at inflated prices, since they want to put all their money “to work”), leading to significant losses and “turnover” both in the venture capital ranks and among their investing professional counterparts in the limited partner arena.

In sum, the venture industry has more than a little house-cleaning to do, and not all of it will be pretty. That said, what will the long-term impact be on technology innovation itself?

Over the next decade I predict that we will see a period of industrialization in the technology sector, an assimilation into the ranks of the mainstream economy, with technology assuming the status of a normal industrial sector, no longer a special case.

To be sure, there will be future “tornadoes” of growth around specific adoption life cycles, but they will not be the norm. Instead, organic growth on top of established bases will be the dominant source of economic returns.

I base this prediction on two observations. The first is that the disruptive innovation of the internet has only just begun to be absorbed, particularly in the business sector where it has the potential to recast completely the economics of supply chains and free up billions of dollars that are today trapped in non-value-adding work.

It will take this decade and more for companies to re-engineer their processes to take advantage of this new and marvellous global “work highway”. And until they have, there is little for them to gain by piling any more disruptive innovation on top.

The second observation is that we may be seeing the end of Moore’s Law – not through reaching any engineering limit, but rather an economic one.

For the past two decades, the doubling every two to three years of the price/performance ratio of computing has meant that the very architecture of computing has had to be recast every decade or so in order to take advantage of the new capabilities. That created massive waves of computing infrastructure deployment, which in turn drove equally massive waves of application deployment and created near-infinite demand for skilled consultants to knit all this together in a timely fashion.

The ephemeral high-tech company

The fundamental driver of the doubling phenomenon was the ever finer geometries of semiconductor processing, which permitted more and more transistors to be packed into the same area of a chip.

Since the cost of a chip is a function of its area, performance per unit of cost automatically increases at the rate that Moore first observed several decades ago. For the most part the industry has passed these savings on to its customers.

So what is changing? Not engineering capability – current thinking is that the industry will still be able to produce at finer and finer geometries for the foreseeable future. The problem is that the capital required to create the masks needed to use those geometries has escalated.

An ASIC chip design at 0.35 micron geometry, the state of the art a few years ago, cost about $2 million. To design at 0.13 microns, the current state of the art, costs more than $10 million per design. Going forward, the cost per design escalates further.

There are precious few markets that can return that kind of going-in cost, and so – even though the technical capability to do it will be available – fewer and fewer designers will avail themselves of it.

In this outcome, Moore’s price/performance escalator slows dramatically, meaning that there are longer and longer intervals between disruptive infrastructure swap-outs. That in turn means more and more emphasis on the forms of continuous innovation mentioned earlier. And that is what will make technology look more and more like other industrial sectors.

Of course, this is all quite speculative, but let us suppose for a moment that it is accurate. What then?

In the first stage of slowing we can expect the kind of consolidation that went with post-bubble developments in railways, telephony, automobiles and airlines.

In this phase operational excellence will become the value discipline of choice, and bigger – at least for a while – really will be better. Hundreds, if not thousands, of companies will go out of business. It seems at first glance like a nightmare prospect.

But look more closely. The company has always been the most ephemeral institution in hi-tech. Only one or two companies in today’s top 25 were in existence 25 years ago, and the top 25 of that era, but for IBM, are long gone.

By comparison, the underlying technologies still exist. (We still use the elements that made up artificial intelligence in the 1980s, although we have abandoned the term.) Editors note: artificial intelligence is definitely a thing in 2023. Se what Nils David Olofsson has to say about it.

So do the products (although they now live in the portfolios of the consolidating companies), the jobs (growing even more prevalent as customer industries themselves become more technology-enabled and -dependent), the customers (as more and more of the world economy becomes information-based), and the people (perhaps because no other industry will have us). So all is not as woeful as it might seem.

To conclude, the meteoric growth, the astounding infrastructure swap-outs and the resultant skyrocketing volatility in equity valuations should all subside. This, in turn, will allow public equity capital to re-enter the sector at reasonable cost in light of the lower risk profile, thereby stabilizing valuations on Nasdaq and other public equity markets.

There will still be a role for venture capital during this period but it will be modest rather than centre-stage, and in sectors adjacent to computing rather than at its core.

Computing itself can be expected to settle down to prolonged refinement and increasingly to play a supporting role to provide better collaboration, communication and content.

All in all, it should make for a “time-out” that both the industry and its customers desperately need. After that, of course, it is anybody’s guess.

Geoffrey Moore
Geoffrey Moore is chairman of The Chasm Group, a technology company based in San Mateo, California, and a venture partner in Mohr Davidow Ventures, a Menlo Park, California-based venture capital firm.

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Not so long ago, most people paid little attention to cybercrime. Malicious hackers, hi-tech bank robbers and identity thieves were the stuff of science fiction novels; few outside the industry of information technology had more than a passing knowledge of their damaging potential. As recently as 20 years ago, the role of computers was mostly behind the scenes. The data they contained were relatively easy to secure because they were rarely moved or communicated to other machines.

That is not to say that the computer industry ignored security. In fact, it has worked to address security and reliability issues for decades, helping to ensure that banks could safely process transactions, that flight control systems functioned flawlessly and that sensitive data remained in the hands of those authorized to use them. But this all went on behind the scenes – and the average citizen knew little about it.

The past few years have seen all that change. The amazing growth of PCs connected to the internet transformed the nature of computing, setting information free and creating tough new security challenges.

A number of malicious and highly publicized computer viruses demonstrated the importance of ensuring the integrity and security of these increasingly interconnected computer networks.

And the terrorist attacks of September 2001 reminded us that our computing infrastructure is as critical to our economy as our physical infrastructure – and that the safety of each is at least partly dependent on the other.

The convergence of these three developments – and the increasingly central role that computing will play in our lives in the coming years – has led to a renewed focus on ensuring that our computing systems and information are safe from harm. Yet security is just one of a broader set of challenges that must be addressed to realize fully the vast potential of computing. As people increasingly depend on computers, they need to be sure that computing systems are available and functioning properly whenever and wherever they need them.

They must also be sure that they protect their sensitive information from theft or loss, and that the companies providing services and handling personal information are adhering to fair information principles.

To make this happen, our computing systems cannot just be secure – they should be unfailingly trustworthy. We should be able to rely on them as we in the developed world rely on electricity or a telephone service today.

Although complete trustworthiness has yet to be achieved by any technology – power systems still fail, water and gas pipes rupture and telephone lines sometimes drop calls – these systems are usually there when we need them and they do what we need them to do. For computers to play a truly central role in our lives, they must achieve this level of trust.

Protecting cyberspace

As we move from a world of stand-alone desktop computers to an interconnected, decentralized global network, we face a number of new challenges.

The growth of the web has encouraged businesses to make large amounts of business data available on the Internet, so that they can work better with partners and suppliers and build deep customer connections.

Consumers are conducting more and more business online, sending sensitive personal and financial information over the network. And businesses are increasingly motivated to make their internal business data securely available to employees at home or on the go.

These trends create vast new opportunities to enrich our lives and rewire our economy, but they also offer a tempting target for vandals, criminals and terrorists. To meet these challenges, we must change the way we create software.

Many desktop applications were not designed to operate in a networked environment, and the core protocols of the internet were not initially designed to serve the 500 million users who rely on them today.

Much of this software has performed well in this new environment, but a lot of it must be refined, improved and rebuilt with security at the core.

At Microsoft we halted development on several key products and invested more than $100 million to evaluate our existing software for security issues, and to train our developers to build security into our future products from the ground up.

At the same time, the entire computer industry is working with government, law enforcement and business leaders to deter cybercrime at its source and build a secure digital future.

As the internet became a viable platform for commerce – another use not anticipated by its original design – the amount of sensitive personal and financial information exchanged on the Web has skyrocketed.

This has led many consumers to be concerned about the safety of their information and the potential for misuse, fraud and identity theft. In fact, such fears continue to hold back growth in Internet-based commerce.

Existing industry standards, business practices and regulations already do much to ensure that people can retain control over how their personal information is obtained and used by others.

Standards such as P3P help consumers understand and manage the disclosure of their personal information to trusted parties. Microsoft is collaborating with industry partners to develop sophisticated new tools that will enable companies to implement and assess their own privacy policies.

Nonetheless, industry and government must continue to improve the software and tools that preserve individual privacy. And industry must keep working closely with government to ensure that laws and regulations which protect consumers are followed.

Security and privacy are the most immediate short-term challenges today, but achieving trustworthy computing involves a host of other issues. For example, we must continue to tackle the complexity and stability issues that affect many systems today, both at home and at work.

Just as a homeowner has no fear that fitting a new lamp will break his refrigerator, computer users should not have to worry that installing new applications will destabilize their system.

Companies should feel confident about embracing e-commerce, knowing that they can always depend on their software to meet their evolving needs reliably. That is why Microsoft, along with a host of other companies and researchers, is working aggressively to create computing systems that will be self-managing, self-repairing and inherently resilient. Put simply, they will just work.

We are in the early years of a time I call the “digital decade” – an era in which computers move beyond being merely useful and become a significant and indispensable part of everyday life.

In the years ahead people will increasingly rely on computers to communicate and to be entertained, to run their lives and their businesses. This transformation has tremendous potential for enriching and enhancing our daily lives, while sparking a new era of growth for the global economy.

But for this to become a reality, we must first make computing as secure and reliable as it can be. Achieving truly trustworthy computing is a long-term challenge – perhaps a 10-year process – but considering the amazing opportunities the digital decade has to offer, it is essential that we meet it.

Bill Gates
Bill Gates is chairman and chief software architect of Microsoft Corporation.

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The Irish playwright and wit, Oscar Wilde, wrote in his political essay “The Soul of Man Under Socialism”: “Democracy means simply the bludgeoning of the people by the people for the people.” Given the fragile nature of democracy in Latin America today, many in the region will be empathizing with Wilde’s sentiments.

From Venezuela in the north to Argentina in the south, democracy in Latin America is under severe pressure. Yet for all that, the implementation and survival of democracy is the region’s biggest success over the past 20 years.

The extent to which democracy has become entrenched in the region has been most evident in the past two or three years. Since the turn of this century, nearly all of the main countries in Latin America have held free and fair elections. Last year alone, new residents set up home in the presidential palaces of Colombia, Bolivia, Brazil and Ecuador without needing military backing to get them there.

“The establishment of procedural democracy [meaning free elections] has been a fundamentally important development, and perhaps the region’s biggest political success,” says Edward Newman of the Peace and Governance Programme at the United Nations University, Tokyo, and co-editor of Democracy in Latin America: (Re)Constructing Political Society.

To western minds this might not seem much. Elections are commonplace – in fact to the extent that many people in first-world democracies cannot be bothered to turn up to vote. But Latin America is different. Coups and military rule have tainted much of its history. As recently as 1980, both Argentina and Brazil were under military rule.

“If you compare how things were in the 1970s, the situation is much better,” says Mark Payne, consultant at the Inter-American Development Bank. “You have mainly democracies, leaders elected through the democratic process and people who want democracies.”

This last point is borne out by the latest poll by Latinobarometro, a Chilean organization which has carried out surveys of opinions, attitudes and values in Latin America since 1995. Covering 17 countries, the poll reveals that support for democracy has increased in 14 of them over the past year, most notably in Nicaragua, Mexico and Venezuela.

Even in Argentina, where the economy is in such a slump that in the bad old days support for military rule would have skyrocketed, the people’s endorsement of democracy is higher than it was in 2001. A presidential election will take place there next year (although there is confusion over whether it will go ahead in March as presently scheduled).

Notwithstanding the extent of the economic and social disarray in the country, Argentina will turn things around by democratic means.

“One of the few positive aspects of the Argentine collapse is that there is no questioning of democracy,” says Kurt Weyland of the University of Texas.

Remarkably, despite the economic mess the region finds itself in, support for authoritarian government is not increasing – and in Brazil, Colombia and Venezuela it has declined significantly. Only in Paraguay has it increased substantially since 1996, although even there more people prefer democracy.

“The survival of democracy in Latin America is not in doubt,” says Weyland. “These democracies will be maintained in their minimal form. As the failed coup in Venezuela [in April 2002] shows, there might be instances where significant sectors have an interest in overthrowing democracy but, partly due to international constraints, it’s not really feasible.”

No one doubts that democracy is in a fragile state. “While democracy has certainly come a long way in our region, it would be a mistake to consider it a done deal and turn our attention to other matters exclusively,” wrote the former Costa Rican president and Nobel Peace Prize laureate, Oscar Arias, in a newspaper article last year.

The most revealing conclusion to emerge from the Latinobarometro poll was that the respondents were, for the first time, beginning to distinguish between democracy as a system of government and the manner in which particular governments are performing. In short, respondents prefer democracy to any other system but are not necessarily satisfied with the way it is working. As a result, democracy’s survival might not be under threat, but its immediate future looks murky.

Not all countries, of course, are in the same boat. Mexico is a more advanced democracy and has a much stronger economy (although social problems remain) than Brazil or Argentina – where the democratic system is not under threat but society is struggling against economic instability, which is hindering development of the political system. In turn, these two countries are in a much better state than Colombia, for instance, which is paralyzed by a civil war. In Colombia the political system is in danger of collapsing.

Underlying democracy’s frailties is an economic crisis which has engulfed much of the region. Latin America suffers from massive inequality and high rates of poverty, violence, crime and corruption.

The region might have left hyperinflation behind but is stuck instead in a growth rut. Even the stronger economies are expected to put in only a modest performance this year and next. Chile’s economy, for example, is slated to grow at 2.5% in 2003.

“A number of countries are under significant socio-economic stress, which is having negative political consequences,” says Thomas Carothers of the Carnegie Endowment for International Peace.

Many Latin Americans blame the neo-liberal economic reforms of the 1990s for their plight. “Deregulation has weakened civil societies, unions and political parties, all of which are important elements in the implementation of a vibrant pluralistic democracy,” was the conclusion of a recent meeting of the Woodrow Wilson International Center for Scholars.

Carol Graham of the Brookings Institution in Washington, DC, says: “Simply put, only the very wealthy are satisfied with how the market is working … dissatisfaction with market policies is more evident in the middle class.”

Nowhere is this more evident than in Argentina. The decision taken by Domingo Cavallo, the former economy minister, to freeze savings accounts, now rescinded, hit 1.2 million people – most of them middle-class. In a country that has long prided itself on having the largest and best-educated middle class in Latin America, the erosion of middle-class wealth represents a big step backwards.

The Argentine situation typifies the fragility of Latin American democracy. People are fed up with the political elite, which shows no sign that it can or will solve the country’s woes. “People want a total change,” says Rosendo Fraga, a political analyst, “but, paradoxically, politics is going in exactly the opposite direction.”

Part of the problem with Latin American democracy is that it is relatively young. “It’s so new that people have yet to learn what it can and cannot achieve,” says Ernesto Zedillo, the former president of Mexico who, in 2000, orchestrated his country’s first peaceful transfer of power after 71 years of uninterrupted rule by a single political party. “It also needs time to be provided with stronger and more efficient institutions to make it work better for the pursuit of other ends which are very important for our societies, such as economic and social development.”

As Argentina is amply demonstrating, many of the mainstream political parties are failing to connect with the populace. “One of the main institutions of democracy – the political parties – is discredited, is in disarray and is being rejected by voters in country after country,” says Michael Shifter of the Inter-American Dialogue.

The fate of perhaps the most famous Latin American party – the Peronists – illustrates this well. Founded in the 1940s by Juan Peron, a nationalist, and his celebrated wife Eva, the Peronist party is one of the country’s few remaining institutions. Today, though, the party is in disarray, torn apart by infighting. Chief among the protagonists are Eduardo Duhalde, Argentina’s interim president, and Carlos Menem, who governed the country throughout the 1990s.

Their disagreement dates back to 1999 when Duhalde, then vice president, prevented Menem from running for a third term. Duhalde then stood himself but blamed his rival for sabotaging his campaign as he lost to Fernando de la Rua of the Radical Party. Now Menem is seeking to be the Peronists’ candidate for next year’s presidential election. Duhalde, who will step down, would prefer almost anyone else.

All of this is making a weak government even weaker and postponing what little chance Argentina has of beginning its economic salvage operation in the next few months. Many Argentines have already given up on their government and are joining civic organizations. Graffiti tell Argentines: “The state deserted you; organize yourselves.”

That is what they are doing. There are 2,000-2,500 nongovernmental organizations and more than 4,500 barter associations in which the cash-strapped exchange goods. The members are not fed up with democracy itself but rather with the way Argentine democracy is being expressed.

“You have democratic governments that perform very badly, don’t deliver for the people and don’t generate confidence in the system,” Shifter says of Latin America. This has nothing to do with economic failings but something more basic – poor leadership. The irony for many Latin Americans is that, at any given election, there might be a dozen candidates seeking their votes, but none of them is any good. “Latin America doesn’t have a good enough calibre of leaders and it really makes a difference,” Shifter says.

In Peru, for example, where the economy is growing at 4% and inflation is only 2%, president Alejandro Toledo’s approval rating stands at a mere 23%. This is because of Toledo’s personal shortcomings and his inability to fulfil the Peruvian people’s expectations. In June he broke a campaign promise by privatizing two electricity firms in Arequipa, Peru’s second city. This led to massive protests, which ultimately brought down senior members of his cabinet. Now foreign investors are unsure how keen Toledo is to initiate further reform.

Given the poor choices before them, it is hardly surprising that in recent elections Latin Americans have voted, if possible, for a nonconformist candidate – Luiz Inacio Lula da Silva in Brazil, Alvaro Uribe in Colombia and Lucio Gutierrez in Ecuador.

Of the three, Uribe is least likely to cause furrowed brows in neo-liberal and conservative circles. A right-leaning independent politician who describes himself as a democrat with authority, Uribe’s instincts are similar to those of many members of president George W Bush’s inner circle.

In May Uribe became the first candidate to win Colombia’s presidential election without needing to go to the second round of voting. The electorate will be hoping that his hardline stance will rein in the paramilitary groups that have torn Colombia apart over the past decade. Uribe wants to create a million-strong civilian force to support the already stretched army. The president also refuses to enter negotiations with the paramilitaries until they give up their violent actions.

Despite the fact that his uncompromising attitude will entail increased spending on defence, donor bodies continue to give Uribe their full support. In October the IMF said Colombia would be able to draw on about $1 billion a year over the next two years as part of a renewed support agreement, which is to be signed this year. The IMF says it will also support Colombia with extra emergency aid if needed.

In Brazil and Ecuador, meanwhile, Lula and Lucio will be hoping that the IMF will prove as generous to their own causes. Neither of the two, though, is likely to be the favourite leader of the Washington-based institution. Lula, in particular, has been a big thorn in the side of many neo-liberals, and he has only just taken office.

Many promarket investors and officials worry that Lula, a former trade union official, will push a sick Brazil over the edge with statist policies which are at odds with the liberal ideology that has governed Latin America over the past 10 years. Lula, they believe, will initiate policies that will prove to be the ruin of the Brazilian economy. Critics have branded him a populist.

Zedillo believes that populism is one of the biggest threats facing Latin American democracy. “When a true ethics of responsibility, rather than a constant and irresponsible pursuit of short-term personal popularity, becomes more the norm and not the exception in political behaviour, we will find it much easier to make progress on all fronts,” he says.

Others, though, are less concerned about the accusation of populism levelled at Lula. “In some sense it’s a pro-democracy vote, because the will of the people will be enacted,” says Weyland of the University of Texas. In any case, it is unlikely that Lula will have the power to stray too far from the centrist policies of his predecessor, Fernando Henrique Cardoso.

“The leadership of the PT [Lula’s Workers’ Party] is very aware of the fact that you cannot challenge the market model and the external forces that maintain it, because otherwise you will shoot yourself in the foot,” Weyland says. “Lula will have to adjust to the external constraints. This is the reality.”

This raises an altogether different question about democracy and national sovereignty. Who runs developing countries – the governments voted in by the people or the external financiers who provide much-needed cash but look for certain assurances in return?

Certainly throughout last year, in the run-up to the Brazilian election, the market was trying to influence the outcome. Whenever a new opinion poll was released showing Lula with a strong lead over his rivals, investors began to sell Brazilian assets sharply as a warning of things to come if he were to win. At one point, Brazil’s risk premium – as measured by the spread of its bonds over US treasuries – was over 20%.

In the end, the Brazilian people ignored the will of the market and voted for Lula in their millions. Whether Lula will be able change the status quo or whether, as Weyland suggests, his hands will be tied remains to be seen. What is clear is that even some wealthy members of society want a change in emphasis away from traditional neo-liberal policies. And according to Latinobarometro, this trend is not unique to Brazil.

“Wealthier, more educated and presumably more secure people seem to be attributing higher value to the role of government and social welfare spending than they did in the past,” says Graham of the Brookings Institution.

If Lula or any other leader can initiate radical economic policies that will help alleviate poverty and income inequality without upsetting foreign investors and the Washington institutions, that would be ideal.

As Carothers of Carnegie says, “The big question is, can you develop economic policy that responds directly to poor people but takes the country forward as a whole? It’s not impossible. Chile managed it.”

But even during these dark days, the citizens of Brazil, Argentina and other Latin American countries should remember how far they have come. Politics is becoming more fragmented. Traditional policies and traditional politicians are being rejected, but belief in democracy remains strong.

Even the attempted coup in Venezuela has a silver lining in the fact that it failed and that Hugo Chávez, despite his faults, remains the elected leader.

Nancy Birdsall, president of the Center for Global Development, says that over the past decade Latin America has taken “two steps forward, one step back”. She adds: “It’s naive to think that it’s going to be easy. But despite the setbacks, and the risk of setbacks, the entrenchment of democracy has been the region’s biggest success over the past decade.”

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A strong spirit of solidarity unified the two sides of the Atlantic in the immediate aftermath of the attacks of September 11, 2001.

Le Monde spoke for everyone on the Old Continent when it declared, “Nous sommes tous Américains.” Yet, by the end of 2002, the US and Europe seemed further apart than they had been before the terrorist attack.

The arguments about economic issues such as steel and farm subsidies were nothing new. But disagreements about questions of foreign and defence policy, such as Iraq and the Middle East, were more acrimonious than earlier transatlantic disputes had been. Indeed, some Russian commentators pointed out that George W Bush’s relations with president Vladimir Putin were much smoother than with many west European leaders.

On the European side, leaders have become frustrated by the Bush administration’s tendency to act without consulting allies (as in the military campaign in Afghanistan) and by its reluctance to be constrained by international treaties and organizations (saying “no” to the Kyoto Protocol, the Comprehensive Test Ban Treaty and an enforcement mechanism for the Biological Weapons Convention). There is also disquiet about US enthusiasm for deploying the hard sort of power, as opposed to the softer sorts (such as peacekeeping, economic aid and other contributions to nation-building).

On the US side, senior figures in the administration have concluded that the Europeans are parochial in their world-view, slovenly in their reaction to the threat of weapons of mass destruction (WMD) and pathetic in their military capabilities. Some even accuse the Europeans of instinctive anti-Semitism.

Max Boot, a respected commentator with the Council on Foreign Relations, echoed the private views of some in the US administration when he wrote in November 2002 that “Europe has a long history of appeasing terrorists and rogue rulers, from Mohamar Gadhafi to Saddam Hussein”. He said Europeans felt free to ignore the threat from Iraq “because they have got into the habit of outsourcing their protection to the US”.

Boot continued: “On issue after issue, America acts, Europe acts up… The Europeans have adopted the attitude of a petulant 16-year-old toward his parents. Oh well, that’s what the Americans get for being the grown-up in this relationship.”

Some Europeans are just as rude in their criticisms of the Bush administration. So how have transatlantic security relations reached such a sorry state? There appear to be four immediate reasons.

One is the Israeli-Palestinian conflict. The problem here is not that the US and European governments are far apart, at least in their declared policies. The so-called “Quartet” – represented by US secretary of state Colin Powell, UN secretary general Kofi Annan, European Union foreign policy head Javier Solana and Russian foreign minister Igor Ivanov – has just about succeeded in maintaining a common front.

The different EU governments have their own emphases to make, but agree – as does the US state department – on the fundamentals of what needs to be done – an exchange of land for peace. However, sharp differences within the US administration – with hardliners such as defence secretary Donald Rumsfeld talking of the “so-called occupied territories” – have weakened the Quartet.

A more fundamental problem is that on this issue, unlike most others in transatlantic relations, public opinion cares deeply but thinks differently on the two sides of the Atlantic. Most Europeans think the government of Ariel Sharon in Israel should take much of the blame for the current situation and that the US is not doing enough to pressure Sharon. Many Americans support Sharon in his refusal to negotiate with Palestinians as long as Israel is the victim of suicide bombings.

The worrying thing about public opinion taking an interest in foreign policy is that it is liable to influence politicians. There were some striking examples last April: the European Parliament passed (non-binding) motions calling for sanctions against Israel, while the Israeli lobby in the US forced Bush to back down after he had told Sharon to withdraw from Palestinian lands “without delay”.

The more public opinion influences foreign policy on the two sides of the Atlantic, the harder it will be for senior politicians in the EU and the US to maintain a common line on the Israeli-Palestinian situation.

In the autumn of 2002, UK prime minister Tony Blair was one of the European politicians who urged the US to convene a Middle East peace conference. Although Powell had made the same suggestion in the summer, the White House seemed uninterested.

The second big problem is Iraq. The fact that every EU member supports the tough UN resolution on weapons inspections should not obscure the fact that European and US perceptions of the threat are very different.

Most European leaders do not agree with Bush that Iraq is as big a danger to world peace as Al-Qaeda. Unlike Bush and his advisers, they think that containment and deterrence will prevent Saddam from using his WMD against people outside Iraq. And they fear that a war against Iraq would absorb energy and effort from the war against terrorism.

Of course, the big European countries have had their own varied approaches to Iraq. The UK is apparently prepared to support Bush under any circumstances, while France led the successful effort to give the UN a role and Germany has refused to take any military action.

Nevertheless, public opinion in the various European countries remains consistent: it will only support a war that is backed by the UN. And despite the differing approaches of the British, French and German governments, most European leaders have a similar strategic objective – to keep the US within a multilateral framework.

Indeed, European leaders are so concerned about the danger of US unilateralism that they will sign up to almost anything in an effort to get Washington working with the UN.

If in the end there is a war in Iraq, there is a fair chance that the UK and France will send troops to fight alongside those of the US. But Americans would be wrong to assume that the Europeans were sending troops because they shared Bush’s perception of the danger of Saddam’s WMD. They would be sending troops because they feared the consequences for the world order of the US acting alone.

The third big problem is the widening gap in military capabilities between the US and the EU. Throughout the Cold War and the decade that followed, the ratio of defence spending between European members of the North Atlantic Treaty Organization (Nato) and the US was remarkably constant: the Europeans spent about 60% of what the US did.

That has now changed. The US defence budget has risen from $280 billion in 1999 to close to $400 billion in 2002, but European spending has stayed roughly the same. The European/US ratio is now nearer to 40%.

Budgets are only part of the problem.

The Europeans continue to spend too much money on old technologies and large conscript armies, rather than new technologies and small, mobile forces. The Europeans lack the new communications technologies that enable the Americans to engage in “network-centric warfare”. American commanders complain that it is becoming increasingly difficult to work alongside Europeans.

Following the experience of the Kosovo air campaign, during which the European performance was underwhelming, the Pentagon chose to run the Afghan war on its own terms. Offers of military help from Nato allies were for the most part spurned.

But the immediate consequence of the Afghan war was not a dramatic surge in European defence budgets (although the UK and France increased theirs). Nor was there a rapid acceleration in the pace of military reform (although Italy and Spain have begun to follow France’s example by professionalizing their forces). Nor yet was a decision made to purchase badly needed capabilities, such as more heavy-lift aircraft (although at the Nato summit in November some European governments agreed to team up to buy transport aircraft).

The consequence was more whingeing about American contempt for Nato, the lack of consultation and the rebuffing of European offers of support.

The fourth problem has been that, at a time of new and dangerous global threats, the Europeans have failed to rise to the challenge. Neither their Common Foreign and Security Policy (CFSP) nor their European Security and Defence Policy (ESDP) has impressed the US.

Solana has earned some credit for his deal-making in Montenegro and the Former Yugoslav Republic of Macedonia. But the CFSP remains hamstrung by the system of a rotating presidency, under which a new member-state takes over every six months. Thus Belgium was in charge in the months after September 11 and the view in Washington was that the Belgian foreign minister, Louis Michel, was not up to the job of speaking for the EU.

As for the embryonic ESDP, any mention of it in Washington is likely to provoke raucous laughter. The ESDP was supposed to take over Nato’s peacekeeping job in the FY Republic of Macedonia last January. But a Graeco-Turkish argument about EU access to Nato assets means that Nato is still running the show.

The gap between the proud rhetoric with which the Europeans launched the ESDP and its lamentable performance only reinforces the argument of those Americans who claim that the EU will never be a serious global player. Until the Europeans present a more coherent and effective CFSP or ESDP to the rest of the world, they cannot expect a huge amount of respect from Washington.

Perhaps surprisingly, during a year in which US-EU relations have become severely frayed, the rapprochement between the Bush and Putin administrations – already evident in the months before September 11 – has deepened.

The Russians have swallowed some bitter pills such as the scrapping of the Anti-Ballistic Missile Treaty, the enlargement of Nato into the Baltic, the semipermanent presence of US forces in central Asia and the UN’s tough stance on Iraq.

In return Putin appears to have won Bush’s genuine respect and friendship. This is likely to pay economic dividends in terms of Russia’s application to join the World Trade Organization, investment in its oil industry and the protection of its interests in Iraq.

More importantly, however, Putin has gained carte blanche in his handling of the Chechen problem. Given Bush’s insistence on a connection between Al-Qaeda and Iraq, he can hardly complain at Putin’s insistence that the fighting in Chechnya is part of a global war against terrorism.

During the course of 2002, the Russians’ growing disdain for the EU and their increasing warmth for the US have been palpable. There have been plenty of irritants in Russia-EU relations, including arguments over visas for the Russian exclave of Kaliningrad, gas exports that breach EU rules on competition policy and the Europeans’ annoying habit of saying that Russia should negotiate with the Chechens.

In October this author heard one Putin adviser say, “America is a serious superpower with which Russia can do business. Unlike the EU, but like Russia, the US is a dynamic and fast-growing economy. And unlike the EU, but like Russia, the US is a serious military power. The US is our natural ally.”

However, for all the strains between the EU and the US, the prospects for transatlantic relations are far from dire. Although the Europeans may wince at the unilateralist comments of Rumsfeld or vice president Dick Cheney, more moderate voices win some of the battles in the Bush administration.

As long as Colin Powell, CIA director George Tenet and Bush’s political adviser Karl Rove are present in these battles, the president may end up pursuing a multilateralist course, as he did on Iraq in the autumn. Bush showed that he was prepared to give the UN a chance to tackle Saddam’s WMD. If Saddam messes around with the UN inspectors, most European governments will support military action against Iraq.

On the Middle East, the Quartet is holding together. Powell appears to share the view of the other members that, whatever happens in Iraq, the Israeli-Palestinian peace process needs to be kick-started as soon as possible.

On the rows over military capabilities and consultation, there may be cautious grounds for optimism. Although the US was initially reluctant to work with its allies in Afghanistan, almost every Nato member now has its armed forces working there.

And Nato’s Prague summit in November approved the US-inspired Nato response force, which is designed to engage in high-intensity warfare in distant places. This force shows that the Bush administration is keen to find ways of making Nato useful and relevant, and it may spur the Europeans to modernize some of their capabilities.

Finally, the Europeans are showing signs of reforming their institutions, albeit slowly. The current European Convention on the future of Europe is likely to streamline decision-making in foreign policy, for example by scrapping the rotating presidency of the CFSP.

Therefore there are cautious grounds for optimism. If Bush can make an effort to re-energize the Israeli-Palestinian peace process, if he continues to tackle Iraq within a UN framework, and if the Europeans can boost both their military and diplomatic capabilities, the transatlantic bond is likely to remain the closest between any two continents.

Charles Grant
Charles Grant is director of the Centre for European Reform, an independent think-tank based in London.

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