Causal Connections Between Education and Investment [Archives:2000/30/Business & Economy]

July 24 2000

Dr. Abdulaziz
The term “investment atmosphere” refers to the conditions and circumstances in which any investment takes place. It also implies the impact of these situations, negative or positive, on prospects of success of investment projects. The expression also includes political, economic, social and security conditions and circumstances besides legal, organizational and administrative frameworks. Availability of a proper climate for investment is considered an essential condition, but not a guarantee for success of any investment process.
During the period 1975-1995, Arab states achieved considerable success in surmounting obstructions in investment through efforts in structural and economic reform policies. That resulted in a noticeable improvement in the investment climate. Despite these successes in economic policies, movement and trends of Arab investments are still behind Arab aspirations.
Causal relations between the educational level and the efficiency of taking investment decisions based on realistic experience have to be analyzed in the context of the latest, remarkable economic progress which East Asian countries have achieved, popularly known as the “East Asian Miracle”. Different studies on this experiment have indicated that investment in education played a major role in increasing efficiency of investment in various production fields in those countries. The splendid development in the technology of information and media led entrepreneurs in advanced countries to urge upon their governments to take practical steps to encourage building up of international societies of information. This move intensified efforts to revitalize education as a natural gateway to promote the people’s potential to cater to the needs of the society. The appeals for this purpose were made not only to the governments of the developing countries but to those of the advanced countries as well whose educational system is more progressive. That is the reason why computers, information nets and CD head readers constitute an integral part of daily activities of giant companies and huge government institutions; but they are rarely employed at educational institutions despite their inherent advantage as educational aids.
East Asian countries’ experience indicates that development model based on the state’s selective intervention in economic affairs leads to tremendous results in development. Importance of such a model consists in the selective intervention of the state in investment in the field of forming human capital via government spending on education at all stages.
In Yemen, the last four decades have witnessed sizeable expansion in the public sector and improvement in the state’s economy as a result of a number of factors and increase in oil revenues, together with a boosted confidence in the efficiency of the state and its public sector especially after September 26 and October 14 revolutions. The state has modified its production structure and has pushed ahead its development process which both the Imamate and the period of colonization had blocked. The basic issue, however, did not relate to a dialectical differentiation between the public and private sectors.
The choice of the public sector was perfectly logical and had its clear justifications. Besides its commonly agreed role as in generating the national wealth (viz. oil revenue), it was capable of coping with trends of development plans and supporting sustainable development, administrative funding and marketing services with a view to developing expertise in new sectors, which the private sector could not manage then. However, the most dangerous problem facing Yemen has been illiteracy. Therefore, the state is accountable for providing required cadres and, at the same time, developing infrastructures and basic services, especially education including higher education and scientific research. The public sector still continues to be in charge of strategic affairs backed by a sound administration. On the other hand, the limited size of the existing private sector calls upon the government to accelerate the pace and quality of administration of the sectors.
While adopting a comprehensive economic and administrative reform policies, the Government should reconsider ways of using outputs of foreign and local scientific and research institutions by offering better salary and wage scales, granting them moral and financial support, improving their living and social conditions and so forth. The government should also ensure a suitable scientific environment for growth and optimization of talents of such groups for building a national pool of human resources.
The absence of sustained efforts to harness the brain power for promotion of national efficiency commensurate with the needs of development, and under utilization of their talents has encouraged their migration in quest of better amenities. This phenomenon would certainly obstruct the process of social development and lead to retardation in efficient performance of duties at universities and scientific research institutions, which constitute vital and significant sources for feeding and supplying policy-makers with information, statistics, political, economic and social analysis for a balanced development.
Compared to some Arab countries the percentage of illiteracy in Yemen is over 60%. The number of Yemeni graduates in 1994, compared to the Arab in countries according to the UNDP, is 0.2 per 1000.
In view of the prevalent shortcomings in the field of scientific research in Yemeni universities, dependence on overseas expertise is currently the only available option for years to come.This necessitates increasing financial allocations for scientific research and higher studies, making full use of the huge potentialities available in Arab and friendly countries and utilizing the relevant international programs.
This underscores the importance of scientific research in Yemen. In order to provide a congenial climate it is essential to accelerate economic and administrative reforms which could be achieved through:-
1 – the creation of specialized research centers and providing them with highly qualified scientists and researchers,
2 – encouraging overseas education making it relevant to solve the problems of Yemen at the grassroots level
3 – mobilizing financial support to meet the expenditure on researches undertaken by our scholars-which include gathering information, preparation of researches, typing works, as well translation works in case the research was prepared in a non-Arab country,
4 – allocation of funds for students’ travels,
5 – formation of specialized committees for research in various aspect of economic, political, social and administrative importance under the control of the Minister of Education. Each committee would prepare a budget for the funds needed,
6 – making it obligatory for scholars abroad and inside to a condition that the subject of their research should relate to some aspect of the country’s scientific, economic, social, political and administrative progress,
7 – activizing private universities which by and large lack the simplest fundamentals of higher education and scientific research with poor teaching staff and poor research and lab equipment. It is a mere commercial trend and the State has to intervene in reviewing the role of these universities and laying rules and regulations to improve the quality of higher education and scientific researches at these universities,
8 – coordination in and integration of the activities of these universities so as to benefit the society in finding solutions through scientific research. None of these universities exploit the potentialities available with certain institutions, corporations or Projects through organizing training courses during vacation. I suggest that the Higher Board of Universities takes this point into serious consideration.