Challenge and Response, 1800–1980

The economic history of the Middle East ^* in the last two hundred years has a dominant theme: impact and reaction, or challenge and response. The impact, or challenge, was that of industrializing, capitalist Europe, expanding all over the globe in search of food, raw materials, markets, and outlets for its energy, capital, and population, quite determined to ensure that the rules of the economic system under which it operated were observed by the rest of the world—if necessary through annexation. The reaction, or response, of the Middle East was slow in coming and gathered momentum only in the present century. For hundreds of years the region had been stagnating, or even retrogressing, ¹ and many decades passed before an awakening to contemporary realities, a growing strength, and a combination of favorable external circumstances enabled it to respond to the challenges posed by European economic and political dominance.