ESCWA. The present study contributes to the elucidation of the concept of democratic governance, which does not translate as less State but rather as more effective State policies and institutions. This entails the construction of country-specific indicators. The study also attempts to place democratic governance in the context of Arab countries in transition and analyses the challenges of the transformative process that these countries have begun. Emphasis is placed on the methodological issues facing the construction of indicators and indices, as well as their many potential uses. The objective is to initiate debate on governance and its role in steering the transition process.