FORTUNE — Marhaba and hello. In March, I visited the Mohammed bin Rashid School of Communications at the American University in Dubai, where I sit on the advisory board with prominent regional business leaders. After some students presented reports to us in fluent English, I was surprised to hear my fellow board members say bluntly that their native language is “in crisis.”
It turns out English is fast becoming the only language of a new generation of educated Arabs.
This isn’t a good thing for the region or the rest of the world. (I’ll get to that in a moment.) The journalism school at the AUD is the only modern program in the Middle East that allows students to study in Arabic. Still, many students arrive poorly versed in written Arabic and the formal spoken language and require refresher Arabic language courses.
Literacy in the Gulf States is 98%, according to Unesco. But that literacy is increasingly in English, not Arabic.
This English bias starts early, with children in private “model” schools in the United Arab Emirates studying their full curriculum, including math and science, in English. But state schools are pushing a pro-English agenda too. Professor Patricia Abu Wardeh, who has lived in the UAE for 16 years and in the region for more than three decades, laments that the UAE’s government-sponsored Zayed University offers no major in Arabic.
The trend appears to be taking hold regionwide. In Saudi Arabia, many upper-middle-class families speak English at home — not just at work — because, as one knowledgeable source told me, parents fear Arabic isn’t sophisticated.
One Emirati CEO told me his own children do not speak Arabic fluently. He said he put them in English schools to help ensure they’d have great career prospects. But now he says he regrets that his children don’t feel comfortable speaking the language of their forefathers.
Why the anxiety among these elites? It isn’t just sentimental. The bifurcation of wealth, a key part of Arab Spring uprisings elsewhere in the region, is mirrored in the bifurcation of language. I am continually told that what I’ve experienced anecdotally is true: The wealthier the family, the less likely its members speak Arabic at home. If people in the same country don’t speak the same language, how can they work across class lines to solve the problems of high unemployment that plague even oil-rich Saudi Arabia? (SM Advisory Group says 20% is an extremely conservative estimate for Saudi joblessness.)
For executives trying to build local businesses, the English bias is a challenge. The dean of the AUD’s school of journalism, Ali Al Jaber, told me, “If you can’t address your own people, then you can’t be successful.” Pierre el Daher, the CEO of broadcaster MBC, says hiring journalists is a challenge because fluency in both English and Arabic “is a rare quality.”
Sure, English is the world’s business language. More Chinese are learning English right now than there are Americans in the U.S. But China has struck a bilingual balance. Its research universities teach some of the world’s brightest minds in Chinese. Professor Wardeh finds much for Arab nations to admire in this model: “If you’ve got your head screwed on right,” she tells me, “you’ll do it like the Chinese.”
Arabic is a beautiful language to hear, and Osman Sultan, the CEO of wireless giant Du, told me he’s seen elites learning new Arabic words, post-Arab Spring, because they want to connect with an emerging regional identity. Tom Speechley of UAE-based Abraaj Capital says Arabic language content is the fastest growing segment of the Internet, thanks to surging mobile use among the masses. Here’s hoping that surge helps convince government leaders and the upwardly mobile that Arabic is part of their economic future, not a cultural relic of the past.
Erin Burnett is the anchor of CNN’s Erin Burnett OutFront.
This story is from the May 21, 2012 issue of Fortune.