Economic development is a key. But so is minimizing Iranian influence.
Look at the United Arab Emirates... Not many Terrorists there.
In fact, look at the difference between the "Northern" Middle East and the Southern Middle East... There is really two different Middle Easts when you think about it.
I think it has to do with the Iranian sphere of influence also...
Iran destablizes it's neighbors. Get rid of Iran and create economic development and what do you know: No more terrorism.