Within US policy circles, the Muslim Brotherhood is often spoken of in somewhat of a hushed tone, often times in conjunction with ominous phrases like "Islamo-fascism" or "jihadi extremism."
I was therefore dismayed but not surprised to read Foreign Policy's most recent take on the political situation currently playing out in Egypt. Mohamed el-Baradei's "commitment to liberal reform" is questionable, writes Ilan Berman, because (and here's where the hushed tone comes in) he has been "flirting with the Muslim Brotherhood." This "flirtation" is in reference to Baradei's outreach to the Muslim Brotherhood (and virtually every other opposition group and party within Egypt) in his effort to cobble together a coalition for political reform -- what he has called "The National Coalition for Change." Berman goes on to explain that the Muslim Brotherhood is "the world's most influential font of radical Islamic ideas" and that, as a result, "if the Brotherhood is joining a coalition committed to political liberalism, it's clearly not for ideological reasons." There were lots of other factual inaccuracies, analytical shortcomings, and gross mis-characterizations in the essay -- but I'll spare you.
Ilan Berman, as far as I could tell, seems to have limited expertise in local Egyptian politics (indeed there seems to be quite a trend these days of alleged Egypt 'experts' writing dispassionately about the upcoming elections). It was therefore an incredible relief to find that Foreign Policy had also published an eloquent and thorough rebuttal of Berman's article, which effectively debunked every single statement made in the piece. Samer Shehata, a professor at Georgetown, is actually an Egypt expert, having spent extensive time living and researching in the country. He has an impressive understanding of domestic politics and the various political actors in the country -- and it shows in his response.
I won't elaborate the various points Shehata makes, as they are stated better by him. His broad critique, however, is that the Muslim Brotherhood is "far from the radical threat portrayed by Berman" and that in fact it is a diverse Islamist movement with a history that extends back farther even than the current regime and that it's role in Egyptian politics is incredibly complex.
The latter is a point that is far too infrequently made in Washington (or anywhere in the US, besides the odd university seminar room). The 'hushed-tone' attitude surrounding the Muslim Brotherhood is really unfortunate. The movement certainly has had violent episodes in its past and there are factions in it today that espouse a more uncompromising bent of political Islam. But the Muslim Brotherhood is also arguably one of the most moderate Islamist groups in the Middle East today and many of its members are open-minded, well-educated professionals who are happy to embrace and participate in a liberal political system. Indeed, it is hard to imagine a genuine, well-functioning democracy in Egypt that does not include, in some shape or form, an MB-based party. In order for Baradei's reform project to have any credibility or mass support he needs the Muslim Brotherhood's blessing, and he is therefore wise to reach out to its leaders and include them in his coalition. Unfortunately the policy wonks in Washington (who claim to want democracy for Egypt) tend to avoid this inconvenient reality and choose instead to paint the Muslim Brotherhood with the same broad "Islamo-fascism" brush that is reserved for any Islamically-oriented political group.
A final point: these sort of ill-informed 'analyses' are unfortunately a common occurrence in much of the writing on the Middle East by think tank experts, policymakers, and even journalists. This fact is well known and often-decried among professors and grad students in the ME Studies departments of US universities. There is a disdain for the policymaking community's myopic focus on current events and an assumption that much of this analysis is conducted without any real depth of understanding. This is a fair criticism. But what is truly maddening is that most of these individuals -- who have the understanding and nuanced insight necessary to effectively combat these flawed accounts -- don't ever respond. Samer Shehata is a well-respected academic whose work on Egyptian labour is some of the best on the subject. And yet here he is, getting his hands dirty in the policymaking realm to make sure that poor articles like Berman's do not go unanswered. It's too bad that more professors of ME studies don't take it upon themselves to do the same.
Showing posts with label Killian Clarke. Show all posts
Showing posts with label Killian Clarke. Show all posts
Saturday, April 10, 2010
Wednesday, March 10, 2010
A Nuclear Middle East
Nuclear is all the rage these days. Barack Obama's election in the United States and the recent climate change summit in Copenhagen have sparked a global rush into nuclear energy, with countries from El Salvador to Ghana to Mongolia declaring their intention to build nuclear power plants. Nuclear energy is a much cleaner (though also more expensive and potentially dangerous) form of energy than oil, gas, and coal and it can produce far more electricity than wind, solar, or hydro. The combination of these factors makes nuclear a popular option for governments seeking to wean themselves off dependence on fossil fuels.
The Middle East has not missed out on this fad. Beginning in the middle of the last decade, governments in the region abandoned their policies of striving for a nuclear-free Middle East (excepting Israel) as six countries announced their intention to build civil nuclear programs. As of today, the countries in the region that have voiced interest in establishing nuclear energy capabilities are: Algeria, Bahrain, Egypt, Iran, Israel, Jordan, Kuwait, Libya, Morocco, Oman, Qatar, Saudi Arabia, Sudan, Syria, Tunisia, Turkey, United Arab Emirates, and Yemen. It is a pretty comprehensive list: the only countries that have not yet expressed interest are Lebanon, Palestine, and Iraq.
The question of nuclear energy in the Middle East has resurfaced again in the past weeks. The United Arab Emirates recently placed its first order for a nuclear reactor with a consortium of Korean companies, following a fierce, year-long round of bidding. Israel says it wants to build a third nuclear power plant, in conjunction with its Jordanian neighbors (though the Jordanians say the project will not move forward until the Israeli-Palestinian conflict is resolved...). Syria, too, recently reaffirmed its desire for a reactor (no one really knows whether Syria already built one with North Korea's help, only to have it destroyed by the Israelis in September 2007). Meanwhile, Egypt claims to be making progress on finding a site for its first nuclear plant.
So the region is abuzz with nuclear activity. But this article in Daedalus, part of a series on nuclear power, says that not only are most of these countries incapable of building nuclear power plants in the near future, their justifications for wanting them are also implausible.
On the feasibility point, there are two major hurdles that must be overcome before a state can buy a nuclear reactor: cost and grid capacity. The article states that in order to afford a nuclear reactor, which these days costs at least a few billion US dollars, a country must have a GDP of at least $50 billion. Then, in addition, its electricity grid must have a minimum of 10 gigawatts in order to accommodate a large reactor.
These criteria narrow the list of potential nuclear states in the region from eighteen down to five: Egypt, Turkey, the UAE, Saudi Arabia, and Algeria.
But the reasons these countries have given for wanting nuclear power do not hold up under scrutiny. Energy security is the most common justification. Consider the UAE, which based its plea for nuclear power on its rapidly rising electricity demand and its inability to meet this demand with natural gas imported from Qatar. A nuclear option would allow the country to be self-sufficient, with nuclear power eventually providing 25% of all electricity. Egypt, Turkey, Saudi Arabia, and Algeria have all made similar arguments.
But as the Daedalus article makes clear, all of these countries have more than adequate access to fossil fuels or other sources of power within their borders, giving them the potential to produce sufficient electricity for decades to come. In Egypt, natural gas supplies could power the country for 43 years. In Turkey, vast hydro resources, if harnessed effectively, could provide just as much electricity as nuclear reactors -- potentially forever. Algeria, Saudi Arabia, and the UAE, have oil and/or natural gas reserves capable of providing electricity to their people for 43, 66, and 100 years, respectively. By the time fossil fuels come close to running out, either nuclear will be so cheap that it will be easily adoptable or (more likely) there will be myriad renewable energy alternatives, especially in countries with abundant sunlight.
So why the rush into nuclear power, an expensive and politically fraught energy source, when it isn't really necessary? The article poses two answers. First, nuclear energy confers a degree of international credibility on a country, especially in the developing world. Since the 1950s, a nuclear program has been seen as a sign of a country's entry into the developed world -- this is what motivated Brazil, Argentina, South Africa, India, Pakistan, and Libya to seek nuclear options. A nuclear program is a mark of honor, a way of stimulating national pride -- and the rhetoric used by Middle Eastern regimes to describe their nuclear ambitions suggest that leaders will have no qualms using nuclear energy for this end.
Moreover, a nuclear program -- even for civilian purposes -- can create a certain strategic deterrent for neighboring countries, especially if the state in question develops its own enrichment capabilities. Japan, though not an officially recognized nuclear-weapon state, could probably build such a weapon within days if it wanted to. Middle Eastern states may be watching Iran's progress in its nuclear program and calculating that they, too, should probably get into the game.
A civilian program therefore provides both international credibility and a foot in the nuclear-weapons door. The important question is whether anyone -- either inside or outside the region -- would want to have the feet of eighteen Middle Eastern states eventually wedged in that door.
The Middle East has not missed out on this fad. Beginning in the middle of the last decade, governments in the region abandoned their policies of striving for a nuclear-free Middle East (excepting Israel) as six countries announced their intention to build civil nuclear programs. As of today, the countries in the region that have voiced interest in establishing nuclear energy capabilities are: Algeria, Bahrain, Egypt, Iran, Israel, Jordan, Kuwait, Libya, Morocco, Oman, Qatar, Saudi Arabia, Sudan, Syria, Tunisia, Turkey, United Arab Emirates, and Yemen. It is a pretty comprehensive list: the only countries that have not yet expressed interest are Lebanon, Palestine, and Iraq.
The question of nuclear energy in the Middle East has resurfaced again in the past weeks. The United Arab Emirates recently placed its first order for a nuclear reactor with a consortium of Korean companies, following a fierce, year-long round of bidding. Israel says it wants to build a third nuclear power plant, in conjunction with its Jordanian neighbors (though the Jordanians say the project will not move forward until the Israeli-Palestinian conflict is resolved...). Syria, too, recently reaffirmed its desire for a reactor (no one really knows whether Syria already built one with North Korea's help, only to have it destroyed by the Israelis in September 2007). Meanwhile, Egypt claims to be making progress on finding a site for its first nuclear plant.
So the region is abuzz with nuclear activity. But this article in Daedalus, part of a series on nuclear power, says that not only are most of these countries incapable of building nuclear power plants in the near future, their justifications for wanting them are also implausible.
On the feasibility point, there are two major hurdles that must be overcome before a state can buy a nuclear reactor: cost and grid capacity. The article states that in order to afford a nuclear reactor, which these days costs at least a few billion US dollars, a country must have a GDP of at least $50 billion. Then, in addition, its electricity grid must have a minimum of 10 gigawatts in order to accommodate a large reactor.
These criteria narrow the list of potential nuclear states in the region from eighteen down to five: Egypt, Turkey, the UAE, Saudi Arabia, and Algeria.
But the reasons these countries have given for wanting nuclear power do not hold up under scrutiny. Energy security is the most common justification. Consider the UAE, which based its plea for nuclear power on its rapidly rising electricity demand and its inability to meet this demand with natural gas imported from Qatar. A nuclear option would allow the country to be self-sufficient, with nuclear power eventually providing 25% of all electricity. Egypt, Turkey, Saudi Arabia, and Algeria have all made similar arguments.
But as the Daedalus article makes clear, all of these countries have more than adequate access to fossil fuels or other sources of power within their borders, giving them the potential to produce sufficient electricity for decades to come. In Egypt, natural gas supplies could power the country for 43 years. In Turkey, vast hydro resources, if harnessed effectively, could provide just as much electricity as nuclear reactors -- potentially forever. Algeria, Saudi Arabia, and the UAE, have oil and/or natural gas reserves capable of providing electricity to their people for 43, 66, and 100 years, respectively. By the time fossil fuels come close to running out, either nuclear will be so cheap that it will be easily adoptable or (more likely) there will be myriad renewable energy alternatives, especially in countries with abundant sunlight.
So why the rush into nuclear power, an expensive and politically fraught energy source, when it isn't really necessary? The article poses two answers. First, nuclear energy confers a degree of international credibility on a country, especially in the developing world. Since the 1950s, a nuclear program has been seen as a sign of a country's entry into the developed world -- this is what motivated Brazil, Argentina, South Africa, India, Pakistan, and Libya to seek nuclear options. A nuclear program is a mark of honor, a way of stimulating national pride -- and the rhetoric used by Middle Eastern regimes to describe their nuclear ambitions suggest that leaders will have no qualms using nuclear energy for this end.
Moreover, a nuclear program -- even for civilian purposes -- can create a certain strategic deterrent for neighboring countries, especially if the state in question develops its own enrichment capabilities. Japan, though not an officially recognized nuclear-weapon state, could probably build such a weapon within days if it wanted to. Middle Eastern states may be watching Iran's progress in its nuclear program and calculating that they, too, should probably get into the game.
A civilian program therefore provides both international credibility and a foot in the nuclear-weapons door. The important question is whether anyone -- either inside or outside the region -- would want to have the feet of eighteen Middle Eastern states eventually wedged in that door.
Saturday, March 6, 2010
Remittances
Someone recently pointed me to this article in the Abu Dhabi newspaper The National. It is one of the most interesting pieces I have read in a long time on the political economy of the Middle East. John Lavois, one of the newspaper's senior editors, weds some beautiful anecdotal reporting with broader musings on the moral and economic implications of remittance flows from the UAE's foreign-born underclass.
Remittances are an incredibly important part of the Middle Eastern economy. In the non-oil states, remittances from nationals working abroad make up significant portions of gross domestic products. In oil states, like the UAE, workers from poorer countries (both within and outside of the Middle East) form a large majority of laborers and service workers and many of them remit as much as 90% of their wages to their families back home. Remittances therefore shape the region's economy in every possible way -- they flow into, out of, and within the borders of the Middle East.
Some of the facts are startling. According to this article, for example, a total of $34.7 billion flowed into the Middle East and North Africa in the form of remittances in 2007. That is a larger amount of money than the entire GDP of Jordan. The World Bank estimates that the top recipients of remittance payments in the region are, in order: Egypt, Morocco, Lebanon, Jordan, Algeria, and Tunisia. In some of these countries, sizable proportions of national GDPs are composed of remittances. Lebanon, for example, relies on remittances for one quarter of its GDP; in Jordan they comprise one fifth. Morocco, Tunisia, Egypt, and Yemen all rely on remittances for roughly 6% of their GDPs.
On the flip side, the remittance flows coming out of countries in the Gulf are equally striking. The World Bank calculates, for example, that only the United States sends out more remittance payments than Saudi Arabia, which in turn sends out more than rich European countries like Germany and Switzerland.
The relative weight of these remittances on the economies of so many Middle Eastern countries is all the more striking when the nature of these payments is actually considered. Most of the payments are relatively tiny; they are micro-payments, proportions of wages that are already startlingly low. The National article does an especially good job of demonstrating the truly "micro" nature of these payments. Their relatively large weight on very "macro" economic forces says a good deal about how many laborers there really are living and working in countries other than their own.
The article also tells a story of real moral ambiguity. The Gulf's foreign-born labor force is often held up as a sign of all that is perverted and wrong about its political economy. Rich locals, too spoiled and pampered to take menial jobs, rely on foreign-born workers, often living in sub-par conditions, with few rights, and depressed wages, to perform the basic tasks necessary to run a society. In places like Dubai, where growth has been happening at a dizzying pace, foreign labor has been even more important, a key driver behind the emirate's frenetic modernization. The sad paradox of cities like Dubai, critics say, is that while half the city lives and plays in a grown-up's version of Disney Land, the other half of the city lives in squalid labor camps that don't even appear on maps, too scared to speak up for fear of losing a job that is supporting an entire family thousands of miles away.
But there is another story to tell, as well -- one of economic empowerment, of new opportunities, of globalization harnessed in a way that enriches the formerly impoverished. As the National article points out, there is a reason so many workers continue to migrate to the Gulf, in spite of its deplorable labor conditions. Indeed many development economist argue that lower barriers to immigration and maximizing labor mobility is one important way by which poor countries can develop. Some see the large number of foreign remittances flowing into non-oil MENA states as a sign of economic weakness and dependency. Viewed another way, they could be a powerful force pulling members of these countries out of poverty. For example, one of the reasons Yemen's economy is said to be so backward is because huge numbers of its nationals were expelled from Saudi Arabia in the early 90s when President Saleh backed Saddam Hussein's invasion of Kuwait. Those workers were forced to go home, the remittances stopped flowing in, and the economy fizzled and crashed.
I don't think there's an obvious way to come down on this issue. There may be some middle ground, though. Remittances are clearly important for many individuals in the developing world and encouraging labor mobility is certainly a defensible policy. But the UAE and other Gulf countries are wrong to take advantage of their foreign workforce. Their governments should appreciate how much of their economies are dependent on these laborers, and accord them the appropriate level of social and political rights. There is, after all, no law of economics that says remittance payments have to flow from the exploited.
Remittances are an incredibly important part of the Middle Eastern economy. In the non-oil states, remittances from nationals working abroad make up significant portions of gross domestic products. In oil states, like the UAE, workers from poorer countries (both within and outside of the Middle East) form a large majority of laborers and service workers and many of them remit as much as 90% of their wages to their families back home. Remittances therefore shape the region's economy in every possible way -- they flow into, out of, and within the borders of the Middle East.
Some of the facts are startling. According to this article, for example, a total of $34.7 billion flowed into the Middle East and North Africa in the form of remittances in 2007. That is a larger amount of money than the entire GDP of Jordan. The World Bank estimates that the top recipients of remittance payments in the region are, in order: Egypt, Morocco, Lebanon, Jordan, Algeria, and Tunisia. In some of these countries, sizable proportions of national GDPs are composed of remittances. Lebanon, for example, relies on remittances for one quarter of its GDP; in Jordan they comprise one fifth. Morocco, Tunisia, Egypt, and Yemen all rely on remittances for roughly 6% of their GDPs.
On the flip side, the remittance flows coming out of countries in the Gulf are equally striking. The World Bank calculates, for example, that only the United States sends out more remittance payments than Saudi Arabia, which in turn sends out more than rich European countries like Germany and Switzerland.
The relative weight of these remittances on the economies of so many Middle Eastern countries is all the more striking when the nature of these payments is actually considered. Most of the payments are relatively tiny; they are micro-payments, proportions of wages that are already startlingly low. The National article does an especially good job of demonstrating the truly "micro" nature of these payments. Their relatively large weight on very "macro" economic forces says a good deal about how many laborers there really are living and working in countries other than their own.
The article also tells a story of real moral ambiguity. The Gulf's foreign-born labor force is often held up as a sign of all that is perverted and wrong about its political economy. Rich locals, too spoiled and pampered to take menial jobs, rely on foreign-born workers, often living in sub-par conditions, with few rights, and depressed wages, to perform the basic tasks necessary to run a society. In places like Dubai, where growth has been happening at a dizzying pace, foreign labor has been even more important, a key driver behind the emirate's frenetic modernization. The sad paradox of cities like Dubai, critics say, is that while half the city lives and plays in a grown-up's version of Disney Land, the other half of the city lives in squalid labor camps that don't even appear on maps, too scared to speak up for fear of losing a job that is supporting an entire family thousands of miles away.
But there is another story to tell, as well -- one of economic empowerment, of new opportunities, of globalization harnessed in a way that enriches the formerly impoverished. As the National article points out, there is a reason so many workers continue to migrate to the Gulf, in spite of its deplorable labor conditions. Indeed many development economist argue that lower barriers to immigration and maximizing labor mobility is one important way by which poor countries can develop. Some see the large number of foreign remittances flowing into non-oil MENA states as a sign of economic weakness and dependency. Viewed another way, they could be a powerful force pulling members of these countries out of poverty. For example, one of the reasons Yemen's economy is said to be so backward is because huge numbers of its nationals were expelled from Saudi Arabia in the early 90s when President Saleh backed Saddam Hussein's invasion of Kuwait. Those workers were forced to go home, the remittances stopped flowing in, and the economy fizzled and crashed.
I don't think there's an obvious way to come down on this issue. There may be some middle ground, though. Remittances are clearly important for many individuals in the developing world and encouraging labor mobility is certainly a defensible policy. But the UAE and other Gulf countries are wrong to take advantage of their foreign workforce. Their governments should appreciate how much of their economies are dependent on these laborers, and accord them the appropriate level of social and political rights. There is, after all, no law of economics that says remittance payments have to flow from the exploited.
Saturday, February 27, 2010
The Jeremiads on Dubai
There have been a lot of doomsday predictions lately regarding Dubai's future. Consider this FP article on the emerging literature that has sprung up criticizing Dubai's model of development and anticipating the city's imminent downfall. Critics of the city point to a staggering number of legitimate shortcomings: Dubai is over-leveraged, its development model is unsustainable, its cultural vision is contradictory, its population is under-educated, its institutions are bureaucratic and corrupt, its labor conditions are miserable, its buildings are shiny but substance-less and now empty, its judicial system is arcane, and it is now attracting an array of unsavory criminals, smugglers, and racketeers.
All of the above criticisms of Dubai are, in my opinion, entirely valid. The city-state grew too fast during the boom years. It built in order to impress, not to develop. It tried to market itself as a meeting place between East and West, as a cosmopolitan melting pot in the Arab world. The problem is Dubai thought this utopia could be bought (or borrowed and then bought) rather than being cultivated over time.
Curious people from around the world were unsurprisingly drawn to this strange new phenomenon happening in the deserts of the Arab Gulf. They came, they took photos, some of them even settled down for a bit. Now they are all gone. With the unveiling of the new Burj Khalifa, Dubai seems not to have quite learned its lesson. The city is still trying, now increasingly desperately, to attract the world's attention with another superlative, hoping that no one will notice that they have yet to find enough find tenants to fill the monolith.
All that being said, I think the Jeremiads on Dubai are overblown. The bloom may be off the rose -- but the rose still remains. Dubai, for all its myriad flaws, has a lot going for it. For example, Dubai is the sixth busiest port in the world with thousands upon thousands of containers passing through on their way from the East to the West and back again. The only ports with more traffic than Dubai are the megaports of East Asia -- Singapore, Shanghai, Hong Kong, Shenzhen, and Busan. The next largest port within even the general vicinity of Dubai is Mumbai, at number twenty-seven. In the Middle East, Jeddah is second, with a ranking of thrirty-two and about a quarter of the traffic of Dubai.
Dubai's port is likely its greatest and most sustainable long-term asset. Think of Singapore, another city that had its fair share of skeptics and detractors in the 1970s. Its position as one of the largest ports in the world (today it is number one) has propelled it on a bull-run of multi-decade economic growth, such that it now ranks as one of the world's greatest metropolises. The Dubai port generates a huge amount of commercial activity in the city, which is the original reason that so many different companies in various industries originally decided to set up shop there. As long as the hum of port activity persists, many of these industries and companies are likely to remain.
Dubai also has a slightly less tangible asset working in its favor -- inertia. Yes, the city has seen hitches recently. But are all those companies that relocated to Dubai, convinced it was going to be the new urban center of a fast-growing emerging market, really going to pick up and relocate? Is the marginal benefit of moving down the road to Abu Dhabi, or across the sea to Doha, or further into the desert to Riyadh really that great? Dubai may have tripped, but it will take a lot more than a single sovereign debt debacle to cause a true mass exodus. As long as the Gulf remains a key emerging market (and with oil supplies still plentiful, that will likely be for a while), it will need a regional capital out of which firms can base their operations. For the foreseeable future Dubai still looks like the most likely city to have that honor.
No doubt Dubai's glory days are over. But the city-state can still learn from the poor choices of the past decade and right itself. It can get itself back on a road to growth and development, though this time it will have to be at a much more restrained and sustainable pace.
All of the above criticisms of Dubai are, in my opinion, entirely valid. The city-state grew too fast during the boom years. It built in order to impress, not to develop. It tried to market itself as a meeting place between East and West, as a cosmopolitan melting pot in the Arab world. The problem is Dubai thought this utopia could be bought (or borrowed and then bought) rather than being cultivated over time.
Curious people from around the world were unsurprisingly drawn to this strange new phenomenon happening in the deserts of the Arab Gulf. They came, they took photos, some of them even settled down for a bit. Now they are all gone. With the unveiling of the new Burj Khalifa, Dubai seems not to have quite learned its lesson. The city is still trying, now increasingly desperately, to attract the world's attention with another superlative, hoping that no one will notice that they have yet to find enough find tenants to fill the monolith.
All that being said, I think the Jeremiads on Dubai are overblown. The bloom may be off the rose -- but the rose still remains. Dubai, for all its myriad flaws, has a lot going for it. For example, Dubai is the sixth busiest port in the world with thousands upon thousands of containers passing through on their way from the East to the West and back again. The only ports with more traffic than Dubai are the megaports of East Asia -- Singapore, Shanghai, Hong Kong, Shenzhen, and Busan. The next largest port within even the general vicinity of Dubai is Mumbai, at number twenty-seven. In the Middle East, Jeddah is second, with a ranking of thrirty-two and about a quarter of the traffic of Dubai.
Dubai's port is likely its greatest and most sustainable long-term asset. Think of Singapore, another city that had its fair share of skeptics and detractors in the 1970s. Its position as one of the largest ports in the world (today it is number one) has propelled it on a bull-run of multi-decade economic growth, such that it now ranks as one of the world's greatest metropolises. The Dubai port generates a huge amount of commercial activity in the city, which is the original reason that so many different companies in various industries originally decided to set up shop there. As long as the hum of port activity persists, many of these industries and companies are likely to remain.
Dubai also has a slightly less tangible asset working in its favor -- inertia. Yes, the city has seen hitches recently. But are all those companies that relocated to Dubai, convinced it was going to be the new urban center of a fast-growing emerging market, really going to pick up and relocate? Is the marginal benefit of moving down the road to Abu Dhabi, or across the sea to Doha, or further into the desert to Riyadh really that great? Dubai may have tripped, but it will take a lot more than a single sovereign debt debacle to cause a true mass exodus. As long as the Gulf remains a key emerging market (and with oil supplies still plentiful, that will likely be for a while), it will need a regional capital out of which firms can base their operations. For the foreseeable future Dubai still looks like the most likely city to have that honor.
No doubt Dubai's glory days are over. But the city-state can still learn from the poor choices of the past decade and right itself. It can get itself back on a road to growth and development, though this time it will have to be at a much more restrained and sustainable pace.
Friday, February 19, 2010
Yemen, Again
James Dorsey, a freelance journalist, recently published an article on Foreign Affairs' website that may just be the best piece of analysis on Yemen I have read thus far. It does a beautiful job capturing why Yemen is such a problem-ridden state and why it will be so difficult for anyone (including the Yemeni government) to solve its interconnected problems. He addresses some of the biggest questions that have been aired since the Christmas Day bomb attempt of Umar Farouk Abdulmutallab. Why has Al Qaeda gained a foothold in Yemen? Why is Yemen so difficult to rule? And what can the US (or the West) do about it?
He points out that one of the principal reasons AQAP (Al Qaeda in the Arabian Peninsula) has been able to settle in Yemen is because it provides social services to local villagers. The Yemeni government's presence beyond core sectors of the country is so minimal that critical services -- like education, healthcare, and security -- are entirely ignored. Locals are happy to extend their support to any group that can fill this void. This notion of legitimacy coming from social service provision is not a new one, and has been used to describe political dynamics in other parts of the Middle East, as well as Latin America, South Asia, and Africa. There is compelling evidence that any group -- state or non-state -- will gain grassroots political favor through the extension of services; in fact, the phenomenon is so common in the developing world that 'non-state social welfare provision' has become something of an academic sub-field. Within the Middle East, experts have mostly studied how providing social services can be a key part of the political strategies of certain Islamist groups -- Hamas, Hezbullah, and the Egyptian MB, being the most prominent examples. It is therefore unsurprising to hear that Al Qaeda's Yemen branch has adopted much the same tactic, with equal success.
This point dovetails nicely with Dorsey's second key insight, which is that a security-dominated approach to Yemen is likely to bear little fruit for the West. Al Qaeda has been successful in Yemen, in part, because it provides key services that the government fails to offer. Foreign aid, both in the form of funding and training, can help the Yemeni government extend its social service capabilities further afield. By usurping Al Qaeda's role as a provider and protector, the government can win back the favor of the population and erode Al Qaeda's popularity and legitimacy. Of course, there is the issue of Yemen's current government being so corrupt and bureaucratic that it struggles to accept large amounts of aid. But, as Dorsey points out, the West has few better options but to try.
A final important argument that he makes is that the West is much better off relying on other state actors, particularly Saudi Arabia and others in the GCC, to help implement reform in Yemen. The Saudi government has influence both with Yemen's government and with many of its tribes and could be a powerful agent of positive change if it signed onto a series of reform initiatives. Many of Yemen's greatest security, political, social, and economic problems could be better addressed with Saudi support. Moreover, Saudis are trusted in Yemen to a far greater extent than Western workers and do not operate with the automatic handicap of being seen as a foreign occupier or agents of neo-colonialism.
An interesting idea highlighted within this argument is the suggestion that the GCC bring Yemen into its fold. To my knowledge, this is not a possibility that has been seriously discussed, probably because the Gulf countries would never give it real consideration. Yemen is far too poor, divided, and corrupt for the other Gulf states to consider letting it into what they consider to be an elite club. Moreover, as the GCC considers the possibility of further economic integration (possibly a single currency union), letting Yemen in would complicate matters even further. But what could work is providing Yemen with a reasonable path toward GCC membership. This strategy has proven remarkably successful in Europe, where the European Union has laid out a series of stringent development hurdles that must be cleared in order for candidate countries to gain membership (in fact, this article points out how much better this strategy has been than the foreign aid approach that the US has used with its Caribbean neighbors...and is likely to use with Yemen). In Eastern European countries like Bulgaria and Romania, which joined the Union in 2007, massive political and economic reform efforts were undertaken to prepare for membership. Yemen has openly expressed its desire to join the GCC. If the Council provided a credible path toward Yemeni membership, entailing a series of stringent criteria that would first have to be met, Yemen's government might be coaxed into making some of the tough decisions necessary to avert further decay.
No effort at domestic transformation in Yemen will be successful without the full backing of the Yemeni government. A path to GCC membership may be the best idea yet aired to cajole the government into coming fully on board.
He points out that one of the principal reasons AQAP (Al Qaeda in the Arabian Peninsula) has been able to settle in Yemen is because it provides social services to local villagers. The Yemeni government's presence beyond core sectors of the country is so minimal that critical services -- like education, healthcare, and security -- are entirely ignored. Locals are happy to extend their support to any group that can fill this void. This notion of legitimacy coming from social service provision is not a new one, and has been used to describe political dynamics in other parts of the Middle East, as well as Latin America, South Asia, and Africa. There is compelling evidence that any group -- state or non-state -- will gain grassroots political favor through the extension of services; in fact, the phenomenon is so common in the developing world that 'non-state social welfare provision' has become something of an academic sub-field. Within the Middle East, experts have mostly studied how providing social services can be a key part of the political strategies of certain Islamist groups -- Hamas, Hezbullah, and the Egyptian MB, being the most prominent examples. It is therefore unsurprising to hear that Al Qaeda's Yemen branch has adopted much the same tactic, with equal success.
This point dovetails nicely with Dorsey's second key insight, which is that a security-dominated approach to Yemen is likely to bear little fruit for the West. Al Qaeda has been successful in Yemen, in part, because it provides key services that the government fails to offer. Foreign aid, both in the form of funding and training, can help the Yemeni government extend its social service capabilities further afield. By usurping Al Qaeda's role as a provider and protector, the government can win back the favor of the population and erode Al Qaeda's popularity and legitimacy. Of course, there is the issue of Yemen's current government being so corrupt and bureaucratic that it struggles to accept large amounts of aid. But, as Dorsey points out, the West has few better options but to try.
A final important argument that he makes is that the West is much better off relying on other state actors, particularly Saudi Arabia and others in the GCC, to help implement reform in Yemen. The Saudi government has influence both with Yemen's government and with many of its tribes and could be a powerful agent of positive change if it signed onto a series of reform initiatives. Many of Yemen's greatest security, political, social, and economic problems could be better addressed with Saudi support. Moreover, Saudis are trusted in Yemen to a far greater extent than Western workers and do not operate with the automatic handicap of being seen as a foreign occupier or agents of neo-colonialism.
An interesting idea highlighted within this argument is the suggestion that the GCC bring Yemen into its fold. To my knowledge, this is not a possibility that has been seriously discussed, probably because the Gulf countries would never give it real consideration. Yemen is far too poor, divided, and corrupt for the other Gulf states to consider letting it into what they consider to be an elite club. Moreover, as the GCC considers the possibility of further economic integration (possibly a single currency union), letting Yemen in would complicate matters even further. But what could work is providing Yemen with a reasonable path toward GCC membership. This strategy has proven remarkably successful in Europe, where the European Union has laid out a series of stringent development hurdles that must be cleared in order for candidate countries to gain membership (in fact, this article points out how much better this strategy has been than the foreign aid approach that the US has used with its Caribbean neighbors...and is likely to use with Yemen). In Eastern European countries like Bulgaria and Romania, which joined the Union in 2007, massive political and economic reform efforts were undertaken to prepare for membership. Yemen has openly expressed its desire to join the GCC. If the Council provided a credible path toward Yemeni membership, entailing a series of stringent criteria that would first have to be met, Yemen's government might be coaxed into making some of the tough decisions necessary to avert further decay.
No effort at domestic transformation in Yemen will be successful without the full backing of the Yemeni government. A path to GCC membership may be the best idea yet aired to cajole the government into coming fully on board.
Tuesday, February 16, 2010
Moving the UN to Dubai
As a brief follow-up to my last post on Dubai, this article introduces a provocative, if somewhat amusing, argument: move the United Nations headquarters from New York City to Dubai. The authors point out that moving the UN to the Emirate would solve a host of problems for each city. For New York, it would free up office and residential space and relieve the city from having to pay for the expensive upkeep of a crumbling facility full of America-bashing diplomats. And for Dubai, it would bring renewed international attention and prestige after its image has been tarnished and would fill a bunch of empty buildings that are currently desperate for tenants. The city could even construct a Dubai United Nations City -- to go alongside its Media City, Internet City, Knowledge Village, Festival City, Sports City, and Cultural Village. Dubai, for its part, seems enthusiastic: it responded to the Op-Ed three days later, saying it "is fully prepared to host the UN's headquarters."
The idea is interesting perhaps most for its implausibility. While it makes perfect practical sense the way the authors lay it out, there is simply no way the UN would choose the razzle-dazzle Emirate as its new home. The city is too young, too unproven, and too closely associated with glamor, new money, and ostentation. The United States is also wary of Dubai and the broader UAE, as evinced by Congress's decision in 2006 to block the Dubai port operator DP World from taking over operations at a collection of US ports. It is much more likely (as the article points out) that when the UN seeks a temporary new home in 2015, it will go to a different Asian city state -- Singapore. This is perhaps a telling choice. Singapore, at one point in its life, faced many of the questions skeptics are now raising about Dubai. In the decade following its independence many in the international community doubted that Singapore could present a viable economic model that would ensure its survival. And yet, here it is: a thriving cosmopolitan center of economic prosperity, vying to host the world's preeminent international organization.
Who knows. Perhaps three decades from now Dubai will not seems such an unlikely choice to host the United Nations...
The idea is interesting perhaps most for its implausibility. While it makes perfect practical sense the way the authors lay it out, there is simply no way the UN would choose the razzle-dazzle Emirate as its new home. The city is too young, too unproven, and too closely associated with glamor, new money, and ostentation. The United States is also wary of Dubai and the broader UAE, as evinced by Congress's decision in 2006 to block the Dubai port operator DP World from taking over operations at a collection of US ports. It is much more likely (as the article points out) that when the UN seeks a temporary new home in 2015, it will go to a different Asian city state -- Singapore. This is perhaps a telling choice. Singapore, at one point in its life, faced many of the questions skeptics are now raising about Dubai. In the decade following its independence many in the international community doubted that Singapore could present a viable economic model that would ensure its survival. And yet, here it is: a thriving cosmopolitan center of economic prosperity, vying to host the world's preeminent international organization.
Who knows. Perhaps three decades from now Dubai will not seems such an unlikely choice to host the United Nations...
Saturday, February 13, 2010
The Problem with Symbols
Several days ago the Burj Khalifa, the latest 'superlative' to emerge from the emirate of Dubai, was closed to the public after a small explosion in one of the elevators. A group of tourists apparently sat terrified in the elevator, stuck between two floors, for more than 45 minutes before rescue workers managed to pry the doors open and evacuate them via a service elevator. Afterward, Emaar properties, which owns the property, announced that the observation deck would be closed due to "technical issues with the power supply."
This is only the latest public relations debacle to wrangle Dubai, after an embarrassing near-default on semi-public debt that required neighboring Abu Dhabi to come to the rescue with a multi-billion dollar loan. The world watched stunned as Dubai's shiny veneer was briefly scraped away to reveal a slightly grimier undercoating. Dubai responded to this financial setback by unveiling a brand new display of profligacy and ostentation. The opening for the Burj Khalifa was rushed forward to January 4, largely to take the world's attention off the debt embarrassment. The event was steeped in symbolism. At the last minute the name of the building was changed from 'Burj Dubai' to 'Burj Khalifa,' a nod (perhaps of gratitude) to the ruling family of the UAE and a sign of Emirati national unity. The tower is the tallest in the world, a symbol of Dubai's rise to international prominence, a beacon calling one and all to a new cosmopolitan Mecca that fuses the best of the old and the new... Or so they hoped.
The tower may still achieve what Dubai had in mind. But the problem with symbols is that their meaning can shift in unpredictable ways. Until last week the only part of the Burj Khalifa that was open and operational was the tourist observation deck. Even when it opened, the windows at the top were apparently still caked in dust because cleaners had had no time to wipe them down. This new setback, which has received attention in a slew of Western publications, could actually bolster the image of the city that was fostered by the debt mess. Will the emirate continue to be seen as an urban meeting place between the East and the West, with enough pomp to wow even the savviest global travelers? Or will this new tower come to represent a city that is already past its heyday, with nothing much to show for it but a whole lot of debt and a bunch of behemoth-like structures that barely even work?
This is only the latest public relations debacle to wrangle Dubai, after an embarrassing near-default on semi-public debt that required neighboring Abu Dhabi to come to the rescue with a multi-billion dollar loan. The world watched stunned as Dubai's shiny veneer was briefly scraped away to reveal a slightly grimier undercoating. Dubai responded to this financial setback by unveiling a brand new display of profligacy and ostentation. The opening for the Burj Khalifa was rushed forward to January 4, largely to take the world's attention off the debt embarrassment. The event was steeped in symbolism. At the last minute the name of the building was changed from 'Burj Dubai' to 'Burj Khalifa,' a nod (perhaps of gratitude) to the ruling family of the UAE and a sign of Emirati national unity. The tower is the tallest in the world, a symbol of Dubai's rise to international prominence, a beacon calling one and all to a new cosmopolitan Mecca that fuses the best of the old and the new... Or so they hoped.
The tower may still achieve what Dubai had in mind. But the problem with symbols is that their meaning can shift in unpredictable ways. Until last week the only part of the Burj Khalifa that was open and operational was the tourist observation deck. Even when it opened, the windows at the top were apparently still caked in dust because cleaners had had no time to wipe them down. This new setback, which has received attention in a slew of Western publications, could actually bolster the image of the city that was fostered by the debt mess. Will the emirate continue to be seen as an urban meeting place between the East and the West, with enough pomp to wow even the savviest global travelers? Or will this new tower come to represent a city that is already past its heyday, with nothing much to show for it but a whole lot of debt and a bunch of behemoth-like structures that barely even work?
Thursday, February 11, 2010
Egypt's Negotiating Handicap
The International Institute of Strategic Studies just released a 'strategic comment' on the Israeli-Palestinian peace situation. The title kind of says it all: "Receding Prospects for Middle Eastern Peace." It certainly makes for sober reading. The authors systematically enumerate the array of problems that are currently conspiring to make the alleged 'Peace Process' more like a 'Peace Debacle.' Intransigence on both the Palestinian and Israeli sides of the table are the primary drivers of the stalemate, though virtually all of the participating actors have contributed to the mess as well.
One of these actors is Egypt. The Egyptian regime currently serves as a sponsor and intermediary in the talks between Fatah and Hamas to create a unity Palestinian government. Given how much these two parties hate each other, it is not terribly surprising that Egypt has seen little success. As the article explains, Fatah has signed an Egyptian-sponsored reconciliation agreement that would establish elections for a new Palestinian government in 2010. But with no real incentive, Hamas has yet to sign on.
Whereas in the past Egypt has sought to cajole Hamas into taking more conciliatory positions, its strategy at this stage seems to be good, old-fashioned arm-twisting. It has started construction of an underground wall, which will block Hamas's system of tunnels that gives it access to outside goods. It has also started rallying other Arab states to apply pressure on Hamas to sign the agreement and claims to be building support for an Arab peacekeeping force that would maintain security in the Gaza strip. Much of this seems to be a tactic aimed at forcing Hamas to back down and sign the accord.
Egypt's tactic may work. But given how resilient Hamas has proven itself in the face of outside pressure, I agree with the IISS and suspect the group may hold out.
In fact, there are may be a more fundamental problem stemming directly from Egypt's role in the process. I have not seen this discussed much (which means there may be nothing to it!) but I tend to believe that one of the reasons Egypt has so much difficulty extracting concessions from Hamas on Fatah's behalf is because of a basic lack of trust. Hamas doesn't trust the Egyptian regime -- probably with good reason. Egypt is an unequivocal supporter of Abbas and the Fatah party. It also has a deeply hostile position toward political Islam, primarily due to its fraught relationship with its own internal Islamist movement. In fact it struck me as somewhat ironic that this press on stalled Fatah-Hamas talks came simultaneous with news of Egypt's most recent wave of crackdowns on moderate Muslim Brotherhood leaders. How does Egypt expect to build trust with Hamas if it is groundlessly imprisoning and repressing members of Hamas's sister organization? I honestly don't know how deep Hamas's current connection with the MB is (beyond there ideological and historical links), but even if these ties are weak, it does not send a very constructive message.
To be honest, I believe that Egypt is not the best party to broker these negotiations. The best intermediaries are at least ostensibly neutral in the dispute and are trusted by both sides. Egypt is neither of these. I think the prospects for a mutually agreeable reconciliation agreement would be much higher if a different Arab or Middle Eastern government were to step in instead. Off the top of my head, I can think of Saudi Arabia, Turkey, or Qatar as obvious possibilities. Saudi is a major regional player, which has better Islamist credentials than Egypt and whose role in the Peace Process has come to be crucial over the years. The latter two have both proven to be adept intermediaries (Turkey with Syria and Israel, and Qatar between factions in Lebanon) and also have relatively good relations with both Hamas and Fatah.
To be honest, no matter who is the mediator, the likelihood of these two parties coming together to form a unity government is still very slim. But these things only get solved through baby steps. Jettisoning Egypt as chief negotiator between the two parties might be a good start.
One of these actors is Egypt. The Egyptian regime currently serves as a sponsor and intermediary in the talks between Fatah and Hamas to create a unity Palestinian government. Given how much these two parties hate each other, it is not terribly surprising that Egypt has seen little success. As the article explains, Fatah has signed an Egyptian-sponsored reconciliation agreement that would establish elections for a new Palestinian government in 2010. But with no real incentive, Hamas has yet to sign on.
Whereas in the past Egypt has sought to cajole Hamas into taking more conciliatory positions, its strategy at this stage seems to be good, old-fashioned arm-twisting. It has started construction of an underground wall, which will block Hamas's system of tunnels that gives it access to outside goods. It has also started rallying other Arab states to apply pressure on Hamas to sign the agreement and claims to be building support for an Arab peacekeeping force that would maintain security in the Gaza strip. Much of this seems to be a tactic aimed at forcing Hamas to back down and sign the accord.
Egypt's tactic may work. But given how resilient Hamas has proven itself in the face of outside pressure, I agree with the IISS and suspect the group may hold out.
In fact, there are may be a more fundamental problem stemming directly from Egypt's role in the process. I have not seen this discussed much (which means there may be nothing to it!) but I tend to believe that one of the reasons Egypt has so much difficulty extracting concessions from Hamas on Fatah's behalf is because of a basic lack of trust. Hamas doesn't trust the Egyptian regime -- probably with good reason. Egypt is an unequivocal supporter of Abbas and the Fatah party. It also has a deeply hostile position toward political Islam, primarily due to its fraught relationship with its own internal Islamist movement. In fact it struck me as somewhat ironic that this press on stalled Fatah-Hamas talks came simultaneous with news of Egypt's most recent wave of crackdowns on moderate Muslim Brotherhood leaders. How does Egypt expect to build trust with Hamas if it is groundlessly imprisoning and repressing members of Hamas's sister organization? I honestly don't know how deep Hamas's current connection with the MB is (beyond there ideological and historical links), but even if these ties are weak, it does not send a very constructive message.
To be honest, I believe that Egypt is not the best party to broker these negotiations. The best intermediaries are at least ostensibly neutral in the dispute and are trusted by both sides. Egypt is neither of these. I think the prospects for a mutually agreeable reconciliation agreement would be much higher if a different Arab or Middle Eastern government were to step in instead. Off the top of my head, I can think of Saudi Arabia, Turkey, or Qatar as obvious possibilities. Saudi is a major regional player, which has better Islamist credentials than Egypt and whose role in the Peace Process has come to be crucial over the years. The latter two have both proven to be adept intermediaries (Turkey with Syria and Israel, and Qatar between factions in Lebanon) and also have relatively good relations with both Hamas and Fatah.
To be honest, no matter who is the mediator, the likelihood of these two parties coming together to form a unity government is still very slim. But these things only get solved through baby steps. Jettisoning Egypt as chief negotiator between the two parties might be a good start.
Saturday, February 6, 2010
Spreading the Wealth
This article from the Associated Press caught my eye earlier this week. The semi-official Palestine Investment Fund is teaming up with Abraaj Capital of Dubai to start a $50 million private equity fund specifically devoted to investing in the Palestinian economy. $50 million is a little more than 1% of Palestine's GDP...so the potential impact is huge.
I think it's a positive move. I have long puzzled over why the Gulf, with all its oil wealth sloshing around with nowhere to go, doesn't put more of that money where it's mouth is. These states are vehement supporters of the Palestinian national cause. None of them recognize Israel and Saudi Arabia especially is considered a key player in brokering any final deal with Israel.
But for all their bluster, I wonder that these governments don't devote more of their state-controlled oil wealth toward strengthening the Palestinian economy in preparation for its ultimate independence. Salam Fayyad, Palestine's prime minister, has embraced this strategy, setting a two-year time horizon for developing an economy that can survive on its own. Israel certainly hasn't made this easy for the Palestinians: there are still ample roadblocks to economic growth, not the least of which was Israel's devastating attacks on Gaza at the beginning of 2009. But in the case of the West Bank, at least, the economy has recently flourished. While the rest of the world languished in recession through 2009, the West Bank's economy grew at 5.5%. As long as the peace with Israel remains intact, growth in the territory is likely to continue, setting Palestine on a course toward economic viability and (possibly) statehood.
This strikes me as an arena where the Gulf states can have a real impact, especially while political negotiations are deadlocked. The governments in the region have huge wealth to deploy through their sovereign wealth funds. They can't invest it all (or even most of it) in their own economies because of the risk that this would spur inflation, crippling other industries that they are trying to establish. So they have to deploy this capital abroad. Although they have mostly tended to look to the West, especially Europe, for investment prospects, the funds should consider sourcing deals closer to home.
Moreover, for these sovereign wealth funds, a little can go a long way. $50 million may be a big drop in the bucket of the Palestinian economy -- but it is minuscule compared to the holdings of these funds, some of which manage hundreds of billions of dollars.
It is somewhat ironic that the Gulf investment institution behind this new private equity fund is Abraaj Capital, which hails from oil-poor and debt-ridden Dubai. Perhaps, though, its move will strike an example for some of the other funds in the region.
People often talk about the Middle East as a poor and backwards region. It certainly is not the latter and only parts of it are the former. With so much wealth collecting in the Gulf, the managers of these assets should consider how they can use their economic power to effect positive change in their less well-endowed neighbors. Investing in Palestine's economy is an obvious first step.
I think it's a positive move. I have long puzzled over why the Gulf, with all its oil wealth sloshing around with nowhere to go, doesn't put more of that money where it's mouth is. These states are vehement supporters of the Palestinian national cause. None of them recognize Israel and Saudi Arabia especially is considered a key player in brokering any final deal with Israel.
But for all their bluster, I wonder that these governments don't devote more of their state-controlled oil wealth toward strengthening the Palestinian economy in preparation for its ultimate independence. Salam Fayyad, Palestine's prime minister, has embraced this strategy, setting a two-year time horizon for developing an economy that can survive on its own. Israel certainly hasn't made this easy for the Palestinians: there are still ample roadblocks to economic growth, not the least of which was Israel's devastating attacks on Gaza at the beginning of 2009. But in the case of the West Bank, at least, the economy has recently flourished. While the rest of the world languished in recession through 2009, the West Bank's economy grew at 5.5%. As long as the peace with Israel remains intact, growth in the territory is likely to continue, setting Palestine on a course toward economic viability and (possibly) statehood.
This strikes me as an arena where the Gulf states can have a real impact, especially while political negotiations are deadlocked. The governments in the region have huge wealth to deploy through their sovereign wealth funds. They can't invest it all (or even most of it) in their own economies because of the risk that this would spur inflation, crippling other industries that they are trying to establish. So they have to deploy this capital abroad. Although they have mostly tended to look to the West, especially Europe, for investment prospects, the funds should consider sourcing deals closer to home.
Moreover, for these sovereign wealth funds, a little can go a long way. $50 million may be a big drop in the bucket of the Palestinian economy -- but it is minuscule compared to the holdings of these funds, some of which manage hundreds of billions of dollars.
It is somewhat ironic that the Gulf investment institution behind this new private equity fund is Abraaj Capital, which hails from oil-poor and debt-ridden Dubai. Perhaps, though, its move will strike an example for some of the other funds in the region.
People often talk about the Middle East as a poor and backwards region. It certainly is not the latter and only parts of it are the former. With so much wealth collecting in the Gulf, the managers of these assets should consider how they can use their economic power to effect positive change in their less well-endowed neighbors. Investing in Palestine's economy is an obvious first step.
Thursday, January 28, 2010
Keeping the Hand Extended
Richard Haass, the president of the Council on Foreign Relations, has an article in the current Newsweek on how the Obama administration ought to approach Iran. It is a relatively novel take on an ongoing (and tired) debate, in which new ideas and fresh approaches are rare.
I liked the article for its framework, but disagreed with the conclusion. Although a bit over-simplistic, Haass divides foreign policy into two schools of thought: a realist one, which deals with states as unitary actors and engages with them on foreign policy only, and a neoconservative one, which sometimes circumvents state governments and tries to influence activities within borders. Put another way, realists accept that they have to deal with unpalatable regimes, whereas neocons try to oust them.
Haass endorses the latter approach to Iran. He admits to being a 'flip-flopper' on this issue, having supported Obama's efforts to reach out to Tehran and use direct negotiations to try to pry Iran away from its nuclear program. But with talks going nowhere and research toward a nuclear bomb probably moving ahead, Haass calls for a change of tactic. Rather than coaxing the regime away from nukes, Washington should try to topple it by supporting the efforts of the opposition 'Green Movement.'
This is wrong for several reasons. The first is that there is nothing meaningful that Western governments can do to help this movement. In the article Haass suggests: 'speaking out' on behalf of the opposition movement, singling out the Revolutionary Guard for sanctioning, funding a project at Yale that documents human rights abuses in Iran, helping activists gain access to the Internet, and allowing the Iranian diaspora community to send money to fund the movement. I have no idea how the latter two could be accomplished from Washington and it's laughable to think that the Iranian regime will topple under the weight of any number of Ivy League human rights reports.
Short of military-led regime change, the Iranian government will only change under pressure from below. Haass doesn't talk about the internal dynamics of the opposition. He doesn't discuss the fact that the opposition leaders are longstanding political figures in Iran, whose political faction has existed since Mir Hossein Moussavi and Mehdi Karroubi helped Khomeini topple the Shah. For eight years their reformist political wing held the presidency. And their statements, particularly recent ones that tacitly accept the legitimacy of the elections, are far from revolutionary.
Mehdi Karroubi recently discussed the opposition's strategy with the FT. The topic of regime change is noticeably absent from his speech. Rather, he explains that the opposition's current tactic is to peel away moderate members of the current regime in order cut short Ahmidenejad's tenure. The options range from "removing [him] from office to restricting him or reshuffling the cabinet." Moreover, the article points out that Khamenei will likely only capitulate to the demands of the opposition if the poor join their movement.
These facts all point to the unavoidable conclusion that if Iran is to change, it will be reformed not remade -- and that such reforms depend almost entirely on the political whims of Tehran elites and the actions of the Iranian poor. The US may want to help: but it simply cannot.
The tactic Haass outlines would have the reverse effect from what he hopes. When Ahmidenejad first entered office he gained legitimacy by a) making unreasonable populist promises to the poor (which were not kept) and b) creating the impression that Iran was under threat from the West. The latter tactic worked well. Haass argues that the regime is already painting the opposition as a puppet of the West. But the difference between calling the West hostile now, as opposed to five years ago, is that back then it was mostly true (at least in tone, if not in action). Claiming now that Western governments are providing aid to the opposition (Germany has now received the dubious honor of being included in this growing club) simply makes the regime seem pathetic and desperate, undermining its legitimacy rather than bolstering it.
So Obama should do...nothing. At least nothing more than he's already doing. He should be constant and persistent in extending and re-extending his 'open hand' to the regime, making it clear that the US is not belligerent and that it simply wants to talk. These negotiations may prove futile; in fact, there is a better than average chance that they will. But that doesn't matter at this point. Western diplomats should let the forces in Tehran play out as they will; they may soon find themselves pleasantly surprised by the outcome.
I liked the article for its framework, but disagreed with the conclusion. Although a bit over-simplistic, Haass divides foreign policy into two schools of thought: a realist one, which deals with states as unitary actors and engages with them on foreign policy only, and a neoconservative one, which sometimes circumvents state governments and tries to influence activities within borders. Put another way, realists accept that they have to deal with unpalatable regimes, whereas neocons try to oust them.
Haass endorses the latter approach to Iran. He admits to being a 'flip-flopper' on this issue, having supported Obama's efforts to reach out to Tehran and use direct negotiations to try to pry Iran away from its nuclear program. But with talks going nowhere and research toward a nuclear bomb probably moving ahead, Haass calls for a change of tactic. Rather than coaxing the regime away from nukes, Washington should try to topple it by supporting the efforts of the opposition 'Green Movement.'
This is wrong for several reasons. The first is that there is nothing meaningful that Western governments can do to help this movement. In the article Haass suggests: 'speaking out' on behalf of the opposition movement, singling out the Revolutionary Guard for sanctioning, funding a project at Yale that documents human rights abuses in Iran, helping activists gain access to the Internet, and allowing the Iranian diaspora community to send money to fund the movement. I have no idea how the latter two could be accomplished from Washington and it's laughable to think that the Iranian regime will topple under the weight of any number of Ivy League human rights reports.
Short of military-led regime change, the Iranian government will only change under pressure from below. Haass doesn't talk about the internal dynamics of the opposition. He doesn't discuss the fact that the opposition leaders are longstanding political figures in Iran, whose political faction has existed since Mir Hossein Moussavi and Mehdi Karroubi helped Khomeini topple the Shah. For eight years their reformist political wing held the presidency. And their statements, particularly recent ones that tacitly accept the legitimacy of the elections, are far from revolutionary.
Mehdi Karroubi recently discussed the opposition's strategy with the FT. The topic of regime change is noticeably absent from his speech. Rather, he explains that the opposition's current tactic is to peel away moderate members of the current regime in order cut short Ahmidenejad's tenure. The options range from "removing [him] from office to restricting him or reshuffling the cabinet." Moreover, the article points out that Khamenei will likely only capitulate to the demands of the opposition if the poor join their movement.
These facts all point to the unavoidable conclusion that if Iran is to change, it will be reformed not remade -- and that such reforms depend almost entirely on the political whims of Tehran elites and the actions of the Iranian poor. The US may want to help: but it simply cannot.
The tactic Haass outlines would have the reverse effect from what he hopes. When Ahmidenejad first entered office he gained legitimacy by a) making unreasonable populist promises to the poor (which were not kept) and b) creating the impression that Iran was under threat from the West. The latter tactic worked well. Haass argues that the regime is already painting the opposition as a puppet of the West. But the difference between calling the West hostile now, as opposed to five years ago, is that back then it was mostly true (at least in tone, if not in action). Claiming now that Western governments are providing aid to the opposition (Germany has now received the dubious honor of being included in this growing club) simply makes the regime seem pathetic and desperate, undermining its legitimacy rather than bolstering it.
So Obama should do...nothing. At least nothing more than he's already doing. He should be constant and persistent in extending and re-extending his 'open hand' to the regime, making it clear that the US is not belligerent and that it simply wants to talk. These negotiations may prove futile; in fact, there is a better than average chance that they will. But that doesn't matter at this point. Western diplomats should let the forces in Tehran play out as they will; they may soon find themselves pleasantly surprised by the outcome.
Thursday, January 21, 2010
Reading Lists
Two prominent historians provide their lists of must-read books on the Middle East:
Juan Cole: Middle East history professor at the University of Michigan and author of two recent books on the region.
And Eugene Rogan: Director of the Middle East Center at Oxford.
I guess it should come as no surprise that the one point of overlap between the two lists is Albert Hourani's A History of the Arab Peoples.
The interview in which Rogan presents his list was timed to coincide with the launch of his recent book, The Arabs: A History. Rogan actually wrote the book, in many ways, as an extension or revision of Hourani's work. In the interview he characterizes it as a sort of post-9/11 version of Arab history. Not only does it focus more on 19th and 20th century history than does Hourani's, but in describing the history of the Arab people it seeks to articulate a partial response to the shrill, but frequently-raised question: why do they hate us?
I have only read the first half of Rogan's book. But at first pass, I think that Rogan conveniently warps the last five-hundred years of Arab history to fit his thesis -- which also attempts to answer the blunt question above. He argues that "the Arabs have negotiated the modern age largely by the rules set by the dominant powers of the day. In this sense, modern Arab history begins with the Ottoman conquest of the Arab world in the sixteenth century, when the Arabs first came to be ruled by an external power." Thus, Arabs hate us because they have been dominated by foreign powers for half a millennium and are really ticked off about it.
The problem is not only that the argument is overly simplistic, but in the book Rogan sort of tries to warp time to conform to his thesis. In a 500 page book he spends the first 60 pages on the Ottoman Empire. This is arguably the place where his thesis finds itself on its weakest footing and demands a more serious argument than the one he provides. I felt like he breezed past 300 years of history in part so that he could make history conform to his story.
Still, he does present an excellent reading list and gives good reasons for his selections. Worth a look.
Juan Cole: Middle East history professor at the University of Michigan and author of two recent books on the region.
And Eugene Rogan: Director of the Middle East Center at Oxford.
I guess it should come as no surprise that the one point of overlap between the two lists is Albert Hourani's A History of the Arab Peoples.
The interview in which Rogan presents his list was timed to coincide with the launch of his recent book, The Arabs: A History. Rogan actually wrote the book, in many ways, as an extension or revision of Hourani's work. In the interview he characterizes it as a sort of post-9/11 version of Arab history. Not only does it focus more on 19th and 20th century history than does Hourani's, but in describing the history of the Arab people it seeks to articulate a partial response to the shrill, but frequently-raised question: why do they hate us?
I have only read the first half of Rogan's book. But at first pass, I think that Rogan conveniently warps the last five-hundred years of Arab history to fit his thesis -- which also attempts to answer the blunt question above. He argues that "the Arabs have negotiated the modern age largely by the rules set by the dominant powers of the day. In this sense, modern Arab history begins with the Ottoman conquest of the Arab world in the sixteenth century, when the Arabs first came to be ruled by an external power." Thus, Arabs hate us because they have been dominated by foreign powers for half a millennium and are really ticked off about it.
The problem is not only that the argument is overly simplistic, but in the book Rogan sort of tries to warp time to conform to his thesis. In a 500 page book he spends the first 60 pages on the Ottoman Empire. This is arguably the place where his thesis finds itself on its weakest footing and demands a more serious argument than the one he provides. I felt like he breezed past 300 years of history in part so that he could make history conform to his story.
Still, he does present an excellent reading list and gives good reasons for his selections. Worth a look.
Monday, January 18, 2010
The MB Selects a New Leader
Two days ago the Muslim Brotherhood selected a new Supreme Leader, only the eighth time this has happened since the society was founded in 1928 by Hassan al-Banna. The individual selected is a relatively unknown professor of veterinary pathology at the University of Beni Suef named Mohamed Badie. He is one of the members of the 1965 Group, the collection of MB leaders who were imprisoned with former MB leader Sayid Qutb in August 1965 for allegedly trying to overthrow the regime of Gamal Abdel Nasser.
What does his selection mean for the MB and for politics in Egypt? I think there are two big conclusions that can be drawn:
1. It seems clear now that the MB will not take a confrontational position in challenging the regime during the upcoming parliamentary elections (this October) and presidential elections (next year). In 2005, the Brotherhood's reformist faction managed to convince its leadership that the political environment was open enough to safely compete in parliamentary elections; they were rewarded with a quarter of the seats, the largest opposition bloc in Egypt's recent history.
But this year looks to be a different story. There is far less external pressure on Mubarak than there was in 2005 to run somewhat fair elections and that, combined with recent constitutional amendments prohibiting independents from competing for parliament seats (this is how MB candidates always run, since the MB itself is banned), were always going to make it a tough fight for the Brotherhood. Badie's selection as Supreme Leader and his relatively conciliatory remarks about the regime in his acceptance speech (he said that "the Brothers have never been antagonistic to the ruling regime") make it even more clear that the Brotherhood will likely retreat back into social work and away from political activity in the years to come. However, if a leadership crisis does ensue, as some predict will happen if and when Hosni Mubarak can no longer serve as president, it will be interesting to see if the MB rise to the occasion and enter political life again, even under this low-key, conservative leader.
2. Another implication of Badie's selection is that the MB may shift to the right, becoming more insular and more consolidated around a rural, hard-line base. There are a sizable number of young and middle-aged moderates in the MB and they may be disappointed and disillusioned with Badie's rise to the position of Supreme Leader. Moderate leaders who were once active in student movements in the 70s and who advocated more political engagement, like Essam el-Erian and Abdel Moneim Aboul Fotouh, have been systematically shut out from the Guidance Bureau, which has remained in the hands of the older, more conservative leaders. Many younger members of the movement, particularly recruits from Cairo and other urban areas, will feel less and less represented by these conservative members and frustrated by the lack of political action, particularly if they see political opportunities being missed. Moreover, as Ibrahim al-Hodeiby (the grandson of former Supreme Leader Ma’amoun al-Hodeiby) writes, there is a growing number of MB leaders from Egypt's rural areas whose ideas are drawn from Wahhabi Salafi ideology and Badie's selection may be a sign of their increasing influence on the movement. Hodeiby, by the way, is one of those young moderate members...
In the 1990s Abu el-Ela Madi and some other MB reformers left the movement to form the Wasat Party. The party hasn't really gotten off the ground; it has been denied a party license on four separate incidences and it doesn't have much of a membership base. But if Badie's selection is a sign of a deeper conservative entrenchment in the MB, then in the years ahead we may see moderates in the movement splintering off to join parties like the Wasat, where their views and beliefs might be better represented. This could portend a realignment of Islamist politics in Egypt, which has always been dominated by the Brotherhood.
What does his selection mean for the MB and for politics in Egypt? I think there are two big conclusions that can be drawn:
1. It seems clear now that the MB will not take a confrontational position in challenging the regime during the upcoming parliamentary elections (this October) and presidential elections (next year). In 2005, the Brotherhood's reformist faction managed to convince its leadership that the political environment was open enough to safely compete in parliamentary elections; they were rewarded with a quarter of the seats, the largest opposition bloc in Egypt's recent history.
But this year looks to be a different story. There is far less external pressure on Mubarak than there was in 2005 to run somewhat fair elections and that, combined with recent constitutional amendments prohibiting independents from competing for parliament seats (this is how MB candidates always run, since the MB itself is banned), were always going to make it a tough fight for the Brotherhood. Badie's selection as Supreme Leader and his relatively conciliatory remarks about the regime in his acceptance speech (he said that "the Brothers have never been antagonistic to the ruling regime") make it even more clear that the Brotherhood will likely retreat back into social work and away from political activity in the years to come. However, if a leadership crisis does ensue, as some predict will happen if and when Hosni Mubarak can no longer serve as president, it will be interesting to see if the MB rise to the occasion and enter political life again, even under this low-key, conservative leader.
2. Another implication of Badie's selection is that the MB may shift to the right, becoming more insular and more consolidated around a rural, hard-line base. There are a sizable number of young and middle-aged moderates in the MB and they may be disappointed and disillusioned with Badie's rise to the position of Supreme Leader. Moderate leaders who were once active in student movements in the 70s and who advocated more political engagement, like Essam el-Erian and Abdel Moneim Aboul Fotouh, have been systematically shut out from the Guidance Bureau, which has remained in the hands of the older, more conservative leaders. Many younger members of the movement, particularly recruits from Cairo and other urban areas, will feel less and less represented by these conservative members and frustrated by the lack of political action, particularly if they see political opportunities being missed. Moreover, as Ibrahim al-Hodeiby (the grandson of former Supreme Leader Ma’amoun al-Hodeiby) writes, there is a growing number of MB leaders from Egypt's rural areas whose ideas are drawn from Wahhabi Salafi ideology and Badie's selection may be a sign of their increasing influence on the movement. Hodeiby, by the way, is one of those young moderate members...
In the 1990s Abu el-Ela Madi and some other MB reformers left the movement to form the Wasat Party. The party hasn't really gotten off the ground; it has been denied a party license on four separate incidences and it doesn't have much of a membership base. But if Badie's selection is a sign of a deeper conservative entrenchment in the MB, then in the years ahead we may see moderates in the movement splintering off to join parties like the Wasat, where their views and beliefs might be better represented. This could portend a realignment of Islamist politics in Egypt, which has always been dominated by the Brotherhood.
Wednesday, January 13, 2010
Multilateralism in Yemen
There have been a lot of articles written by experts on Yemen or counter-terrorism articulating what they believe a smart US policy would be. Consider this recent Op-Ed in the WSJ arguing that President Obama should form a Joint Task Force on Yemen to "develop and implement a strategy to improve the effectiveness of the Yemeni government and security forces, re-establish civil order, and eliminate the al Qaeda safe haven." I had been hopeful when I started reading the article, because the authors began by calling for an alternative "smart power" approach to the "limited counterterrorist approaches" that had been adopted so far. When I called for the same that was not exactly what I had in mind...
Then there was this article in Newsweek, which basically makes no argument whatsoever, other than that President Saleh is an "SOB." The WSJ piece said the same in gentler terms (it called him an "unpalatable partner") and in general this sentiment has been expressed in many other articles on Yemen. We want to help these people but what are we supposed to do when their leader is a corrupt maniac who refuses our money??
This has been the principal dilemma for the experts offering policy advice. How do you help a country that scorns your offers? Clearly Saleh is no saint...but if he is a maniac, then he is probably only a megalomaniac who wants to hold onto power for as long as possible. And he has some pretty good reasons for not wanting to accept too much US aid. The Newsweek article criticizes him for often snapping at Americans that "we are not your employees." The last thing he wants is for his country to see him as an American lapdog.
So what can we do? The suggestions that these pieces put forward are pretty laughable -- they are vague, unlikely to have any real impact, or outright counterproductive. For example, both suggest that Saleh will only help the US fight Al Qaeda if the US recognizes his number one security priority and wades in to help him fight the Houthis. I can't think of a better idea than to have the US fighting a proxy war with Iran in Yemen.
The solutions proposed will not do, not only because they are narrowly focused on security rather than development, not only because they are unlikely to be acceptable to Yemenis or to achieve their desired ends, and not only because the US does not have the financial means to properly execute them. Their fundamental flaw is that they involve two players only: the United States and Yemen. The fact is that if the US wants to make sure that Yemen doesn't fail, then it needs to butt out.
American should rely on its allies to execute the proper array of security and development strategies in Yemen. The problem is that American policymakers hate ceding control; there is a prevailing attitude in Washington that no one can do the job better than the United States. This is pointedly wrong, especially when it comes to Yemen.
There are many countries that could potentially do a better job training Yemeni security forces, undertaking joint military missions, establishing aid programs, executing development projects, and helping to stabilize the country. This is not just because of the Yemeni stigma against US aid dollars. In fact, there are many countries and agencies out there that have a deeper understanding of the problems Yemen faces and are better equipped to tackle them. The WSJ article mentions that the US embassy in Sana'a is understaffed and under-resourced. I would also add that it is under-educated (at least when it comes to Yemen's problems).
Although European countries can also be mistruted, some states have much better and more longstanding relationships with Yemen. Germany is a good example, with a large Yemeni expat community and a fairly sizable diplomatic and development presence in the country. Then there are Middle Eastern neighbors like Egypt and Saudi Arabia. Now that Saudi has come to Sana'a's rescue against the Houthi's, Saleh would likely welcome additional extensions of help from a neighbor that has always been something of a rival. Sana'a also has longstanding ties with Egypt, ever since Nasser helped the North win the civil war, and Egyptian aid might be welcomed. Finally, there are innumerable international aid organizations that are experienced in providing the kind of development insistence that Yemen needs.
America should back off. It should delegate some of its security activities to allies like Europe and Saudi Arabia. It should divert more funds (and a higher percentage of funds) to economic and social development, but should do so indirectly, through other countries' aid programs and through international organizations. It should recognize and accept that, for many reasons, it can only do so much by itself in Yemen.
Then there was this article in Newsweek, which basically makes no argument whatsoever, other than that President Saleh is an "SOB." The WSJ piece said the same in gentler terms (it called him an "unpalatable partner") and in general this sentiment has been expressed in many other articles on Yemen. We want to help these people but what are we supposed to do when their leader is a corrupt maniac who refuses our money??
This has been the principal dilemma for the experts offering policy advice. How do you help a country that scorns your offers? Clearly Saleh is no saint...but if he is a maniac, then he is probably only a megalomaniac who wants to hold onto power for as long as possible. And he has some pretty good reasons for not wanting to accept too much US aid. The Newsweek article criticizes him for often snapping at Americans that "we are not your employees." The last thing he wants is for his country to see him as an American lapdog.
So what can we do? The suggestions that these pieces put forward are pretty laughable -- they are vague, unlikely to have any real impact, or outright counterproductive. For example, both suggest that Saleh will only help the US fight Al Qaeda if the US recognizes his number one security priority and wades in to help him fight the Houthis. I can't think of a better idea than to have the US fighting a proxy war with Iran in Yemen.
The solutions proposed will not do, not only because they are narrowly focused on security rather than development, not only because they are unlikely to be acceptable to Yemenis or to achieve their desired ends, and not only because the US does not have the financial means to properly execute them. Their fundamental flaw is that they involve two players only: the United States and Yemen. The fact is that if the US wants to make sure that Yemen doesn't fail, then it needs to butt out.
American should rely on its allies to execute the proper array of security and development strategies in Yemen. The problem is that American policymakers hate ceding control; there is a prevailing attitude in Washington that no one can do the job better than the United States. This is pointedly wrong, especially when it comes to Yemen.
There are many countries that could potentially do a better job training Yemeni security forces, undertaking joint military missions, establishing aid programs, executing development projects, and helping to stabilize the country. This is not just because of the Yemeni stigma against US aid dollars. In fact, there are many countries and agencies out there that have a deeper understanding of the problems Yemen faces and are better equipped to tackle them. The WSJ article mentions that the US embassy in Sana'a is understaffed and under-resourced. I would also add that it is under-educated (at least when it comes to Yemen's problems).
Although European countries can also be mistruted, some states have much better and more longstanding relationships with Yemen. Germany is a good example, with a large Yemeni expat community and a fairly sizable diplomatic and development presence in the country. Then there are Middle Eastern neighbors like Egypt and Saudi Arabia. Now that Saudi has come to Sana'a's rescue against the Houthi's, Saleh would likely welcome additional extensions of help from a neighbor that has always been something of a rival. Sana'a also has longstanding ties with Egypt, ever since Nasser helped the North win the civil war, and Egyptian aid might be welcomed. Finally, there are innumerable international aid organizations that are experienced in providing the kind of development insistence that Yemen needs.
America should back off. It should delegate some of its security activities to allies like Europe and Saudi Arabia. It should divert more funds (and a higher percentage of funds) to economic and social development, but should do so indirectly, through other countries' aid programs and through international organizations. It should recognize and accept that, for many reasons, it can only do so much by itself in Yemen.
Saturday, January 9, 2010
How to Help Yemen?
As this week wore on, the Western press continued to churn out articles on Yemen. With the security story largely beaten to death, towards the end of the week newspapers started to turn towards other angles on Yemen -- looking at the country's problems with poverty, its wrecked economy, its corrupt and overly-bureaucratic system of government, its war with the Houthi rebels, and the conflict with the South (in short, many of the topics that in my last post I lamented were being ignored).
One of these articles particularly caught my eye: a NYT piece on the paltry amount of non-military aid the US sends to Yemen and its limited ability to affect conditions in the country. Indeed, the article reaches the conclusion that Yemen is essentially a lost cause.
In fact, this has been the tone of many articles that have discussed Yemen's broader problems and how the West might help the country address them. What can possibly be done in a country with such multifarious and deep-rooted social, political, and economic travails?
This conclusion frustrates me. The problems Yemen faces are indeed deep and difficult to solve; but they are not new. When I visited the country in 2007 all of the same issues were present and had been for many years before. The Houthi war has been going on for 5 years. Secessionist tendencies have existed almost since the day Yemen became unified. The country's economic woes certainly are not fresh news; Yemen's economy has been in trouble ever since the early 90s when Saudi Arabia, enraged over Yemen's support of Saddam Hussein's invasion of Kuwait, expelled the vast number of Yemeni laborers who had kept their home economy propped up through remittances. The oil reserves have always been known to be small. And the water table has been steadily decreasing, raising eyebrows throughout the development community, for years as well.
Of course, before now the United States and other Western governments had no reason to care about the problems of a small, backwater Arab country. So they left them to fester. And now they are grasping about in desperation looking for a silver bullet that will fix all Yemen's woes and throwing their hands up when one cannot be found.
I think this points to a fundamental flaw with the way the West conducts counter-terrorism and foreign policy strategies. Even despite all the talk over the last decade of preventing extremism from taking hold, US policies are still largely reactive.
Had the aid organizations and Western governments turned more attention to Yemen a decade ago or even earlier, the problems that are currently bemoaned might be much less severe. As the NYT article shows, US aid to Yemen has been paltry, especially when compared to other countries in the region (Israel, Egypt, Iraq, Afghanistan, Jordan). Moreover, up until recently, aid organization could operate in Yemen safely, without having to fear attacks or kidnappings. Yemen is no Somalia. When I visited the country, it felt safe and stable and there were a good number of Westerners visiting and working in Sana'a.
There has been a lot of debate among counter-terror experts about whether poverty breeds terrorism. Many members of Al Qaeda actually hail from middle class backgrounds, rather than deep impoverishment. I don't claim to be an expert, but it strikes me from what I have read that in a country like Yemen there is a connection between poverty and extremism. Yemenis who join Al Qaeda do so not only because of their beliefs, but also because of the lack of opportunities available to them.
A smart counter-terror policy would recognize that (in fact would have recognized that a decade ago). It would focus on long-term mitigation and prevention strategies. It would provide more non-military aid to build schools, hospitals, mosques, and roads. It would involve sending technical trainers who can help to develop local capabilities in areas like water conservation and oil exploration. It would involve working through diplomatic channels with US allies in the Gulf to ensure that Yemeni laborers can flow easily across borders to the places where there are jobs. Unfortunately it may be too late for all that now.
One of these articles particularly caught my eye: a NYT piece on the paltry amount of non-military aid the US sends to Yemen and its limited ability to affect conditions in the country. Indeed, the article reaches the conclusion that Yemen is essentially a lost cause.
In fact, this has been the tone of many articles that have discussed Yemen's broader problems and how the West might help the country address them. What can possibly be done in a country with such multifarious and deep-rooted social, political, and economic travails?
This conclusion frustrates me. The problems Yemen faces are indeed deep and difficult to solve; but they are not new. When I visited the country in 2007 all of the same issues were present and had been for many years before. The Houthi war has been going on for 5 years. Secessionist tendencies have existed almost since the day Yemen became unified. The country's economic woes certainly are not fresh news; Yemen's economy has been in trouble ever since the early 90s when Saudi Arabia, enraged over Yemen's support of Saddam Hussein's invasion of Kuwait, expelled the vast number of Yemeni laborers who had kept their home economy propped up through remittances. The oil reserves have always been known to be small. And the water table has been steadily decreasing, raising eyebrows throughout the development community, for years as well.
Of course, before now the United States and other Western governments had no reason to care about the problems of a small, backwater Arab country. So they left them to fester. And now they are grasping about in desperation looking for a silver bullet that will fix all Yemen's woes and throwing their hands up when one cannot be found.
I think this points to a fundamental flaw with the way the West conducts counter-terrorism and foreign policy strategies. Even despite all the talk over the last decade of preventing extremism from taking hold, US policies are still largely reactive.
Had the aid organizations and Western governments turned more attention to Yemen a decade ago or even earlier, the problems that are currently bemoaned might be much less severe. As the NYT article shows, US aid to Yemen has been paltry, especially when compared to other countries in the region (Israel, Egypt, Iraq, Afghanistan, Jordan). Moreover, up until recently, aid organization could operate in Yemen safely, without having to fear attacks or kidnappings. Yemen is no Somalia. When I visited the country, it felt safe and stable and there were a good number of Westerners visiting and working in Sana'a.
There has been a lot of debate among counter-terror experts about whether poverty breeds terrorism. Many members of Al Qaeda actually hail from middle class backgrounds, rather than deep impoverishment. I don't claim to be an expert, but it strikes me from what I have read that in a country like Yemen there is a connection between poverty and extremism. Yemenis who join Al Qaeda do so not only because of their beliefs, but also because of the lack of opportunities available to them.
A smart counter-terror policy would recognize that (in fact would have recognized that a decade ago). It would focus on long-term mitigation and prevention strategies. It would provide more non-military aid to build schools, hospitals, mosques, and roads. It would involve sending technical trainers who can help to develop local capabilities in areas like water conservation and oil exploration. It would involve working through diplomatic channels with US allies in the Gulf to ensure that Yemeni laborers can flow easily across borders to the places where there are jobs. Unfortunately it may be too late for all that now.
Tuesday, January 5, 2010
What's Yemen?
In the last few weeks, Yemen -- a mostly unnoticed and unheard-of country on the southern Arabian peninsula -- has been thrust into the international spotlight. Although the Al Qaeda network has been quietly gaining a foothold in the country for some time now, the recent attempt by one of its members to detonate a bomb on a US airline has propelled the country to the top of the news cycle and the Western foreign policy agenda. If most Americans know Yemen, it is probably from the Friends episode where Chandler boards a plane for Sana'a to escape a revolting girlfriend. Now they are wondering where this country came from and what to make of it.
A couple of years ago I spent five weeks in Yemen. I don't pretend that this gives me any sort of special insight into what's going on there or how to solve the myriad problems that the country faces. But my initial impression of the news coverage is that, with some exceptions, it has been far to narrowly focused on the question of Al Qaeda, ignoring the array of concomitant problems that make Yemen such a potentially explosive place.
Probably this is due to general ignorance on the part of most commentators, analysts, and journalists -- the American public are not the only ones who have ignored Yemen for years. But examining a country through the extremely narrow lens of anti-terrorism and security can create a host of problems. The US government turned a blind eye to the network of interrelated issues in Somalia, Afghanistan, and Iraq before sending in troops. It chose to act now and ask questions later -- a mistake that hopefully will not be repeated in Yemen.
The most egregious shortcoming in the recent coverage is the utter inability of commentators to fathom how Al Qaeda becoming stronger can fail to be the number one priority for the Yemeni government. Al Qaeda is the West's number one security concern. How can it not be Yemen's?
The problem is that the Yemeni state is under attack from so many sides that it can hardly hold itself together. Analysts overlook the devastating civil war with Houthi rebels in the north, which the government has several times come close to losing. They forget that Yemen is actually the combination of two formerly autonomous (and hostile) countries and that many in the South yearn for re-independence. Recently they have grown increasingly active in seeking it. Moreover, politics in Sana'a are volatile at the moment, as President Saleh will likely end his tenure soon (after a mere three decades in office) leading to a great deal of uncertainty over who will succeed him. And then there are the myriad social and economic problems: a water table that is almost depleted, an almost spent oil supply, rapid population growth, a lack of employment options, and one of the highest gun-to-citizen ratios in the world.
Frankly, if I were Yemen I'm not sure that Al Qaeda would be top of my list either.
A couple of years ago I spent five weeks in Yemen. I don't pretend that this gives me any sort of special insight into what's going on there or how to solve the myriad problems that the country faces. But my initial impression of the news coverage is that, with some exceptions, it has been far to narrowly focused on the question of Al Qaeda, ignoring the array of concomitant problems that make Yemen such a potentially explosive place.
Probably this is due to general ignorance on the part of most commentators, analysts, and journalists -- the American public are not the only ones who have ignored Yemen for years. But examining a country through the extremely narrow lens of anti-terrorism and security can create a host of problems. The US government turned a blind eye to the network of interrelated issues in Somalia, Afghanistan, and Iraq before sending in troops. It chose to act now and ask questions later -- a mistake that hopefully will not be repeated in Yemen.
The most egregious shortcoming in the recent coverage is the utter inability of commentators to fathom how Al Qaeda becoming stronger can fail to be the number one priority for the Yemeni government. Al Qaeda is the West's number one security concern. How can it not be Yemen's?
The problem is that the Yemeni state is under attack from so many sides that it can hardly hold itself together. Analysts overlook the devastating civil war with Houthi rebels in the north, which the government has several times come close to losing. They forget that Yemen is actually the combination of two formerly autonomous (and hostile) countries and that many in the South yearn for re-independence. Recently they have grown increasingly active in seeking it. Moreover, politics in Sana'a are volatile at the moment, as President Saleh will likely end his tenure soon (after a mere three decades in office) leading to a great deal of uncertainty over who will succeed him. And then there are the myriad social and economic problems: a water table that is almost depleted, an almost spent oil supply, rapid population growth, a lack of employment options, and one of the highest gun-to-citizen ratios in the world.
Frankly, if I were Yemen I'm not sure that Al Qaeda would be top of my list either.
Sunday, December 20, 2009
Egypt: State of the Nation
On Thursday, the Financial Times ran a 12 page special report on Egypt, which I recommend to all those who are interested in contemporary economic, political, and social trends in the country.
The FT is one of those newspapers with a certain bent: it focuses on economics and financial markets, and has a leaning towards free-market liberalism. True to form, the report has a number of articles on the Egyptian economy. But it also has some interesting analysis of the state of Egypt's higher education, its environmental problems, its agriculture sector, and the publishing industry (it also includes the same tired guessing games of who will succeed Mubarak). For those interested in something of a snapshot of where Egypt stands at the end of 2009, it is worth a read. I thought I'd lay out some of the more interesting statistics from this piece, as well as my responses to them:
70% of Egypt's GDP is made up of small and medium-sized businesses (SMEs), and they employ more than half the population. Yet, despite the importance of these businesses to the economy, they have low access to credit and receive little support from the government. Egypt's banks remain relatively well-capitalized; they avoided the worst pangs of the credit crisis as they were largely disconnected from global financial markets. But they are also extremely risk averse and prefer to loan money to the government and to large companies. The result is that SMEs struggle to gain loans and to scale up their operations when they need to, making it very difficult for the sector to grow or flourish.
The Egyptian stock exchange is capitalized at $90 billion and many analysts said it was better positioned than any other stock market in the region to have high growth next year. This in many ways struck me as the flip side of the previous point. As SMEs remain starved for capital, unable to grow or prosper, Egypt's large companies are earning record profits and are set to take off next year. The FT also points out that much of this strength has come from a government stimulus package of over $2.7 billion -- I wonder why they couldn't have directed more of this money to helping the little guys?
9.6% of Egyptians are unemployed but 40% live in poverty. That means that although the country's unemployment rate is lower than the United States', its poverty rate is almost three times as high. It also means that there are a lot of Egyptians out there with jobs who still do not earn enough to support themselves and their families. For a country growing at 4.7% (this year's GDP growth), this strikes me as unacceptable. Governments tend to focus on the absolute number of jobs in the marketplace. The FT interviewed Egypt's finance minister, Youssef Boutrous Ghali, who bragged that the government had created 3.5 million new jobs with its stimulus package. The two problems with this kind of job creation is that a) it may not be sustainable, as those jobs will disappear when the infrastructure projects are completed and b) there is no explanation of what those jobs are paying or how the workers are treated. There was no discussion in this interview or any of the other articles of how Egypt plans to tackle the poverty rate -- a striking oversight, in my opinion.
12.6% of Egyptian workers are employed in the tourism industry, which seems a bit precarious to me. Tourism is one of those industries that can disappear in the blink of an eye. This happened in 1997 when the Luxor terror bombings scared away Western tourists for years. This is not to suggest that such attacks will happen again; in fact I'm inclined to think that the threat to tourists from violent extremism is pretty low. But tourism can be volatile and I worry that Egypt may be staking too much of its economy on an industry that can dry up overnight.
Egypt's food exports could reach $20 billion by 2020, making it a net food exporter, rather than a food importer. This strikes me as very good news for a country that has faced troubling food shortages and food riots in the past. The report has a fascinating article about the rising investment in farming in Egypt, as developers reclaim desert land and turn it into arable fields for growing fruit and vegetables for domestic consumption and export to Europe. In fact, many of the new farms have adopted cutting edge drip-irrigation technology, which provides plants with precisely the amount of water that they need to grow. For a country with a discrete supply of water (the flow of water from the Nile is predetermined through international treaties), such high-tech irrigation techniques are necessary to increase the supply of food, feed a growing population, and continue to develop a valuable export good.
270 Turkish companies invest in Egypt, many in the textile sector. I have always though that intra-Middle East trade and investment can help the region grow and can allow some of the poorer countries to capitalize on the growth of richer ones. Moreover, drawing investment from countries in the 'near abroad' can be a good step toward proving that a market's investment climate is favorable and can further attract investment from places farther afield, like Europe or North America.
There are 180,000 undergraduates at Cairo University. The current higher education system in Egypt faces a number of problems, most of which boil down to the difficulty of offering free education to too many students with not enough resources. The system needs more facilities, more professors, and more jobs for graduates once they leave. I think that eventually Egypt is going to have to start charging tuition on a tiered basis (by income level) if it wants to maintain a robust university system. And the government is going to need to set aside a good chunk of its future budgets to investment in education. Otherwise Egypt is no longer going to be able to brag of having one of the best educated workforces in the region.
The Egyptian government killed 200,000 pigs this year, when the swine flu epidemic broke out. Those pigs used to eat 60% of the garbage collected by the zabaleen community of Coptic Christians. I have already blogged about how tragic this was for the zabaleen community, who are now facing incomes (which were already miniscule) at half their former levels and a mountain of trash building up with nowhere to go.
In my opinion this last statistic brought the whole report to an ironic conclusion. All indicators point to a country that is ripe for economic growth, with great potential in a number of sectors, including small and medium-sized businesses. But a largely corrupt and incompetent government continues to make self-serving, rash, and misguided policy decisions designed to curb political opposition and maintain stability. Hard to imagine what is currently holding Egypt back...
The FT is one of those newspapers with a certain bent: it focuses on economics and financial markets, and has a leaning towards free-market liberalism. True to form, the report has a number of articles on the Egyptian economy. But it also has some interesting analysis of the state of Egypt's higher education, its environmental problems, its agriculture sector, and the publishing industry (it also includes the same tired guessing games of who will succeed Mubarak). For those interested in something of a snapshot of where Egypt stands at the end of 2009, it is worth a read. I thought I'd lay out some of the more interesting statistics from this piece, as well as my responses to them:
70% of Egypt's GDP is made up of small and medium-sized businesses (SMEs), and they employ more than half the population. Yet, despite the importance of these businesses to the economy, they have low access to credit and receive little support from the government. Egypt's banks remain relatively well-capitalized; they avoided the worst pangs of the credit crisis as they were largely disconnected from global financial markets. But they are also extremely risk averse and prefer to loan money to the government and to large companies. The result is that SMEs struggle to gain loans and to scale up their operations when they need to, making it very difficult for the sector to grow or flourish.
The Egyptian stock exchange is capitalized at $90 billion and many analysts said it was better positioned than any other stock market in the region to have high growth next year. This in many ways struck me as the flip side of the previous point. As SMEs remain starved for capital, unable to grow or prosper, Egypt's large companies are earning record profits and are set to take off next year. The FT also points out that much of this strength has come from a government stimulus package of over $2.7 billion -- I wonder why they couldn't have directed more of this money to helping the little guys?
9.6% of Egyptians are unemployed but 40% live in poverty. That means that although the country's unemployment rate is lower than the United States', its poverty rate is almost three times as high. It also means that there are a lot of Egyptians out there with jobs who still do not earn enough to support themselves and their families. For a country growing at 4.7% (this year's GDP growth), this strikes me as unacceptable. Governments tend to focus on the absolute number of jobs in the marketplace. The FT interviewed Egypt's finance minister, Youssef Boutrous Ghali, who bragged that the government had created 3.5 million new jobs with its stimulus package. The two problems with this kind of job creation is that a) it may not be sustainable, as those jobs will disappear when the infrastructure projects are completed and b) there is no explanation of what those jobs are paying or how the workers are treated. There was no discussion in this interview or any of the other articles of how Egypt plans to tackle the poverty rate -- a striking oversight, in my opinion.
12.6% of Egyptian workers are employed in the tourism industry, which seems a bit precarious to me. Tourism is one of those industries that can disappear in the blink of an eye. This happened in 1997 when the Luxor terror bombings scared away Western tourists for years. This is not to suggest that such attacks will happen again; in fact I'm inclined to think that the threat to tourists from violent extremism is pretty low. But tourism can be volatile and I worry that Egypt may be staking too much of its economy on an industry that can dry up overnight.
Egypt's food exports could reach $20 billion by 2020, making it a net food exporter, rather than a food importer. This strikes me as very good news for a country that has faced troubling food shortages and food riots in the past. The report has a fascinating article about the rising investment in farming in Egypt, as developers reclaim desert land and turn it into arable fields for growing fruit and vegetables for domestic consumption and export to Europe. In fact, many of the new farms have adopted cutting edge drip-irrigation technology, which provides plants with precisely the amount of water that they need to grow. For a country with a discrete supply of water (the flow of water from the Nile is predetermined through international treaties), such high-tech irrigation techniques are necessary to increase the supply of food, feed a growing population, and continue to develop a valuable export good.
270 Turkish companies invest in Egypt, many in the textile sector. I have always though that intra-Middle East trade and investment can help the region grow and can allow some of the poorer countries to capitalize on the growth of richer ones. Moreover, drawing investment from countries in the 'near abroad' can be a good step toward proving that a market's investment climate is favorable and can further attract investment from places farther afield, like Europe or North America.
There are 180,000 undergraduates at Cairo University. The current higher education system in Egypt faces a number of problems, most of which boil down to the difficulty of offering free education to too many students with not enough resources. The system needs more facilities, more professors, and more jobs for graduates once they leave. I think that eventually Egypt is going to have to start charging tuition on a tiered basis (by income level) if it wants to maintain a robust university system. And the government is going to need to set aside a good chunk of its future budgets to investment in education. Otherwise Egypt is no longer going to be able to brag of having one of the best educated workforces in the region.
The Egyptian government killed 200,000 pigs this year, when the swine flu epidemic broke out. Those pigs used to eat 60% of the garbage collected by the zabaleen community of Coptic Christians. I have already blogged about how tragic this was for the zabaleen community, who are now facing incomes (which were already miniscule) at half their former levels and a mountain of trash building up with nowhere to go.
In my opinion this last statistic brought the whole report to an ironic conclusion. All indicators point to a country that is ripe for economic growth, with great potential in a number of sectors, including small and medium-sized businesses. But a largely corrupt and incompetent government continues to make self-serving, rash, and misguided policy decisions designed to curb political opposition and maintain stability. Hard to imagine what is currently holding Egypt back...
Tuesday, December 8, 2009
President Baradei?
Speculation on Egypt's impending presidential election returned to a fevered level this week as Mohamad el Baradei, now-former Director-General of the IAEA, commented on the possibility of running for the position in the 2011 race. The question of who will run has been the subject of increasingly pitched debates over the last year, but the addition of Baradei's name to the standard list of contenders adds an extra layer of complexity to this divination game. Baradei's statement on CNN three days ago was the catalyst for this new round of speculation:
"I've been closely following calls for me to run in the next presidential elections. Though I deeply appreciate people's trust in my abilities, I'd like to make it clear that my final position will be determined upon a number of fundamental issues. Elections must be under the full supervision of the judiciary and in the presence of international observers from the United Nations to ensure transparency."
Hardly an iron-clad statement of purpose.
Still, the addition of Baradei into the mix -- which currently includes Hosni Mubarak, his son, Gamal Mubarak, Omar Suleiman, the head of Egypt's security services, and Amr Moussa, the secretary general of the Arab League -- has led some to suggest that he might present new hope for a united opposition front to whomever is the NDP candidate (most likely to be one of the two Mubarakas).
Indeed, many independent and opposition groups hailed Baradei's statement and suggested that they might support him if he tried to run. The Wafd Party has suggested nominating him as their candidate and opposition groups like Kefaya and the 6th of April Movement released endorsements of his potential candidacy.
Of course this is all mostly meaningless, since any Baradei candidacy is likely to be de-railed before it ever gets off the ground, simply due to Egypt's draconian election laws (more details on this here).
But for the sake of argument, let's consider the potential for Baradei to be a truly unifying opposition candidate. I see three reasons that this is unlikely:
First, Baradei has little connection to Egypt. He has spent only six years living in the country since 1964 (a fact pointed out by the independent columnist Omar Taher in the opposition newspaper Al Dostoor). He is already being accused for being out-of-touch with concrete Egyptian issues and Egyptians are little familiar with his background, beliefs, or vision for the country.
Second, he is too close to a Western foreign policy establishment that the Egyptian opposition has come to deeply distrust. Ultimately I think the opposition would fracture over whether or not to support a figure who has spent so much time working with and for states and organizations that are often criticized for exercising neo-imperialism and paternalism (the UN, the United States, and Israel).
Finally, and most importantly, I don't think Baradei has the breadth of appeal to attract the many different camps in Egypt's opposition, including the most important one -- the Islamists. Frankly, no opposition candidate who runs for President without the backing of the Muslim Brotherhood can be taken seriously. The rest of the opposition is too weak and divided to present the kind of grassroots foundation that would make a candidate viable. The organizations that have endorsed Baradei are primarily secular and liberal, while organizations and parties aligned with other ideologies (including Nasserists, socialists, and Islamists), have given, at best, tepid responses. An independent who runs with an MB endorsement (and who can also appeal to some of these other ideological groups) is probably the best shot the opposition has at presenting a real alternative to the NDP's selection.
Who might that be? We can only speculate.
"I've been closely following calls for me to run in the next presidential elections. Though I deeply appreciate people's trust in my abilities, I'd like to make it clear that my final position will be determined upon a number of fundamental issues. Elections must be under the full supervision of the judiciary and in the presence of international observers from the United Nations to ensure transparency."
Hardly an iron-clad statement of purpose.
Still, the addition of Baradei into the mix -- which currently includes Hosni Mubarak, his son, Gamal Mubarak, Omar Suleiman, the head of Egypt's security services, and Amr Moussa, the secretary general of the Arab League -- has led some to suggest that he might present new hope for a united opposition front to whomever is the NDP candidate (most likely to be one of the two Mubarakas).
Indeed, many independent and opposition groups hailed Baradei's statement and suggested that they might support him if he tried to run. The Wafd Party has suggested nominating him as their candidate and opposition groups like Kefaya and the 6th of April Movement released endorsements of his potential candidacy.
Of course this is all mostly meaningless, since any Baradei candidacy is likely to be de-railed before it ever gets off the ground, simply due to Egypt's draconian election laws (more details on this here).
But for the sake of argument, let's consider the potential for Baradei to be a truly unifying opposition candidate. I see three reasons that this is unlikely:
First, Baradei has little connection to Egypt. He has spent only six years living in the country since 1964 (a fact pointed out by the independent columnist Omar Taher in the opposition newspaper Al Dostoor). He is already being accused for being out-of-touch with concrete Egyptian issues and Egyptians are little familiar with his background, beliefs, or vision for the country.
Second, he is too close to a Western foreign policy establishment that the Egyptian opposition has come to deeply distrust. Ultimately I think the opposition would fracture over whether or not to support a figure who has spent so much time working with and for states and organizations that are often criticized for exercising neo-imperialism and paternalism (the UN, the United States, and Israel).
Finally, and most importantly, I don't think Baradei has the breadth of appeal to attract the many different camps in Egypt's opposition, including the most important one -- the Islamists. Frankly, no opposition candidate who runs for President without the backing of the Muslim Brotherhood can be taken seriously. The rest of the opposition is too weak and divided to present the kind of grassroots foundation that would make a candidate viable. The organizations that have endorsed Baradei are primarily secular and liberal, while organizations and parties aligned with other ideologies (including Nasserists, socialists, and Islamists), have given, at best, tepid responses. An independent who runs with an MB endorsement (and who can also appeal to some of these other ideological groups) is probably the best shot the opposition has at presenting a real alternative to the NDP's selection.
Who might that be? We can only speculate.
Thursday, December 3, 2009
Need Somewhere to do your Christmas Shopping...?
This season, consider buying a piece of trash.
Today the NYT ran a story about a pair of women in New York who sell handicrafts made by the Egyptian zabaleen. The zabaleen are an extremely poor community of Coptic Christians who live in Cairo and make a living collecting, selling, and recycling the city's trash. Fifteen years ago the two Egyptian-American women who sell the merchandise stumbled on a workshop of zabaleen women who were turning the trash they collected into handicrafts. They began bringing these goods back to America and selling them at craft fairs.
The zabaleen are a remarkable community, who have somehow managed to figure out a way to scrape together a living in both a hostile and squalid environment. They had a particularly rough year in 2009, when the Egyptian government (in all of its wisdom) decided the best way to combat swine flu was to kill off all the country's pigs -- many of which are used by the zabaleen to dispose of trash (Michael Slackman wrote a good article about this here).
If history serves as a guide, the community will figure out a way to survive, despite their recent hardship. Still, it sounds like the zabaleen could use a little boost from some socially-conscious, Middle East grad students (it is, after all, a down economy and demand is sagging). The article says they'll be selling the merchandise at the Calvary Church next to Gramercy Park until Saturday. Might be the year to finally buy Mom her first rug made of trash...
Today the NYT ran a story about a pair of women in New York who sell handicrafts made by the Egyptian zabaleen. The zabaleen are an extremely poor community of Coptic Christians who live in Cairo and make a living collecting, selling, and recycling the city's trash. Fifteen years ago the two Egyptian-American women who sell the merchandise stumbled on a workshop of zabaleen women who were turning the trash they collected into handicrafts. They began bringing these goods back to America and selling them at craft fairs.
The zabaleen are a remarkable community, who have somehow managed to figure out a way to scrape together a living in both a hostile and squalid environment. They had a particularly rough year in 2009, when the Egyptian government (in all of its wisdom) decided the best way to combat swine flu was to kill off all the country's pigs -- many of which are used by the zabaleen to dispose of trash (Michael Slackman wrote a good article about this here).
If history serves as a guide, the community will figure out a way to survive, despite their recent hardship. Still, it sounds like the zabaleen could use a little boost from some socially-conscious, Middle East grad students (it is, after all, a down economy and demand is sagging). The article says they'll be selling the merchandise at the Calvary Church next to Gramercy Park until Saturday. Might be the year to finally buy Mom her first rug made of trash...
Tuesday, December 1, 2009
Abu Dhabi's Big Gamble
Although Shardul already discussed a little the financial mess that Dubai World seems to have created for itself, I wanted to probe this development a little bit further. Although it certainly has been interesting to watch Dubai slowly sink into a bog of debt (in my opinion, portending a much more modest decade for Dubai than the current one has been), I have been more intrigued by the response from the Emirate's smaller but far richer neighbor to the South -- Abu Dhabi.
Abu Dhabi is not only the political capital of the UAE but (more importantly) controls the majority of the country's oil and gas production. Revenues from sales of these resources has allowed the city to accumulate a massive amount of wealth, estimated by some to be close to $500bn. Dubai, on the other hand, has no oil and so has had to base its frantic growth primarily on debt raised in international markets.
The question that has puzzled me is why Abu Dhabi (or the UAE central government, which is essentially the same thing) does not step up and bail out its sinking twin sister. While the government made a weak statement saying they would "pick and choose" which debts to underwrite, the real news was what it didn't say -- it did not guarantee Dubai World's total debt, nor did it offer to extend an emergency line of credit (as it did earlier this year). Is there no sense of national solidarity in the UAE whereby one Emirate is expected to help out its neighbors? And even if there isn't, certainly there are reasons grounded in self-interest for Abu Dhabi to step up to the plate. Abu Dhabi's stock market opened 8% down today and surely the press has been bad enough already to scare creditors away for months to come or even longer. Abu Dhabi should not so much be worried about saving Dubai World...it should be worried about saving itself.
So here are the three best explanations I have heard for why Abu Dhabi has been so reticent thus far:
Glee. Frankly I think it is very likely that the Nahyans and the rest of the Abu Dhabi elite are watching all this with something of a twinkle in their eyes. For years they have watched grouchily as Dubai grew and grew and grew some more, catching headlines, drawing in foreigners, and projecting its glitzy image around the world. Pithy sayings like "Shanghai, Mumbai, Dubai, or goodbye" infuriated those in Abu Dhabi, who thought that Dubai was gaining undeserved credit and recognition, when they were the ones with all the oil and wealth. Now, the tables have turned quite abruptly and Abu Dhabi might just want to savor the moment for a little; the more the image of Dubai as a high-flying city of superlatives is undermined, the more Abu Dhabi can hope to be able to appropriate some of that sexiness for itself.
Political control. Another rationale, somewhat connected to the one above, is that Abu Dhabi may be using the occasion to consolidate its political hold over the UAE. The country is remarkably decentralized and much of its recent development has been characterized by both economic and political competition between Dubai and Abu Dhabi. While the Nahyans have explicitly denied that there is any bad political blood between themselves and Sheikh Mo (Dubai's enigmatic ruler), there is much historical evidence of tension between the two camps. Abu Dhabi may therefore use this opportunity to beef up the authority of the UAE central government and permanently rein in Dubai.
Moral hazard. In addition to the base calculations of power and politics, there is a relatively sound economic argument to be made for not bailing out Dubai World. The issue is one of moral hazard. Abu Dhabi has already bailed out Dubai to the sum of $10bn and guaranteeing Dubai World's debt could potentially put it on the hook for $35bn more. Even for Abu Dhabi, that is a lot of money. The greater problem, though, is if Dubai starts to get the impression that Abu Dhabi will always be there to watch its back when it behaves irresponsibly. If Abu Dhabi cannot make Dubai feel the pain now, there is no reason to expect that during the next boom-cycle Dubai will not ramp up its leverage once again and get itself mired in another debt quagmire. If Abu Dhabi cannot convince Dubai (and foreign investors) that it has no appetite for underwriting its debt (either explicitly or tacitly) then it could end up backing even more than $35bn sometime in the future.
Abu Dhabi is not only the political capital of the UAE but (more importantly) controls the majority of the country's oil and gas production. Revenues from sales of these resources has allowed the city to accumulate a massive amount of wealth, estimated by some to be close to $500bn. Dubai, on the other hand, has no oil and so has had to base its frantic growth primarily on debt raised in international markets.
The question that has puzzled me is why Abu Dhabi (or the UAE central government, which is essentially the same thing) does not step up and bail out its sinking twin sister. While the government made a weak statement saying they would "pick and choose" which debts to underwrite, the real news was what it didn't say -- it did not guarantee Dubai World's total debt, nor did it offer to extend an emergency line of credit (as it did earlier this year). Is there no sense of national solidarity in the UAE whereby one Emirate is expected to help out its neighbors? And even if there isn't, certainly there are reasons grounded in self-interest for Abu Dhabi to step up to the plate. Abu Dhabi's stock market opened 8% down today and surely the press has been bad enough already to scare creditors away for months to come or even longer. Abu Dhabi should not so much be worried about saving Dubai World...it should be worried about saving itself.
So here are the three best explanations I have heard for why Abu Dhabi has been so reticent thus far:
Glee. Frankly I think it is very likely that the Nahyans and the rest of the Abu Dhabi elite are watching all this with something of a twinkle in their eyes. For years they have watched grouchily as Dubai grew and grew and grew some more, catching headlines, drawing in foreigners, and projecting its glitzy image around the world. Pithy sayings like "Shanghai, Mumbai, Dubai, or goodbye" infuriated those in Abu Dhabi, who thought that Dubai was gaining undeserved credit and recognition, when they were the ones with all the oil and wealth. Now, the tables have turned quite abruptly and Abu Dhabi might just want to savor the moment for a little; the more the image of Dubai as a high-flying city of superlatives is undermined, the more Abu Dhabi can hope to be able to appropriate some of that sexiness for itself.
Political control. Another rationale, somewhat connected to the one above, is that Abu Dhabi may be using the occasion to consolidate its political hold over the UAE. The country is remarkably decentralized and much of its recent development has been characterized by both economic and political competition between Dubai and Abu Dhabi. While the Nahyans have explicitly denied that there is any bad political blood between themselves and Sheikh Mo (Dubai's enigmatic ruler), there is much historical evidence of tension between the two camps. Abu Dhabi may therefore use this opportunity to beef up the authority of the UAE central government and permanently rein in Dubai.
Moral hazard. In addition to the base calculations of power and politics, there is a relatively sound economic argument to be made for not bailing out Dubai World. The issue is one of moral hazard. Abu Dhabi has already bailed out Dubai to the sum of $10bn and guaranteeing Dubai World's debt could potentially put it on the hook for $35bn more. Even for Abu Dhabi, that is a lot of money. The greater problem, though, is if Dubai starts to get the impression that Abu Dhabi will always be there to watch its back when it behaves irresponsibly. If Abu Dhabi cannot make Dubai feel the pain now, there is no reason to expect that during the next boom-cycle Dubai will not ramp up its leverage once again and get itself mired in another debt quagmire. If Abu Dhabi cannot convince Dubai (and foreign investors) that it has no appetite for underwriting its debt (either explicitly or tacitly) then it could end up backing even more than $35bn sometime in the future.
Saturday, November 28, 2009
Football Politics
A set of recent articles in The New York Times about the national football teams of Egypt, Iraq, and Palestine caught my attention. The articles were printed in isolation, prompted by three separate events in the world of football (or 'soccer,' for those of us on this side of the Atlantic). But I thought they were interesting when placed in comparison, as they each revealed something distinctive about the national politics shaping the states from which the teams hailed.
It is always a bit reductive to talk about national sports teams in symbolic terms. For the most part I tend to think that sports are just sports and not particularly representative of much beyond that. But just like all national obsessions, football can sometimes shed light on the popular dynamics shaping the political or social direction of a given nation. In the case of these three articles, I thought that the particular football-politics that they described had some interesting things to say about the current political predicaments facing the three countries.
The first article was a Michael Slackman piece on the Egyptian rioting following the country's loss to Algeria in the final World Cup qualifying match. Egypt was the heavy favorite and the country, which is a perennial powerhouse in the world of African football, had been hoping to finally buck its trend of underperfomance and qualify for football's greatest tournament for the first time in two decades (instead, they lost 1-0).
It was not so much the performance of the team that I found to be indicative of Egypt's current political situation, but rather the response of the country's state leaders. As Slackman points out, Egypt's government officials tried to use the face-off with Algeria to stir up national solidarity and (more importantly) divert attention from the perpetual failings of the Mubarak regime. When Egypt lost the match, the government reacted with petulant accusations against Algerian fans and lashed out by withdrawing its ambassador from Algiers. Alaa Mubarak, the President's son, released statements stirring up feelings of collective resentment against alleged Algerian affronts; they were meant to sound defiant, but instead rang as pathetic. And yet, Egyptians reacted to the propaganda and took to the streets, protesting against the perceived injustices and marching on the Algerian embassy.
This all struck me as remarkably indicative of the political problems that Egypt faces. An authoritarian regime with little to no popular credibility is looking increasingly desperate for new ways to maintain its control on a restless and disillusioned population. It thought the competition with Algeria might help it to boost the nation's solidarity, but when the team lost, it had to resort to the perverted opposite of national pride -- collective resentment. And then, of course, the entire situation spun out of its control. Its public statements and petty reactions led to violence in the streets, forcing the regime to deploy riot police to quell the restlessness that it had unleashed. The whole affair simply leaves the government looking hapless and desperate -- no vision, no credibility, and no ability to control a justifiably restless population.
The second article discussed the current predicament facing Iraq's national football team, which was recently suspended by FIFA due to meddlesome government interference in the affairs of the Iraqi Football Association. The suspension is an embarrassment, particularly for a team that had been flagged as a rising football power in Asia and dubbed "The Lions of Mesopotamia" after they won the Asia Cup in 2007.
When Iraq won this tournament -- Asia's most prestigious -- the country momentarily came together in a great surge of national unity. For all its divisions and strife, Iraqis have united in the past around their football team, which remained under the ruthless supervision of Saddam Hussein's son before 2003. In 2007, the country's victory was heralded as a sign that Iraqis could overcome their differences and work towards a collective future together. Now, the suspension of the team seems to portend the opposite. It uncannily coincides with the current debacle going on in Iraq's parliament over the election law. Just as the various factions seemed prepared to sign an agreement, the loose-cannon VP Tareq al-Hashemi shot the whole agreement to pieces with his veto. Who knows whether the agreement can be put back together. But it does seem that every time Iraqis are given a bit of hope for national reconciliation -- be it in football or in voting laws -- the affair gets hamstrung by the fractious bickering of its perpetually divided political leaders.
The final article gave a more classic account of how football can unite and inspire populations. It described the Palestinian women's football team in their match-up against Jordan in the West Bank town of Al Ram. Although surrounded by blockades and in the shadow of Israeli checkpoints, the event had an uplifting and somewhat defiant tone to it, as though the participants were determined to express their national pride despite the innumerable obstacles currently preventing that nation from coming to full fruition. The players competed and the fans cheered almost as an alternative means of national resistance. It was an powerful sign that despite facing nothing but disappointment in the eternally-draw-out peace negotiations with Israel, Palestinians are still finding reasons to cheer. They are coming up with alternative ways to forward their national project through channels that do not involve uninspiring politicians, intractable negotiating positions, and stalled 'peace processes.'
It is always a bit reductive to talk about national sports teams in symbolic terms. For the most part I tend to think that sports are just sports and not particularly representative of much beyond that. But just like all national obsessions, football can sometimes shed light on the popular dynamics shaping the political or social direction of a given nation. In the case of these three articles, I thought that the particular football-politics that they described had some interesting things to say about the current political predicaments facing the three countries.
The first article was a Michael Slackman piece on the Egyptian rioting following the country's loss to Algeria in the final World Cup qualifying match. Egypt was the heavy favorite and the country, which is a perennial powerhouse in the world of African football, had been hoping to finally buck its trend of underperfomance and qualify for football's greatest tournament for the first time in two decades (instead, they lost 1-0).
It was not so much the performance of the team that I found to be indicative of Egypt's current political situation, but rather the response of the country's state leaders. As Slackman points out, Egypt's government officials tried to use the face-off with Algeria to stir up national solidarity and (more importantly) divert attention from the perpetual failings of the Mubarak regime. When Egypt lost the match, the government reacted with petulant accusations against Algerian fans and lashed out by withdrawing its ambassador from Algiers. Alaa Mubarak, the President's son, released statements stirring up feelings of collective resentment against alleged Algerian affronts; they were meant to sound defiant, but instead rang as pathetic. And yet, Egyptians reacted to the propaganda and took to the streets, protesting against the perceived injustices and marching on the Algerian embassy.
This all struck me as remarkably indicative of the political problems that Egypt faces. An authoritarian regime with little to no popular credibility is looking increasingly desperate for new ways to maintain its control on a restless and disillusioned population. It thought the competition with Algeria might help it to boost the nation's solidarity, but when the team lost, it had to resort to the perverted opposite of national pride -- collective resentment. And then, of course, the entire situation spun out of its control. Its public statements and petty reactions led to violence in the streets, forcing the regime to deploy riot police to quell the restlessness that it had unleashed. The whole affair simply leaves the government looking hapless and desperate -- no vision, no credibility, and no ability to control a justifiably restless population.
The second article discussed the current predicament facing Iraq's national football team, which was recently suspended by FIFA due to meddlesome government interference in the affairs of the Iraqi Football Association. The suspension is an embarrassment, particularly for a team that had been flagged as a rising football power in Asia and dubbed "The Lions of Mesopotamia" after they won the Asia Cup in 2007.
When Iraq won this tournament -- Asia's most prestigious -- the country momentarily came together in a great surge of national unity. For all its divisions and strife, Iraqis have united in the past around their football team, which remained under the ruthless supervision of Saddam Hussein's son before 2003. In 2007, the country's victory was heralded as a sign that Iraqis could overcome their differences and work towards a collective future together. Now, the suspension of the team seems to portend the opposite. It uncannily coincides with the current debacle going on in Iraq's parliament over the election law. Just as the various factions seemed prepared to sign an agreement, the loose-cannon VP Tareq al-Hashemi shot the whole agreement to pieces with his veto. Who knows whether the agreement can be put back together. But it does seem that every time Iraqis are given a bit of hope for national reconciliation -- be it in football or in voting laws -- the affair gets hamstrung by the fractious bickering of its perpetually divided political leaders.
The final article gave a more classic account of how football can unite and inspire populations. It described the Palestinian women's football team in their match-up against Jordan in the West Bank town of Al Ram. Although surrounded by blockades and in the shadow of Israeli checkpoints, the event had an uplifting and somewhat defiant tone to it, as though the participants were determined to express their national pride despite the innumerable obstacles currently preventing that nation from coming to full fruition. The players competed and the fans cheered almost as an alternative means of national resistance. It was an powerful sign that despite facing nothing but disappointment in the eternally-draw-out peace negotiations with Israel, Palestinians are still finding reasons to cheer. They are coming up with alternative ways to forward their national project through channels that do not involve uninspiring politicians, intractable negotiating positions, and stalled 'peace processes.'
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