Posts Tagged ‘the Gulf’

If you build it, will they come? Capital investment in the Gulf

Tuesday, September 1st, 2009
Burj Dubai, the tallest man-made structure in the world. Burj means tower in Arabic.

Burj Dubai, the tallest man-made structure in the world. Burj means tower in Arabic.

Brian Stelter wrote yesterday in the business section of the nytimes about the fallow film production studios in Dubai. Check the great lede:

When the heiress Paris Hilton traveled here in June and July to audition female friends for her show “My New BFF,” her producers had access to state-of-the-art studios and a government eager to import a touch of Hollywood glamour to the Middle East.

But to adhere to the region’s Islamic norms, many of the ingredients in reality TV were taboo: there would be no drinking, no cursing, no dramatic displays of affection. The producers thought about filming a scene at a water park, but passed on the option of dressing the contestants in religiously appropriate swimwear.

I do have to fault the article for relying on the simple equation of Hollywood/America = Sex. After all, not all American films revolved around sex–though if they are set in the Middle East, they’re probably about terrorism and oil.

“Syriana” and “The Kingdom” were both filmed in Dubai (though arguably, that was a win/win for both Dubai and the filmmakers, since it let the filmmakers approximate Saudi Arabia–while Dubai could make themselves look better, at the expense of Saudi’s flaws). But to date, they are the only Western films to be partially made in the Emirates.  I have to wonder, why was “Body of Lies,” a similar political thriller about terrorism, turned down in 2007? Maybe Dubai doesn’t want to get typecast …

This month, the government rejected the request from the producers of the sequel of “Sex and the City,” which was to be partially set in Dubai:

Dubai Studio City’s facilities have been used in 26 feature films, mostly from gulf countries and Bollywood. … In rejecting the request from the producers of the “Sex and the City” sequel this summer, Mr. Sharif said, the authorities took into account “the multicultural fabric of the society and its perceptions.”

According to a government official familiar with the script, its plot lines — with the women coming to Dubai, spending money lavishly and cavorting — were perceived to reinforce negative stereotypes about the region.

Good luck with that. When I was in Doha, and told female (khalijeeat) acquaintances that I had lived in New York City, they immediately asked if it was like “Sex and the City.” Some of them wanted nothing more than to move there and live like Carrie Bradshaw and the rest of them. So are the censoring authorities more afraid of stereotypes of the Gulf, or of their women following the Western example?

And so the article goes, assessing the hurdles to film production in Dubai, including failed co-productions (the abysmal “Shorts,” which just opened to pathetic box office returns in America). The articles focuses on Islamic law and censorship as the principal problem for the Gulf’s investments:

Dubai, its rival Abu Dhabi and other Persian Gulf cities face enormous hurdles as they try to diversify their economies by fostering creativity and becoming entertainment capitals. Chief among those hurdles: they operate under Islamic law. Hollywood does not. So far, the oil-rich countries have proved more able to pay for fancy media productions and to build expensive film facilities than to actually lure production to the Middle East, as economic efforts run up against their traditional values and censorship.

The article also ends on this note:

Even more than the staff issues, enduring issues of censorship may be the most stubborn hurdle for the gulf region — even if, as Mr. Hirschorn jokingly said, “our government censor turned out to be a really nice guy.”

Perhaps that’s part of the problem. Perhaps that’s why (DUH) a Paris Hilton reality TV show probably won’t have much to with the Gulf.

But the real problem in my eyes is not the strict moral codes in the Gulf countries, but the failure of their labor markets. The piece briefly touches on this point:

Some of the other hurdles are logistical. For instance, local requirements for full-time work visas mean that the country lacks a robust freelance market to support productions. Jamal al-Sharif, the executive director of Dubai Studio City, which was founded in 2005 to stimulate the regional film industry, acknowledged that “a vital ingredient for building the film industry is access to talent.”

The current business model of Hollywood is dependent on putting together “packaged” deals. Essentially, every film is established as a singular corporate entity, a one-0ff, a model that requires a lot of flexibility–negotiations must occur between every component part in a film production.

This essentially means that the talent–not just actors, writers, directors, but the production assistants, set designers, everyone beyond the camera and behind the scenes–must be brought in to Dubai for one movie. And then, once the production is over,  everyone goes home–because the countries’ visa laws won’t permit unemployed foreigners to remain in the country.

There is no efficiency involve. The Emirates doesn’t have taxes, but that doesn’t negate the expense required to move an entire production–full of all these moving parts, subject to shifting negotiations–to a country far away. And it’s not like someone can stick around after the filmmaking is done, or if something changes in the negotiations and participants need to shift around–visas in the Gulf countries are subject to strict regulations. Lose your current job, and you must leave.

The Gulf’s labor laws are one of the biggest problems in capitalizing on their outsized capital investments. Places like the Media Zone in Abu Dhabi or Education City in Doha won’t flourish on their own. Regardless of their stellar, expensive facilities, these places actually require even more, continuous investments in human capital. Skilled workers, whether engineers or educators or filmmakers or journalists, must be recruited from the West or other Arab countries and brought over on a case-by-case basis. And once again, it’s not terribly easy to change jobs once you’re in country–don’t count on an unemployment period for job hunting, because even as a Westerner or a fellow Arab, you will be deported.

This is to say nothing of the unskilled laborers, working in the Gulf. For more on them, read this lengthy investigative article I wrote while in Doha. It also delves a little deeper into the problems of the labor laws if you’re curious on that count.

In the end, if the Gulf countries want to make the most of their investments, it’s not the morality laws that need to be changed. It’s the labor laws.

The dark side of Dubai

Monday, August 10th, 2009

Migrant construction workers in Dubai, easily identified by their uniform jumpsuits.

Migrant construction workers in Dubai, easily identified by their uniform jumpsuits.

I’ve written about the Gulf before; WaPo published a length piece about the plight of foreign workers, caught between the economic downturn and the legal/political systems of the autocratic Gulf states. These countries’ restrictive labor laws and lax enforcement of labor protections allow abuse to flourish. I wrote about the workers in Qatar here. The working man isn’t really covered here, but I can’t blame WaPo for focusing on the more glamorous side, the glittering towers on the seaside.

Herve Jaubert, a French spy who left espionage to make leisure submarines for the wealthy, was riding high.

Bankrolled by Dubai World, a government-owned conglomerate, he built a submarine workshop on the Persian Gulf, lived rent-free in a villa with a pool and tooled around town in a red Lamborghini. He had two Hummers. He vacationed with local plutocrats.

Jaubert said he heard whispers about Dubai’s darker side — the abuse of desperate laborers from impoverished Asian lands, the jailing of the occasional Westerner who crossed a sheik — but “I brushed it all off. I saw glamour. I saw marble columns, mirrors and money.”

To say nothing of the less fortunate–the non-Westerner working in a Gulf country. But even Western countries are not inclined to criticize the governments of countries that host naval ships or ports or bases (Bahrain, Qatar, Dubai), and the U.S. nearly struck a nuclear deal with Dubai until that unfortunate video of a member of a royal family torturing an Afghani grain merchant.

Today, the former intelligence operative, who fled Dubai last summer in a rubber dinghy, is a wanted man. In June, a Dubai court convicted him in absentia on charges of embezzling $3.8 million and handed down a five-year sentence, plus a big fine. Jaubert, speaking recently at his new home near West Palm Beach, Fla., said he stole nothing and vowed never to set foot in Dubai again. He said he fled because of gruesome threats by interrogators to stick needles up his nose and what he described as constantly shifting, and all bogus, accusations relating to bullets, murder and the finances of Dubai World’s now-defunct luxury submarine subsidiary.

“If I hadn’t escaped, I’d be in the same hell as everyone else,” said Jaubert, one of scores of expatriate business people in this gleaming city-state who have been accused of crimes — and, in some cases, jailed for long periods without being charged.

Jaubert’s troubles began two years ago when Dubai’s then-booming economy was showing the first faint signs of strain. Local stock and property prices have since swooned, and the tempo of arrests for alleged business misdeeds ranging from a dud check — a criminal offense here — to serious fraud has picked up sharply.

Dubai’s government declined to comment on Jaubert’s allegations of mistreatment, but it has targeted what it sees as dodgy dealmakers and deadbeat debtors, and has declared “no tolerance” of “anybody who makes illegal profits.” For many expatriates, however, this smacks of a hunt for foreign culprits to blame for the sheikdom’s sliding economic fortunes.

The last part seems slightly speculative. A massive, widespread boom in wealth hides the drain of corruption, or the flaws of a bad business plan. So perhaps, the crackdown on foreigners is more due to the abating tolerance of the ruling elite for failure. Seriously, the ex-French spy was building luxury submarines … Not the brightest business plan. But also, probably not his idea in the first–more likely an invitation from a more idiosyncratic member of the royal family. And therein lies the scape-goating. It wasn’t the mismanagement of investments by the royalty; it was the corruption brought by foreigners!

More after the jump:

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Michael Jackson and the Gulf

Friday, June 26th, 2009

The fifth to last paragraph in a three page nytimes obit:

After his trial, Mr. Jackson largely left the United States for Bahrain, the island nation in the Persian Gulf, where he was the guest of Sheik Abdullah, a son of the ruler of the country, King Hamad bin Isa al-Khalifa. Mr. Jackson would never return to live at his ranch. Instead he remained in Bahrain, Dubai and Ireland for the next several years, managing his increasingly unstable finances. He remained an avid shopper, however, and was spotted at shopping malls in the black robes and veils traditionally worn by Bahraini women.

Apparently his relationship with the Sheikh soon soured, after a few business deals gone wrong. The Sheikh sued Jackson for $7  million dollars and settled out of court.

Bahrain’s oldest newspaper briefly shut down

Monday, June 22nd, 2009

Akhbar al-Khaleej (News of the Gulf) received a temporary injunction for publishing an op-ed decrying widespread election fraud in Iran … and oh yeah, implying that Mahmoud Ahmadinejad might be Jewish. Translated by al-Arabiya:

Rajab wrote: “In a televised live debate between Mehdi Karroubi and Ahmadinejad, Karroubi took a jab at Ahmadinejad’s origins and said ‘my full name is Mehdi so and so Karroubi’ so what is your full name?’”

Rajab went on to write that Ahmadinejad stated his name but failed to mention his “real” surname “which all Iranians know to be Jewish and that is what Karroubi was trying to get at.”

The question of Ahmadinejad’s origins have been raised before by the son of one of the republic’s conservative Ayatollahs, Mehdi Khazali, who wrote on his website that the president had changed his family name form the originally Jewsih [sic] name Saborjhian.

British newspaper the Guardian also reported that this family had changed its name for “a mixture of religious and economic reasons.”

Media freedom in Yemen

Thursday, June 4th, 2009

Just to continue to pick on the most impoverished Arab nation in the Gulf, the AFP (link to the Daily Star) reports on a crackdown on the Yemeni press/media:

The Yemeni government has “sacrificed” press freedom in attempting to control unrest in the southern regions, a Doha-based media watchdog charged on Monday. “There can be no doubt that the Sanaa authorities have sacrificed press freedom in their efforts to control unrest in the south of the country,” the Doha Center for Media Freedom said in a statement.

The government of President Ali Abdullah Saleh decided in May to close eight newspapers it accused of inciting separatism in southern Yemen, where 16 people have been killed in clashes since late April, including five members of the security forces.

“We call for an end to official censorship and unfair arrests,” it said, commenting on the release of online journalist Yahya Bamahfoud on Friday after being held by state security in the southeastern town of Mukalla for three weeks.

“Another online journalist is still being held in blatant disregard for the most basic human rights. Eight newspapers are officially censored in Yemen. The army has even been sent with grenades and machine guns to arrest journalists,” the center added.

Deep focused devotees will recognize the Doha Center for Media Freedom. The fight over the press continues in the Gulf.

Doha dust-up; or, Qatar quarrel; or, alternative alliterative appellations

Wednesday, May 20th, 2009

A May 14th article in the Economist documents  a fight over media freedom in the Gulf. It’s pretty excellent, my partial scrape after the jump.

Mr Ménard says the row is really between conservatives and liberals in Qatar itself. “I know of no other country in the Arab world that would have had the courage to open the centre” and invite a critic into their midst, he says, lauding the emir and Sheikha Mozah. Closing the centre, he says, would be a defeat not only for liberalisation but also for the image of Qatar. For the royal rulers, it will be a hard choice.

But first, an introduction to the principal belligerent in the battle: ex-Reporters without Borders President Robert Menard, heading the Doha Centre for Media Freedom. His very first press conference in February, coverage in the Gulf Times:

Addressing a press conference to release the first annual report by the DCMF on media freedom in the Middle East and North Africa, Robert Menard, the director general of the centre, said the Qatari press law, which was issued in 1979, had never been amended in spite of a revolution in the local media scene in the country.

“Without changing the status of press freedom in Qatar, it would be impossible for the centre to criticise any other country for imposing restrictions on media freedom,” Menard said.

“I thank God that the press law is not strictly enforced, otherwise the number of you attending the press conference would have been less,” he said, adding that the centre sought to maintain its independence and credibility.

However, Menard, who was the chief of the Reporters Without Borders Organisation, claimed that he had been assured by top authorities of changes to the situation of press freedom in Qatar.

“In return I made a commitment to them to have a body in Qatar that enjoyed respect around the world,” he added.

“There should be an association to defend journalists working in Qatar. How can a journalist be asked to work while he is threatened to be deported the next day because of his work,” he asked.

[...]

About the practice of employers holding the passports of journalists, Menard claimed it was imposing restrictions on the freedom of journalists.

“Even if such practice is not confined to journalists, employers have no right to hold passports,” he added.

In its annual report about Qatar, the DCMF said that journalists “must tread carefully to avoid being sacked or even deported. Journalists are also vulnerable because Qatar has no association that can defend them before their employers or the authorities, since the trade unions are strictly forbidden here.”

Oh, Qatar. How I miss you. And fearing imprisonment while reporting in Qatar.

The only thing I have to add is that when Northwestern University opened up a Qatar branch of its Medill school of journalism, the Qatari government promised absolute freedom of the press. And yet, the restrictive press law of 1979 remains on the books, threatening prosecution for non-compliant journalists. Dubai made that same promise of press freedom when it opened up its vast media center, including the a new headquarters for CNN… good thing they just passed their own law banning defamation of the country or monarchy (like the similar law in Qatar–a mighty good pretext for throwing uppity journalists in jail, and deporting snooping foreign correspondents).

Scrape of the Economist article after the jump.

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Life in Oman

Friday, May 15th, 2009

Michael Slackman wrote a fascinating piece in the nytimes today about the people in Khasab, Oman and their relation to an increasingly authoritarian government, which threatens the incredible progress the country has made.

Oman, a nation of about three million people, has survived in a turbulent neighborhood in part because it has adopted a keep-your-head down approach, shunning the kind of attention many of its regional neighbors have craved. This differentiates Oman from Dubai, which is right next door and before the global financial crisis was often promoted as the model modern Arab state.

Oman, however, may ultimately emerge as the model modern Arab state, at least in terms of development. It started from nearly zero when the sultan took power. At the time, the gates to the capital city of Muscat were still being closed at night. Sunglasses were banned, along with bicycles and radios, as Western conventions. There was essentially no national infrastructure. Infant mortality was so high that families held celebrations when a baby survived to its first birthday.

But when the sultan came to power, he offered a chance for change and he called on Omanis to work with him to build a new state. Oman had oil, and the money helped a great deal.

But there was no pressure to come out of the hills. For at least another 14 years, Saed al-Dhori was reluctant to leave a life that centered on the daily donkey ride along narrow paths to fetch water from a well. In the valley below, his extended family built homes and had children, and those children went to school, and bought cars. He finally came down in 1984, when he was ready. That was part of the sultan’s plan, to let people move at their own pace.

“Before, people moved everywhere on donkeys,” said Mr. Dhori, a diminutive man in his 80s with hands and feet as rough as the rocks around him. “You could stop them and talk to them. Now, everyone is zooming around in cars.”

He marvels at the changes. But Oman has also discovered that it is difficult to open the doors to modernity, especially to education, without also fostering a degree of cynicism about authority and a desire for more freedom. That, and the reality that its oil may soon run out, is what Oman is wrestling with today.

“This is our life, we have to talk about freedom of speech and about public freedoms,” said Mr. Hashmi, the information and research manager of the State Council. “These are not accessories. These are necessities for Omanis in the 21st century.”

manama(na)

Monday, April 6th, 2009

I’d just like to throw your attention briefly to the wonderful Gulf country of Bahrain.

In the tense landscape of the Middle East, there is little room left for Jewish Arabs, a tiny minority in this country as well as in places like Egypt, Morocco and Tunisia. But in Bahrain, the king, Hamad bin Isa al-Khalifa, has taken unprecedented steps for an Arab leader to show his support for his dwindling Jewish population. Last year, he appointed a Jewish woman, Houda Ezra Ebrahim Nonoo, as ambassador to the United States, the first Jewish ambassador posted abroad by any Arab country.

Then he made a personal visit to London to appeal to expatriate Jews to return to Bahrain. He has also appointed Jewish business leaders to the Shura Council, which acts as an upper house of Parliament. Those measures went against the tide in a region where anti-Semitism is often preached from government-controlled mosques and hating all Jews has become interchangeable with hating the state of Israel.

The Gulf still holds fast to its charming ways:

Being Jewish in the conservative Persian Gulf region still presents challenges, even in Bahrain. Though it has preserved its last synagogue, the building has not had a religious use for decades and all Jewish symbols have been removed. Nevertheless, it is defaced with graffiti that says, in Arabic, “Death to Israel.”

Sigh… For more on the larger geopolitical issues, please read the wonderful article in the nytimes. But thankfully scraping is still legal. Choice samples:

Some people here take a cynical view of their king’s outreach. Bahrain is a close American ally of great strategic value to Washington. It is near Iran and allows the United States Navy to base its Fifth Fleet here. Many people said the king’s overtures were a safe and convenient bid to cement ties with Washington.

“We always believe here that control of America is governed by the Zionist lobby,” said Salman Kamal al-Deen, a businessman and the head of the Bahrain Human Rights Society. “The media and the money are all in the hands of the Jews. We believe if we have a Jewish ambassador and Jews in the Shura Council, this is a positive indicator for the country.”

There is also some resentment at the king’s support for the small Jewish community. Bahrain is hot with sectarian tensions: the king, a Sunni Muslim, is accused of discriminating against Shiite Muslims, who make up a majority of the native population. Shiites are barred from almost all positions in the military and security services, and they say they are not given the same employment and education opportunities as their Sunni neighbors.

Shiites complain that the 36 Jews are treated better than they are, and that the king’s Jewish outreach is intended to make Bahrain appear to be a tolerant society, papering over the systemic discrimination they say they experience.

[...]

Fouad Shehab, a history professor at Bahrain University, said it was easy to like ["Rouben Rouben, 55, an electronics dealer who proudly displays his name, a recognizably Jewish one, on the sign above all four of his shops in Manama, the capital."]. “I’ve known Rouben for years,” he said with a smile. “I go to buy from him. I don’t feel he is a Jew.

Man, I could write paragraphs about that last sentence. Pages, books even! But this is a blog. Comment away on your favorite interpretation of the kicker, keeping in mind the historical/economic/political/social/religious context of Arab Jews, living in a predominantly Muslim country, with all the attendant controversies caused by a Jewish nationalist state in the region.

The widening Gulf

Monday, February 16th, 2009

The nytimes published a recent article on the bleak prospects of foreigners in Dubai:

With Dubai’s economy in free fall, newspapers have reported that more than 3,000 cars sit abandoned in the parking lot at the Dubai Airport, left by fleeing, debt-ridden foreigners (who could in fact be imprisoned if they failed to pay their bills). Some are said to have maxed-out credit cards inside and notes of apology taped to the windshield.

The government says the real number is much lower. But the stories contain at least a grain of truth: jobless people here lose their work visas and then must leave the country within a month. That in turn reduces spending, creates housing vacancies and lowers real estate prices, in a downward spiral that has left parts of Dubai — once hailed as the economic superpower of the Middle East — looking like a ghost town.

In Qatar, I heard horror stories of foreigners who got sick or were involved in an accident, leaving them with huge debts and no way to pay them off. And in Qatar, you cannot leave if you have any outstanding debts. That really doesn’t leave you with any option than debtors’ prison.

No one knows how bad things have become, though it is clear that tens of thousands have left, real estate prices have crashed and scores of Dubai’s major construction projects have been suspended or canceled. But with the government unwilling to provide data, rumors are bound to flourish, damaging confidence and further undermining the economy.

Instead of moving toward greater transparency, the emirates seem to be moving in the other direction. A new draft media law would make it a crime to damage the country’s reputation or economy, punishable by fines of up to 1 million dirhams (about $272,000). Some say it is already having a chilling effect on reporting about the crisis.

Yikes. Good luck to the new locations of “CNN, the book publishers HarperCollins and Random House, the British Broadcasting Corporation, The Financial Times and the Thomson Reuters Foundation, the charity arm of the financial news giant Thomson Reuters,” in the Abu Dhabi Media Zone. Why does the “zone” part of the name suddenly sound sinister?

NIGHTMARES!

Monday, February 16th, 2009

While the Obama administration is stressing the need to diversify America’s fuel supplies and wean the nation from its dependence on foreign oil, Saudi Arabia, the world’s biggest oil exporter, is warning about a “nightmare scenario” if consumers seek to speed up the development of alternative fuels.

Ali al-Naimi, the Saudi oil minister, said Tuesday evening at an oil industry conference in Houston that a push to develop more renewable fuels might jeopardize investments in conventional fuels.

“While the push for alternatives is important, we must also be mindful that efforts to rapidly promote alternatives could have a chilling effect on investment in the oil sector,” he said. “A nightmare scenario would be created if alternative energy supplies fail to meet overly optimistic expectations, while traditional energy suppliers scale back investment due to expectations of declining demand for their products.”

Is that a threat?

Saudi Arabia, along with other oil exporters, has long complained about what they view as the uncertainty of energy policies in Western nations. This uncertainty, oil producers argue, hampers their ability to make long-term plans to develop their resources.

:(

If only energy policy and prices were more certain… I have an idea! Monopolistic cartel, anyone? I see a few hands…

At the moment, the slowing economy and collapsing demand for oil is freezing investments around the world. The secretary-general of the Organization of the Petroleum Exporting Countries said recently that cartel members had canceled 35 drilling projects because of lower prices.

AHHHHHHHH! If only America would stop talking about alternative energy!