Saudi Arabia: Fault Lines

Back from the Brink concluded with a general review of current economic and political conditions in Saudi Arabia. Fault Lines takes a closer look at some of the socio-economic challenges facing Saudi Arabia.

Saudi Arabia's economy remains heavily dependent on oil and therefore on oil prices. While oil prices are likely to remain high in the short (and perhaps even medium) term, economic diversification is essential in the long run. The government pushed through a series of macroeconomic reforms as it prepared for accession to the WTO. It has also encouraged diversification through investment in infrastructure, favorable tax policies, and by encouraging private sector investment. A recent World Bank report named Saudi Arabia as having the best business environment in the region, ahead of UAE (and Dubai). Currently, though, the private sector accounts for only 40% of the GDP.

Unemployment and underemployment remain bigger concerns. Almost 40% of the Saudi population is 15 or younger. Official estimates put the rate of unemployment (only male) at about 13% but it is widely acknowledged that real unemployment rates are higher. Generous benefits and a cultural aversion to certain types of jobs (which are seen as being lowly) have reduced incentive to work. Instead, Saudis employ five and a half million foreign workers, mostly from South and South East Asia. Foreigners make up 60% of the kingdom’s 8.5 million strong workforce. The proportion of foreigners in the private sector is even higher. (The Economist, January 5, 2006) The government has introduced various measures to increase Saudi participation in the economy but most of these measures have been aimed at employers in the form of quotas. There has been little effort to address the deficiencies in the education system or to reduce welfare benefits for the terminally unemployed.

…Imported labour is, on average, 30% cheaper than Saudi manpower. Private employers have such a strong preference for foreigners that many resort to creating pretend jobs for Saudis to meet increasingly tough quotas. A law just passed that requires 75% "Saudisation" simply cannot be complied with in the short term, says one experienced consultant… (The Economist, January 5, 2006)

The unemployment figures do not even begin to factor in women. Saudi Arabia now graduates more women than men but women’s participation in the economy is restricted mostly to education and healthcare. Women form a measly 5% of the Saudi workforce. The sidelining of half of the population does not make much economic sense, even if we leave alone the issues of equality and human rights.

Women’s rights (or the lack thereof) are a glaring indicator of another, larger fault line – the lack of socio-political rights. In deference to the conservative clerics, Saudi Arabia has some of the most stringent regulations on social behavior and interaction, and women bear the brunt of these regulations. Religious rights are severely curtailed not just for Christians and those following other religions but also for Shias and other Islamic sects. Saudi Arabia is perhaps the only country in the world that officially prohibits the practice of any religion other than the state religion…

To be continued

Tags: Saudi Arabia, Middle East, Economy, Culture, Society, Energy, Religion, Islam, women's rights

Saudi Arabia: Back from the Brink

The modern state of Saudi Arabia is a result of close cooperation and collaboration between Abdul Aziz Al-Saud and puritan followers of the Wahabbi tradition. Wahabbism, a fundamentalist Sunni movement, is the dominant religion of Saudi Arabia and its influence permeates all walks of life here. Saudi Arabia may be an absolute monarchy but the powers of the monarch are not unlimited, and the ruling family depends on the Wahabbi clerics for legitimacy. This dependency has in turn emboldened and empowered the country's fiercely conservative religious establishment to block much needed social, political, and economic reforms.

Until the recent spike in oil prices, Saudi Arabia seemed to be on the verge of a breakdown. Stagnant prices of oil in the eighties and nineties created an economic slowdown as the petroleum sector accounts for roughly 75% of the government’s budgetary revenues, 45% of GDP, and 90% of export earnings. (CIA World Factbook 2005) Population growth outstripped economic growth, creating a massive strain on public finances and threatening the generous welfare system. The presence of American troops on Saudi soil strained the monarchy’s relations with the religious establishment. The role of Saudi nationals in the September 11 bombings in New York City attracted external criticism while domestic terror attacks reinforced its internal vulnerabilities.

Soaring demand for oil and the recent spike in world oil prices have provided a reprieve for Saudi Arabia. The coffers are full and oil prices are likely to remain high for the foreseeable future. International criticism of Saudi Arabia is muted as oil supplies get tighter. Terror attacks in the kingdom have put the clerics on defensive and they've have made the relative security and stability under the monarchy more attractive to the population in general. Yet, the need for reform remains critical…

To be continued

Tags: Saudi Arabia, Middle East, Islam, Economy, Culture, Society, Terrorism, Energy

World Press Photo Awards

World Press Photo of the Year 2005
Finbarr O'Reilly, Canada, Reuters.
Mother and child at emergency feeding center, Tahoua, Niger, 1 August

Rafiq Maqbool, India, The Associated Press.
Earthquake survivor waits for medical help, Kashmir, India, 9 October

Sven Torfinn, The Netherlands, Panos Pictures.
Relatives mourn young girl, Tche refugee camp, DR Congo, March

Chris Hondros, USA, Getty Images.
Young girl grieves her parents killed by US patrol, Tal Afar, Iraq, 18 January

Tags:
Art, Current Affairs, Iraq, Photography

The Cartoon Controversy

Protests over the depiction of Prophet Muhammad in cartoon strips continue around the world. The Danish mission in Beirut was torched a day after the Danish and Norwegian missions in Damascus suffered a similar fate. Iran has cut off all trade ties with Denmark and the row shows no signs of abating.

The 12 cartoons at the center of controversy were published on 30 September 2005 by the Danish newspaper Jyllands-Posten. These show the prophet Muhammad in a variety of humorous or satirical situations. Some of the cartoons are fairly benign whereas others are very provocative. One of the cartoons shows the Prophet wearing a lit bomb decorated with the Muslim declaration of faith instead of a turban. Benign or not, the cartoons attracted the ire of Muslims because Islamic tradition explicitly forbids any depiction of Allah or the Prophet.

The Danish government has apologized for the offense caused by the cartoons but it has also defended the freedom of expression in media. The reaction of other Western governments has been similarly restrained and nuanced. The controversy is problematic for Western governments – they are keen to avoid another confrontation where they are seen as attacking Islam. The economic impact of the incident on Denmark itself is likely to be minimal but the psychological impact may turn out to be much more significant. The Danes see themselves as a peace-loving nation and they are not used to seeing Danish flags being burnt around the world. There are fears that the furor over the cartoons may lead to terrorist attacks on Danish soil and retaliation against Danish troops in Iraq.

The controversial cartoons themselves are symbolic of greater fault lines in the West and in the East. The tendency to use religion as a tool for mass manipulation, as means towards achieving political ends is age old; its use is certainly not restricted to the Muslim world. (The very successful guns, gods, and gays strategy used by Republicans in US is one example that is often overlooked in presence of more obvious choices such as Iran and Sudan.)

Excessive political correctness has forced uncomfortable (and yet essential) discussions about race, religion, immigration, and many other issues underground in most Western societies. These topics cannot be discussed politely by polite people; they have become the exclusive realm of the radical groups on the right and therefore subservient to ideologies based on fear and exclusion.

In many countries in the Middle East, repressive regimes use religion to hide a multitude of national and societal problems such as chronic unemployment, poverty, corruption and non-representative governments. Protests, such as the current ones, are utilized as valves to release tensions and keep a restive population at bay.

The publication of these cartoons is an ideal opportunity to discuss religion, religious stereotypes, and cultural diversity on a national and global level. It may be easier in the short term to minimize the fallout from the cartoons by ignoring the larger issues, but in the long term it can only lead to disastrous results. The situation calls for courage on part of the West and the East – the courage to support freedom of expression and religion*, courage that its leaders seem to lack.

* freedom of religion being the ability to follow one’s religious beliefs without imposing them on non-believers

Links:
Cartoon Row Timeline - BBC
The Escalating Cartoon Clash -Time
Iran Paper Strikes Back - BBC
Your Taboo, Not Mine - Andrew Sullivan

Tags:
Mohammed Cartoon, Denmark

India, Iran, and the US

Last week the US Ambassador David Mulford warned India that a landmark deal on civilian nuclear cooperation would die in the US Congress if Delhi doesn’t back a UN motion against Iran. The deal has generated quite a bit of opposition in the Congress to begin with, the opposition stemming from India’s refusal to sign the NPT; Indian refusal to back the UN motion would certainly make it that much more difficult to convince a reticent Congress. Regardless of the validity or merits of the threat, or even the actual outcome in the US Congress, the public warning in and of itself is likely to make India balk.

Indo-US relations have only recently grown warmer after years of wariness. India has global ambitions, ambitions that it deems perfectly legitimate given its size, location, population, and more recently, rapid economic growth. Like most countries, the ambitions and self-assessment of strength are somewhat inflated. Having policy decisions dictated by the Americans is seen as an affront, it wounds national pride and makes Indians across the political spectrum prickly.

Indian foreign policy is built on the bedrock of third world solidarity and non-alignment. While priorities and attachments have shifted to take into account post cold war realities, the country still labors under the policies and ideals formulated by Nehru. India’s decision to support an earlier resolution against Iran was heavily criticized by the leftist parties in the ruling coalition, and by the Hindu right wing opposition. Supporting the UN motion will certainly bring more criticism, and given the public warning, charges of caving in to US pressure.

India’s reluctance to endorse UN action against Iran is not just a product of some feel-good third world solidarity policy. India is keen to maintain support in the Islamic world, support that it sees as a bulwark in its long running rivalry with Pakistan. Moreover, India needs oil and gas, both of which Iran has a plenty. Despite these reasons, India may have been tempted to support UN action against Iran (as evidenced by its earlier vote at the IAEA) but the public warning from Washington will make it tough to do so.

Upate:
India voted to refer Iran to the UN Security Council. Only Syria, Cuba, and Venezuela voted against the motion.

Indian Communists call for a debate in the parliament to discuss India's decision to support the the motion.

India-US nuclear deal runs into trouble.

Tags:
India, Iran, IAEA, Nuclear