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The Iranian Illusion

The Manama Dialogue

Dr. Mohamed Abd el Salam

There Will Be Gas

Manuel Almeida

The Last Breath of

Khomeinism By Najah Mohamed Ali

Issue 1535, 4 December 2009

Iana Dreyer

Editorial Cover The Iranian Illusion

The Manama Dialogue

Dr. Mohamed Abd el Salam

Manuel Almeida

There Will Be Gas Iana Dreyer

Established in 1987 by Prince Ahmad Bin Salman Bin Abdel Aziz

The Last Breath of

Khomeinism By Najah Mohamed Ali

Issue 1535, 4 December 2009

Dear Readers,

Established by Hisham and Mohamad Ali Hafez

Editor- in- Chief ADEL Al TORAIFI

Managing Director TARIK ALGAIN

Published by

to The Majalla Digital, this week W elcome our issue brings to you an analysis of the state of Iranian politics since the June elections. We have invited Najah Mohammed Aly, the Chief Analyst for Al-Arabiya television, to evaluate the crisis that the Islamic Republic is facing. As such, Aly provides an extensive coverage of the role that young Iranians had in the Green Movement during and the prospect for change that they represent for Iranian politics. This issue equally brings an important interview with Dr. John Chipman CMG, Director General and Chief Executive of the International Institute of Strategic Studies, in which he discusses the upcoming Manama Dialogue, a key regional security summit being held in Bahrain next week. We invite you to read these articles and much more on our website at As always, we welcome and value our readers’ feedback and we invite you to take the opportunity to leave your comments or contact us if you are interested in writing for our publication.

The Majalla Magazine HH Saudi Research & Marketing (UK) Limited Arab Press House 182-184 High Holborn, LONDON WC1V 7AP DDI: +44 (0)20 7539 2335/2337 Tel.: +44 (0)20 7821 8181, Fax: +(0)20 7831 2310


Adel Al ToraiďŹ Editor-in-Chief


Issue 1535


Contents 08 Geopolitics The Iranian Illusion

11 In Brief Around The World Quotes Of The Week Magazine Round Up Letters

18 Features The Last Breath of Khomeinism

30 Ideas Where were you on 911/? THE MAJALLA EDITORIAL TEAM London Bureau Chief Manuel Almeida Cairo Bureau Chief Ahmed Ayoub Editors Stephen Glain Paula Mejia Dina Wahba Wesam Sherif Daniel Caparelli Editorial Secretary Jan Singfield Webmaster Mohamed Saleh Translation Sherif Okasha 4 December, 2009



35 People Interview

The Manama Dialogue

Issue 1535, 4 December 2009


The Diplomat on a War Mission

43 Economics

Submissions To submit articles or opinion, please email: Note: all articles should not exceed 800 words

Gulf Economics

Keep the Change Interntional Investor

There Will Be Gas


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51 Reviews Books

Crude World Readings Reports


The Different Faces of Development

56 The Political Essay Better Safe Than Sorry

Mr. Wael Al Fayez Tel.: 0096614411444 F.: 0096614400996 P.O.BOX 22304 Riyadh 11495, Saudi Arabia

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Issue 1535

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The Iranian Illusion

Regional ambitions through the magnifying glass

Like Egypt and Saudi Arabia, Iran is a regional power. However, it is definitely not on the road towards being a super power. Tehran's movements in the region are based on a geostrategic framework, which may or may not be Persian, yet they are neither Islamic nor Shiite. National interests, bargaining cards and deconstructive activities, are all manipulated by finance and intelligence. There have always been general unanswered questions in high profile Arab discussions, most important of which are: Who rules Iran? And what does Tehran want? Specific questions have also surfaced, does Iran possess nuclear weapons? Is it trying to spread Shiism in the Arab region? The aforementioned questions have in turn lead to unorthodox inquiries and assumptions questioning whether Iran is considered a bigger threat than Israel in the region, and what the proper means to deal with that threat are. Usually, when all these questions are posed concerning a certain state in the region, it becomes an "issue" until it eventually evolves to become a threat under the assumption that if it is not dealt with, it shall dangerously aggravate.

animosities is bound by the patterns of "security relations". In other words, the level of trust between security institutions is considered as a vital determinant in state to state relationship and, if ignored, states walk right into a political mine field.


Public opinion in the region is under the impression that the Arab states do not have any have specific policies towards Iran; it is though that Arab countries are either driven by the interests of political systems or they are simply blindly following "American orientations". In reality, the issue is a far more complex. As soon as facts concerning the Iranian paradox start unveiling, officials tend to take the path of discretion, which comes as a surprise to many. There still remains a large sector of scholars who are oblivious to the idea that the problem maybe rooted in Tehran and not in Arab states. Nevertheless, it would be unrealistic to think that Arab officials have reached final conclusions concerning whether the ruler of Iran is the Supreme Leader or the President, and discussions have also proven futile in defining conservatives, moderates, and pragmatics. The current ongoing debate is concerned with the ruling equations and interactions of different concentrations of power in the state, may these focal points be the political institution, security systems, the revolutionary guard, the bazaar class, or the Beniad groups. As for Iran's regional orientations; there are several ideas that are always under discussion. For example, Iran now is acknowledged as a regional power like Saudi Arabia and Egypt, but not a superpower, However, Iran cannot be considered a Middle Eastern China, since Iran has several weaknesses that are constantly present. What is obvious now is that Iran is merely highlighted by a "Regional Aura", which was strengthened through Arab or Arabic speaking media. Iran 4 December, 2009

Dr. Mohamed Abd el Salam does not provide a political, economic, nor a cultural model to be followed. Here lies a controversy concerning whether Iran has fallen into the trip of which it was warned by Sa'don Hamady once, which is the "Illusion of Power". One of the ideas that has become a debate is that Iran is vehemently involved in many of the Arab states' affairs, yet not through dealing with governments but rather through opposition and non-state actors. Iran has managed to effectively interfere in Iraq, Lebanon, Gaza Strip and Northern Yemen. However, interestingly, it seems that Iran has reached its expansionary limits, seeing that it has spent too much to the extent that endangers is internal leadership. A number of the Arab countries have decided to hold upfront confrontations with Iran, to clear its influence in the region, like Morocco, Saudi Arabia and perhaps Egypt.

Of course Iranian-Arab relations are not bound to remain eternally tense, for during the Khatami's era unprecedented cooperation initiatives were close to seeing the light, if it weren't for extremist interventions. Those who visit Iran will realize that people's awareness remains a relatively healthy one, even at the times of turmoil, where all countries have kept minimum level of communication. Accordingly, there's a conclusion that Iran is not necessarily an ally, yet not an enemy either, which has resulted in a regional cold war. In light of the aforementioned, how to deal with Iran still remains as an unanswered question. There are those who push for dialogue, under moral and ethical reasoning, while on the other hand, there are those who push for confrontation. The latter believe that Iran has to realize that there's a price to pay for its regional adventures. Both approaches, however, are faced with trouble, for the camps of both the pigeons and the vultures have failed to provide explanations to concepts such as "engagement", which was tested through experience.

The Iranian behavior in the region is a cornerstone of controversy due to the notion that Iran's movements in the region are based on geostrategic frameworks that maybe Persian, but are definitely not Islamic nor Shiite. It is basically composed of national interests, bargaining cards and deconstructive activities manipulated by finance and intelligence. Here, one must not wonder much whether a Shiite state can endorse a Sunni group, because the answer is yes, since the issue is far from religious attributes. If the question is whether possessing nuclear arms could help in confronting Israel, then the answer is no.

In the end, some guidelines to Arab debates concerning Iran can be determined, which underline the gray areas that still govern the current policies. The current Iranian policies have been practiced by Arab states previously, which have in turn resulted in harsh inter-Arab confrontations, none of which ended on a good note. Military catastrophes, international isolation, or internal changes are usually the result of state policies that attempt at changing their context, and maybe Iran would take a revision approach towards its policies before an imminent point of no return.

On many other fronts, the same amount of clarity is not available, since Arab states discriminate between the Iranian and the Turkish model. And despite the Ottoman-like features of the latter, Turkey is considered a friendly nation to the Arab states for different reasons. What many fail to notice, however, is that the criteria for alliances and

Head of the Regional Security & Arms Control Program at the Al-Ahram Center for Political & Strategic Studies, Cairo. 08

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In Brief Around The World

Quotes Of The Week

Magazine Round Up


A New Phase of Reform

The King's decisions reinforce confidence in Saudi leadership

King Abdullah's has taken a decision to reimburse those who were affected by Jeddah floods, in addition to the payment of 1 million Saudi Riyals to the families of the victims. The decision was passionately hailed by the Saudi elite in addition to the populace. The decision was considered a continuation of the reform program initiated by the King four years ago. King Abdullah Bin Abdul Aziz had reiterated on the importance of determining Issue 1535

those who are accountable for the recent incidents, may they be people or institutions. Accordingly, a fact finding committee has been structured and is headed by Prince Khaled Al Faisal, the Prince of Mekkah. The committee's goal is to establish accountability measures and aid the affected personnel through housing and support that provide for the people's welfare. Observers have considered the recent decisions as the beginning

of a new phase of reform and a strong will for progressive development. The committee is expected to achieve its goals successfully, putting an end to public finance squander and enforcing respect for the rule of law. On the other hand, Prince Khaled Bin Faisal has announced that King Abdullah Bin Abdul Aziz has issued instructions to place all resources and means under the committee's auspices, to provide proper aid to the victims of the flood. 11

In Brief - Around The World

Around The World 1 Saudi kingdom




Prince Khaled Bin Sultan , Deputy Defense Minister said The armed forces completely control Mount Doud, one of the most strategic regions. The deputy minister did not say how large an area had been occupied by the Shi'ite rebels. Khaled's statement was the first high-level Saudi confirmation that the Believing Youth had controlled a significant area along the 1,600-kilometer Saudi-Yemeni border.

3 Turkey Turkish Prime Minister Recep Tayyip Erdogan said Switzerland's vote to ban the construction of minarets was a "sign of an increasing racist and fascist stance in Europe. Erdogan added Islamophobia was a "crime against humanity," just like anti-Semitism . Turkish president Abdullah gol also criticized the Sweden referendum in which 57.5 percent of voters had backed the initiative.

2 UAE Dubai's ruler, Sheik Mohammed bins Rashid Al Maktoum, insisted at an investor conference that Dubai and its government-run businesses were in good shape. Those who were claiming otherwise should "shut up," he said in an unusually blunt outburst. 4 December, 2009

4 Iran President Ahmadinejad said that despite the support given in the IAEA vote by Russia and China, Western governments would not succeed in their efforts to isolate Iran.

5 South Korea Lee Myung-bak South Korea's president declared that he was willing to meet North Korean leader Kim Jong Il anytime to resolve the nuclear standoff on the divided peninsula and other issues. Lee suggested that an inter-Korean summit could be held to try to improve relations. 12

In Brief - Around The World

8 US

7 3 9




US president Barack Obama informed senior military chiefs in Afghanistan Monday, Nov. 30, they would receive another 30,000 US and 10,000 extra troops from eight NATO countries. In response,Afghan Taliban leader Mullah Omar tried to get the jump on him by warning that the US and its allies faced defeat.

9 Israel


Yigal Palmor Israeli foreign ministry spokesman said that a Swedishled push for the European Union to call for the division of Jerusalem and the recognition of East Jerusalem as the capital of a Palestinian state would trip up Europe's own efforts to play a role in Middle East peacemaking.

10 Belgium 6 France

7 Serbia

Thierry Mariani, Sarkozy's special representative dealing with the conflict in Afghanistan and Pakistan announced that France will not deploy extra combat troops to Afghanistan but may send more military trainers for Afghan forces

Dusan Batakovic, Serbia's ambassador to France said Kosovo's selfclaimed independence challenged his country's sovereignty.

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On the other hand, Kosovo told the U.N.'s highest court its independence is irreversible and warned that any attempt to cancel it could set off a renewed conflict

Swedish Foreign Minister Carl Bildt has introduced a resolution to the European Union to be considered in Brussels that would call for the recognition of East Jerusalem as the capital of any future Palestinian state. Israeli officials immediately condemned the proposal and said that it will harm negotiations between Israeli and Palestinian officials. 13

In Brief - Quotes Of The Week


Magazine Round Up

Of The Week

"The decision to ban minarets will endanger our security". The Swiss foreign minister Micheline Calmy-Rey commenting on her country's vote prohibiting new minarets.

"We are inclined to act under the agency’s supervision and this requires a commitment to a diplomatic solution ... If others try to pull off some political trickery, then Iran will change its path. So they should decide which way to go". Irani Majlis speaker Ali Larijani expressing his nation's will to engage the west in diplomatic negotiations to solve the nuclear program dilemma.

"We expect a dark year in Sudan". Sadiq Al-Mahdi, Head of the National Umma Party, predicting the future scenarios of Sudanese turmoil that is likely to accompany the upcoming referendum on unification.

"I doubt the information which you are giving is correct because I don't think Osama Bin Laden is in Pakistan". The Pakistani Prime Minister Yousuf Raza Gilani addressing the his British peer Gordon Brown in reference to speculations concerning Osama Bin Laden's presence in Pakistan 4 December, 2009


Magazine Round Up 1 Newsweek An Empire at Risk Niall Ferguson discusses in this week's cover story the effects of the financial crisis on the American international hegemony. To Ferguson, ironically, the US has been able to overcome the cold war and surpass the devastating effects of 9/11, yet the dire economic conditions may cause the downfall of the American "empire". The economic crisis has taken its toll equally on different states, may they be internationally influential or not. Accordingly Ferguson discusses the measures taken by the American government to counter the federal debt, reiterating on the importance of fiscal reform as the only way out of the current predicament. 14

3 New Statesman Two Sides of the Coin

2 2 Time The Decade from Hell

Mehdi Hasan discusses the American and British measures used to defeat Taliban that to Hasan, are likely to prove counterproductive. The article argues that military measures taken by the American and British governments were never a reason for the decline of hostilities and insurgency, using the Iraqi case as an example. In Iraq, the drop in violence caused by the large amounts of money paid to Sunni insurgents to join the alliance's battle against Qaeda, rather than by military deterrence. If the superficial and oversimplified counterinsurgency policies are not changed, hearts minds and battles will not be won in Afghanistan.

This article handles the events which have contributed in labeling the past 10 years as the decade from hell. The article argues that everyone was better of at the beginning of the current decade than now. The curse of past 10 years has affected politics, economy, environment and even sports. The fall of the berlin wall and the demise of communism were once called the end of history. Little did they know that it was the silence that preceded the storm.

4 4 Foreign Policy Al Qaeda's Dissident The current issue of Foreign Policy tackles the profile of Sayyid Imam Al-Sharif, one of Al Qaeda's founders, who was the mentor of Ayman alZawahiri. Sharif was also viewed as a backstabber and a liar, due to what he exposed in his prison writings, which was more incriminating to al Qaeda than merely being descriptive. The article delivers a chronological development of Sharif's evolution and ideological development, which have eventually ended in conflict with Qaeda members.

3 Cover of the Week

Cover Of The Week

The New Republic Popularity Contest Jonathan Chait discusses Obama's current policies, handling Democrat and Republican views concerning it. According to Chait, Obama's policies maybe overreaching, for despite the support for the medical health care reform, many other spending programs remain unpopular. The current democrat strategies aided by Obama, are in fact intimidating the populace. According to a recent survey, the majority of people believe that the government is too involved in state affairs, which in turn portrays the democrats and Obama's oblivious attitude towards the public. Issue 1535


In Brief - Letters


Slaves of Two Masters Obama`s negotiation team should know that Iran is aggressively pursuing uranium enrichment because of their belief that it is their inherent right, so there will be no negotiations as long as the U.S. insist on partial enrichment Tawfiq Gizani Morocco

There is no doubt that the foreign policy of the Justice and Development Party has earned the sympathy of the people and increased its popularity, especially after the religious speech of Erdogan and described by some analysts as the process of politicization of the Interior, and also a big role in the establishment of friendly relations and financial relations with Russia, making it the largest partner commercial ..

There and Back Again I think that the AKP is seeking a difficult equation, and we must not forget the economic problems that Turkey encountered in 2001 led to the deterioration of the Turkish economy, which is expected to impact the Turkish economy in the future significantly. . Inas Al faheem UAE 4 December, 2009

Ibrahim Mwafi Syria There is no doubt that Iran is trying to impose full control on the Middle East as a major force in the region, and it shows clearly that during the nuclear testing its relations with major countries in the world, in regard to Houthis, I do not know what Iran has to gain from supporting these rebels.. Iyad Nassar Egyptian Engineer USA 16

In Brief - Magazine Round Up

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4 December, 2009

18 18

The Last Breath of

Khomeinism BY Najah Mohamed Ali

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The Last Breath of Khomeinism After insurrection, which way now for Iran’s conservatives and reformers? Najah Mohammed Aly After the demonstrations which exacerbated divisions within the Iranian Islamic Republic regime,, reformers spoke about the impossibility of national reconciliation unless the regime fulfills the public requirements and form the green government. As the authority and especially the legitimacy of those in power is further undermined, their actions are leading to the demise of Khomeinism as we know it.

Iran's President Mahmoud Ahmadinejad gestures during a meeting with Bolivia's President Evo Morales on November 24, 2009 at the Quemado presidential palace in La Paz. Ahmadinejad arrived in Bolivia for a short visit the second leg of a Latin America tour of three leftist nations sympathetic to his administration. AFP PHOTO/Aizar Raldes © GETTY IMAGES

n addition to its results, the last presidential elections in Iran on 12 June aroused controversy over the legitimacy of the Guardianship of the Jurist’s system. This is due to its abandonment of many of the basic principles on which the Islamic Republic was founded. Prominent among these principles is the respect of minority rights, as stipulated by the constitution. The elections, as they were unfolding during the electoral campaign of the four candidates, Mahmoud Ahmadinejad, Hossein Mousavi, Mahdi Krobi and Mohsen Rezai, re-established the link between


4 December, 2009

the Iranian people and an already established system based on the velayat al-faqih system before its distortion.

the polls gives the seal of approval to the Guardianship of the Jurist's system established by the late Imam Khomeini.

Though a large segment of the population did not participate in the yes/no referendum held on 12 April 1980 for being underage, they do believe in their right to choose a new form of government that may go beyond the principles of the Islamic Republic. This was obvious throughout two terms of the reformist Sayed Mohammed Khatami's presidency. However, the fact that the Iranian voters still go to

Legitimacy of the regime Legitimacy of the Iranian Republic's system has been subject to much criticism in recent years, after the death of its founder in June 1989. Most of the blame was directed at the election results that brought former president Mohammad Khatami to power in 1997. His election at the time represented a significant threat to the influence of religious 20

Features authorities, prominent among which was the Guardian Jurist Ayatollah Sayed Ali Khamenei. These authorities-directly or indirectly stood behind Khatami's opponent Ali Akbar Natek Nouri. Contrary to the wishes of the clerics, Khatami won the elections. From that time on, the legitimacy of the Islamic Republic was questioned since young generations had voted for Khatami and not for the religious authorities’ candidate. This revealed beyond any shadow of doubt that young people have reservations concerning the legitimacy of the regime. Still, they can live with it and this is why they went to the polls again hoping this time to exact a real change. Generally-speaking, no one questioned the fact that the latest Iranian presidential elections were a great opportunity for significant transformation considering the overall international climate at the time. Not only were the elections following the inauguration of Obama as President of the US, there were also radical upheavals in Iraq and Afghanistan which had an important impact on the regional role of Iran. The national diversity of the four presidential candidates was an indicator that the national problem was on the way of being solved within the framework of the constitution, not otherwise. It was also a sign that the governorates had to be ruled in a decentralized way, that is, independently of the capital. This is a far better situation than one in which the regime had to face claims of independence on the part of ethnic minorities. This is particularly true, given that most national minorities in Iran do not ask for more than a fair representation. Interestingly, the candidates who were allowed by the Guardian Issue 1535

Council of the Constitution to enter the electoral race – with the exception of Ahmadinejad – paid close attention to this issue. Prominent among those was Mehdi Karroubi who surpassed his opponents by putting up a more courageous turn of phrase. Such was the case when he demanded the amendment of the constitution and the election of governors as opposed to their appointment. Some analysts attributed this kind of boldness to his Lur origins. Others interpreted it that Karroubi has always tried to court people's national feelings in a way that even surpassed Mohsen Rezaei AlBakhtiari, who found himself in approximation to the national cause, although he was in the forefront of those who support dealing with it

from a security perspective, when he was the leader of the Revolutionary Guards during the war against Iraq (19801988-). Mousavi also addressed this issue, and promised the non-Persians to grant them the right to use their language. He also promised to build mosques for the Sunni in Tehran. The Guardian Council of the Constitution rejected the conditions amended by the Shura Council to limit the number of candidates for the presidential elections and described these conditions as "breaching the constitution". The Council includes six fiqhs appointed by the Guardian Jurist and another six of legislators elected by the Shura Council which is assigned to approve the decisions of Shura, interpret the constitution, approve the candidates 21

Features in any elections and also approve the results and validity of these elections. However, the Guardian Council of the Constitution maintains the conditions which do not allow any Sunnis or even Zaidi or Ismaili Shiite to run for presidential elections. The constitution necessitates that the candidate be an Iranian who believes in the Islamic Republic, and more importantly one who is a Twelver (Ithiniyashria) Shiite. It does not matter whether he is Arab, Kurdish or Baloch, or from any other non-Persian nationalities. In Iran, the Kurdish, the Arab, the Persian, the Turkmen, the Azari and the Baloch, all live in a single state. The deposed Shah managed to unify all of them using force, and the Islamic Republic made them closer to each other through religion and doctrine. Many people think that Bakhtiaris, Lurs, Mazendranis, Gelanine and others constitute independent nationalities, because they speak a language different from the Persian. In Zahdan, for example, and also in Al-Ahwaz, many incidents recently took place and they are stereotypes of incidents which the governorate of Sistan and Baluchestan with the Sunni majority and governorate of Khナォzestト] witnessed. Those who call for separatism of Khナォzestト] called it "Arabistan or Al-Ahwaz". Between "Republic" and "Islamic" The elections ended, and the reform leaders announced their rejection of the elections results. So did foreign journalists who were allowed to cover the electoral campaign and saw long queues of Iranians, popular among which were young people waving with their green badges, the symbol of change. At the time, the number of young voters was about 15 million, constituting nearly a third of 46 million Iranians who had the right to vote. When this group was on 4 December, 2009

Pro-opposition protestors rally in the streets of central Tehran on July 9, 2009. Iranian police fired tear-gas as thousands of unrest in 1999, witnesses said.

its way to the voting centers, it was necessary for the world to see their joy and life-loving attitude. It seemed they were celebrating the founding principles and values of the regime of "the Islamic Republic of Iran" and the goals of its constitution after the profound wound caused by the policy of Ahmedinejad which possibly would put an end to their connection with the existing regime. Most young people in Iran have lost their trust in "The Islamic Republic" throughout the years after reformist president Mohammad Khatami assumed power, especially at the height of

the struggle between "Rohaneyat Mobariz" and "Rohaneon Mobariz". During this struggle, the religious scholars of both those trends were trading accusations and scandals. This weakened the relationship of young people, especially university students, with religious scholars after the election of Khatami in 1997 has relatively revived this continually tense relationship. The exception was during the revolution that toppled Shah Mohammad Reza Pahlavi and until the departure of Imam Khomeini in June 1989. It is no secret that the debates, 22

Features The unprecedented televised debates in Iran between the presidential candidates have cast suspicions over all the leaders of the revolution and the regime, whether religious clerics or others. Meanwhile, Mir Hossein Mousavi succeeded in drawing the attention of the young generation, even those who have not heard of his name, or were not yet born when he stayed in the shadows for nearly twenty years. Experts justify this by saying that history must leave its effect on the third generation of the revolution. Two Presidents

demonstrators defied government warnings and staged a march to commemorate the anniversary of bloody student © GETTY IMAGES

aired for the first time on TV among the four candidates, plus the method used by Ahmadinejad "to embarrass his rivals", were too much for many Iranian youth to handle. Ahmadinejad, praised by his supporters for using a populist speech that touched the hearts of Iran's poor, was seen by most of the youth in Iran as a reckless speech against those whom he believes are his enemies. This same group of young Iranians were the group that voted for his rival candidate Mir Hossein Mousavi. This war was accompanied by "Eastern and Western" plots, Issue 1535

especially in the case of Mir Hossein Mousavi's wife, Mrs. Zahra Rhnord. The plots also attempted to defame the positive popular reputation of war-era Prime Minister Mousavi, by distributing a photo of his wife without a veil. The photo was taken when she was still a young girl, before she became committed to religion and the revolution. She joined the revolution before it emerged victorious, when her opponents were busy with their studies. This is said by most of the people who lost confidence in Ahmadinejad, and described him in their slogans as a "liar!"

Everyone is now certain that the results of the elections were rigged in favor of Ahmadinejad, after initial results showed a landslide victory for Mir Hossein Mousavi. The biggest evidence of this fraud was the long lines of voters from the “Green Wave”, and their distinctive marks, whether in Tehran or other Iranian cities and villages. They existed even in places where supporters of Ahmadinejad gave money to anyone who would vote for their president. These long lines were real indicators of the size of the support given to Mousavi, in sharp contrast with the official results of the elections. The fraud was not limited to the results only. Before voting, officials at Mousavi’s election campaign were forced to make an appeal to voters to bring their own pens for use instead of pens available at the polling stations. They received information, which was later confirmed by the head of the monitoring department in the Interior Ministry, that the ink of the voting pens evaporates after ten minutes. Despite all this, it was absolutely clear that Mousavi has won by a majority of votes by just looking at the millions of voters who went 23

Features to give him their votes, wearing green scarves or green waste bands. This has prompted journalists, corresponding to unofficial media to ascertain that a fraud has taken place when a landslide victory of Ahmadinejad was announced, especially in the hometowns of his three rivals. After this clear breach of all standards of electoral democracy in Iran, Mousavi declared himself president of the people, instead of Ahmadinejad, president of the authority, the military power and the money in Iran. Today Mousavi leads a renaissance movement within the regime, while committing himself to its constitutional rules and all details of the Islamic jurist system. This happens despite all the brutal repression that his supporters of young people are subjected to, while images and live recordings show even his female supporters being beaten to death. A coup against legitimacy What happened was not a "velvet revolution". In other words, Yed Alla Goani, President of the Political Bureau of the Revolutionary Guards, made a clear threat before the election day by saying: "Any kind of velvet Revolution will not be successful in Iran". It was also not a "coup" against the system, as other leaders of the Revolutionary Guards said. They now grasp every detail of power. Political insiders say the situation now is a revolution within the Islamic revolution itself. It is a struggle between supporters of the "Islamic Republic", with all its institutions and election mechanisms, and advocates of transforming it into an "Islamic government". This was clearly said by Ayatollah Assadullah Bayat, a religious cleric in Qom, on Tuesday, June 16. In his letter of response to Mousavi, he called on the religious clerics to "intervene to force a re4 December, 2009

election and save the country from an imminent danger that threatens to demolish the foundations of the system established by Imam Khomeini." It is worthy to note that Ayatollah Khomeini was the one who supported the idea of a referendum on the "Islamic Republic", on April 12, 1980. He also refused to add or omit any other word to the name and form of the political system. In this regard he said "No less, no more". Throughout his jurisprudential tenure, he stressed the people's right to vote, and to establish constitutional institutions convenient for the requirements of

the time. At that time, a dispute rose between two trends of thought. The first was the one led by Khomeini. The second trend completely rejected the idea of an "Islamic government" while the Imam Mahdi was still absent. They preferred to wait for his arrival to "fill the earth with justice and equity, after it was filled with injustice and oppression." At the same period, an organization called "Forkan" also emerged. It was formed from a group of clerics. They carried out assassinations of some of the symbols of the Khomeini trend. Several senior figures were killed, such as Ayatollah Mohammad Mofteh, and Ayatollah Morteza 24

Features today, supported by Ayatollah Mohammad Mesbah-Yazdi, believes that the Islamic juristguardian should be discovered rather than being elected. They also believe that the members of the Experts Assembly should not have the right to hold the guardian responsible or to relive him of his post. He takes his legitimacy from God, as he is a special deputy of the Imam Mahdi. On the contrary, Rafsanjani and the rest of the school of Imam Khomeini, believe that the Islamic jurist-guardian should be elected, and that his legitimacy should be determined by the extent of his popularity. Motahhari. Hashemi Rafsanjani was also on the list. An attempt was made to assassinate him inside his house, but he survived because his wife rushed to save him. It was clear that clerics believed in this idea, such as Akbr Kodrzy, who led the "Forkan" organization under the guidance of intellectual figures. Their names were not officially disclosed, to preserve the reputation of the religious scholars. They stayed in the country, even after the execution of Akbar Kodrzy. Some of them do not believe that Kodrzy is dead. They have a secret organization called "the Cave Group". They also work on dismantling the religious establishment in any way they can. They believe that it is an invalid establishment. They benefit greatly from the conflict between the trends of the "Republic" and the "government" within this prestigious institution in Qom. There was also a trend called "the argumentatives", which enjoyed the support of some religious authorities in Najaf and Qom (Khoei and Burujerdi). It enjoyed this support because it was founded to fight "Baha'i" (a monotheistic religion). However, it was on bad terms with

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Khomeini. But members of this group, especially the students of Mahmoud Halabi, and the followers of Imam al-Khoei, managed to sneak "in broad daylight" into the Islamic Republic. Moreover, many of them assumed high positions in the regime. Hence, there is a clear difference between the Khomeini school of thought and upstarters who used the revolution and the regime after 1980. The radical religious right wing, represented today by the "Mootalfa Islamic Party", is one of the biggest supporters of Ahmadinejad. After the election of Mohammed Khatami in 1997, the party considered the idea of abolishing the post of president. It even proposed the canceling of the presidential elections, and the Islamic jurist Ayatollah Ali Khamenei, the supreme religious leader of the revolution, should appoint a prime minister, which name ought to be presented before the Shura Council to ratify. Moreover, the controversy that arose during the last meeting of the Experts Assembly, which was headed by Hashemi Rafsanjani, has revealed a fact unknown to many. The trend which controls power

Neither reformers nor conservatives In this context, we must differentiate between the two terms: “reformers” and “conservatives”. The conflict is between those who call themselves followers of Imam Khomeini (the reformers), and the fundamentalists with principles, as they call themselves. They are a mix of critics and supporters of the conservative Mahmoud Ahmadinejad. Perhaps the element that most aggravates the crisis is the obvious strictness of the security forces against the former rulers of the country. Some of them were close to the late Imam Khomeini, and had a prominent role in the overall developments in Iran before and after the triumph of the Islamic revolution. The conflict between the two camps has gone far beyond anything that happened in the past inside the official establishment. It was clear that the Revolutionary Guards, who were accused of working for Ahmadinejad, in opposition to the Constitution and the recommendations of Khamenei, are the ones who run the camp of Ahmadinejad.


Features This is a deeply rooted conflict that will likely deteriorate further, especially if the efforts for reaching a peaceful settlement (in particular those made by Rafsanjani) come to a dead end. This may open the door to a serious crisis between Rafsanjani and the jurist guardian Ayatollah Ali Khamenei. It will be more so since Khamenei was quick to endorse the election results, even before the Council of maintenance of the Constitution announced its opinion. Khamenei also ignored Rafsanjani's message, in which Rafsanjani reminded him of their history together, before and after the Islamic revolution. Rafsanjani, Mir-Hussein Mousavi, Mohammed Khatami, and many more of Qom’s other religious clerics, including Khamenei, were all devoted students of Khomeini. But in reality, Khamenei did not like Mousavi very much, even when he was president of the country and when Mir-Hussein Mousavi was his Prime Minister. In some of his announcements Khamenei had tried to acquit Mousavi’s supporters, denying their involvement in what he called "riots" and abuse of public funds. The images that were taken of these riots confirm that the "Basij" (a plainclothes paramilitary volunteer militia) the ones who made the peaceful demonstrations look violent. Also, the killing of demonstrators and the attacks on girls in the "Islamic Republic" are not expected to stop soon. The constant justification for such violent acts is always: "Save the regime", meaning the "Islamic government", at all costs, even if it meant stealing votes. Rafsanjani: For How long? Mir Hossein Mousavi, whom the religious cleric Ayatollah Yousef has described as the "pious son of the 4 December, 2009

founder of the Islamic Republic", received considerable support from Hashemi Rafsanjani, the Chairman of the Expediency Discernment Council, and other known clerics. They considered what happened "a serious departure from the way of Ayatollah Khomeini, and the core Rules of the Islamic Republic".

Experts Assembly, is charged with electing, monitoring, and dismissing the Supreme Leader of Iran. But today he is facing attempts to remove him from the presidency of the Experts Assembly and the Expediency Council. He has previously been excluded from leading the Friday prayers in Tehran.

It is obvious that Mousavi has dealt with this crisis in a spirit of leadership. He addresses his speeches to all of the Iranian people and not to his supporters only. He even labeled the young men who were killed during the demonstrations as martyrs. He also called upon the Iranian people to unit in solidarity with the families of these young men and the families of the injured, and called for a national day of mourning.

Khomeinism and Khameneism

It has also become clear from recent developments that intransigent conservatives cannot tolerate Rafsanjani any more. In the presidential elections of 2005, he was subjected to a strong propaganda campaign that was launched against him by influential people in the Revolutionary Guard and the Basij. The purpose of that campaign was to pave the way for Ahmadinejad. They also re-launched it against him during the elections of June 12. They did not stop even after Ahmadinejad became president for a second term. Many believe that Rafsanjani is capable of facing Ahmadinejad and those who support him. But it is clear that Rafsanjani, former president Mohammed Khatami, Mir Hossein Mousavi, and all the symbols and figures of the Khomeini current, prefer to work through the legitimate frameworks of the Islamic law. They do not even think of breaking it. They only care about the system they founded. Rafsanjani, also chairman of the

Former president Mohammed Khatami and the religious clerics who were close to Imam Khomeini, warned against an Iranian political current that is working on excluding the students of Khomeini and his doctrine, and eliminating them completely. This was the focus of the trials, beside instant calls to arrest those whom they called the "ringleaders� (Khatami, Mousavi and Karrubi). The attempts at eliminating the students of the late Imam became very clear in a way that would make people in Iran think that there are some people who do not want the "way of the Imam" to exist, especially regarding the details of governance. The leaders and symbols of the Revolution, who remained close to the Imam until his death in June 1989, are supporting those who have become known as the leaders of reform. There is also a "suspicious movement" that was outcast and unknown in the period of Khomeini's rule (1979 to 1989). It has climbed the wall of the revolution in order to stab it from behind, after its leader has died. The repetition of statements by men like Ayatollah Yousef Sanaaiy, President Khatami and even Rafsanjani, has become a clear indication of such discrimination, which the reformers have started raising their voice about for the first time. They have warned against a "suspicious movement" in the Islamic Republic. A political current 26

Features that "is working on undermining the regime from the inside and distorting its image, to make it look like a violent cruel oppressor abroad". Reformers have also begun to talk, for the first time, about the discrimination between the "disciples of Imam Khomeini" and "supporters of Khamenei". It is as if the conflict within the Islamic Republic has turned from a conflict and dispute over the results of the presidential elections, to a conflict between two approaches. The word "Apostles" shows that the first is a sacred approach, with its significant link to Jesus Christ and his peaceful way of refusing violence in all its forms. The second can be called a dictatorship, in which the followers of the dictator benefit from his tyranny. They might also encourage him to choose the path of tyranny and religious oppression in the face of an ordinary opposition movement. Reformist leader Mehdi Karroubi, known in Iran as "the Sheikh of reforms," recently said, defying his arrest: "Had Imam Khomeini been present, he would have canceled the elections". Perhaps it is just a wish, an insight or a return to the rules laid down by the imam. Khomeini's lectures were about "Guardianship of the Islamic Jurists" in Najaf. It is the highest stage of the academic portfolio before the students reach the stage of being qualified for Ijithad in the Shiite doctrine matters (the process of making a legal decision by independent interpretation of the legal sources). Khomeinei was criticized during his life, even when he was leading the Islamic Republic of Iran. His understanding of the powers of the guardian jurist was criticized. When Khemenei was appointed as the guardian jurist, his involvement in detailed matters and affairs of the government, which is not the prerogative of the leader, but the Issue 1535

responsibility of the President of the Republic, he was criticized. The Shiite reference Hussein Ali Montazeri, who wrote a book in detail about the guardian jurist has specified the duties and obligations of the guardian jurist, Khemenei, who was not willing to lead, so the members of the Assembly of counselors held a meeting after Khomeini's death in which they could not determine his successor. But Rafsanjani said it happened that he heard Khomeini saying that Khamenei would deserve to be his successor. This was the first violation of the Imam's commandment that his words shouldn't be taken for granted after his death if they are not recorded by his voice or supported by the experts of voices. Khamenei did not practically exercise leadership, even after he became president of the country with a strong prime minister, Mir Hossein Mousavi. Khomeini was supported in every disagreement with the President and became a reference after he assumed leadership. He was characterized by interfering in the details of governance, as he did with the law of the press during the presidency of Mohammed Khatami, and by what happened in the presidential election when he supported the validity of the elections before the Guardian Council of the Constitution decided. During his religious leadership of Iran, Khamenei dealt with a strong president, Hashemi Rafsanjani who pushed the regime to make a constitutional amendment in his favor. Under this amendment, the powers of the prime minister were incorporated into the powers of the president, which was a symbolic position in the era of Khamenei. Khemenei also associated with President Mohammad Khatami who was dealing with him as an opponent of the regime, not as a president elected by an unfamiliar majority of votes, as opposed to a

candidate who lost the race despite his support of the party and the religious institution of the guardian jurist. While the well-known religious figures were excluded or forced out and even rejected in the Khomeini era, especially the followers and disciples of "Hojjatieh" approach, who never believed in establishing a religious state in the absence period, they returned and climbed the regime's wall and took control of much of its revolutionary legitimacy. They also had restricted the powers of Imam. They even arrested Ali Reza Beheshti and violating the sanctity of his family (Ali Reza Beheshti was the son of Ayatollah Mohammed Hussein Beheshti, the thinker and the Chief Justice of the Islamic Republic). They accused the grandson of the Imam Khomini Hassan of betrayal, who boycotted the ceremonies of Ahmedinejad's inauguration as a president for a second term. He did not attend with Imam Khomeini's grandson Hassan and accused him of treason, who boycotted the inauguration ceremony of President Mahmoud Ahmadinejad for a second term. He did not attend with him at the grave of his grandfather, a tradition he was accustomed to in the past. Khomeini supported the separation between the leftist and the rightist religious trends. They represented as one entity called, "Rohaniat Mubarez" and also supported the birth of Rohanyon Mubarez complex, financially supported to reform itself whereas he didn't back what he called "the original Muhammedan Islam", as opposed to old-fashioned Islam which was a characteristic of the "current conservatives". Not only that, but Imam Khomeini left the matter of deciding whether they would continue the war or not to the specialists and officials, after 27

regaining (Khorramshahr) from Iraq in May 1982. They thought it was better to continue the war whereas he supported ceasing the war. However, he reluctantly approved the decision no. 5981988/, when the officials found themselves in a crisis from which they were saved thanks to Khomeini's reluctant approval. Khamenei could cancel the election results on the grounds that the Guardian Council of Constitution was not qualified for making fair judgments. This became clear since the first days of the election campaign and the involvement of 7 out of 12 including the President of the Guardian Council of the Constitution, Ayatollah Ahmad Jannati, in the propaganda for Ahmadinejad, and also after the incidents that followed the elections and the involvement of members of the Council, including Ahmad Jannati in calling for arresting the two opposing candidates, MirHossein Moussavi and Mehdi Karroubi, because such calls were considered as an interference into the Council's affairs and powers. Even in the so-called “Velvet Revolution� and the following soft revolution, adopted by Khamenei against the regime, the mere declaration of the leaders of the Revolutionary Guard that they 4 December, 2009

were monitoring the elements of revolt against the regime and they had evidence thereof, rendered the last elections null and void both lawfully and logically. Because, if this had been true, the Revolutionary Guards could have monitored the "conspiracy". He feared that the Revolution would fail and therefore he came down to the scene and took part in the coup against elections. Had Imam Khomeini been alive, he would not have allowed the Revolutionary Guards from the very beginning to interfere into politics or take sides with any candidates. He would not have also been compelled to threaten to use force again as Khamenei did, threatening, the use of force as the last resort. The green government The Iranians who reject the election results continue to protest by organizing demonstrations everyday at universities, and take advantage of any religious or national occasion to take to the street, like what happened in the demonstrations of "Jerusalem Day" on the last Friday of Ramadan, and the demonstrations that broke out on the fourth of November, the anniversary of the occupation of the American Embassy. These demonstrations increased the

challenge, although the radical daily "Kayhan" newspaper thought that the arrests of student leaders during the demonstrations were the most influential in the reform movement. However, reformers’ websites stressed that these arrests just made them more insistent to go on their protests in the upcoming events, and they began to mobilize themselves for new demonstrations on the day of the student, in a couple of weeks from now. Experts believe that these demonstrations will exacerbate divisions within the Islamic Republic regime, and deepen the gap between civilians and authorities, thus driving the majority of younger generations who support the reform movement. After these demonstrations, reformers spoke about the impossibility of national reconciliation unless the regime fulfills the public requirements and form the green government. This undermines further more the authority and legitimacy of those in power, especially since Ayatollah Khamenei has deemed the questioning the electoral results a crime.

Chief Analyst Television





Issue 1535



4 December, 2009


Where were you


Issue 1535



Where were you on 911/?

The Controversy behind Khaled Sheikh Mohammed’s Trial PAULA MEJIA In recent weeks, there has been great uproar in the U.S. over the administration’s decision to try Khaled Sheik Mohammed, the self-declared mastermind of the terror attacks, in a federal court in New York City along with four other detainees. Beneath these arguments lies much more than a disagreement over where the trial should be held, these arguments are clear accusations between parties and evidence of a divide that plagues American politics.

here were you when Kennedy was shot? Only a few generations ago this question was a reference to the event that, for many, defined the then-current state of the American psyche. Today, it’s Where were you on 911/?


The terror attacks in New York and Washington D.C. have been referenced and analyzed to the degree they have been as a result of the impact this event had on the US’s perception of itself, its capabilities and its responsibilities on an 4 December, 2009

international and domestic scale. The outcome of this event was an unfortunate green light to numerous policies by the Bush administration that tainted the image of American democracy at home and abroad. Nonetheless, the value of the attacks on American political expectations continues to hold to this day. And while a new administration has come to undo much of the damage that was partially allowed by the event that traumatized so many, Obama’s government must continue to deal with the aftermath of the attacks as

more than a tragedy, for the political pertinence of 911/ remains to this day. In recent weeks, there has been great uproar in the U.S. over the administration’s decision to try Khaled Sheik Mohammed, the selfdeclared mastermind of the terror attacks, in a civilian court in New York City along with four other detainees. The question that is repeatedly debated is whether it is right for the defendants to be tried in New York as civilians. 32

Ideas Arguments abound, from those declaring that a trial near Ground Zero would have invaluable symbolic meaning of justice for the families of the victims, others note the importance of a fair trial after the various human rights scandals associated to the search of terror suspects – Guantanamo, water boarding, and Abu Grahib to name a few. On the other hand, there are those that condemn the decision for the safety implications it could have on the city, still others for the opportunity of terror groups to acquire intelligence from the trials. Put together it seems that each argument is bound by completely different criteria to decide what is ultimately correct. Morality, legality, safety and diplomacy are just some of the determinants behind each point of view. But the reason behind the controversy is unclear. After all, in both a civilian and military trial the detainees would likely be found guilty and justice would be delivered to the families of victims and to the U.S. as a whole. Secondly, no politician has claimed that all Guantanamo detainees will or should be tried as civilians, in fact the majority will be tried by military tribunals. During a recent interview by the Council on Foreign Relations with Steven Simon and John Bellinger, experts on the Middle East and International Law respectively, agreed that this is not a black and white issue but that it is being presented as such. There have been similar trials in the US dealing with terror suspects, such as the federal trial of Sheik Omar Abdul Rahman responsible for the 1993 WTC bombings. Why then are Americans so divided over the “where” and “how” of this particular trial? To refer to one of the many recent articles on the subject, Allan Gerson, former counsellor for international affairs during the Reagan administration, draws links between the trial of Khaled Sheikh Mohammed and the Nuremberg trials in a recent Op-ed for the New York Times. Gerson observes that “… there is [a] cost of forgoing the traditional route [of military trials]. The 911/ families do not deserve to be doubly victimized by the atrocity itself and the falsification of history to create the impression of some aberrant murderer who flouted Issue 1535

the law”. And it is precisely the historically defining role of a trial on the 911/ attacks that renders this particular decision so contentious.

Who controls the trial of Khaled Sheikh Mohammed, has the power to implicitly make assertions over the past wrongs of the US both domestically and internationally The Nuremberg trials were not only significant for their ability to condemn the atrocities of World War II. Beyond this humanitarian and moral aim, there was a clear political agenda to these trials, as is the case in many trials of value to national identity. Like the Nuremberg trials, the trial of Khaled Sheikh Mohammed is politically symbolic and it is the political weight of the trial that renders the “where” and “how” a battle worth fighting for many. Articles from the New York Times to the Wall Street Journal have reflected that there is a significant partisan dimension to the disagreement behind the decision to hold the trials in New York, with the majority of Republicans being against the decision, and many Democrats being in favour. While a partisan divide is hardly uncommon in any major decision undertaken in the U.S., the current debate has a degree of particularity to it precisely because of the way in which 911/ has impacted the domestic and international political identity of the U.S. According the BBC, Senate Republican leader Mitch Connell described the decision as “a step backwards of our country” that “puts all Americans unnecessarily at risk”. Bush’s last attorney general, Michael Mukasey noted on a similar note that “The Justice Department claims that our courts are well suited to the task. Based on my experience trying such cases… they aren’t”. Former presidential Republican

candidate Senator John McCain said “They are war criminals, who committed acts of war against our citizens and those of dozens of other nations”. On the other end of the spectrum are those like Tom Malinowski of Human Rights Watch who argues that “bringing these men to justice in a legitimate system will allow the world to focus at long last on the atrocities they are accused of committing against us, rather than on how we have treated them”. Beneath these arguments lies much more than a disagreement over where the trial should be held, these arguments are clear accusations between parties and evidence of a divide that plagues American politics. Republican representatives question the ability of the current government in place to carry out the trial, a government that happens to be administered mainly by members of the Democratic party. On the other hand the opposition defends its decision by calling it a necessary measure for undoing what the previous (read Republican) administration did wrong. In George Orwell’s classic 1984 he provides great insight into the value of the ability of controlling how the past is perceived. “Who controls the past,' ran the Party slogan, 'controls the future: who controls the present controls the past.' And yet the past, though of its nature alterable, never had been altered. Whatever was true now was true from everlasting to everlasting. It was quite simple. All that was needed was an unending series of victories over your own memory”. Who controls the trial of Khaled Sheikh Mohammed, has the power to implicitly make assertions over the past wrongs of the US both domestically and internationally. While the ability of justice to be implemented by the trial is the more obviously significant aspect of the trial of Khaled Sheikh Mohammed, the nature of the debate in the US over the trial reflects an ugly truth of American politics. Despite the changes that the 911/ attacks brought on the US and the World, partisan politics continue to affect much of the national debate within the country, and this recent case of subtle mud-slinging is causing many in power to lose sight of what is truly important in the upcoming trials. 33

4 December, 2009



The Manama

Dialogue By Manuel Almeida Issue 1535


People - Interview

Dr John Chipman CMG, Director General and Chief Executive of [IISS] The International Institute for Strategic Studies Dr John Chipman spoke with The Majalla about the “Manama Dialogue”, the key Regional Security Summit which has taken place every year in Bahrain since 2004. This year’s summit will take place from the 11 to the 13 of December 2009. Dr Chipman explained the other activities that the IISS has been developing in the region; and expressed his views on crucial security matters such as a nuclear armed Iran; the modernization of military systems and weapons control in the Gulf; and the future of NATO in Afghanistan.

r John Chipman is DirectorGeneral and Chief Executive of the International Institute for Strategic Studies in London, a leading Think Tank focusing on international security. Dr Chipman spoke with The Majalla about the “Manama Dialogue”, the key Regional Security Summit which has taken place every year in Bahrain since 2004. This year’s summit will take place from the 11 to the 13 of December 2009. Dr Chipman explained the other activities that the IISS has been developing in the region; and expressed his views on crucial security matters such as a nuclear armed Iran; the modernization of military systems and weapons control in the Gulf; and the future of NATO in Afghanistan. Dr Chipman received his BA in History from Harvard, an MA in International History from the London School of Economics, and an M. Phil in International Relations from Balliol College Oxford. He joined the IISS as Research Associate in 19831984-, during which time he was also a NATO fellow.


London, 1st December 2009 The Majalla: Can you explain to our readers what the Manama Dialogue in Bahrain is? The idea of the Manama dialogue is to create an intergovernmental forum where foreign ministers, defence ministers, national security advisers, and chief of defence staffs, in short, the national security establishments of the key countries of the region and most important outside powers that have a political and security engagement in the region can meet on a regular basis. In the Gulf, aside from Gulf Cooperation Council (GCC), there is no regional security mechanism that permits the national security establishments of the states having a stake in Gulf security to engage in defence diplomacy with each other. There have been frequent calls for a kind of OSCE [Organization for Security and Cooperation in Europe]

for the Middle East to be established, and what we are trying to do at the IISS is, under the umbrella of the IISS, to create the conditions under which this kind of defence diplomacy can be conducted. Q: In spite of being recent, the prestige of the Manama Dialogue is already very high. Why do you think this is? I think from the very first year, the government delegates to the Manama Dialogue realized that there was no other forum that allowed for informal exchanges of this kind. Each of the prime ministers, foreign ministers, and government ministers, who address the conference appreciate the possibility to give their perspectives on national, regional and foreign security policy. But the principal advantage for them is the private bilateral meetings and the multilateral meetings they have. And I would emphasize this is not just multilateral meetings between the various Middle Eastern states

4 December, 2009


People - Interview that participate, or even between the Western states and the Middle Eastern states that participate, but also crucially between Asia Pacific states who are now having a more important role in Arabian Gulf security. Q: It is believed that diplomacy has been moving from the traditional state-to-state sphere to other types of forums. Is the Manama Dialogue a good example of this? I think you could argue that, to a degree, the Manama Dialogue represents the privatization of diplomacy. Where it would have taken many more years for the governments of the region to organize for themselves such a meeting, because the IISS is a private organization, with an international character, acting with no agenda of its own, it was able to perhaps move more speedily to assemble these personalities for this meeting. But it is up to the regional players to use it for their own benefit. We provide the platform, and then it is up to the government representatives to take that opportunity, seize it, and use it to develop more interesting and mutually beneficial policies for regional security. Q: The press coverage of the event is certainly good for business, but considering the high level guests and the sensitivity of the topics discussed, does it discourage guests to express their opinions and provide insightful information? I don’t think that. What is interesting is that because you have all these ministers from the region giving public speeches that are on the record, it compels these governments to think about what is the most important message that they want to deliver in this public forum. And we designed the Manama dialogue so that there would be a public element to it, so that these issues of security did not appear as opaque and secretive as many in the region might fear and many outsiders often are concerned by that as well. So the public element of the forum is crucially important, because it creates transparency, and it helps to establish perhaps the basis for better confidence. The fact also that the speeches aren’t just delivered and that is the end of it, but that the experts that we gather can cross-examine the ministers in public and ask them sensitive questions is important. Last year for example, when US secretary of Defence Gates spoke about the campaign in Afghanistan, he was asked very sensitive questions about how long the United States might wish to be there and he provided very frank answers. For example saying that while the government in the United States might approve Issue 1535

an increase in troop numbers that was requested by the commanders, he personally was concerned about having too large a footprint, a military footprint in Afghanistan, for too long a period. And I think this gave a much stronger understanding to those in the region about the finely balanced arguments that take place within the US on these kinds of issues that perhaps otherwise are not exposed in the region. But the Manama dialogue is also designed to have private sessions, off the record sessions, where the ministers and senior government officials speaking are not going to be quoted by the press, and are able to have a genuine exchange with experts. Finally, there is a third element, where the private bilateral and multilateral meetings that the ministers organize for themselves which the IISS has nothing to do with at all. But we are aware of the multiple meetings that take place, which obviously is one of the reasons that the ministers are very keen to come and stay for longer than half a day. Q: Will Robert Gates deliver the keynote address this year as happened in 2007 and 2008? What I can say is that this is going to be a very big US delegation, with a number of senior players from the State Department, the Pentagon, the National Security Council, and the White House, all participating. And the United States is taking seriously this year the Manama dialogue as it has done in previous years. We are also expecting to receive an important Iranian delegation this year, led by a minister and with participation from the various elements of the Iranian national security establishment, and so we are hoping that the Manama dialogue will create an opportunity for more diplomacy between the states of the region and Iran, and countries from other parts of the world that are concerned with regional stability. Q: What will be the main topics of discussion this year and how did you define these? I think there are essentially four. One will be the war and turmoil in Afghanistan and Pakistan. We will have strong delegations from Afghanistan and Pakistan and I think the states of the Gulf are very concerned with the stability of Pakistan, and with the future of the campaign in Afghanistan. Some of them are in fact involved in providing economic assistance, some are involved in providing diplomatic facilities for eventual discussions with the Taliban, and some even are providing discretely some direct military assistance to the campaign.

And so engaging the Gulf Arab states in the debate on the future of Afghanistan and Pakistan is we think very important. A second big issue is of course still Iraq. There are elections to take place in Iraq next year, while much of the international focus has been in the Afghan and Pakistan campaign, the stabilization of Iraq is not yet 100% complete and for the region it is very important. The Manama dialogue I think has played an important in role in the last five years in developing more confidence between the Gulf Arab states and Iraq, who were at times sceptical about the nature of the Iraqi government and were concerned about hints of its sectarian qualities. And I think the Manama dialogue can work as a confidence building measures to develop stronger links between the GCC countries and Iraq. I think a third issue will be the war in Yemen and the involvement of Saudi Arabia in that conflict, and the tactics and strategy that Saudi Arabia has pursued. We look forward to hearing from the delegation of Yemen on what its perceptions are about how that conflict might develop. And finally there will be the Iranian question, which manifests itself in a variety of different ways. And giving the dramas over the last few months over the Iranian nuclear file, I think there will be great interest in what the Iranian delegation has to say about that, but also about its perceptions of the future regional security architecture, and how one can be developed that accommodates the interests of all countries of the Gulf region, not just one or two. Q: Apart from the Manama Dialogue, what other activities related with the Middle East is the IISS developing? We are delighted that early this year we signed an agreement with the Kingdom of Bahrain to establish a regional branch for the Middle East in Bahrain. So we will have offices in the Financial Harbour that we will be opening in 2010. We will be bringing some analysts from Europe and North America to that office, but we will also be hiring analysts from within the Gulf to work in our Bahrain office to ensure that we have perspectives from the region. We will also be having people from South Asia working in our Gulf office, especially from India. And the Middle East office established in Bahrain will also work with other GCC countries. We have an important conference that we run every year in Oman on radicalism in South Asia, involving delegations from Afghanistan, Pakistan, India, and Bangladesh. 37

People - Interview We have in the past run meetings on water resources in south Asia and Abu Dhabi. We have done conferences in Saudi Arabia and Qatar as well. And so we hope this IISS Middle East office in Bahrain will serve to bring analytical perceptions from the rest of the world to the Middle East, and also give a voice to the Middle East in Asia, Europe, Latin America, Africa, and North America, so that all the regions of the world that have now gained a great deal of economic and political interest in the Gulf understand the perceptions from the region. That is how we conceive about the IISS Middle East office in Bahrain and we think that it will be a way of bringing more into the mainstream of the international debate the perspectives of the region. Q: We would be grateful to have your views on a few strategic and security matters in the Middle East. Arms imports to the Middle East have dropped significantly in the last couple of decades. Will a nuclear armed Iran change this tendency? There has been an interest in a number of GCC countries in modernizing their armed forces, their aircraft and their air defences. Clearly, for some countries, especially the UAE, the ambiguity about Iran’s strategic posture is a spur to developing more modern military systems. What is also becoming more important is to find better ways for the GCC to coordinate air defences in particular, and one of the interests that some of the governments from outside the region will have in engaging with players of the Manama dialogue would be to see how greater efficiencies can take place in GCC air defences and more coordination, because the place is too small for one country to handle its air defences on its own. Q: There is a sense of apathy of Arab countries when it comes to dealing with Iran’s nuclear plans. Do you agree? And why do you think this is? It is understandable that Gulf Arab states in particular don’t want to be at the centre of this very intense diplomatic dispute. On the other hand, they are the ones to be first affected if Iran will one day gain a nuclear weapon, or to be able to threaten the region in some way because of the confidence that will soon acquire a nuclear weapon. And so my own view is that it is important for the states of the region to find some way to become part of the negotiations and discussions with Iran. The example I always use is the example of the six party talks in Korea, where there has been concern about North Korea’s nuclear weapons programme. There, crucially the states of the region, South Korea, Japan

and China, are directly engaged in negotiations and discussions, and I believe that countries like Saudi Arabia, Egypt, and Turkey should at least informally be engaged in the so-called “51+” discussions that have taken place with the Islamic republic of Iran. Sometimes you hear these states concerned that the 51+ will do a deal with Iran over their heads, sometimes you hear concerns that the kind of pressure they are imposing on Iran is not appropriate to arrive at an agreed solution. Both of these concerns, at each extreme, would be resolved if they were more involved in the discussions, and I think countries like Saudi Arabia, Egypt and Turkey, who would be amongst the first affected by a failure of the diplomacy with Iran, they should engaged more intensely from the start. Q: What do you make of the speculation that Gulf countries might buy nuclear warheads from Pakistan in order to balance Iran? I don’t think that is likely but it is one of those rumours that is hugely fuelled in the Gulf. There have been concerns expressed in the West that the long time strategic relationship between Saudi Arabia and Pakistan might permit such an arrangement. I don’t think that is likely. I do think what is important though is for there to be a dialogue between the P5 states of the UN Security Council with the Gulf Arab states about how their security might be guaranteed in the event that diplomacy with Iran would fail. There have been concerns expressed that Saudi Arabia, Egypt and Turkey might revise their views about whether they might one day develop nuclear weapons if the Iranians do acquire them for themselves. So really part of what the P5 needs to do is, in the first instance, succeed in their diplomacy with Iran, but if that would to fail, find a way to extend certain guarantees to the states of the region that wouldn’t require them to get nuclear weapons of their own. And there are some discussions in expert circles that haven’t yet entered the formal public domain, about whether one day there would need to be nuclear guarantees given to these states, the so-called “extended deterrence”, provided to the states of the region. And these debates are still very very quiet and they haven’t yet been engaged in by foreign ministers or defence ministers, but I think it is one of those things that quietly people are talking about, and which Iran might want to consider in slowing down its progress towards developing a nuclear option, because it would be unfortunate if the region became subject to a formal balance of nuclear power, but that would be better than having competitors unilaterally

developing nuclear power. Q: What is the state of arms control agreements in the region? Well there are not very many arms control agreements in the region that really assist in the development of the kind of formal balance of power that we had in the old days between East and West in Europe. And there is an incomplete involvement of some of the states of the region in some of the global arms control arrangements. However, there is more interest for example in initiatives such as the Proliferation Security Initiative, the so-called “PSI”, and obviously the current dramas about piracy in the region are inspiring states to look much more closely at the coordination of efforts to combat problems of piracy, so I think the prospect for more coordinated diplomacy on security issues, because of the variety of new threats that are emerging, is there, and that is something we would like to inspire in the Manama Dialogue. Q: You were a NATO Fellow. Do you believe NATO can be successful in Afghanistan? And what does “success” mean there? I think it was always a mistake to make the success of the campaign in Afghanistan a litmus test for the NATO Alliance. Especially as the mission in Afghanistan became defined over the last few years as grander and grander, so much so that at one point it appeared that success could only be achieved in Afghanistan if we were developing a sort of a Western-style democracy. I think what is happening now is that we are going to redefine the mission in Afghanistan to its original purpose which was to ensure that Afghanistan will never again be a place from which organized terrorist attacks internationally could take place. That requires changing the balance of power with the Taliban, but it does not require its comprehensive and total defeat. Some diplomatic work will need to be done to find ways to inspire lower level Taliban to, if not directly support the government, not oppose it using violent means. If this more modest definition of success in Afghanistan takes place, and the right application of force, diplomacy and development assistance is deployed, there is no reason why NATO and the wider international community engaged in Afghanistan, shouldn’t succeed over the next few years. Interview conducted by by Manuel Almeida

4 December, 2009


People - Profile

The Discreet Diplomat

Yukiya Amano the Director General of the International Atomic Energy Agency Some think of him as a diplomat, while others wish him to be a politician, yet he might end up as a puppet stringed by conflicting parties. What many fail to notice however, is that the new Director General of the IAEA has his own hidden agenda that will be revealed in time.

International Atomic Energy Agency IAEA Director General Mohamed ElBaradei (L) and IAEA Director General designate Yukiya Amano attend a board of governors meeting at the UN IAEA's headquarters in Vienna on November 27, 2009. The UN atomic watchdog voted in favour of a resolution to censure Iran at a meeting here Friday Š GETTY IMAGES

"I am faced by many challenges, but I will do my best" This was one of the first statements issued by Yukiya Amano, the new Director General of the IAEA upon his inauguration a sthe head of the nuclear watchdog. 40

4 December, 2009

This statement was considered accurate by many experts, for Amano is faced by numerous hardships and difficulties that will make his task seem like a war held on many fronts. The new assignment didn't

intimidate Amano, in fact, the old veteran considers it a source of motivation, and is exerting maximum efforts in order to prepare himself for what he is about to confront. Amano is an expert in the field of nuclear disarmament and is known for 40

People - Profile his ability to manage tedious and tricky nuclear files. This goes back to the 12 years he spent moving between different positions in the IAEA, which in turn polished his skills greatly. One of the most important and crucial posts held by Amano was as the head of the research department in the Japanese institute of international relations. This post allowed Amano to interact extensively with diplomats and politicians giving him a chance to get acquainted to the rules of the game. Furthermore, throughout 36 years of work in the Japanese foreign ministry, Amano had the chance to participate in the revision of the nuclear proliferation treaty in the years 1995, 2000 and 2005. Eventually, Amano was appointed as representative for his country in the IAEA, which later on led to his election as the Director of the agency at the age of 62, which followed five election rounds. Amano finds himself overwhelmed with duties and responsibilities left by his predecessor Mohamed El Baradei, despite the fact that he has only been in office for a few days. Mohamed El Baradei's legacy is considered the first speed bump on therugged road Amano will travel. El Baradei, for one, was known for his efficiency in handling nuclear profiles and mediation tasks. This puts Amano in an awkward position, as early comparisons with his predecessor will prove challenging. Nevertheless, Amano is well aware that he will be chased by blame like El Baradei was during his 12 year run in IAEA, where he was called both a Western agent and an Iranian ally. In spite of his profound respect towards the ex-Director General, Issue 1535

Amano declared early-on his disagreement with El Baradei on several topics: first of which was his belief that "political negotiation is not the agency's task, but implementing the safeguards that have been agreed upon". Thus Amano has made it crystal clear that he sees the nuclear watchdog as more of a technical body than a political one. Amano is known to be more conservative than his predecessor and believes that the agency's responsibilities should not in any way be politicized. Contrary to El Baradei who was very outspoken, Amano tends to be more discreet and prefers to work behind the scenes. Amano backs this attitude by his belief that "the statements made by the director of the agency have political implications, and if they are not dealt with carefully they can be very dangerous" For a person characterized by calmness and stability, his conservative attitude is not considered out of the ordinary. Amano, after all,was born only 2 years after the Hiroshima and Nagasaki catastrophe, and thus understands very well what is at stake if a nuclear attack should occur Nuclear issues have been rising to their boiling points throughout that past few years, and if he doesn't deal with them intelligently they might very well explode. On the one hand the Iranian predicament has taken several twists that have only added more complexity to the issue. Amano has assumed responsibility at a time when the agency has asked Iran to further cooperate with international community, a demand that was swiftly met by an Iranian declaration to build 10 nuclear enrichment facilities. Amano has previously announced that Iran

is so important that it should be treated with respect, in addition to keeping mutual communication intact, despite that he doesn't expect a quick resolution to the dilemma. Hence, what solutions does the experienced diplomat have to offer in order to deal with Iran? On the other hand, the North Korean and Syrian files remain a pebble in the international community's shoe. These two heated issues could become the new cornerstone in the west's relation with IAEA and accordingly Amano, since the arm of political conflict between the US and both Syria and North Korea could spread to engulf and apply pressure on the agency, which the opposite of what Amano aspires for. What's interesting is that many of the principles called for by Amano are put under scrutiny by diplomats. Amano's conduct prior to the elections is consistently used as example of his deliberately hidden political skills, which in may contradict the ideals which he endorses. Amano's competitor during the elections was known as a person with a strong personality, which would definitely obstruct western interests. This simple fact was used intelligently by Amano who criticized the agency's policies, not necessarily out of conviction but rather to steer the electoral process in his favor, The "political" maneuvers that he implemented might in fact backfire and prove counterproductive, since up to this moment no one knows what his real intentions are nor how he intends to handle pending cases. Yet, when push comes to shove, Amano might be forced to change his policies 41

4 December, 2009

Economics Gulf Economics

International Investor



The Change By Stephen Glain

Issue 1535


Economics - Gulf Economics

Keep the Change

The path to economic diversification Stephen Glain GCC countries are on the right track to achieve a balanced level of economic diversification. Investment in quality education and physical infrastructure might not lead the region to be the next world’s warehouse but are contributing to bring a breath of dynamism to these countries’ economies.

Staff members and students walk on campus at the King Abdullah University of Science and Technology (KAUST) on October 13, 2009, in Thuwal, 80 kilometers north of Jeddah © GETTY IMAGES

campus is understated, T hemore suburban mall than institute of higher learning, and the enrolment is thoroughly cosmopolitan. Its ten thousand students come from 202 countries – more, its administrators like to point out, than there are members of the United Nations. Between classes, students gather at the Starbucks cafe or catch up on assigned reading in the commons. Not far away, construction workers ready another block of dormitories for an incoming class of freshman. It is an odd setting in a region associated more with oil derricks than mortarboards, but Dubai International Academic City represents a fresh coordinate in a 4 December, 2009

slowly diversifying Arab economy. Occupying some 25 million square feet of prime real estate in Dubai, it is one of the largest clusters of foreign and regional universities in the Arab world, with classes offered by such institutions as Michigan State University and Australia’s University of Wollongong. By the time of its scheduled completion in 2015, the $3.2 billion complex expects enrolment to reach 40,000 students.

Masdar Institute of Science and Technology, with the help of its partner, the Massachusetts Institute of Technology, is marketing itself as a powerhouse for research and development. Then there is Saudi Arabia’s King Abdullah University for Science and Technology, which opened in September with an endowment of $10 billion, 800 students and a mission to establish itself as a world-class postgraduate institution in a country with no real tradition of one.

Higher education centres like DIAC represent the kind of servicesector enterprise that planners hope will one day create enough wealth to offset the Arab world’s critical dependence on energy for growth. In nearby Abu Dhabi, the

So starved is Saudi Arabia for managerial expertise that in its first year KAUST will be run by Saudi Aramco, the kingdom’s energy giant. It is an apt pairing. Not only does Aramco symbolize 44

Economics - Gulf Economics the desert kingdom’s dominance in hydrocarbon fuels, it is also one of the most respected service-sector companies in the Arab world. For the Gulf states to successfully diversify their economies, experts say, they would do well to concentrate on service-related enterprises like education and other so-called “non-tradable” industries that are most likely to attract firsttime job seekers. “They will have to invest in skills and education,” says Uri Dadush, director of the international economics program of the Washington-based Carnegie Endowments for International Peace. “The question for them is not export diversification as much as jobs, which means economic diversification through nonexport-related services. There is a market for education, but also for construction, wholesale businesses and restaurants.” Diversification of any kind has been an elusive goal in a region where cushy public-sector positions are still regarded as an entitlement. Most of the labour in the Gulf emirates, from construction and domestic work to white-collar professions like teaching and health care, are provided by expatriates who remit much of their earning back home. Educated emirates, in contrast, tend to gravitate to the civil service, with its relatively shorter hours and generous pensions. As a social contract – the state as the employer of first, and often last, resort – worked fine until the oil boom of the 1970s collapsed into a prolonged economic drought, compelling many guest workers to return home and rendering much of the Gulf economy inert. Previous attempts among the Gulf states to subsidize their way out of their oil dependency fizzled due to a failure of will, followed by a recovery in oil prices that allowed regimes to put off the pain of substantial reform. The result was a cascade of boom-bust cycles and dizzying levels of public debt. What inspires cautious optimism about this most recent initiative is the breadth and scope of the commitment to change even as oil prices remain well above $50 Issue 1535

dollars a barrel, the average rate assumed by Gulf states in their 2009 budgets. While the developed world continues to reel from the 2008 credit collapse, much of the germinal Middle Eastern economy has emerged more or less intact. The outlook for the Gulf is particularly bright; according to a recent report from the Economist Intelligence Unit, regional growth is expected to outstrip the global average, with an annualized rate of 4.5 percent over the next decade. While energy production will continue to dominate the economy, it will likely account for a declining share of growth. From 20022006-, non-oil related commerce outpaced energy as a source of revenue in every Gulf state except for Saudi Arabia, which the ratio was nearly balanced, though oil revenue still accounted for 86 percent of the total. Gulf regimes seem to have learned from their past mistakes. Since 2003, when the botched U.S.occupation of post-invasion Iraq drove petroleum prices to record levels, the oil-producing countries of the Middle East have amassed estimated budget surpluses of $605 billion. Unlike previous boom cycles, when windfall profits were ploughed into hastily planned property developments or trophy assets overseas, Arab oil giants have taken advantage of this most recent bull market to right their balance sheets and invest in new infrastructure. Bahrain, which possesses only modest petroleum reserves relative to its neighbours, is generally thought to lead the region in economic diversification. Its financial sector remains among the region’s most prolific, foreign investment has risen in response to business-friendly reforms, and the government hopes to double household income over the next two decades by investing in hightech industry, public transportation, and education. Qatar, with its vast gas reserves, has emerged as a beacon for regional and international bankers, and such financial institutions as UBS, State Street, and Sumitomo Mitsui Banking Corp. are now licensed in Doha. Goldman Sachs is advising the government on several planned

corporate mergers in the shipping and property markets, part of a plan to enhance market efficiency. Saudi Arabia, perhaps the least patient of the Gulf states with its petroleum habit – and saddled with an estimated 15 percent jobless rate – has earmarked several sectors at once for development. The government is spending a fortune to mine its considerable and largely untapped mineral resources while laying down a railroad grid that will link its coastal and inland cities for both passenger and cargo traffic. It has also opened service sectors like finance and aviation to both local and foreign investors. Most significantly, Riyadh is leveraging the generous concessions it obtained as part of its 2005 admission into the World Trade Organization to establish itself as a fiercely competitive petrochemical producer. Under the terms of its entry, Saudi Basic Industries Corp. is allowed to buy oil from Saudi Aramco at non-market rates, which gives it a huge advantage over such rivals as Germany’s BASF. While the industry itself is hugely capital intensive and creates relatively few jobs, Saudi economic planners hope its cheap raw materials will compel manufacturers of goods with a high plastic content – casings for televisions for example, or tires of auto vehicles – to locate factories in the kingdom. No one is suggesting the Persian Gulf will one day become a beehive of heavy manufacturing. The region faces serious challenges on several fronts, including an exchange rate system that is linked to the U.S. dollar, which restricts monetary policy flexibility and threatens asset inflation in the current low-interest rate environment. With global growth expected to come from the developing world for at least the next generation, however, emirate leaders can reasonably assume a robust and sustained demand for oil and gas, the region’s lifeblood. They have demonstrated the will and the vision to go beyond oil. The challenge now is to fuel enough service-sector activity to accommodate young jobs seekers in both numbers and aspiration. 45

Economics - International Investor

There Will Be Gas

Joining the gas competition in the EU

The decision earlier this year by Qatar to press ahead in its investments into its gas export capacities, despite the fall in energy prices and slowing demand, is a shrewd move that reveals deep understanding of international markets. From a European perspective, this decision appears even more so as import dependency rises and relations with its main supplier in the East deteriorate.

Iana Dreyer


he European Union’s (EU) share of gas in its consumption of primary energy has risen from 18% in 1990, to 24% in its latest count. Gas plays a crucial role in its strategy to lower carbon emissions. The EU - the world’s largest economic bloc - is seeing its dependence on imports of gas rise: domestic reserves are starting to run out. The EU has recently run into severe problems with the behaviour of its main external gas supplier, responsible for 40% of its imports: Russia’s export monopoly Gazprom. Gazprom has become one of the Kremlin’s national champions, conveniently manipulated in order to pursue other political goals in Russia’s neighbourhood. Conflicts with former members of the Soviet Empire, such as the Baltic States (now part of the EU), Ukraine, or Belarus, have led to gas supply cuts. The last one in January 2009 has left thousands in the cold in the midst of winter and paralysed large swathes of domestic economies in the EU. Worst hit were the new EU member states, formerly part of the Soviet bloc, which have joined the club since 2004. While their economies have diversified away from their former industrial and trade integration with Russia, their gas markets have not. The former Soviet pipelines still feed individually, like an umbilical cord, each Central and Eastern European country, on their way to the big markets in the West. Slowly, however, the EU’s domestic gas market organization is changing. A guardian of the EU’s single market, the Commission in Brussels has several times stepped in to untangle the knots that prevent the EU’s gas markets from functioning as one. Dominated by domestic monopolies or oligopolies, generally in the hands of governments which prioritise good relations with Russia, European markets have seen insufficient investment into alternative supply routes, interconnecting pipelines, 4 December, 2009

LNG terminals, or storage capacity to meet demand in case of emergency. If the EU’s markets were fully integrated, the drama of early 2009 wouldn’t have occurred. Indeed, if, say, the big and diversified German and the currently fully Gazpromdependent Bulgarian gas market were interconnected, for example, Bulgaria would be able to quickly switch to emergency deliveries from Germany and tap into previously stored reserves. Yet most national gas companies just don’t invest because they have the wrong incentives in an environment that doesn’t provide sufficient room for competition. A growing set of evidence shows that the only genuinely effective way to increase competition and therefore raise investment is the path taken by the United Kingdom and the Netherlands: to dismantle the currently vertically integrated gas behemoths and separate their production, transmission and supply activities, a term dubbed “full ownership unbundling”. It is not surprising that Qatar’s main export target is the liquid and dynamic UK market. The Commission has proposed legislation in 2009 to oblige EU member states to follow that model. But due to fierce resistance many of the provisions will not be applied uniformly across the bloc. Yet resistance is likely to wane. In parallel to legislating, Brussels has launched antitrust investigations against big energy majors such as Italy’s ENI, or Germany’s RWE that revealed these companies restrictive practices such as precluding access by other suppliers to their transmission networks, or under-investing in pipelines to keep supply scarce. The Commission’s pressure is likely to give non-incumbent suppliers greater chances to serve the EU’s lucrative consumers. Times are changing even in countries that have so far favoured cosy

relations with Russia to supply their monopolised domestic markets. This is for example the case of Germany, the EU’s biggest gas market, a friend of Russia, but also a silent strategist to become less dependent in it. German companies have scaled up investment in LNG terminals, launched partnerships with Central Asia, and investment plans into new sources of supplies in Norway, Africa, and the Middle East. Germany is a proponent of a pipeline to route Central Asian and Caucasian (and potentially Iranian) gas, Nabucco. Germany’s Cartel Office has been busy cleaning up the domestic market, thus providing more opportunities for outsiders. Central and Eastern European markets are also progressively changing. Hungary, keen to reduce its dependency on gas supplies from the single main pipeline that connects it to Russia has followed the British and Dutch model in 2007. Since then, investment into transport and storage capacity has soared. Hungary has surprised many in January 2009 by its ability to respond to the crisis, and to help out some of its less fortunate neighbours. Gazprom is reacting. It has invested in Nigeria, partnered up with North Africans or aired plans for a “gas OPEC”. But Gazprom’s uncompetitive business model means it doesn’t invest sufficiently into new capacity and technology: it is not a lucrative partner. Nor does Russia like to coordinate its actions internationally. Middle Eastern players would be better advised to engage directly with a more competitive and reliable EU market. Trade Policy Analyst at the European Centre for International Political Economy, Brussels, specialised in European and Russian foreign energy relations 46

Issue 1535

4 December, 2009


Economics - Markets

Dubai World

After 6 days of panic, world financial markets began to rally on Tuesday, December 1, 2009. The news of the beginning of talks between Dubai World and its creditors to restructure US$ 26 billion (out of US$ 59 billion) of debt gave a speck of confidence to investors. On Monday, Abu Dhabi had already reportedly stepped in to guarantee Dubai’s debts, keeping at bay fears of a second world recession. Last week, Dubai had revealed its intention of delaying payments on US$ 59 billion out of US$ 80 billion debt, sending markets in a downward spiral.

President Obama will commit the U.S. to large cuts in greenhouse gas emissions at the Copenhagen summit, increasing the likelihood of an international deal being agreed U.S. CO2 emissions, billion tonnes 6.96 Other target cuts by 2020 (from -17% 1990 emissions) 5.98 Japan 25% 5.78 -30% EU 20% 4.87 -42%

China has joined the U.S. in pledging its first greenhouse gas emissions targets ahead of the Copenhagen summit – but critics say the plan would allow Chinese emissions to continue to rise Carbon intensity of Chinese economy – measures 1980 energy efficiency 7.89 (billion tons CO2 per $million GDP)


2005 2.95


2020 China target: 1.62


2005 world average: 0.75 1980

Source: WRI






UK-Saudi Bank Dispute -83% 1.18

1990 2005 2020 2025 2030 2050 Source: CAIT Issue 1535


The British Bankers Association asked Saudi Arabia to allow international creditors and banks to take part in the US$22 billion debt restructuration negotiations of the Saad Group and Algosabi. The Saudi government has so far refused this solution arguing that this is a private family feud. The BBA has asked the UK government to step in, since it argues this delay in solving this problem has left international banks exposed to billions of dollars of losses. 49

4 December, 2009

Reviews Books

Issue 1535




Reviews - Books

Crude World Crude World: The Violent Twilight of Oil Peter Maass Alfred A Knopf 2009 n The Pearl, the 1947 novella by the American novelist John Steinbeck, an impoverished Mexican diver named Kino scoops up an enormous pearl from the bed of a gulf tributary. The raw gem’s unlocked wealth promises to deliver Kino and his family from penury but it also provokes the villagers to scheme for its possession. Like a cancer in its host, Steinbeck writes, the pearl “stirred up something infinitely black and evil….The poison sacs of the town began to manufacture venom, and the town swelled and puffed with the pressure of it." The story ends with Kino, fearing the pearl will destroy him and his family, returning it to the Gulf’s shimmering folds.


Sadly, the same cannot be done with our hydrocarbon economy. As Peter Maass concedes in his latest book, a first-person account of oilinduced ecocide, geology cannot be reversed. Crude World: The Violent Twilight of Oil, is a forensic tour through the devastation wrought by an energy source that is in some ways as deadly as it is empowering. Like Kino’s blighted pearl, oil subverts the primitive societies where it is so often discovered – the author frequently cites Norway for its exceptional rule-of-law buffer against the oil curse – leaving armed conflict, kleptocracy, and environmental havoc in its wake. In a concise 225 pages, Maass illustrates how oil-rich dictators, usually with the indulgence of Western governments, sack pastoral idylls and plunder delicate ecosystems. Oil, he writes, “not only offers itself as a treasure to be stolen; it can become a political amulet that protects the thieves from abandonment or punishment.” Though there is no shortage of books about the petroleum industry – the publication of Daniel Yergin’s The Prize in 1991 sired an entire genre – Maass weaves a tale that is distinguished by its scope, wit and verve. Like a gas flare from an oil rig, he illuminates a hydrocarbon landscape that stretches from the killing fields of Equatorial Guinea and Iraq to the environmental disaster zones of the Niger Delta and the Oriente region of Ecuador. The cycle of exploitation in the non-Norway oil world is, by his account, depressingly familiar: a petroleum field is discovered under a far-flung nation; 4 December, 2009

the world’s energy lords converge around the local strongman who has filled a post-colonial void; free of the industrial laws and ethics laws that prevail in their own countries, the oil companies cut a deal with the regime. Drilling rights are exchanged for slush funds, reserves are siphoned away, virgin lands and waters are violated and the people, particularly those caught in the middle, are crushed. That, in a nutshell, is what has happened to oil-endowed Equatorial Guinea, the tiny West African nation run by Teodoro Obiang, a dictator who has allegedly cannibalized opponents, obliged a U.S. ambassador to flee the country by threatening his life, and managed to parlay a $60,000 salary into a fortune worth $700 million. Obiang, Maass writes, bartered away to oil giants ExxonMobil, Marathon Oil Corp. and Hess Corp. a majority of the profits from his country’s energy reserves in exchange for regular cash deposits with Riggs Bank in Washington, D.C. After the size of the payments was revealed in a U.S. Senate report, lawmakers launched a hearing and summoned top officials from Riggs and the oil companies to testify. One of them, Andrew Swiger of Exxon, told legislators that the kickbacks to Obiang were all part of their commercial obligations to “make Equatorial Guinea a better place.” Amazingly, the theft of Equatorial Guinea’s natural resources continues. (Just last week, The New York Times ran a front-page story on the numerous homes, automobiles, speedboats and private jet maintained and enjoyed in America by Obiang’s son.) “The more that was taken from its people,” Maass writes, “the better [was Obiang’s] relations with Washington. It did not matter that [he] had threatened to kill the American ambassador….One of oil’s darkly magical properties is that it erases inconvenient memories.” In this relentless account of villainy and scandalous neglect – the chapters are given one-word titles, such as “Plunder,” “Rot,” and “Contamination,” in fitting tribute to the Catholic Church’s Cardinal Sins – Maass apportions blame judiciously. He is tough on industry leaders like Exxon and British Petroleum, which rival Wall Street’s Goldman Sachs and AIG as icons of corporate avarice, but

he is equally hard on the state-owned oil companies that surged to power when populist leaders nationalized their energy sectors. Petroecuador of Ecuador, for example, is singled out for doing as much to despoil the environment as its foreign predecessors. While the author salutes Saudi Aramco, the world-class steward of Riyadh’s oil wealth, he details how the Saudi royal family’s impious excesses during the 1970s oil boom invigorated radical Islam. Maass does a superb job explaining how seemingly decent oil executives can persuade themselves and others around them that conniving with dictators and razing whole stretches of the planet is somehow good for the commonweal. He profiles oilman James Giffen, the ex-bagman to Kazak dictator Nursultan Nazarbayev, who proudly tells the author that he was the inspiration for a particularly unscrupulous character in the movie Syriana. Charming rogues, man-eating heads of state, Nigerian tribal kings waging low-intensity wars against oil-mad, aggrandizing regimes. Maass lays it all out with the crisp pace of a graphic novel. He remarks how, from one steamy boom town after another, he meets characters worthy of a Graham Greene novel. But Crude World reads more like Heart of Darkness, Joseph Conrad’s morality play about the latent savagery in all humans. As his journey takes him deep into some of the world’s most unsavory places – the defiled Oriente, the Niger Delta’s toxic Oru Sangama, Washington’s lobbyist-infested K Street – he places us on intimate terms with the evil that men do purveying the hydrocarbon economy. It an association made all the more unnerving by our patronage of it. 52

Reviews - Books

Readings Books Burma/Myanmar: What Everybody Needs to Know


David I Steinberg November 2009 In the past two decades, Burma/Myanmar has become a front-page topic in newspapers across the world. This former British colony has one of the most secretive, corrupt, and repressive regimes on the planet, yet it houses a Nobel Peace Prize winner who is and in and out of house arrest. It has an ancient civilization that is mostly unknown to Westerners, yet it was an important--and legendary--theater in World War II. Burma/Myanmar: What Everyone Needs to Know offers a concise synthesis of this forbidding yet fascinating country. David Steinberg, one of the world's eminent authorities on the region, explains the current situation in detail yet contextualizes it in a wide-ranging survey of Burmese history and culture.


Going Rogue Sarah Palin November 2009 A year ago, Sarah Palin burst onto the American political stage. Yet even now, few know who this woman really is. In this eagerly anticipated memoir, Palin paints an intimate portrait of growing up in the wilds of Alaska; meeting her lifelong love; her decision to enter politics; the importance of faith and family; and the unique joys and trials of life as a high-profile working mother.

Reports Fixing a Failed Strategy in Afghanistan Gilles Doronsoro Carnegie Report November 2009 As the debate on future U.S. strategy draws to a close, the war in Afghanistan is spreading to the North, the balance of power in Afghanistan has shifted in the Taliban’s favor, and the Afghan government continues to lose legitimacy in the eyes of the population and international community. In order to correct a failing strategy, the United States and its allies need to protect cities and reallocate more resources to the North. Gilles Dorronsoro explains that more troops alone will not fix a flawed approach and details what a new, successful U.S. strategy should look like.


World Aids Day Human Rights Watch Podcast 21 December 1, 2009 It's been more than two decades since the HIV/AIDS epidemic began. In places like Uganda, prevention and treatment are threatened by human rights abuses. With HRW's Joe Amon and Scott Long.They note that one of the biggest obstacles concerning the pandemic is that specific populations lack the education on HIV. These also happen to be the populations that are not receiving adequate treatment. Issue 1535


Reviews - Reports

The Different Faces of Development Challenges to Human Security in Arab Countries Arab Human Development Report 2009 UNDP 2009 Towards Productive Intercommunication for Knowledge Arab Knowledge Report 2009 UNDP & Mohamed Bin Roshid Al Maktoum Foundation 2009

Beyond looking at the usual economic indicators, these two investigations frame the question in original ways. As a result, they manage to look at the issue by observing how development affects the well-being of individuals, that is, how it affects what the UN has dubbed human security. Their unique approach to development undoubtedly highlights risk factors for the region that might otherwise have gone unobserved. for the Middle U nfortunately East, resource wealth and development do not necessarily go hand in hand. Numerous factors determine whether a state achieves development, and this is precisely what the 2009 Arab Development Report and the 2009 Arab Knowledge Report explain. More interestingly, these two investigations manage to frame the question of development in different ways. That is, recognizing that wealth does not imply development, both reports start from the premise that the definition of development should be analyzed in order to determine how development is to be measured. 4 December, 2009

In this sense, the originality of the 2009 Arab Knowledge Report stands out greatly. The Arab Knowledge report notes that “the current knowledge and communications revolutions have opened new possibilities to develop human livelihoods and strengthen the efforts to increased forms of knowledge that contribute to the achievement of human welfare�. In other words, according to the report, the ability of government’s to provide and encourage knowledge production and its dispersion are an important factor in providing individuals with the ability to increase their welfare. Beyond looking at gross economic indicators such as GDP, for example,

the Arab Knowledge report takes on a much more specific, some would say human, side of development and it manages to do so while paying attention to the cultural and historical particularities of the region that might impact the out come of their practices. For example, the report describes its approach had to concerned itself with some of the formative components of the different domains of knowledge in the Arab reality. The report claims that this permits them to diagnose and measure the size of existing knowledge gaps and in turn generating an internal debate that aspires to build and develop Arab knowledge performance. 54

Reviews - Reports clearly required involves region wide initiatives. In this sense both reports coincide in their recommendations, despite the different areas of development they explore.

As a result of these aims, the report approaches the question of Arab Knowledge through themes. Special attention is given to expanding the capacity of institutions that are associated with knowledge in the region. The chapter did however highlight concerns over the way the limitation of economic freedoms might impact these institutions. The oil boom, it was recognized, has not done much to boost economic freedoms. The rise of extremist religious tendencies was also evaluated as an important factor inhibiting Arab knowledge. While still providing an original way of assessing development, the Arab Human Development report takes into account a greater range of factors that affect development directly, and in turn is able to provide more specific definitions than the Arab Knowledge Report. The focus of the Arab Development Report, sponsored by the UNDP and authored by intellectuals and scholars from Arab countries, is the concept of human security. The UNDP defines human security as “the liberation of human beings form those intense, extensive, prolonged and comprehensive threats to which their lives and freedom are vulnerable”. More importantly it argues that the obstacles to human development in the region that have proved so stubborn lie in the region’s characteristics which undermine human security. The report thus notes the fragility of the region’s political, social, economic and environmental structures, its lack of people-centred development policies and its vulnerability to outside intervention. Human Security, the report concludes, is a prerequisite for human development, and its widespread absence in Arab countries has held back their progress. The Arab Development report outlines seven dimensions of threats, but also provides suggestions for how these may be surmounted. Like many developing countries, high unemployment and persisting poverty are underlined as particularly challenging. Consequently, notes the report, “the Issue 1535

fabled oil wealth of the Arab countries presents a misleading picture of their economic situation, one that masks the structural weaknesses of many Arab economies and the resulting insecurity of countries and citizens alike”. Another important challenge that the Middle East has long faced regards the growing population and the environmental impact this has. According to UN estimates, Arab countries will be the home to 395 million people by 2015, in a region where water and arable land are shrinking. Additionally, the question of military intervention also poses serious obstacles for the human security of the region. In Iraq, the Occupied Palestinian Territory and Somalia, people’s basic rights to self determination and peace have been forcibly annulled. They face threats to their lives, freedoms, livelihoods, education, nutrition, and health. These threats greatly undermine the development of the region. The report acknowledges that recommendations to rectify these challenges are beyond the capabilities of individual states ¬– as what is

While the Arab Knowledge Report does provide a unique interpretation of challenges to development in the Middle East, and it is certainly clear that knowledge propagation is necessary to the promotion of development, in comparison to the Arab Development report it does present a few deficiencies. For one, the majority of the report is spent outlining the theoretical dimensions of knowledge and the aims of the research agenda. While these are important aspects of the investigation, without which the report would have been incomplete, it appears as though the attention paid to the theoretical foundations of the debate caused some neglect of the possible solutions that could be undertaken by the regional states. On the other hand, the Arab Development Report, although greater in scope manages to explore each theme in detail. More importantly perhaps, is the ability of the report to link the different challenges together, highlight their urgency, and recommend necessary policies to limit their impact. Put together however, the two reports provide an important assessment of the challenges the region faces. Although not without hope, it is clear that the region cannot continue to ignore the well being of its citizens and that it must undertake a holistic approach towards development if it wishes to see its resource wealth translate into an overall improvement in the quality of life of individuals. These two reports, through their unique approach to development, manage to not only redefine the issue, but also to question the factors that affect development. This approach undoubtedly highlights important risk factors that through another methodology may have gone unobserved. For the full reports please refer to: 55

The Political Essay

Better Safe Than Sorry

Why Europeanist Blair would be a bad choice for Europe The choice of Van Rompuy as the President of the European Council – in detriment of a political personality such as Tony Blair – provoked a wave of criticism. However, Blair’s foreign policy beliefs and, especially, his involvement in the events that led to the 2003 invasion of Iraq, are deeply contrary to the image the EU wants to export. n recent months, no name became more associated publicly with the position of President of the European Union Council than that of former UK Prime Minister Tony Blair. Among EU leaders, however, this idea was soon discarded. When, two weeks ago, the unknown Belgian Prime Minister Herman Van Rompuy was announced as the EU Council first President, and considering the weight of Blair’s name, the general reaction was a natural feeling of disappointment.

Blair will be publicly questioned about his alignment with Bush and with the either forged or mistaken intelligence reports about Iraq’s nuclear programme. It will look at whether or not Blair backed the Bush Administration in its plan of invading Iraq long before the British Parliament gave authorization for the military operation. And sensitive information from diplomats, civil servants and former spies is likely to become public.


Britain has never been one of the EU’s most enthusiastic members, which gives more credit to Blair’s strong record as an Europeanist and a leader who bridged Britain and the EU. Except for national leaders such as Angela Merkel or Nikolas Sarkozy, Blair is undoubtedly the most internationally well-known EU politician. And it was precisely the fear of national leaders, such as Merkel or Sarkozy, of being over-shadowed by a politician of the magnitude of Blair that was pointed out as one of the main reasons behind the choice. Also, a tacit agreement between the major EU political blocs played a role against Blair. However, another factor might have helped in ruining Blair’s chances for the EU Council’s top spot. That is the political events that led to the invasion of Iraq, about which an enquiry is currently taking place in Britain. Blair’s fame abroad owes more to his controversial role in a couple of very sensitive international issues than to a case of Obama-like popularity. In 1999, Blair made a speech before the Chicago Economic Club where he put forward his “Doctrine of the International Community”. Known as “The Blair Doctrine”, the former British prime minister, among many other international issues, outlined the circumstances that warrant the international community to intervene in the affairs of other nations. This, in Blair’s words, was “the most pressing foreign policy problem faced by the international community.” 1999 was 4 December, 2009

Manuel Almeida the year that NATO intervened in Kosovo to put a halt to the massacre of Kosovo Albanians by Yugoslav troops. Today, many consider NATO’s intervention in Kosovo illegal, because it was not sanctioned by the UN Security Council, but legitimate, because it responded to a pressing security matter for EU and NATO countries, and it had a clearly defined humanitarian purpose. There was much more unanimity in the condemnation of the controversial role played by Blair in the 2003 intervention in Iraq. The enquiry in Britain about the US led invasion of Iraq, initiated November 24, was announced in June by Gordon Brown. At first, Brown said the hearing would be held in private. However, Britain’s current prime minister was pressed to opt for a public hearing by anti-war campaigners and families of soldiers killed in Iraq. This means that senior officials and politicians are being questioned publicly about the political developments that led to Britain’s decision to participate in the 2003 invasion of Iraq, and that includes Blair. Blair himself will not unveil either new or compromising information. Moreover, the Iraq enquiry will not apportion criminal liability. In the words of Sir John Chilcot, the chair of the group that will conduct the enquiry, the goal of the panel is “to evaluate what went well and what did not, and crucially, why”. However,

It already became obvious before the enquiry started, that the idea of invading Iraq and changing its regime dates back to at least 2001. In the United States, instead of the policy towards Iraq being shaped according to serious information, intelligence reports and facts were being fixed according to the idea of toppling Saddam’s regime. Regardless of all the possible benefits that a future stable and democratic Saddam-free Iraq might bring to the Middle East and beyond, the use of force as an instrument of foreign policy in the circumstances of the 2003 invasion of Iraq does not reflect the ethos of the EU’s foreign policy. The most obvious critique to the choice of EU member states national leaders is related with the personalities contrast between Van Rompuy and Blair. The consensual appointment of Van Rompuy is naturally considered a step back for the purpose of enhancing the EU’s political image abroad and viewed as a striking evidence of a lack of global ambition. However, and as much an Europeanist Blair might be, the path that lead to the invasion of Iraq is deeply contrary to the values and image the EU wants to export, and this negative legacy is not something that Blair’s position as Middle East Special Envoy can erase. In the end, it is hard to imagine how a politician deeply involved in such a negative chapter of Western international intervention could be an asset for enhancing Europe’s image abroad. 56

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4 December, 2009

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