THE PROGRESSIVE CONSERVATIVE, USA
An Online Journal of Political Commentary & Analysis
Volume X, Issue # 63, March 1, 2008
Dr. Almon Leroy Way, Jr., Editor
Government Committed to & Acting in Accord with Conservative Principles
Ensures a Nation's Strength, Progress, & Prosperity
SOVEREIGN WEALTH FUNDS:
Investment Vehicles for the Persian Gulf Countries
By Nimrod Ralphaeli & Bianca Gersten
BURGEONING OIL PRICES, PERSIAN GULF STATES, & SOVEREIGN WEALTH FUNDS: HOW PERSIAN GULF STATES ARE
USING THEIR HUGE OIL PROFITS & SURPLUS FOREIGN EXHANGE TO PURCHASE ASSETS IN THE U.S.A. & OTHER WESTERN
COUNTRIES -- THE NATIONAL SECURITY IMPLICATIONS OF ARAB STATES ACQUIRING IMPORTANT POSITIONS IN
INDUSTRIAL & OTHER BUSINESS CORPORATIONS IN THE WEST -- A POSSIBLE RESPONSE TO THE PROBLEM BY WESTERN
STATES -- INTRODUCTION OF A STRICT POLICY OF REVIEWING LARGE AQUISITIONS BY SWFS, A POLICY DESIGNED TO MAKE
IT EXTREMELY DIFFICULT, OR EVEN ILLEGAL, FOR SWFS TO ACQUIRE ASSETS IN STRATEGIC SECTORS OF WESTERN
ECONOMIES, FOR EXAMPLE, INFRASTRUCTURE, TELECOMMUNICATIONS, MEDIA, & ENERGY
FULL STORY:
Countries have used sovereign wealth funds (SWFs) as instruments through which to buy assets with their surplus
foreign exchange since the 1950s, when Norway and Singapore, and soon after Kuwait, sought new strategies to insulate
themselves from exchange rate fluctuation. Central banks employed SWFs only as buffers for currency stabilization when
countries had little or no international debt and large current account surpluses. Today, SWFs have become quite
common. As of March, 2007, the United Arab Emirates (UAE) and Saudi Arabia had, respectively, the first and third
largest SWFs internationally, and Kuwait ranked sixth. [1] Because of burgeoning oil prices, Persian Gulf sovereign wealth
funds have become the preferred investment vehicles of Kuwait, Qatar, and the United Arab Emirates. As SWFs blur the
line between public and private investment, however, Western nations worry about the security implications of foreign
countries, including Persian Gulf states, acquiring important positions in key industries and companies.
OIL BOOM PROFITS
Since 2003, oil producing states have reaped a revenue windfall. As oil increased from $27.69 per barrel on average in 2003
to as much as $79 per barrel in 2006, Saudi Arabia, for example, saw its gross domestic product (GDP) increase by well over
$130 billion over that time period, and the United Arab Emirates took home more than an additional $80 billion. [2] Such
revenues have generated enormous liquidity among the Gulf Cooperation Council (GCC) states — Bahrain, Kuwait, Oman,
Qatar, Saudi Arabia, and the United Arab Emirates — and created unprecedented opportunities for large-scale overseas
investments.
At the same time, the oil boom has effected a decrease in the percentage of government debt relative to GDP in the GCC
countries. [3] In 2004, government debt constituted 44.4 percent of GDP, but, by the end of 2007, this figure had fallen close
to 16 percent of GDP. At the same time, foreign exchange reserves have risen from $57.4 billion in 2004 to almost $100 billion.
In just three years, per capita income in GCC countries rose from $14,251 in 2004 to $22,222. [4] And these numbers only
comprise the average: According to International Monetary Fund data, per capita GDP in Qatar has surpassed $70,000, the
third highest in the world behind Luxembourg and Norway. The United Arab Emirates enjoys a per capita GDP of $42,000. [5]
Consumer confidence in the region is at an all time high, [6] and spending is soaring in Kuwait, Saudi Arabia, Qatar, and the
United Arab Emirates.
China and the Persian Gulf emirates, with the exception of Kuwait, accelerate the growth of their respective SWFs by
accumulating dollars, rather than letting their exchange rates appreciate; in a pure market system, such as the one used by
Europe and Japan for their exchange rates, the increasing volume of dollars would cause the value of the dollar to drop. The
artificially high exchange rate has the effect of preserving the value of the SWF holding when expressed in local currency;
were the Chinese yuan to rise to a market-determined level, the value of China's U.S. holdings would be the same in dollars,
but that would translate into fewer yuan. For the Persian Gulf states, accumulating dollars is made all the easier by the
dollar-denominated oil revenues. [7]
Most of the Persian Gulf investments that are directed overseas focus on two objectives: acquisition of assets and real
estate, and the purchase of shares in high quality financial and industrial firms. According to the pan-Arabic daily
Asharq al-Awsat, the Persian Gulf countries invested $140 billion overseas between 2004 and 2007, [8] an
investment blitz that has transformed some of the Persian Gulf emirates into key actors on the international financial stage
in a short period of time.
Morgan Stanley identifies the Abu Dhabi Investment Authority as the world's largest SWF, with assets of $875 billion.
Several Saudi funds are, combined, worth $300 billion. [9] The Kuwait Investment Authority oversees two state funds —
the General Reserves, established in 1960, and the Future Generations Fund, created in 1976 — which are jointly worth $213
billion. [10] The Qatar Investment Authority, which operates overseas through an investment arm known as Delta Two, had
an estimated value of $40 billion at the end of 2006. [11]
All told, the combined funds of the UAE, Saudi Arabia, Kuwait, and Qatar account for more than half the $2.5 trillion total
assets of global SWFs. According to the Saudi economic newspaper Al-Iqtisadiya, the assets managed by the
Persian Gulf SWFs are equal to one fifth of the total assets of the central banks of countries with SWFs, an amount
estimated at $5.3 trillion. [12] The global total of sovereign funds could reach $12 trillion by 2015 as a result of further oil
revenues and capital appreciation, [13] and Deutsche Bank estimates that the value of net GCC-owned foreign assets has
nearly tripled over the last four years from $472.5 billion in 2004 to just over a trillion dollars. [14] As Morgan Stanley
comments, approximately twenty-five largely opaque SWFs manage $2.3 trillion, an amount larger than the entire hedge
fund industry. [15] By 2015, the Persian Gulf countries' SWFs could grow to $5-6 trillion. If Chinese, Russian, and Korean
SWFs are taken into account, the total global SWF value could top $12 trillion, the current volume of U.S. GDP. [16]
PATTERNS OF INVESTMENT
With cash flows growing rapidly, it is neither prudent nor desirable for SWFs to invest entirely in safe, fixed-income
assets such as U.S. Treasury bonds or even in individual, publicly-listed companies. Many SWFs have shifted toward a
2005 recommendation, made by an international consulting firm to the Kuwait Investment Authority, that it "decrease
the fund's allocations to the traditional asset classes (such as publicly-listed equities and bonds) and increase the
allocation into nontraditional and uncorrelated asset classes (such as alternative investments, private equities, and real
estate)." [17] In practice, this has led the Kuwaitis and others to shift investment targets from slow-growth economies,
like the United States, Great Britain and Germany, to rapidly growing economies — namely, China, India, South Korea,
and Turkey. As the chief of the Kuwait Investment Authority asked, "Why invest in 2 percent-growth economies when
you can invest in 8 percent-growth economies?" [18]
To get a better sense of how the newly oil-rich Middle East states have begun investing in foreign markets, consider
some of the largest recent deals.
Dubai, lacking significant oil and gas reserves, is an investment powerhouse out of necessity. Domestically, Dubai has
built world-class banking and tourism industries and opened its real estate market to foreign investors and Winter
residents. Dubai has also become an attractive shopping destination for wealthy individuals from Iran and India. The
business environment has become attractive to foreign corporations seeking regional and international headquarters.
Various information technology firms, investment banks, and media corporations are present in Dubai, and officials
expect financial transactions alone to quadruple from $3.6 billion in 2006 to $15 billion by 2015. [19]
Dubai Istithmar (investment holding company) bought Barneys department stores for $942.3 million in August, 2007.
Dubai World has committed $5 billion to MGM Mirage, which manages casinos in Las Vegas. The government also
offered to buy Auckland International Airport in New Zealand for $3 billion, but the offer fell through because the city
of Auckland, which owns 20 percent of the airport, refused to sell to a foreign concern. Dubai has pending offers for
other high-profile firms, such as OMX, the Nordic Stock Exchange operator, and has purchased 3.2 percent of EADS,
which builds Airbus aircraft, and has acquired 2.2 percent of Deutsche Bank. OMX indicated on November 10, 2007, that
it will accept the offer to be acquired by Dubai. [20]
The International Petroleum Investment Company (IPIC), one of Abu Dhabi's investment arms, agreed to pay $775
million to buy 20.85 percent of Japan's Cosmo Oil to become the largest shareholder in Japan's fourth largest oil refining
company. [21] Another investment arm of Abu Dhabi, Mubadala Development Company, bought a 7.5 percent stake in
The Carlyle Group, LLP, for $1.35 billion. [22]
Kuwait Investment Authority has a large stake in Daimler-Benz, British Petroleum and an array of real estate, including
office buildings in the United Kingdom, United States, Europe, and China. After the deposit of 10 percent of Kuwait's
annual oil revenue into a Future Generations' Fund, KIA invests the highest percentage of the remaining funds, about 60
percent, in stock. [23] The Kuwait Investment Authority, according to its chief, Bader al-Sa'ad, has kept a watchful eye
on Yale University's endowment management as an investment model. [24]
Qatar, for its part, bought the Chelsea Barracks, former home to the famed Coldstream Guards, for $1.85 billion from the
British Ministry of Defense. Qatar reportedly paid three times the assessed value of the 12.8 acre central London
property. Qatar Telecom, a government-owned company, paid $3.7 billion for a 51 percent stake in Kuwait's National
Mobile Telecommunications Company, which operates wireless service from Iraq (the fastest-growing market) to Saudi
Arabia and Algeria.
Qatar's biggest attempted deal to date was an offer to buy J. Sainsbury PLC, the British supermarket chain, for $23 billion,
but in early November, they dropped their offer. One individual involved in the negotiations told the Financial
Times, "We used to think private equity's behaviour could be low, but what Qatar has done is lower than a snake's
belly." [25] Qatar is also in negotiations with Dubai over a package that will involve swapping shares in three stock
exchanges: OMX, NASDAQ, and the London Stock Exchange. [26]
Such transactions are complicated by the fact that, in both Qatar and Dubai, there is little differentiation between the
respective emirs' private wealth and public assets. Regarding Dubai, the Financial Times observed, "Dubai
Holdings belongs to Dubai ruler Sheikh Muhammad bin Rashid al-Maktoum, and in turn owns financial conglomerate
Dubai Group, a 20 percent shareholder in Borse Dubai — the holding company for DFM [Dubai Financial Market], and
DIFX [Dubai International Financial Exchange]. DIFX is a centerpiece of the government's Dubai International Financial
Center, a financial business park, which owns another 20 percent." [27] In March and August, 2007, Maktoum offered to
exchange $5 billion worth of his private land holdings for shares in Emaar Properties, the largest real estate firm in Dubai.
This would have given him a majority shareholding in the company. While Emaar Properties declined the offer, such
commingling of SWF funds with private rulers' accounts may occur in the UAE and Qatar, but no public information is
available. The most recent example of acquisitions of this nature is the purchase by Dubai International Capital, which is
owned by Sheikh al-Maktoum, of a "respectable chunk" of Japan's Sony Corporation. While the official amount of sale
remains undisclosed, financial markets estimate it to be in the range of $1.5 billion, or 3 percent of the company's
outstanding shares. [28] While Saudi and Kuwaiti rulers take their "cut" of oil revenues up front, again, at least in the
case of Saudi Arabia, there is no published data on the state's revenues and how much is distributed to the princes.
WESTERN WORRIES
Former U.S. Treasury Secretary Larry Summers raises a broad concern with SWFs: The capitalist system, he says,
"depends on shareholders causing companies to act so as to maximize the value of their shares," but governments acting
as shareholders might have different, and less economically desirable, motives. "They may want to see their companies
compete effectively, or to extract technology, or to achieve influence," [29] he explained.
Western governments remain concerned that foreign interests may take over economic assets with strategic value, be
they manufacturing plants, banks, industrial enterprises, or high-tech companies. From a Washington standpoint, for
example, there is a major difference between a Saudi acquisition of General Electric's plastics plants and a Saudi purchase
of its aircraft engine unit. Several investments have raised U.S. and European concern about possible hidden political
agendas.
The first major rejection of an Arab SWF investment involved Dubai Ports World's acquisition of P & O, a British
company that operated six major ports in the eastern United States. Concerns about national security led many in the U.S.
Congress to try to block the Dubai company's operation of U.S. ports, an issue settled only when, in March, 2006, Dubai
Ports World agreed to hand over operation of those ports to U.S. entities.
There were similar concerns raised both in New Zealand and Sweden following Dubai's offers to buy the Auckland
International Airport, and also the Swedish stock exchange OMX. [30] Though Dubai withdrew its offer for the Auckland
airport in the face of opposition, it continues to seek the purchase of OMX, as part of a deal in which it will exchange
OMX for NASDAQ's 28 percent share in the London Stock Exchange and an as-yet unspecified amount of equity in
NASDAQ itself. At a September 20, 2007, news conference, about the then-pending acquisition of NASDAQ, President
George W. Bush said that an investment by a government-owned company in NASDAQ would be subject to review by
national security agencies, although he provided a provisional welcome of the deal. [31]
Had it not been for a liquidity squeeze caused by the mortgage credit crisis, Abu Dhabi's $7.5 billion, 4.9 percent stake
purchase of Citigroup, the largest U.S. bank, may have also raised such concern. The state-owned Abu Dhabi Investment
Authority now ranks as one of Citigroup's largest shareholders, as does Prince Walid bin Talal of Saudi Arabia, who
bought into the bank in the early 1990s.
When it comes to sensitive industries, though, not all SWFs are the same. There is a difference between the SWFs of
countries such as China and Russia, both of which have longterm global strategic interests, and the activities of SWFs of
smaller and militarily insignificant countries such as the United Arab Emirates, Qatar, Kuwait, and even Saudi Arabia.
Concern about Persian Gulf countries taking over significant Western assets should focus on two key issues: first,
whether a particular acquisition strengthens Persian Gulf leverage on oil production and pricing; and second, whether an
acquired business might become a conduit for illicit funding for activities that might endanger the security of the host
country or its allies. SWFs are in the business of maximizing returns on investment at a minimum risk, and so this concern
is minor. In addition, they are unlikely to undertake action that might lead the United States to freeze assets through the
International Emergency Economic Powers Act of 1977, which Washington applied widely after 9-11 to terrorists, terror
financiers, and proliferators. Moreover, such conduits are not really needed: There is no shortage of wealthy individuals
in the Persian Gulf who continue to support Islamist terrorism.
Privately, some U.S. policymakers also cite the Arab boycott of Israel as proof of the danger of Arab SWF ownership
because the ban demonstrates the primacy of politics over economics. However, there is less here than meets the eye,
since the Persian Gulf states' adherence to the boycott is more rhetorical than real. The Persian Gulf emirates understand
how ineffective the prohibition is. They have already renounced the secondary and tertiary elements of the ban. In any
event, U.S. law would prevent any U.S. company, regardless of its ownership, from adhering to the boycott. [32]
VETTING MECHANISMS
However, SWFs are here to stay. Given the new global economic reality, Western governments are formulating
mechanisms to vet mergers and acquisitions by foreign entities. Perhaps, the oldest is the Committee on Foreign
Investments in the United States (CFIUS), established in 1975 by an executive order of President Gerald Ford [33] and
chaired by the Treasury Department. The Exon-Florio amendment to the Omnibus Trade and Competitiveness Act (1988)
authorized the CFIUS to view and potentially block foreign acquisitions of U.S. companies that may impair U.S. national
security. Exon-Florio empowers the President to "suspend or prohibit a foreign acquisition … if he finds ‘credible
evidence' that ‘the foreign interest exercising control might take action that threatens to impair the national security.'" [34]
Since 1988, foreign companies have sent CFIUS several thousand notifications of intent to purchase U.S. companies,
but CFIUS has only investigated a few, and of those, it has blocked only one. That case involved the purchase by the
China Aviation Technology Import-Export Corporation — the import-export arm of Beijing's Ministry of Aerospace
Industry — of MAMCO, a privately-owned, Seattle-based manufacturer of civilian aircraft parts. CFIUS's impact may be
greater, however, since many firms withdraw their offers, if it looks like CFIUS may investigate.
There are also archaic restrictions originating from maritime law, such as the Shipping Act of 1916 and the Merchant
Marine Act of 1929, that establish limitations for foreign investment in commercial shipping and merchant marines — 25
percent ownership for rights to coastal waterways and fresh water routes. U.S. regulators have interpreted this act to
protect American airline industries as well. The United States limits foreign ownership of a domestic airline to a maximum
of 49 percent, with a 25 percent limit on control. [35] Though an effective domestic airline industry embraces this
mechanism as a way to avoid foreign competition, national security concerns remain the chief reason why U.S.
flag-bearing ships cannot be sold to non-U.S. citizens without approval from the U.S. Secretary of Transportation. [36]
In 2007, Canada launched a review of the 20-year-old Investment Act to assess whether Ottawa should increase
scrutiny over takeovers, particularly those involving companies with "unclear corporate governance and reporting,"
which may use "non-commercial objectives" in decision-making. This is a clear reference to SWFs. [37]
The Group of Seven (G-7) Finance Ministers have called on the Organization of European Cooperation and Development,
the International Monetary Fund, and the World Bank to identify best practices for SWFs in such areas as institutional
structure, risk management, transparency, and accountability. [38] The European Commission is still mulling over the
issue. However, EU Trade Commissioner Peter Mendelsohn told the German business daily Handelsblatt,
"Europe's interest in maintaining control over important and politically sensitive key industries could be achieved via the
instrument of the golden share," a mechanism that gives the holder veto rights in certain circumstances and can be used
to protect a company from any takeover deemed to endanger national security. [39]
In Germany, Chancellor Angela Merkel asked the European Union to "protect European companies from unwanted
foreign takeover." [40] German Finance Minister Peer Steinbruck told the Bundestag that his country will defend its
companies from takeovers by SWFs that belong to governments whose "social and political systems are not exactly
moderate." [41] Germany's greatest concern is over SWFs from Russia and China.
The United Kingdom remains the most flexible of the Western countries with regard to SWFs. Alistair Darling, Chancellor
of the Exchequer, has argued that economic openness should not be undermined by protectionism. He has maintained,
however, that all investors should follow the rules of the market in regard to transparency and governance and that
reciprocity should apply. [42]
THE SWF RESPONSE
Salman al-Dusry, senior correspondent for Asharq al-Awsat in the United Arab Emirates, highlights the
contradiction facing Persian Gulf countries. While governments almost everywhere strive to attract foreign direct
investments, many Western governments are doing the opposite, when it comes to the Persian Gulf region. The U.S.
Congress and European governments now are seeking to tighten the scope of opportunities for investments by oil-rich
sheikhdoms.
Such a trend leads many Persian Gulf SWFs to diversify geographically, channeling some of their surplus capital to
Middle Eastern countries — particularly into housing and tourism projects in Morocco and Tunisia and into South and
East Asia. The Qatari daily Asharq, drawing on figures from the Gulf Cooperation Council, suggested that GCC
countries have invested $250 billion in China, primarily in service and real estate sectors. [43] But giant deals, such as
the purchase of the General Electric plastic business by the Saudi company SABIC for $11.6 billion, can only materialize in
the industrialized and free economies of Europe and the United States.
Al-Iqtisadiya has suggested that, to allay the fears of undue influence or hidden political agendas by
government-owned SWFs, these funds must adopt a greater measure of transparency by publishing periodic reports on
their investments and assets. The Pension Fund of Norway, the Norwegian SWF, for example, is a model of such
transparency. [44] Absent such reporting, it is difficult to determine whether SWFs might be pursuing a pattern of
investment that could be inimical to the national security of the countries in which they invest.
CONCLUSIONS
In response to the new challenges posed by ambitious investing from oil-rich Persian Gulf states, the Western world will
have difficulty engaging in blatant protectionism, as such policies are greatly detested by financial markets. What could
emerge from pending legislation in both the United States and the European Union, however, is the introduction of a strict
policy of reviewing large acquisitions by SWFs that would make it extremely difficult, or even illegal, for such funds to
acquire assets in socalled strategic sectors — infrastructure, telecommunications, media, and energy. In the case of energy,
in particular, the EU is already working on introducing the principle of reciprocity, which will target Saudi Arabia, Russia, or
any other country where resource nationalism is practiced. One alternative that may develop to blocking access to strategic
industries altogether is the implementation of golden shares, retaining effective veto power, and restricting foreign
investors to nonvoting shares, so that countries, acting as investors, will not be able to steer the recipients of their
investing in any direction they desire.
With their spirit of entrepreneurship, their successful investment activities, and their visible presence in world financial
markets, the Persian Gulf SWFs have inspired a new spirit of economic change in the region. The Carlyle Group L.P. says
that the Middle East is now the "hot spot" for private equity deals, and the British bank HSBC reports that as much as one
third of all project finance involves Middle Eastern projects. [45] This kind of activity could have a significant, longterm
impact on the politics of the region as Middle East investors begin to look beyond historical-regional conflicts and focus
instead on building their economies and generating wealth.
NOTES:
[1] The Economist (London), May 24, 2007.
[2] OPEC Annual Statistical Bulletin 2006 (Vienna: Organization of Petroleum Exporting Countries, 2006), p. 11.
[3] Global GCC Weekly Market Report (Safat, Kuwait), Sept. 6, 2007.
[4] Khaleej Times (Dubai), Sept. 9, 2007.
[5] "Report for Selected Countries and Subjects, United Arab Emirates," World Economic Outlook Database, October 2007, International Monetary Fund, accessed Nov. 13, 2007.
[6] "MasterIndexTM of Consumer Confidence, H1 2007," MasterCard Worldwide, New York.
[7] Asharq al-Awsat (London), Aug. 22, 2007.
[8] Asharq al-Awsat, Aug. 13, 2007.
[9] Asharq al-Awsat, Aug. 26, 2007.
[10] The Gulf Daily News (Manama), July 5, 2007.
[11] The Guardian (London), June 16, 2007.
[12] Al-Iqtisadiya (Jeddah), Aug. 28, 2007.
[13] The Economist (London), May 26, 2007.
[14] Khaleej Times, Sept. 9, 2007.
[15] Financial Times (London), Aug. 22, 2007.
[16] Asharq al-Awsat, Aug. 26, 2007.
[17] "New Developments," The Kuwait Investment Authority (KIA), accessed Nov. 7, 2007.
[18] The Wall Street Journal, Aug. 24, 2007.
[19] Financial Times, July 24, 2007.
[20] Al-Khaleej (Dubai), Nov. 12, 2007.
[21] Al-Khaleej, Sept. 19, 2007.
[22] Al-Khaleej, Sept. 21, 2007.
[23] The Wall Street Journal, Aug. 24, 2007.
[24] The Wall Street Journal, Aug. 27, 2007.
[25] Financial Times, Nov. 6, 2007.
[26] Asharq al-Awsat, Sept. 19, 2007.
[27] Financial Times, Aug. 24, 2007.
[28] Asharq al-Awsat, Nov. 27, 2007
[29] Financial Times, July 29, 2007.
[30] Financial Times, Aug. 31, 2007.
[31] Asharq al-Awsat, Sept. 22, 2007.
[32] Nimrod Raphaeli, "The Arab Boycott of Israel in the Globalization Age," MEMRI Inquiry and Analysis, no. 261, Jan. 20, 2006.
[33] "Executive Order 11858—Foreign Investment in the United States," May 7, 1975.
[34] Ronald D. Lee, "The Dog Doesn't Bark: CFIUS, the National Security Guard Dog with Teeth," Glasser Legal Works, Feb. 2005, pp. 5-11.
[35] Peter H. Burkard, Esq., "Foreign Investments: Restrictions and Reporting Requirements," West Hartford, Conn., Jan. 22, 1993.
[36] Steffen Kern, "Sovereign Wealth Funds—State Investments on the Rise," Deutsche Bank Research, Frankfort, Ger., Sept. 10, 2007, p. 13.
[37] Financial Times, June 12, 2007.
[38] "Statement of G-7 Finance Ministers and Central Bank Governors," HP-625, Office of the United States Treasury, Oct. 19, 2007. The G-7 includes the finance ministers of Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States.
[39] Eubusiness (Luxembourg), July 23, 2007.
[40] Asharq al-Awsat, Aug. 31, 2007.
[41] Asharq al-Awsat, Sept. 15, 2007.
[42] Alistair Darling, chancellor of the Exchequer, Office of Her Majesty's Treasury, speech at the London Business School, July 25, 2007.
[43] Asharq (Doha), Sept. 16, 2007.
[44] Al-Iqtisadiya, Aug. 28, 2007.
[45] The Wall Street Journal, July 19, 2007.
LINKS TO RELATED TOPICS:
American Foreign Policy -- The Middle East
Middle East -- Arabs, Arab States,
& Their Middle Eastern Neighbors
North Africa -- The Arab States of Islamic North Africa
The Middle East & the Problem of Iraq
Page Two
Page One
The Problem of Rogue States:
Iraq as a Case History
National Strategy for Victory in Iraq
The Middle East & the Problem of Iran
Egypt, Arabs, & the Middle East
Tunisia, Islamic North Africa, & the Arab World
The Middle East & the Problem of Syria
The Middle East -- Lebanon as a Geopolitical Problem
Turkey, the Middle East, & the U.S.A.
Israel & the Arabs -- The Israeli-Arab Conflict
Islamism & Jihadism -- The Threat of Radical Islam
Page Three
Page Two
Page One
International Politics & World Disorder:
War & Peace in the Real World
Page Two
Page One
Islamist Terrorist Attacks on the U.S.A.
Osama bin Laden & the Islamist Declaration of War
Against the U.S.A. & Western Civilization
Islamist International Terrorism &
U.S. Intelligence Agencies
U.S. National Security Strategy
American Foreign Policy -- Constitutional Democracy:
U.S. Promotion of Constitutional Democracy in Foreign Countries
Nimrod Raphaeli and Bianca Gersten are, respectively, Editor and Economic Researcher at The Middle East Media Research
Institute (MEMRI) Economic Blog, at www.memrieconomicblog.org.
The foregoing article by Raphaeli and Gersten was originally published in the Middle East Quarterly, Spring, 2008,
and can be found on the Internet website maintained by the Middle East Forum, a foreign policy think tank which seeks to
define and promote American interests in the Middle East, defining U.S. interests to include fighting radical Islam,
working for Palestinian Arab acceptance of the State of Israel, improving the management of U.S. efforts to promote
constitutional democracy in the Middle East, reducing America's energy dependence on the Middle East, more robustly
asserting U.S. interests vis-à-vis Saudi Arabia, and countering the Iranian threat.
(Article URL: http://www.meforum.org/article/)
Republished with Permission of the Middle East Forum
Reprinted from the Middle East Forum News
mefnews@meforum.org (MEF NEWS)
March 1, 2008
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