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Getting the Saudi fight against corruption right

Dr. James M. Dorsey



Kuwaiti billionaire Maan al-Sanea should have seen it coming after Saudi Crown Prince Mohammed bin Salman vowed to root out corruption.

Embroiled in one of the kingdom’s largest financial scandals and collapses that involved a bitter $22 billion battle with a prominent Saudi merchant family, cost some of the world’s biggest banks billions of dollars, and is being slugged out in courts across the globe, Mr. Al-Sanea was low hanging fruit. He was arrested in October when police raided his Saudi mansion two weeks before Prince Mohammed’s frontal assault on the kingdom’s political and economic elite.

Mr. Al-Sanea’s arrest failed to set off alarm bells. Members of the ruling family and business community as well as senior officials likely saw it as a one-off incident. Together with Mr. Al-Sanea, they also grossly underestimated Prince Mohammed’s brashness and ruthlessness and ignored his warning in June that “no one who got involved in a corruption case will escape, regardless if he was a minister or a prince.” 

Mr. Al-Sanea, the ruling family and business community had good reason to be complacent: they, like the crown prince and the Salman branch of the family, were all part of a system and a way of doing business that went back to the founding of Saudi Arabia.

That is why rather than creating a large number of enemies and opening himself up to accusations of selectively targeting people in a bold move that appeared to be more about grabbing power than rooting out corruption, Prince Mohammed may have been well-advised to make his anti-corruption stand differently.

The crown prince’s anti-corruption committee, established hours before the first arrests and announcement of dismissals of prominent princes, officials and businessmen were made, has projected itself as an enforcement agency with the powers to arrest, freeze assets and impose travel bans rather than a regulatory body that would introduce legislation designed to fundamentally alter an ingrained system.

Rooted in a system that until the late 1950s made no distinction between the budgets of the state and the ruling family, Saudi laws still only barely delineate the dividing lines between them nor do they contain anything that would amount to a code to prevent conflict of interest or regulate the way members of the ruling family do business with the state. In fact, business deals often amount to insider baseball in a country in which the family’s finances and sources of revenue are a closely held secret. In fact, if revealed, the Fortune 500 billionaire’s list could well look very different.

Members of the ruling family and associated businessmen initially often made their money by representing foreign companies and receiving huge commissions on government contracts. They often took loans from banks which they failed to pay back. National Commercial Bank, where numbered accounts of princes were managed by senior management, nearly collapsed at the beginning of this century because of unpaid loans.

Life magazine editor Noel F. Bush on a visit in 1943 during which he travelled in the country with its first king, Ibn Saud, portrayed a ruler who operated on the principle of ‘the state is mine’ and doled out welfare to his subjects. It is a system that has since repeatedly been upgraded but whose fundaments remain in place.

“Our unemployment rate would drop rather significantly if the billions we squandered on kickbacks and lavish personal enrichment schemes dressed up as public-works projects were spent instead on the development of small to medium enterprises, vocational training and 21st-century education reforms… In Saudi Arabia, senior officials and princes become billionaires as contracts are either enormously inflated or, at worst, a complete mirage,” wrote Jamal Khashoggi, a Saudi journalist who recently moved to the United States in anticipation of the crown prince’s crackdowns.

Mr. Khashoggi cited the example of an airport built “in the wrong location simply to benefit the princes who own the land. They received the land for free from the government and then got extravagant compensation for the property.”

Prince Mohammed’s plans to diversify and streamline the economy, loosen strict social codes to further his economic reforms, and, in a world in which autocracies can no longer primarily rely on repression, cater to social and job aspirations of an in majority young population while avoiding political change and tightening his grip on power, may well be the most far-reaching upgrade of the system.

No doubt, Prince Mohammed’s tackling of corruption and targeting of prominent people strikes a popular cord with many Saudis who have long been unhappy with arbitrary privileges members of the ruling family were able to accrue to further their business and financial interests.

Nonetheless, the impression that the most recent wave of arrests constituted a power grab rather than a systemic tackling of corruption is reinforced by the fact that the crown prince’s dealings as well as that of his tack of the ruling family remain beyond scrutiny.

The $500 million purchase by Prince Mohammed of the Serena, the world’s 15th largest yacht, raised eyebrows when it was disclosed in 2016 by The New York Times at a time that the crown prince had imposed austerity measures as a result of which many in the kingdom were struggling to make ends meet. The 32-year old crown prince never clarified how he had amassed his wealth.

Nor is it clear how his father, King Salman, funded the use of two offshore companies in the British Virgin Islands to take out mortgages on his London homes worth $34 million and manage a yacht. Similarly,  this week’s publication by the International Consortium of Investigative Journalists (ICIJ) of the Paradise Papers disclosed offshore holdings by several other members of the monarch’s branch of the family.

The New York Times moreover reported that a major Saudi investment firm founded by one of the king’s sons, and now chaired by another, owned a significant stake in a conglomerate that does extensive government business, including in a shipbuilding partnership with a French defense contractor. A smaller firm founded by another of King Salman’s sons operated in sectors regulated and/or funded by the state such as health care, telecommunications and education.

To be clear, offshore assets are not illegal nor are members of the ruling family barred under Saudi law from benefitting from doing business with a state that was named after the family. Equally clear, however, is that Saudi Arabia may benefit more from a reformer who exudes transparency, lives up to his vow that all are equal under the law, and tackles corruption structurally rather than punitively.

To achieve that, Prince Mohammed may be better served by an anti-corruption committee that is less vindictive and more focused on developing and enforcing a set of laws, rules and regulations that ensures rule of law by institutionalizing anti-corruption norms, policing conflict of interest, and introducing transparency into the finances of the state as well as the ruling elite.

Dr. James M. Dorsey is a senior fellow at the S. Rajaratnam School of International Studies, co-director of the University of Würzburg’s Institute for Fan Culture, and the author of The Turbulent World of Middle East Soccer blog, a book with the same title, Comparative Political Transitions between Southeast Asia and the Middle East and North Africa, co-authored with Dr. Teresita Cruz-Del Rosario and three forthcoming books, Shifting Sands, Essays on Sports and Politics in the Middle East and North Africaas well as Creating Frankenstein: The Saudi Export of Ultra-conservatism and China and the Middle East: Venturing into the Maelstrom.

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Middle East

Three Years of Saudi Heinous Crimes in Yemen

Sondoss Al Asaad



Yemen a miserable isolated Arab country has been devastated by an ongoing Saudi bloody war. Since March 2015, Saudi Arabia and its gulf allies (GCC) have launched a vicious military campaign against Yemen to reinstall its former government. Recently, the Saudi Crown Prince Mohammed bin Salman’s visit to the UK has refocused attention on this silent conflict.

The collation has imposed a blockade on the port of Hodeida city, the main entry point for food and medicines and has been repeatedly accused of unlawful airstrikes on civilian targets which amount to war crimes. Obviously, the U.K., U.S. and other Western governments back, supply weapons and provides training to the GCC soldiers.

Amid the global silent and the mainstream media hypocrisy, the criminal collation systematically targets residential areas, claiming it would control arms transfer to the Houthi rebels. Saudi Arabia regards the Houthis as Iranian proxies and intervened to check their advance. These heinous massacres have prompted accusations by some Western opposition MPs and human rights groups of significant responsibility for civilian casualties. Thousands of Yemenis have been killed and the infrastructure has been thoroughly pulverized.

The GCC collation has imposed a blockade on Yemen’s air, sea and land borders in November 2017 in response to Huthis firing missiles towards Riyadh airport, closing an aid lifeline to tens of thousands of starving Yemenis. The U.K. government denies that its forces are advising the Saudis on specific targets, though they admit that, after a raid, British officers can give advice on future targeting policy.

A UN panel of experts that reviewed 10 Saudi airstrikes found Saudi denials of involvement in these specific airstrikes were implausible, and individuals responsible for planning, authorising or executing the strikes would meet the standard for the imposition of UN sanctions. The panel reported early in January, “even if the Saudi Arabia-led coalition had targeted legitimate military objectives … it is highly unlikely that the principles of international humanitarian law of proportionality and precautions in attack were respected.”

At the end of February, Russia vetoed a UK draft resolution that included a condemnation of Iran for violating the UN arms embargo in Yemen over claims that it supplied the missiles used by the Houthis that were fired towards Riyadh.The ongoing war has witnessed heinous atrocities, which emphasizes the urgent need of taking all necessary and possible steps to stop the war, bring the perpetrators to justice and ensure impunity.

Since the beginning of the military campaign, the coalition has targeted numerous facilities including schools, hospitals, airports, ports, universities, water and electric utilities, roads, bridges.  Although international conventions grant full protection for civilian installations, the Saudi warplanes have systematically targeted civil facilities using several internationally forbidden weapons, during the systemic raids over densely populated areas.

Medics have voiced alarm over the raging spread of the cholera epidemic in the impoverished country, saying that one child is infected every minute. Malnourished children, who number more than two million in Yemen, are greatly susceptible. Yemeni Health Ministry says that the Saudi aerial embargo has prevented patients from travelling abroad for treatment, and the entry of medicine into the country has been blocked. Over the following three years, the war has engulfed the entire country causing unbearable suffering for civilians. Due to the relentless bombardment, many civilians have been killed or injured, and a humanitarian crisis has spiraled, while the world ignores this raging war and hears little about its devastating consequences.

Various hospitals were shut because of the bombarding, and the insufficient medical teams. Further, vaccinations of major infectious diseases have been banned, amid the growth of the indicators of child malnutrition, and the spread of epidemics. In addition, more than 95% of doctors, nurses and consultants have been killed or fled the country. The lack of medicines has caused the deaths of many with Thalassemia and Anemia who need a monthly blood transfusion. Dialysis centres have made an SOS to save the lives of more than 6 thousand patients with Renal failure by providing them with necessary medical supplies, pointing out that the number of deaths of patients with renal failure exceeded 17 deaths in every 8 months.

The blockade imposed by the coalition has left more than 12,000 people killed, 49,000 injured and around 20 million people in need of humanitarian assistance. It has also created the world’s largest food security emergency. Human Rights Watch has accused the Saudi-led coalition of committing war crimes, saying its air raids killed 39 civilians, including 26 children, in two months. Additionally, The International Committee of the Red Cross has said that the number of suspected cholera cases in war-torn Yemen has hit one million. More than eight million Yemenis are on the verge of starvation, making Yemen the scene of, what the United Nations calls, the world’s worst humanitarian crisis.The Saudi regime has launched his war to eliminate the Houthis movement and to reinstall a Riyadh-friendly regime in Yemen.

However, the collation has failed to achieve its geopolitical and ideological objectives regardless of spending billions of dollars and enlisting the cooperation of its vassal states as well as some Western countries. The world’s largest humanitarian crisis caused by Saudi prolonged military onslaught has pushed millions of Yemenis to the brink of starvation. Unfortunately, the UN has not yet taken any effective measures to halt the humanitarian tragedy for the sake of the ultimate objective that Saudi Arabia is pursuing in the country, which is eliminating the threat of the Houthis. Obviously, the Saudis have not achieved their basic goals; hence, they are seeking revenge on the innocent Yemenis through their aimless bombardment.

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Middle East

West using JCPOA as lever to pressurize Iran



Recently, Reuters claimed European countries had commenced negotiations with Iran over the country’s role in the region in order to ease U.S. President Donald Trump’s concerns over the Iran nuclear deal known as the Joint Comprehensive Plan of Action (JCPOA).

Reuters alleges that the talks got off the ground on the fringes of the Munich security conference, with Yemen and certain regional issues taking center stage, and that the negotiations are going to continue in the future.

“European powers and Iran have started talks over Tehran’s role in the Middle East and will meet again this month in Italy as part of efforts to prove to U.S. President Donald Trump that they are meeting his concerns over the 2015 nuclear deal,” wrote Reuters.

What is worth mentioning about the Reuters’ report is that the news agency claims the talks between Iran and Europe on regional issues conducted is phased. Reuters says the first round of the negotiations were held on the sidelines of the Munich security conference with the Yemen war top of the agenda, and that the Europeans hope to discuss the role of the groups supporting Iran in Lebanon and Syria. A few points need to be taken into account in this regard.

First, regional talks with Iran has been one of the common demands of the U.S. and the European Union following the conclusion of the JCPOA. When the nuclear deal was signed in July 2015, many analysts unanimously believed that Washington and the European Troika intended to use the JCPOA as a springboard for regional talks with Tehran.

Efforts by Germany, Britain and France to hold regional talks with Iran can be analyzed accordingly. Here, France seeks to play the role of a leading player. The trip to Iran by French Foreign Minister Jean-Yves Le Drian comes within the same framework. Paris has promised Washington to spare no effort to hold negotiations with Iran on the Islamic Republic’s regional policies. Accordingly, Germany and Britain have got on board with France, too.

The second point is that while the general meeting of the UN General Assembly was underway in New York last summer, key talks were held between U.S. President Donald Trump and senior European officials over Iran’s regional policies and their connection with the JCPOA. In the talks, French President Emmanuel Macron promised his U.S. counterpart to channel and manage missile and regional talks with Iran. This comes as the fundamental principles of Iran’s foreign policy will remain unchanged. The principles include Iran’s backing for resistance groups, and above all, the country’s firmly dealing with the regional threats made by the U.S. and its allies and cronies. This firm approach by Iran will shatter the U.S. and Europe’s hope for regional talks with Iran. Still, the European officials believe the commencement of regional negotiations with Iran (even if unofficial), per se, can serve as a starting point to curtail Iran’s power and influence in the region. Thirdly, the Iranian diplomacy apparatus’ insistence on the unchangeable and general strategies of the country’s foreign policy, namely support for resistance groups, promotion of the resistance discourse, and fighting Takfiri terrorism will play a key role in foiling the ploys adopted by the U.S. and the European Union for talks.

One should bear in mind that the European Troika are channeling the talks on behalf of the U.S. and in coordination with the Trump administration. What Iran will employ to counter the joint game launched by Washington, Paris, London and Berlin will be the determination to safeguard the country’s strategic and behavioral principles in the region. It goes without saying that with this firm and prudent defense, the U.S. and the European Troika will not achieve any of their objectives in restricting Iran’s maneuvering power in the region. And lastly, the U.S. and the European Union are using the JCPOA as a lever to channel regional talks with Iran and pressure Tehran into giving in to Washington’s regional demands. In other words, Instead of serving its function as an independent legal document, the JCPOA has turned into a political tool to exert pressure on Iran. Here, too, the Iranian diplomacy and foreign policy apparatus should act very prudently and consider “safeguarding Iran’s regional power” as its red line, not “safeguarding the JCPOA.” Obviously, Washington and the European Troika should get to understand the definitive principle that Iran will not compromise on its fundamental strategies in the region.

First published in our partner Tehran Times

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Middle East

Goals of bin Salman’s visit to UK: Blood-colored agreement

Mohammad Ghaderi



The recent visit of Saudi Crown Prince Mohammad bin Salman to the UK has attracted the attention of the various circles. Besides the diplomatic and business relations, bin Salman signed a preliminary deal to buy 48 Typhoon fighter jets from the UK.

The jets, made by British company BAE Systems, are part of 10 billion-pound deal which has been under discussion for many years. Finally the purchase of Typhoon jets by Saudi Arabia was agreed upon as a result of bin Salman visit to Britain.

It seems that Western-backed arms manufacturers are once again struggling to seize markets in the region, especially in the Arab states of the Persian Gulf. The Yemeni war, which the West has no desire for it to end, is another motivator for selling arms to Saudi Arabia and the UAE. For this reason, Amnesty International denounced the Saudi-British arms contract to buy Typhoon jets and said that it’s just adding fuel to the humanitarian fire in Yemen. The British Labor Party, and some nonprofit organizations, also condemned the deal. Also, Politicians from the UK’s main opposition party have denounced the $140 million humanitarian deal with Saudi Arabia, saying it “made a mockery” of Britain’s reputation as a global leader in delivering humanitarian aid. But the British defense minister defended the deal and described the visit of the crown prince of Saudi Arabia to London as opening a new page in the relations between the two countries.

in bin Salman visit to the British authorities, bilateral relations, strategic cooperation between the two countries and ways to strengthen this cooperation, especially in the defense and military sectors, the opportunities available in Saudi Arabia by 2030, the developments in the Middle East and the world, as well as the so-called fight against Terrorism and extremism were discussed.

In a joint statement by the two countries, British support for Riyadh was emphasized. It’s mentioned in this statement that Saudi Arabia is a strategic ally of Britain in the Middle East. The two sides also emphasized the political settlement of the Yemeni crisis based on the Persian Gulf Cooperation Council’s plan and its strategies, the results of the Yemen national negotiations and Security Council resolution 2216, and claimed that such a solution would guarantee Yemen’s security and integrity.

Ironically this emphasis on the political solutions for the existing crises in Yemen is taking place while Saudi Arabia uses Western weapons to continue to assault this country. With no doubt, Saudi Arabia’s case in war crimes and human rights abuses in Yemen is really dark. Furthermore, the statement emphasizes Britain’s commitment to presenting its experiences to Saudi Arabia in implementing reforms and the joint commitment of the two countries to a long-term partnership to support the 2030s vision of the Saudi Arabia.

Commercially speaking, contracts worth two-billion dollars have been signed on the three-day visit of the Saudi Crown Prince to England, though details of these contracts have not been announced. The two sides also agreed to make up to $ 90 billion in trade and mutual investment in the coming years.

Regarding the current situation, the question is, what are the Saudis and British goals of strengthening relations and signing such great amounts of different contracts?

-Naturally, Saudi Arabia, which is a traditional ally of Britain, will establish different kinds and levels of relations with the UK after the Brexit. The beginning of the development of bilateral relations between the two countries has been shaped around close security and military cooperation, and of course, Britain intends to extend these partnerships to all commercial and economic grounds.

On the other hand, Britain will need a solid ally, money and rich market after leaving the EU. Obviously, Saudi Arabia is at the top of its priorities. Meanwhile, selling billions of pounds of weapons to Saudi Arabia is a deal that, according to British officials, provides tens of thousands of job opportunities inside Britain.

The recent policies of the Saudi Arabia’s Crown Prince for conducting reforms, and creating an open cultural atmosphere inside Saudi Arabia, have also encouraged London to develop relations with Saudi Arabia.

Confronting the influence of the Islamic Republic of Iran has also long been on the agenda of the foreign policy of Riyadh, and this issue has the support of the British authorities. For this reason, Saudi Arabia welcomes British experts’ contributions and advice to counter what it calls Iran’s threats.

On the one hand, bin Salman seeks to secure global support for domestic economic and cultural reforms and, on the other hand, he wants to ensure international investors to stay in the country.

On the other hand, the reform process in Saudi Arabia led by the inexperienced Crown Prince of Saudi Arabia faces serious internal barriers. The quick pace of reforms in the traditional and conservative society of Saudi Arabia will rather have negative consequences than positive ones. This is while economic and cultural reforms in Saudi Arabia, without political reform (freedom and democracy) won’t be a fundamental solution, and thus will certainly face numerous obstacles.

Moreover, the issue of coping with the Islamic Republic of Iran is not easy for the Saudis. In recent years, Saudi Arabia suffered severe defeats in various regional scenes, including Iraq, Syria, Yemen, Lebanon et cetera against the Resistance Movement. Riyadh authorities think they would be able to confront the Islamic Republic of Iran relying on western political support and weapons, especially those by the United Kingdom and the United States. But they have overlooked the point that Western powers are only seeking their own goals and interests in the region, and therefore relying on them will lead to nothing but frustration and despair.

First published in our partner Mehr News Agency

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