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Tuesday, January 16, 2018

Sovereign wealth funds: Investment vehicles or political operators?

Credit: Al Bawardi Critchlow

By James M. Dorsey

The $6.85 billion acquisition in 2006 of Peninsular & Oriental (P&O) Steam Navigation Company, a storied British shipping and logistics company, by Dubai’s state-owned DP World, one the world’s largest port management and terminal operators, sparked fears that governments could employ cash-rich sovereign wealth funds (SWFs) and state-run companies as political muscle.

Twelve years later, with the Middle East fighting multiple battles and external powers jockeying for influence, those fears have proven justified despite the adoption in the wake of the sale of non-binding guidelines for sovereign funds that manage hundreds of billions of dollars.

Concern that an Arab state would post 9/11 gain control of some of the busiest terminals in US ports, including New York, Newark, Baltimore, Philadelphia, New Orleans and Miami, forced DP World to exclude P&O’s American assets from the deal.

The worries prompted the creation of a multilateral international working group chaired by a senior UAE financial official alongside an International Monetary Fund executive that in 2008 adopted the Santiago Principles designed to “ensure that the SWF undertakes investments without any intention or obligation to fulfil, directly or indirectly, any geopolitical agenda of the government.”

Enforcing adherence to the principles has proven easier said than done. With the UAE, whose 1.4 million citizens account for a mere 15 percent of its population of 10 million, projecting itself as a regional military power in the war in Yemen and through the establishment of foreign military bases, DP World has since the US debacle been acquiring ports rights globally, including in countries where the UAE military is active.

To be sure, DP World’s expansion in the Horn of Africa and the Gulf of Aden often makes economic sense and may well have been initially commercially driven in cases like the agreement in 2008 to operate for a period of 30 years the Yemeni port of Aden, once the British empire’s busiest port. The company lost its contract four years later because of its failure to invest in the port.

The port has since taken on even greater geopolitical significance with the UAE military’s focus on Aden and alleged backing for a secessionist movement in southern Yemen in the almost three-year-old Saudi-led military intervention in the country that has allowed DP World to again enter into negotiations about assisting in rebuilding Yemen’s maritime and trade sector that would likely include the company’s return to the Aden port.

DP World’s involvement in Aden tallies in geopolitical terms with its own as well as the UAE’s expansion elsewhere in the Horn of Africa. The company won two years ago a 30-year concession, with an automatic 10-year extension, for the management and development of a multi-purpose deep seaport in Berbera in the breakaway region of Somaliland.

Berbera faces South Yemen across the strategic Bab al Mandab Strait, past which some 4 million barrels of oil flow daily. The UAE military is training Somaliland forces and creating an air and naval facility to protect shipping.

DP World was also developing the port of Bosaso in Puntland, another Somali breakaway region, and was discussing involvement in a third Somali port in Barawe. The Somali ports compliment a UAE military base in Eritrea’s Assab as well as various facilities in Yemen.

“Money and politics make a combustible mix: If you don’t get the formula right, it can blow up in your face,” analysts Adam Ereli and Theodore Karasik warned in a recent Foreign Policy article about the role of sovereign wealth funds in relations between Russia and the Gulf.

In one instance, Kirill Dmitriev, a close associate of President Vladimir Putin and the head of Russia’s sovereign wealth fund, the Russian Direct Investment Fund (RDIF), met in early January 2017l in the Seychelles with Blackwater founder Erik Prince, a supporter of President Donald J. Trump and the brother of US Education Secretary Betsy DeVos in an effort to create a US-Russian back channel. The meeting, days before Mr. Trump’s inauguration, was arranged by UAE Crown Prince Mohammed bin Zayed.

The meeting occurred as UAE, Saudi and other Gulf sovereign funds as well as DP World earmarked $20 billion for investments in infrastructure, energy, transportation, and military production through RDIF as a way of strengthening relations with Russia. RDIF is one of several Russian entities sanctioned by the US Treasury.

“Even if allowances are made for sectorial and geographic diversification, the level of allocations to these markets is out of proportion to their size and viability,” Messrs. Ereli and Karasik said. In a separate article for The Jamestown Foundation, Mr. Karasik argued that “the Gulf states are using their economic strength to flex their political muscle, in order to invest in Russia at a time when Moscow’s embattled economy is struggling with low oil prices.”

Debate about the political role of sovereign wealth funds subsided with the adoption of the Santiago Principles. Those principles are currently being flaunted in an environment of greater economic nationalism, reduced US emphasis on transparency and democratic values, Russian and Chinese focus on economic benefit, and Gulf governments that have become more assertive in flexing their muscles and asserting themselves internationally.

Gulf sovereign wealth funds have learnt the lessons of DP World’s US experience and are likely to be more cautious in ensuring that potential future investments in the US do not challenge Mr. Trump’s America First principle as well as his emphasis on security. Elsewhere, they operate in an environment in which the Santiago Principles fall by the wayside and governments face little criticism of their use of sovereign wealth funds as geopolitical tools.


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 co-host of the New Books in Middle Eastern Studies podcast. James is the author of The Turbulent World of Middle East Soccer blog, a book with the same title as well as Comparative Political Transitions between Southeast Asia and the Middle East and North Africa, co-authored with Dr. Teresita Cruz-Del Rosario and  Shifting Sands, Essays on Sports and Politics in the Middle East and North Africa.

Saturday, January 13, 2018

Salafi mission calls into question Saudi concept of moderation and policy in Yemen


By James M. Dorsey

Plans to open a Salafi missionary centre in the Yemeni province of Al Mahrah on the border with Oman and Saudi Arabia raise questions about Saudi Crown Prince Mohammed bin Salah’s concept of a moderate form of Islam.

The questions are prompted by the fact that Prince Mohammed has so far put little, if any, flesh on his skeletal vow last October to return his ultra-conservative kingdom to “moderate Islam.”

The crown prince has created expectations of more social liberalism with the lifting of a ban on women’s driving, a residual of Bedouin rather than Muslim tradition, as well the granting of female access to male sporting events; the legitimization of various forms of entertainment, including cinema, theatre and music; and the stripping away of the religious police’s right to carry out arrests.

While removing Saudi Arabia as the only Muslim country that didn’t permit women to drive or allow various recreational activities, Prince Mohammed has yet to conceptualize what a rollback of Sunni Muslim ultra-conservatism would mean in a nation whose public life remains steeped in a puritan interpretation of the faith. (The lifting on the ban of women entering stadiums leaves Iran as the only country that restricts female access to male sporting events.)

The disclosure of the plan for a Salafi mission suggests Prince Mohammed may only want to curb ultra-conservatism’s rough edges. It also calls into question Saudi policy in Yemen that is reminiscent of past failures.

Saudi Arabia’s conflict with Iranian-backed Houthi rebels, a Zaydi Shiite Muslim sect with roots in a region bordering the kingdom, dates to Saudi employment of Salafism to counter the group in the 1980s.

The plan harks back to the creation of an anti-Shiite Salafi mission near the Houthi stronghold of Saada that sparked a military confrontation in 2011 with the Yemeni government, one of several wars in the region. The centre was closed in 2014 as part of an agreement to end the fighting.

Prince Mohammed’s use of ultra-conservative Sunni Islam in his confrontation with the Houthis was also evident in the appointment as governor of Saada of Hadi Tirshan al-Wa’ili, a member of a tribe hostile to the Shiite sect, and a follower of Saudi-backed Islamic scholar Uthman Mujalli. Mr. Mujalli reportedly serves as an advisor to Abd Rabbu Mansour Hadi, the exiled, kingdom-backed Yemeni president.

“Over the past forty years, the Saudi government has invested heavily in Salafi-Wahhabi-style madrasas and mosques in the northern areas, only to realise that this programme was jeopardised by the Zaydi revival movement. If the Houthis were to be defeated in their home province, it is likely that the Salafi-Wahhabi programme will be revived, and implemented more fiercely than in previous years,” said Yemen scholar Gabriele vom Bruck.

The disclosure of the Al-Mahrah plan coincided with a damning 79-page United Nations report that condemned Saudi, Iranian and United Arab Emirates interventions in Yemen. The report concluded that Saudi and UAE proxies threatened peace prospects and that a secession of South Yemen that includes Al Mahrah had become a distinct possibility.

The questions about Prince Mohammed’s concept of a moderate Islam go beyond Yemen. The arts, including cinema, remain subject to censorship that is informed by the kingdom’s long-standing ultra-conservative values. A soccer player and a singer are among those who face legal proceedings for un-Islamic forms of expressing themselves.

The government last year introduced physical education in girls’ schools and legalized women’s fitness clubs, but has yet to say whether restrictions on women competing in a variety of Olympic disciplines will be lifted.

Similarly, and perhaps more importantly, it has yet to indicate whether male guardianship, gender segregation, dress codes that force women to fully cover, and the obligatory closure of shops at prayer times will be abolished. Also, the government has still to declare a willingness to lift the ban on the practice of non-Muslim faiths or adherence to strands of Islam considered heretic by the ultra-conservatives.

The example of Yemen suggests that little has changed in Saudi Arabia’s four-decade-old, $100 billion global public diplomacy campaign that promoted Sunni Muslim ultra-conservatism as an anti-dote to revolutionary Iranian ideology.

Yemen is but one extreme of the spectrum. The Saudi-funded and operated grand mosque in Brussels is the other. Saudi Arabia, responding to Belgian criticism of the mosque’s ultra-conservative management, last year appointed as its imam, Tamer Abou el Saod, a 57-year polyglot Luxemburg-based, Swedish consultant with a career in the food industry. Senior Saudi officials have moreover responded positively to a Belgian government initiative to prematurely terminate Saudi Arabia’s 99-year lease of the mosque so that it can take control of it.

In contrast to Yemen, where the use of ultra-conservatism is a deliberate choice, Prince Mohammed may feel constrained in his moderation quest in the kingdom by the fact that his ruling Al Saud family derives its legitimacy from its adherence to ultra-conservatism. In addition, the kingdom’s ultra-conservative religious establishment has repeatedly signalled that the views of at least some its members have not changed even if it has endorsed the crown prince’s policies.

Saudi Arabia last September suspended Saad al-Hijri, a prominent scholar in charge of fatwas in the province of Asir, for opposing the lifting of the ban on driving because women allegedly had only half a brain that is reduced to a quarter when they go shopping. Sheikh Saad made his comment after the Council of Senior Scholars, Saudi Arabia’s highest religious body, had approved the move.

By the same token, no public action was taken against Sheikh Salih al-Fawzan, a member of the council, who declared on his website that "If women are allowed to drive they will be able to go and come as they please day and night, and will easily have access to temptation, because as we know, women are weak and easily tempted." A video clip of Sheikh Salih’s view was posted on YouTube in October. It was not clear when the scholar spoke or whether he had approved the posting.

A main thrust of Prince Mohammed’s drive to return to moderate Islam is the fight against extremism, involving among others the creation of a centre to oversee the interpretations of Prophet Muhammad's teachings in a bid ensure that they do not justify violence.

There is indeed little doubt that the kingdom is serious about countering extremism. Opposing extremism, however, does not automatically equate to moderation or concepts of tolerance and pluralism. Prince Mohammed has yet to clarify if those concepts are part of his notion of moderation. His track record so far is at best a mixed one.


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 co-host of the New Books in Middle Eastern Studies podcast. James is the author of The Turbulent World of Middle East Soccer blog, a book with the same title as well as Comparative Political Transitions between Southeast Asia and the Middle East and North Africa, co-authored with Dr. Teresita Cruz-Del Rosario and  Shifting Sands, Essays on Sports and Politics in the Middle East and North Africa.

Friday, January 12, 2018

Iranian protests expose contours of leadership in the Muslim world

Source: Wikimedia Commons

By James M. Dorsey

If week-long anti-government protests in Iran exposed the Islamic republic’s deep-seated economic and political problems, they also laid bare Saudi Arabia’s structural inability to establish itself as the leader of the Sunni Muslim world.

The responses to the protests of major Sunni Muslim countries in the Middle East and North Africa demonstrated that none of the contenders for regional dominance and leadership that include Turkey and Egypt were willing to follow the Saudi lead.

In fact, the responses appeared to confirm that regional leadership was likely to be shared between Turkey, Iran, and Egypt rather than decided in a debilitating power struggle between Saudi Arabia and the Islamic republic that has wreaked havoc across the Middle East and North Africa and that the kingdom has so far lost on points.

Uncharacteristically, Saudi Arabia under the rule of King Salman and his son, Crown Prince Mohammed bin Salman, has refrained from commenting on the protests. The kingdom has also been silent in the walk-up to US President Donald J. Trump’s decision what to do with American adherence to the 2015 international nuclear agreement with Iran.

While Saudi media, oblivious of the potential for dissent in the kingdom, gloated about the exploding discontent in Iran, Saudi leaders stayed quiet in a bid to avoid providing Iranian leaders with a pretext to blame external forces for the unrest. (That did not stop Supreme Leader Ayatollah Ali Khamenei and other Iranian leaders from laying the blame at the doors of Saudi Arabia, Israel and the United States).

Similarly, Saudi Arabia, whose regional prominence is to a significant extent dependent on US, if not international containment of Iran, stayed publicly on the side lines as Mr. Trump deliberated undermining the agreement that for almost three years has severely restricted Iran’s nuclear program and halted the Islamic republic’s potential ambition of becoming a nuclear power any time soon.

While the Saudis would welcome any tightening of the screws on Iran, they have come to see the agreement as not only preventing Iran, at least for now, from developing a military nuclear capability but also as avoiding a regional nuclear arms race in which Turkey and Egypt as well as potentially the United Arab Emirates would not be left out.

The agreement gives the kingdom in the meantime an opportunity to put in place building blocks for a future military nuclear capability, if deemed necessary. Mr. Trump’s apparent willingness to ease restrictions on Saudi enrichment of uranium as part of his bid to ensure that US companies play a key role in the development of Saudi Arabia’s nuclear energy sector facilitates the Saudi strategy.

In contrast to the Saudis, Turkish president Recep Tayyip Erdogan was vocal in his support for the Iranian government and call to Iranian President Hassan Rouhani to express his solidarity. Egypt, like Saudi Arabia, has not commented on the protests but has been studious in avoiding being sucked into the Saudi-Iranian rivalry, including its multiple proxy battles in Yemen and elsewhere.

The different responses to the Iranian protests represent more than a difference of evaluation of recent events in the Islamic republic. They represent the fault lines of two, if not three, major alliances that are emerging in the Middle East and North Africa and adjacent regions like the Horn of Africa around the contenders for regional leadership. 

They also highlight Saudi Arabia’s inability to garner overwhelming support for its ambition and/or multiple efforts to achieve it by among others declaring an economic and diplomatic boycott of Qatar, intervening militarily in Yemen, and failing to force the resignation of Lebanese prime minister Saad Hariri.

Turkey has effectively sought to counter Saudi moves not only by forging close ties to the Islamic republic despite differences over Syria, but also by supporting Qatar with a military base in the Gulf state and the supply of food and other goods whose flow was interrupted by the Saudi-led boycott.

Turkey has further established a military training facility in Somalia; is discussing creating a base in Djibouti, the Horn of Africa’s rent-a-military base country par excellence with foreign military facilities operated by France, the United States, Saudi Arabia, China and Japan; and recently signed a $650 million agreement with Sudan to rebuild a decaying Ottoman port city and construct a naval dock to maintain civilian and military vessels on the African country’s Red Sea coast. Saudi Arabia sees the Turkish moves as an effort to encircle it.

Turkey, to the chagrin of Saudi Arabia, and its closest regional ally, the UAE, as well as Egypt has supported the Muslim Brotherhood as well as other strands of political Islam. Egypt this week launched an investigation into embarrassing leaks from an alleged intelligence officers that were broadcast on the Brotherhood’s Istanbul-based Mekameleen tv station and published in The New York Times. Egypt has denied the accuracy of the leaks.

If Saudi Arabia, backed by the UAE and Bahrain and Israel as an officially unacknowledged partner constitutes one block, Turkey forms another that could either include or cooperate with the region’s third pole, Iran. Egypt, conscious of its past as the Arab world’s undisputed leader, may not be able to yet carve out a distinct leadership role for itself, but has worked hard to keep the door open.

Underlying the jockeying for regional dominance is a stark reality. Turkey, Iran and Egypt, to varying degrees, have crucial assets that Saudi Arabia lacks: large populations, huge domestic markets, battle-hardened militaries, resources, and a deep sense of identity rooted in an imperial past and/or a sense of thousands of years of history. Saudi Arabia has as the custodian of Islam’s most holy cities, Mecca and financial muscle. In the longer run, that is unlikely to prove sufficient.


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 co-host of the New Books in Middle Eastern Studies podcast. James is the author of The Turbulent World of Middle East Soccer blog, a book with the same title as well as Comparative Political Transitions between Southeast Asia and the Middle East and North Africa, co-authored with Dr. Teresita Cruz-Del Rosario and  Shifting Sands, Essays on Sports and Politics in the Middle East and North Africa.

Thursday, January 11, 2018

Saudi sports: The dark side of Crown Prince Mohammed’s reforms


By James M. Dorsey

Saudi Crown Prince Mohammed bin Salman will be putting his best foot forward when enthusiastic women soccer fans this week attend for the first time a men’s soccer match in the kingdom.

The event symbolizes the social and economic changes Prince Mohammed is introducing in his effort to turn Saudi Arabia into a 21st century autocracy with an economy that produces badly needed jobs in and can compete in a post-oil world.

The match between Al Hilal and Al Ittihad in Riyadh’s King Fahd stadium is “a historic game, the first in which Saudi families can enter a stadium together... They are finally going to have activities and entertainment together where they’re not separated, where parents go with their kids and mothers and even grandmothers, where they can enjoy sports events specifically, together… I really think it reinforces family values,” said Lina Al-Maeena, a member of the kingdom’s Shura or Advisory Council, and director of Jeddah United, Saudi Arabia’s first women’s basketball team.

The event is certain to overshadow Prince Mohammed’s efforts to incorporate sports in his bid to concentrate power in his own hands and crack down on anyone who stands in his way.

Al Hilal signed a sponsorship deal with Kingdom Holding weeks before its majority shareholder and chairman, Prince Alwaleed bin Talal, was detained in November in Prince Mohammed’s massive purge of princes, senior officials, and prominent businessmen on alleged corruption charges.

An internationally acclaimed billionaire businessman with holdings in Western blue chips, Prince Alwaleed has emerged as the symbol of those who have so far refused to cut a monetary deal with the government and were recently moved from Riyadh’s posh Ritz Carlton Hotel to a high security prison in Riyadh.

In the latest incident, Prince Abdullah bin Saud bin Mohammed, the head of kingdom's Maritime Sports Federation, was sacked and replaced by a military officer. Prince Abdullah was the latest Saudi sports executive to be fired in an apparent violation of international sports governance that bans governments from interfering in the affairs of federations and clubs.

Prince Abdullah was reportedly relieved of his position after circulation of a six-minute audio tape on WhatsApp that challenged the government’s justification of last week’s arrest of 11 members of the ruling family, months after the initial purge.

In a country in which differences within the ruling family are seldom aired in public, Saudi Arabia's attorney general, Saud al-Mojeb, said the 11 had been arrested for staging a sit-in outside a palace and protesting a royal order to halt utility payments for family members. He said the princes were also seeking compensation for the 2016 execution of one of their cousins, Prince Turki bin Saud al-Kabir, who was convicted of murder.

In his audio tape, Prince Abdullah denounced Mr. Al-Mojeb’s assertion as “completely false” and “not believable.” He wondered how the princes could have had issues with utility bills, given that they “have great financial capabilities, far from concerns and financial problems, and were raised by their fathers to be obedient” to the king.

Prince Abdullah went on to praise King Salman and Prince Mohammed’s leadership and criticized “the attempts of some to create division and schism within the royal family.”

Prince Abdullah’s dismissal came a month after Turki Bin Abdul Mohsen Al-Asheikh, appointed by Prince Mohammed chairman of the General Sport Authority and effectively Saudi Arabia’s minister of sport, removed Prince Faisal bin Turki bin Nasser as head of Riyadh-based Al Nasser FC, one of the kingdom’s most popular soccer clubs. Prince Faisal was replaced by Salman al-Malik, a member of the board of the Saudi Arabian Football Association.

Prince Faisal is a son of Prince Turki bin Nasser, the honorary chairman of Al Nasser until 2016 and a former high-ranking military officer and fighter pilot who headed the Presidency of Meteorology and Environment.

Prince Turki was among the members of the ruling family caught up in Prince Mohammed’s purge. He was central to a controversial $56 billion arms deal with Britain that sparked a corruption investigation in 2004. The investigation was shut down in 2006 by then prime minister Tony Blair in 2006 under pressure from the Saudis.

Prince Mohammed has identified privatization of sports clubs, many of which are aligned with different members of the ruling families, as a key element in Vision 2030, his reform plan that includes development of sports as both a recreational and public health priority.

The limits of Prince Mohammed’s social liberalization were evident with an unidentified Saudi soccer player for Al-Nojoom FC facing legal charges for refusing a high five during a match and opting instead for dabbing, a dance craze, which involves a person tucking their head into the crook of their arm

Abdallah Al Shahani, a popular singer, actor, and TV host was arrested in August after a video clip of his dab went viral. The Saudi Interior Ministry's National Commission for Combating Drugs recently banned the dance because it allegedly referred to the use of marijuana.

The attendance of woman at a male sporting event constitutes no doubt a milestone that followed on the heels of the lifting of a ban on women’s driving. It is however, but the beginning in a country in which women remain subject to the will of their male guardians and whose reform process has yet to demonstrate that it involves adherence to the rule of law, checks and balances, and greater freedoms that are not curtailed by arbitrary and repressive policies.

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 co-host of the New Books in Middle Eastern Studies podcast. James is the author of The Turbulent World of Middle East Soccer blog, a book with the same title as well as Comparative Political Transitions between Southeast Asia and the Middle East and North Africa, co-authored with Dr. Teresita Cruz-Del Rosario and  Shifting Sands, Essays on Sports and Politics in the Middle East and North Africa

Tuesday, January 9, 2018

Pakistani politics risk aggravating problems and heightening regional tension

Credit: Balochistan Police


By James M. Dorsey

Self-serving Pakistani politics threaten to aggravate the country’s myriad problems that have strained its relations with the United States and could heighten tension in the restless, key geo-strategic region of Balochistan, a vital node bordering Iran in China’s Belt and Road initiative and the earmarked home for the People’s Republic’s second foreign military base.

Pakistan’s short-sighted political battles are being fought at a time of worsening relations with the United States over alleged Pakistani support of militants and concern that the United States may withdraw from the 2015 international nuclear agreement with Iran. They potentially create a dilemma for China which is heavily invested in Pakistan with its more than $50 billion China Pakistan Economic Corridor (CPEC).

Keen to prevent ousted former Prime Minister Nawal Sharif’s Pakistan Muslim League – PML-N from winning a majority in elections scheduled for July, the Pakistani military, in the latest incident, appears to be backing efforts to force Nawab Sanaullah Zehri, the PML-N Chief Minister of Balochistan, to resign.

The stage to remove Mr. Zehri was set last week when the province’s interior minister, Sarfaraz Bugti, known for his close ties to the armed forces, stepped down after co-sponsoring a motion of no-confidence in the chief minister in the provincial assembly.

The targeting of Mr. Zehri, signalled the closing of the door on already failed efforts to drive a wedge between various nationalist Baloch insurgent groups and weaken Islamic militants that have wreaked havoc in Balochistan with attacks on Chinese, Pakistani military, and Shiite targets.

Closing the door amounted to kicking a dead body. Informal contacts between the Baloch provincial government, the federal government when Mr. Sharif was still in office, and Brahmdagh Bugti, a Baloch nationalist living in exile in Switzerland, who heads the Baloch Republican Party, fizzled out when Mr. Zehri came to office in late 2015. Nonetheless, Mr. Zehri refrained from slamming the door shut.

By the same token, Mr. Bugti’s demand that Pakistan end its military and paramilitary operations against nationalist forces in Balochistan, a resource-rich, population-poor region the size of France that straddles the border with the Iranian province of Sistan and Baluchistan, as a pre-condition for formal talks was likely one reason that the contacts failed.

More militant nationalists refused to endorse Mr. Bugti’s position, but quietly watched whether he would make headway. Even so, there was no guarantee that the militants would have accepted a deal negotiated by Mr, Bugti, whose grandfather, Nawab Bugti, was killed by the military in 2006, a year after he had presented a plan for greater Baloch autonomy that stopped short of demanding independence.

The timing of the effort to topple Mr. Zehri and foreclose renewed contacts with Baloch nationalist factions could not be more sensitive. It comes, against the backdrop of a long history of military support for militant religious groups to counter the nationalists in Balochistan, and at a moment that the armed forces have used militants elsewhere to weaken the PMN-L while at the same time refute US allegations that it backs extremists in Pakistan as well as Afghanistan.

The Trump administration said last week that it was cutting almost all security aid to Pakistan believed to total more than $1 billion until it deals with militant networks operating on its soil. Pakistan, in response and in advance of a visit this month by a United Nations Security Council team to evaluate Pakistani compliance with its resolutions, has sought to crack down on the fundraising and political activities of Hafez Saeed, an internationally designated terrorist accused of having masterminded the 2008 attacks in Mumbai.

The crackdown constitutes a double-edged sword. Pakistan and its military needs to be seen to be acting against internationally designated terrorist groups, yet Mr. Saeed has been treated over the years with kid gloves. His organization was allowed to continue operations under multiple guises and although he was put under house arrest several times, he was not remanded behind bars. It wasn’t clear whether the crackdown by the PMN-L-led federal government of Prime Minister Shahid Khaqan Abbasi has the backing of the military.

Mr. Saeed has recently attempted to move into mainstream politics with the backing of the military. Military support was “a combination of keeping control over important national matters like security, defense and foreign policy, but also giving these former militant groups that have served the state a route into the mainstream where their energies can be utilized,” a senior military official said. Mr. Saeed, who headed Lashkar-e-Taiba (LeT), widely viewed as one of South Asia’s most violent groups, was a military proxy in confronting India in Kashmir.

Associates of Mr. Saeed said that their participation in this summer’s election was in part designed to prevent the PMN-L from returning to office. “There is little else more patriotic than ensuring the ouster of the Sharifs. Pakistan needs a government that serves Pakistani, not Indian interests”, said Nadeem Awan, a spokesman for Jamat u-Dawa, widely seen as a LeT front headed by Mr. Saeed.

Former Pakistani strongman General Pervez Musharraf, said last month that he was discussing an alliance with Milli Muslim League (MML), the political party Mr. Saeed is trying to register. Speaking on Pakistani television, Mr. Musharraf pronounced himself “the greatest supporter of LeT.”

The military, also last month, displayed its political influence and inclination by mediating an end to a weeks-long blockade of a main artery leading into Islamabad to protest a perceived softening of the government’s adherence to Islam in a proposed piece of legislation.  

The resolution was seen as favouring Tehreek Labbaik Pakistan (TPL), the organizer of the protest. TPL is a political front for Tehreek Labbaik Ya Rasool Allah (TLR), which glorifies Mumtaz Qadri, who was executed for killing Punjab governor Salman Taseer because of his opposition to Pakistan’s draconic blasphemy law.

All in all, the Pakistani military appears to be embroiled in battles on multiple fronts in a Herculean effort to satisfy target audiences with contradictory demands. Countering the PML-N by supporting religious forces complicates refuting US allegations of support for militants.

It also risks escalating violence in Balochistan and enhancing opportunity for external players like the United States and Saudi Arabia to use the province as a launching pad for efforts to destabilize Iran should they opt to travel down that road.

President Donald J. Trump has to decide this month whether to certify Iranian compliance with the nuclear agreement and waive US sanctions. A failure to do so could lead to a US withdrawal from the agreement.

China, by the same token, sees Pakistan’s use of proxies against India as useful, yet needs stability in Balochistan to secure its massive investment.

Pakistan could well be the ultimate loser in battles between its various institutions that appear focused more on vested interests than on resolving issues that have long held the country back such as extremism, intolerance, and ensuring fundamental rights. In pursuit of their own interests, neither the United States nor China appear willing to help their Pakistani allies look beyond their narrow and most immediate concerns towards the development of policies that would launch the country on a path of security, stability and economic prosperity.


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 co-host of the New Books in Middle Eastern Studies podcast. James is the author of The Turbulent World of Middle East Soccer blog, a book with the same title as well as Comparative Political Transitions between Southeast Asia and the Middle East and North Africa, co-authored with Dr. Teresita Cruz-Del Rosario and  Shifting Sands, Essays on Sports and Politics in the Middle East and North Africa.

Saturday, January 6, 2018

Covert wars: Iran and Saudi Arabia revisit their strategies



By James M. Dorsey

Expressions of support by US President Donald J. Trump and Israeli Prime Minister Benyamin Netanyahu have provided the grist for Iranian claims that anti-government protests were instigated by foreign powers. The largely baseless assertions offer nonetheless insight into the very different strategies adopted by Iran and Saudi Arabia in their vicious struggle for regional dominance.

There is little doubt that the protests were fuelled by widespread economic grievances with Iran’s detractors resembling not always helpful fans on the side lines. In fact, Saudi Arabia, Iran’s nemesis, was the one opponent of the Islamic republic that refrained from joining the fans publicly in a bid to deprive the regime in Tehran from using it as a scapegoat. That did not stop Iranian leaders from pointing a finger at the kingdom in ways that reflected the dynamics of the Iranian-Saudi rivalry.

Both Iranian and Saudi approaches to their rivalry are in flux. Protesters in Iran challenged the government’s heavy expenditure on propping up allies like Syrian President Bashar al-Assad and funding proxies in Lebanon, Iraq, Palestine and Yemen, not to mention proselytization campaigns in West Africa.

The protests are unlikely to change Iranian policy that the country’s leaders view as the crux of their defense strategy in covert wars with the United States and Saudi Arabia that have been ongoing since the 1979 Islamic revolution that toppled the shah, a monarch and an icon of now waning US power in the region.

Nonetheless, Iranian leaders will have to take public grievances into account even if the protests peter out. Rather than toting its regional successes publicly, Iran going forward is likely to be more circumspect about its foreign involvements. While that will not change things on the ground, it may contribute over time to an environment more conducive to a lessening of tensions.

Despite the protests, Iran has little reason to change facts on the ground. With access to the world’s most advanced weapons systems severely restricted for decades because of sanctions and boycotts, some in response to provocative Iranian actions and policies, others part of regional power struggles, Iran has sought to fight its battles far from its borders. Many Iranians bought into the argument that the policy had largely shielded their country from instability and jihadism wracking the rest of the region.

Simultaneous Islamic State attacks last June on the Iranian parliament and the mausoleum of Ayatollah Ruhollah Khomeini, the founder of the Islamic republic, that killed 12 people were viewed as the exception that proved the rule. That perception has changed in a significant segment of the population as protesters demanded that funds allocated to Iran’s defense doctrine and enhancement of its regional influence be invested in improving their deteriorating living standards.

“Our military doctrine is…based on historical experience: During the Iran-Iraq War, Saddam Hussein rained Soviet-made missiles on our cities, some of them carrying chemical components provided by the West. The world not only kept silent, but also no country would sell Iran weapons to enable us to at least deter the aggressor. We learned our lesson,” Iranian Foreign Minister Mohammad Javad Zarif wrote in The New York Times weeks before the protests erupted.

Speaking this week at a Brookings Institution seminar in Washington, Iranian-American journalist Maziar Bahari described Iran’s doctrine as a more brutal and militarized version of the late Israeli prime minister David Ben Gurion’s policy of the periphery that in the absence of relations with Israel’s neighbours sought to forge ties with the neighbours of the Jewish state’s neighbours.

Mr. Zarif represents the view of Iranian President Hassan Rouhani’s pragmatic government, a view shared by conservatives as part of a far greater ambition that they have no compunction about articulating.

In a column in the conservative Tehran Times entitled ‘What makes Iran stronger than Saudi Arabia?’, sociologist and journalist Mohammad Mazhari argued that “the Saudi regime has no comprehension that money cannot replace ideological values.” By contrast, Mr. Mazhari wrote, “there are common ties between Iran and Hezbollah, however the crux of those ties is not monetary. What drives Iran is not a superficial goal, it is working hard to restore the empire, but this time culturally, while Saudi Arabia and its alliances have no clear vision nor project in the Middle East save for keeping their thrones.”     

Prince Mohammed vowed months before Mr. Zarif articulated Iran’s defense doctrine, that the fight with Iran would take place “inside Iran, not in Saudi Arabia.” In doing so, the crown prince was playing on deep-seated Iranian fears rooted in a history of foreign intervention that stretches from ancient to modern times as well as highlighting the fundamentally different Saudi and Iranian strategies.

Since coming to power in 2015, Prince Mohammed has shifted the emphasis of Saudi strategy from long-term cultural and public diplomacy focused on promotion of Sunni Muslim ultra-conservatism as an anti-dote to Iranian Shiite and revolutionary ideology, and passive reliance on the United States to defend the kingdom by containing Iran to a more assertive confrontation of the Islamic republic everywhere but in Iran itself.

Prince Mohammed’s approach is a power play based primarily on chequebook diplomacy, pressure tactics, and projection of the kingdom as the custodian of Islam’s holiest cities. It is an approach that is void of any ideology or worldview beyond the need to counter Iran and support autocratic or authoritarian rule in a bid to ensure the survival of his family’s rule.

Prince Mohammed’s approach has so far produced mixed results at best. His effort to force a political crisis in Lebanon by pressuring Prime Minister Saad Hariri to resign backfired. King Abdullah of Jordan and Palestinian President Mahmoud Abbas rejected the crown prince’s demand that they not attend an Islamic summit in Istanbul convened last month to condemn Mr. Trump’s recognition of Jerusalem as Israel’s capital.

The prince’s one military adventure, intervention in Yemen, has produced a quagmire, severely tarnished the kingdom’s image, and even provoked criticism from one of his greatest fans, Mr. Trump. Egypt has adopted an independent foreign policy that is at times at odds with positions adopted by Saudi Arabia despite being financially dependent on the kingdom.

Hanging in the balance is the question whether Prince Mohammed’s declaration last year that he wants to return the kingdom to a yet undefined moderate form of Islam means that he will introduce an ideological element to his strategy that would replace the increasingly problematic propagation of Sunni Muslim ultra-conservatism.

It’s a tall order in a country whose religious establishment and culture is steeped in ultra-conservatism despite support for more relaxed religious and social codes among a significant segment of a predominantly young population.

A successful redefinition of Islam would not only significantly enhance confidence in Prince Mohammed’s ability to change the nature of Saudi society and economy but also strengthen the kingdom in its struggle with Iran that despite being fought as a zero-sum game can only be resolved with an agreement that recognizes both Saudi Arabia and Iran as key regional players.

Economics rather than Iran’s rivalry with Saudi Arabia and hostility towards the United States and Israel is at the crux of anti-government protests in Iran. Nevertheless, the protests are likely to force Iranian leaders to repackage their foreign involvements at a time that Prince Mohammed is seeking to revamp his kingdom as part of an economic and political survival strategy. In the longer term, that could unintentionally create building blocks for the lowering of tensions in a dispute that has wracked havoc across the Middle East and the wider Muslim world.

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 co-host of the New Books in Middle Eastern Studies podcast. James is the author of The Turbulent World of Middle East Soccer blog, a book with the same title as well as Comparative Political Transitions between Southeast Asia and the Middle East and North Africa, co-authored with Dr. Teresita Cruz-Del Rosario and  Shifting Sands, Essays on Sports and Politics in the Middle East and North Africa.

Wednesday, January 3, 2018

A game of chess: Gulf crisis expands into the Horn of Africa


By James M. Dorsey

The six-month-old Gulf crisis has expanded to the Horn Africa, potentially fuelling simmering regional conflicts.

Renewed fears of heightened tension in the Horn, a region pockmarked by foreign military bases that straddles key Indian Ocean trade roots with its 4,000-kilometre coast line, was sparked by Sudan last month granting Turkey the right to rebuild a decaying Ottoman port city and construct a naval dock to maintain civilian and military vessels on the African country’s Red Sea coast.

The $650 million agreement was the latest indication that East Africa was being drawn into the Gulf dispute and associated conflicts in the Middle East. Concern heightened as the Saudi and United Arab Emirates-led diplomatic and economic boycott of Qatar appeared to have become the new normal.

Competition for influence between rival Gulf states stretches beyond the Horn that straddles the strategic Bab-el-Mandeb strait, links the Gulf of Aden with the Red Sea and is plagued by the nearby war in Yemen, into the Sahel as well as Central and West Africa. Qatar’s emir, Sheikh Tamim bin Hamad Al Thani, toured six West African nations last month to shore up support for his country in its dispute with its Gulf brethren.

Africa is a battlefield not only in the Gulf crisis but also in the fierce rivalry between Saudi Arabia and Iran that is often fought in countries like Nigeria, Senegal, Cameroon and Mauritania primarily as a sectarian struggle between Sunni and Shiite Islam.

The Sudanese-Turkish agreement raised anxiety in capitals on both sides of the Red Sea. Saudi Arabia and the UAE both worry about Turkish military expansion because of its support for Qatar. Turkey has a military base in the Gulf state and has said it would beef up its presence to 3,000 troops in the coming months.

Turkey also has a training base in Somalia and is discussing the establishment of a base in Djibouti, the Horn’s rent-a-military base country par excellence with foreign military facilities operated by France, the United States, Saudi Arabia, China and Japan.

Hinting at a link between the Turkish presence in Sudan and Saudi Arabia, Turkish President Recep Tayyip Erdogan said on a visit to the African nation last month, the first by a Turkish head of state, that the ancient port of Suakin would boost tourism and serve as a transit point for pilgrims travelling to the kingdom’s holy city of Mecca.

Suakin was Sudan’s major port when it was ruled by the Ottomans, but fell into disuse over the last century after the construction of Port Sudan, 60 kilometres to the north. Suakin allowed the Ottomans to secure access to what is today the Hejaz province in Saudi Arabia and home to the Red Sea port of Jeddah.

Saudi Arabia and the UAE, which has bases in Berbera in the breakaway republic of Somaliland and in Eritrea, fear that the agreement will allow Turkey, with whom they have strained relations because of differences over Qatar, Iran and Islamist groups like the Muslim Brotherhood, to station troops close to Jeddah. Saudi Arabia and the UAE suspect Qatar of funding the development of Suakin. Adding to tension is the fact that Turkey suspects the UAE of having supported a failed military coup in July 2016.

The agreement is even more stinging because relations between Saudi Arabia and Sudan had significantly improved after the African country broke off diplomatic relations with Iran in early 2016, an early Saudi victory in its fight for Africa with the Islamic republic.

Sudan has since contributed 6,000 troops as well as fighters from the Janjaweed tribal militia to the Saudi-led intervention in Yemen. The Trump administration eased economic sanctions on Sudan in October at Saudi Arabia’s request.

Saudi Arabia this week agreed to re-establish banking ties with Sudan despite criticism in the Saudi press and on social media of the Sudanese-Turkish agreement. Sudanese President Omar al-Bashir has insisted that his country would keep its troops in Yemen irrespective of the agreement.

Concern about the agreement is not limited to Qatar’s detractors in the Gulf. Egypt suspects that the agreement will fuel a border conflict with Sudan over the region of Halayeeb. Sudan recently accused Egypt of deploying troops to the Sudanese side of the border and sending war planes to overfly the coastal area.

Sudan last month complained to the United Nations that a maritime demarcation agreement reached in 2016 by Egypt and Saudi Arabia infringed on what it claimed to be Sudanese waters off Halayeeb.

Egypt is further worried that mounting tensions will complicate already sharp differences with Sudan as well as Ethiopia over a massive demand that Ethiopia is building. Egypt believes the dam will reduce its vital share of Nile River waters that are the country’s lifeline. Negotiations over the dam are at an impasse, with Sudan appearing to tilt toward Ethiopia in the dispute.

"Sudanese President Omar Bashir is playing with fire in exchange for dollars. Sudan is violating the rules of history and geography and is conspiring against Egypt under the shadow of Turkish madness, Iranian conspiracy, an Ethiopian scheme to starve Egypt of water, and Qatar's financing of efforts to undermine Egypt," charged Emad Adeeb in a column entitled ‘Omar Bashir's political suicide.’

The Gulf crisis, even without Turkey joining the fray, was putting fragile peace arrangements in the Horn at risk.

Qatar, in response to Eritrea and Djibouti’s decision to downgrade relations with the Gulf state when the conflict erupted last June, withdrew its peacekeeping contingent of 400 troops from the Red Sea island of Doumeira.

Eritrea immediately seized the island that is also claimed by Djibouti in a move that could ultimately spark an armed conflict that may draw in Ethiopia.

While reaping the benefits of heightened interest, the Horn risks increased tension and violent conflict in what has become a high stakes chess game for both Middle Eastern and African adversaries.

“Post-Arab Spring…activism may unsurprisingly contribute to the militarisation of the Horn of Africa and, even more dangerously, alter the existing balance of power in this conflict-ridden region, warned Patrick Ferras, director of the Horn of Africa Observatory (CSBA).


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 co-host of the New Books in Middle Eastern Studies podcast. James is the author of The Turbulent World of Middle East Soccer blog, a book with the same title as well as Comparative Political Transitions between Southeast Asia and the Middle East and North Africa, co-authored with Dr. Teresita Cruz-Del Rosario and  Shifting Sands, Essays on Sports and Politics in the Middle East and North Africa.

Monday, January 1, 2018

Iranian protests raise tricky questions for US and Saudi policymakers


By James M. Dorsey

If Saudi Crown Prince Mohammed bin Salman’s chequered foreign policy track record is anything to go by, Iran could tempt him to embark on yet another risky adventure inspired by widespread anti-government protests in Iran, the real focus of his multiple regional quagmires that include the devastating war in Yemen and the failed effort to force Lebanese Prime Minister Saad Hariri to resign.

In many ways, Prince Mohammed faces the same considerations in deciding how to respond to events in Iran as does US President Donald J. Trump. Mr. Trump has to this month not only choose whether to certify to Congress Iranian compliance with the 2015 international agreement that curbed the Islamic republic’s nuclear program, but also whether to waive US sanctions on Iran. A decision to reimpose economic sanctions could mean a US withdrawal from the agreement.

At the core of Mr. Trump’s decision as well as Prince Mohammed’s deliberations on how and if to respond to the Iranian protests is the question whether the United States and/or Saudi Arabia see a strengthening of hard-line conservative factions in Iran as serving their purpose of at least further containing the Islamic republic, and possibly engineering a situation that would be conducive to regime change.

“The most likely scenario is that the evidence of popular dissatisfaction and the inevitable repression will harden the Trump administration's position on sustaining the deal and provide additional incentives for ratcheting up new economic pressure on the government, They also may see some possibility of flipping the Europeans if the crackdown is fierce and well-documented,” said Brookings fellow and ormer State Department policy planning Iran expert Suzanne Maloney. Europe has urged Mr. Trump not to nix the nuclear agreement.

Iranian president Hassan Rouhani, in contrast to hard-liners, has sought to reach out to the protesters by recognizing their right to criticize while denouncing violence and promising to address their economic grievances.

Mr. Rouhani may be able to tackle some issues like the fraudulent financial institutions that have deprived many of their savings, but will struggle to fix the country’s structural economic issues, including the power of hard-line institutions such as the Revolutionary Guards Corps. He may also be able to institutionalize and anchor in law the right to protest with the backing of hardliners. Moreover, addressing economic issues would be even more daunting if Mr. Trump effectively withdraws from the nuclear agreement.

Ultimately, the odds are that hard-liners, irrespective of what scenario unfolds, will emerge strengthened by the current crisis either as the result of protests losing momentum as the regime curbs access to social media, a brutal squashing of the protests as a last resort, or because increased external pressure will initially unite rival factions and reinforce widespread disillusionment with the nuclear agreement that has failed to provide tangible economic benefits to a majority of Iranians.

Looming in the background is the risk that Prince Mohammed with or without US backing or cooperation will seek to exploit the Iranian government’s problems by attempting to further destabilize the Islamic republic by stirring unrest among already restive ethnic minority groups such as the Kurds and the Baloch. Kermanshah, a city in predominantly Kurdish western Iran, was one of the first cities to which the protests spread after first erupting in the conservative stronghold of Mashhad.

Saudi Arabia has funnelled large amounts of money in the last 18 months to militant groups and madrassas or religious seminaries in the Pakistani province of Balochistan that borders on the Iranian region of Sistan and Baluchistan, both populated by restive Baloch populations. A Riyadh-based think tank believed to be supported by Prince Mohammed last year published a blueprint for stirring unrest among the Iranian Baluch.

Mr. Trump and the US State Department have in recent days expressed support for the protesters, urged the international community to chirp in, and said they back those in Iran that are seeking a peaceful transition of government.

Various US analysts have argued that Mr. Trump’s anti-Iranian track record, including his attempted bans on granting visas to Iranians, curtails the impact of his support for the protesters and may even strengthen the hardliners by allowing them to point fingers at alleged foreign instigation.

“While we’re on Trump, the impact of his tweets has been marginal at best. They’ve triggered a slew of angry comments, packed with ridicule. Across classes, factions and generations in Iran, there is a shared contempt for #POTUS whose policies look erratic and hypocritical,” tweeted Bloomberg News’ Iran correspondent, Golnar Motevalli.

Rather than speaking out, the analysts proposed concrete steps the United States could take to support the protesters. Ms. Maloney and journalist Maziar Bahari suggested the United States could use its influence with technology, satellite internet providers and social media companies like Facebook, Twitter and Instagram to try to keep the protesters’ communications channels open.

Former State Department official Reza Marashi argued that advice he and others proffered in 2009 when the Iranian government faced far larger protests against alleged election fraud remained valid in the current situation.

“We advised our superiors to express concern about the violence against protestors, and highlight the importance of respecting free speech, democratic process, and peaceful dissent. We also emphasized a need for the US government to publicly express its respect for Iranian sovereignty, its desire to avoid making America the issue during a domestic Iranian protest, and its belief that it is up to Iranians to determine who Iran’s leaders will be,” Mr. Marashi recalled.

Much of that advice has been ignored by the Trump administration. In doing so, the administration has not only allowed Mr. Rouhani and the hardliners to point to a scapegoat, it has seemingly gone out of its way to raise Iranian fears that US policy, with the Saudis in tow, is focused on regime change.

“Washington would be wise to acknowledge the limits of its power inside Iran. Policymakers and pundits cannot change this simple truth: The problems are Iranian, the protestors are Iranian, and the solution will be Iranian,” Mr. Marashi noted.


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 co-host of the New Books in Middle Eastern Studies podcast. James is the author of The Turbulent World of Middle East Soccer blog, a book with the same title as well as Comparative Political Transitions between Southeast Asia and the Middle East and North Africa, co-authored with Dr. Teresita Cruz-Del Rosario and  Shifting Sands, Essays on Sports and Politics in the Middle East and North Africa.