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A New Strategy for Palestine: New Age Islam's Selection, 26 April 2016

New Age Islam Edit Bureau

26 April 2016

A New Strategy for Palestine

By Linda S. Heard

Analyzing Saudi Arabia’s ‘Vision for The Future’

By Patrick Ryan

Obama, Iran and Cold Peace

By Turki Al-Dakhil

On Transformations In Saudi Arabia

By Mshari Al Thaydi

How Saudi Arabia Is Planning a New Economic Era

By Nathan Hodson

Hurt Saudi Arabia: Iran’s Oil War and Policy Politicization

By Dr. Majid Rafizadeh

Compiled By New Age Islam Edit Bureau



A New Strategy for Palestine

By Linda S. Heard

26 April 2016

The hardships and humiliations suffered by Palestinians are well known. Social media is swamped with videos of Palestinian women and children being roughed-up or killed by Israel’s so-called Defense Forces. Watching the homes of traumatized families being bulldozed makes for difficult viewing but no longer have shock value when such incidents are more the norm than the exception.

The Arab League’s Secretary-General Nabil Al-Arabi has accused Israel of acting “above the law and accountability” over its “forever” annexation of the oil-rich Golan Heights, and has rightly called for the establishment of a “Special Court for the Palestinian Cause.”

But here’s the thing. Even in the unlikely event that such a court were to manifest, the Israeli government would simply brush-off its judgments just as it did when the International Court of Justice in The Hague ordered Israel to tear down its separation fence. Israel has also ignored dozens of United Nations Security Council resolutions because as a nuclear-armed state under the protective umbrella of the United States, it can.

Over recent years, international sympathies have swayed toward the Palestinians as evidenced by an overwhelming vote in the UN General Assembly to accord Palestine non-Member Observer Status. Numerous European countries have passed non-binding resolutions recognizing the Palestinian State while others — the latest the Vatican — have afforded Palestine official recognition. That’s all well and good, but the stark reality is the Palestinian residents of the West Bank and Gaza is arguably worse off today than ever before.

It seems an age ago since President Barack Obama promised to devote his efforts to bring about a Palestinian state within two years. His resolve faltered at the first hurdles and last year he announced before a Jewish congregation in Washington that he was the closest thing to a Jew that ever sat in the Oval Office. Should Hillary Clinton take the next White House she will compete Obama’s boast. As Ben Norton wrote in Salon, “She sounds like Netanyahu.”

The vacuum left by Obama’s defeatism has driven France to take the lead. France’s foreign minister has invited his counterparts from Europe, the Middle East, Asia and the US to Paris to write a new page, a common strategy, toward the goal of a Palestinian State. “The possibility of two states, the only possible solution, is under threat,” he said. “It’s threatened by settlements, but also the absence of the prospect of negotiations.” France asserts it will officially recognize Palestinian should its efforts be unsuccessful.

If you are shaking your head saying to yourself “Here we go again, more futile talks”, I don’t blame you. All the Camp David, Oslo and road map meets raised hopes but turned out to be time wasters permitting Israel to continue with its expansionist policies until the land originally earmarked for a Palestinian State has been gobbled-up by Jewish settlements. The unpalatable fact is this: Unless Netanyahu is fully committed (or the US turns up the heat, which is as unlikely as Pod people descending from outer space) any international peace talks are doomed to failure.

A brand new direction is needed; even one that may require Arabs and Palestinians to hold their nose. Netanyahu is content with the status quo. There are no available sticks out there to deter him. He cares not a jot about insults, court decisions, or UN resolutions as long as he has the US in his pocket. However, there’s a chance that he could be persuaded with carrots.

As morally undeserving Israel surely is of incentives, isn’t it about time the quality of life of the Palestinian people was given priority? Nay, their very right to life in dignity and freedom! The more Israel is bashed, however legitimately so, it will behave like the man in an overcoat fought over by the sun and the wind, which argued over who could force the man to remove his outer garment first. The wind blew and blew but he only held it more tightly around him; then the sun shone brightly and he removed it himself.

It may be that a regional peace process would create a very different climate producing fertile soil to alleviate security concerns and promote prosperity.

Netanyahu has been making noises to that effect since 2014. Speaking at the World Economic Forum in Davos earlier this year, he said, “There is a great shift taking place. We used to think that if we solved the Israel-Palestinian conflict, it would solve the larger Israeli Arab conflict. The more I look at it, the more I think it may be the other way around. That by nurturing these relationships…with the Arab world, that could actually help us resolve the Israeli-Palestinian conflict…” He has also stressed that Israel and Sunni Arab states share the same enemies — Iran and Daesh.

This conscience-saving merry-go-round of international peace talks brokered by US presidents has led nowhere. Perhaps it’s time for Arabs and Israelis to sit around the same table face-to face. In the absence of any other solutions on the horizon, it’s surely worth a try.



Analyzing Saudi Arabia’s ‘Vision for the Future’

By Patrick Ryan

26 April 2016

It may be a case of, “Gentlemen, we have run out of money; it’s time to start thinking,” variously attributed to Winston Churchill and physicist Ernest Rutherford, but the need to reform Saudi Arabia’s oil-dependent economy has actually been the subject of “thinking” for decades.

Thirty years ago the Fourth five-year development plan started the emphasis on boosting private sector growth and industrial sector efficiency. Twenty years later the Eighth plan added emphasis on foreign investment and renewed attention on Saudi human capital. While economic reforms in that era yielded results the current circumstances call for new, bolder action.

A December report from McKinsey, a leading consultancy to the government, noted the economy was at an “inflection point” following a decade of oil fuelled prosperity. “We see a real opportunity for the country to inject new dynamism into its economy through a productivity and investment-led transformation that could help ensure future growth, employment, and prosperity.”

The formal announcement of “Saudi Vision 2030” heralded a dramatic retooling of the Saudi government’s objectives not only in the economy but also in social circles. The plan, approved at Monday’s Cabinet meeting, chaired by King Salman, will be implemented by the Council of Economic Development Affairs (CEDA), headed by Deputy Crown Prince Mohammed bin Salman.

The size and scope of the “Saudi Arabia Vision 2030” will require more study and feedback from those sectors directly affected by its provisions but one can expect there will be no shortage of strong opinions

Prince Mohammed has signalled elements of the “Saudi Vision 2030” for months including expansive high profile interviews with The Economist and Bloomberg earlier this year and a first-ever television appearance with Al Arabiya News Channel on the occasion of the announcement. In the interview he said, “The ‘Vision’ doesn’t require high-spending but restructuring.”

A roadmap called the National Transformation Plan, a component of the “Vision 2030” is expected for release in coming weeks with more details on the initial phase.

New Approach

The restructuring, as described by Prince Mohammed, will include privatization of state assets – most notably an IPO for as much as 5 percent of Saudi Aramco, expansion of the Public Investment Fund to a goal of $2 trillion to serve as a holding company, slowing and in some cases redirecting subsidies, liberalization to attract foreign investors, improving economic efficiencies and attacking wasteful spending, and spurring expansion of the private sector.

The “Vision 2030” is more than a roadmap for economic transformation as were earlier plans for commercial activities. In addition to marquee plans like the $2 trillion investment fund and multi-sector privatization like the Saudi Aramco IPO, the goals include broad social targets.

The “Vision” notes, “Our goal is to promote and reinvigorate social development in order to build a strong and productive society.” It addresses a wide swath such as education, healthcare, urban development, pride in Saudi “identity” and focus on Islamic roots, tourism, culture and entertainment, healthy lifestyles, promotion of family life and children’s character, modernized social welfare, spurring SME capabilities, empowering women, rehabilitating economic cities and more.

Supportive Population

The “Vision” includes both generalized objectives and specific goals. The comments on women’s empowerment are indistinct, saying only that the “Vision” will “enable them to strengthen their future and contribute to the development of our society and economy.” The 2030 goals in other areas get very specific, for example, in the area of leisure activities: “To increase the ratio of individuals exercising at least once a week from 13 percent of population to 40 percent.”

In addition to the wider range of goals the “Vision 2030” offers a new approach in that CEDA will head the implementation rather than individual ministries each with a narrower focus. It also comes at a time when a wider segment of the population is supportive of transformation as the country faces a confluence of challenges. However, there will be resistance from conservative quarters.

The size and scope of the “Saudi Arabia Vision 2030” will require more study and feedback from those sectors directly affected by its provisions but one can expect there will be no shortage of strong opinions given the expansiveness of its provisions. There will be both support and acrimony expressed by differing communities.

Some will see it as timely and a necessary action by the government to address economic and social needs, as well as pushback from those whose core interests will be impacted by liberalization and modernization.

The “Vision” offers a roadmap that may not be new thinking in terms of the need for transformation but its extraordinary and wide-ranging objectives provide reform initiatives on a much grander scale than anything before and foretell a different future for Saudi Arabia.



Obama, Iran and Cold Peace

By Turki Al-Dakhil

25 April 2016

The US-Gulf summit ended coldly as usual. President Barack Obama is reaching out to Iran and is passionate about supreme leader Ali Khamenei. The former has sent two letters to secretly meet with the latter.

The Wall Street Journal reported that the Obama administration agreed to purchase from Iran 32 tons of heavy water, a key component in developing nuclear weapons.

This is a blatant American submission, with US House Speaker Paul Ryan saying the deal “is yet another unprecedented concession to the world’s leading state-sponsor of terrorism.”

Obama speaks of “cold peace” between Saudi Arabia and Iran, and an understanding on the basis that there is “neither a winner nor losers.” The Obama administration’s problem is that it thinks Gulf countries are a consumer of American power.

The Obama administration’s problem is that it thinks Gulf countries are a consumer of American power

Saudi Resolve

However, Saudi Arabia helped the United States topple the Soviet Union via a solid alliance and participating in organized confrontation against Communist expansion. Riyadh also helped manage the battle against the Soviets via oil.

The talks in Kuwait with Houthi rebels show that Saudi Arabia wants to achieve goals on the ground and commit to legitimate decisions such as disarming militias in order to pave the way for a secure and safe Yemen.

This is not about ideological dominance, which Iran exploits and which Obama supports it in. It is about establishing a civil region where the logic of the state and institutions prevail, not militia and gang destruction and bloodshed.



On Transformations in Saudi Arabia

By Mshari Al Thaydi

25 April 2016

On September 23, 1932, the third Saudi state, the Kingdom of Saudi Arabia, was established.

This was about two years after the most important battle which founder of Saudi Arabia, King Abdulaziz, fought against the most dangerous domestic rebel movement led by some extremists belonging to Brotherhood. King Abdulaziz had strengthened the state’s legitimacy at the famous Riyadh conference in which he invited dignitaries from all over the country. All segments of the society witnessed the Brotherhood’s wrongdoings and thus deemed it legitimate to fight against them.

This was March 30, 1929. It was then that Saudi Arabia was born all over again. On March 4, 1938, black gold, i.e. oil, was discovered at Dammam oil well No. 7, thus paving the way for a long oil era, which lasted for decades.

Saudi Arabia has witnessed several transformations since then. For example, there was King Saud’s great decision to open schools for girls in cities across the country in 1959. This decision was satisfactory to a majority of the people and upset few. As expected, it was the vocal category of people who objected to that decision.

However, thanks to the state’s decisiveness, the decision was made and implemented as Saudi researcher Abdullah al-Washmi thoroughly explains in one of his books.

Transformations continued in Saudi Arabia. Among these was the opening of the Saudi television station in Riyadh in 1965, following a decision by King Faisal. Despite criticism, the state was determined to implement this decision, which was deemed vital for the state and society.

Land Of Transformations

Transformations have taken place in Saudi Arabia despite difficulties, challenges and doubts in administrative and political fields, and more importantly, on the social front. During later eras, kings Khalid, Fahd and Abdullah worked and built in the same manner as their predecessors and they all contributed to social, economic and administrative reforms.

One of the significant achievements of King Fahd was the founding of SABIC, the petrochemical giant. Among King Abdullah’s achievements was making Saudi women part of the Shura Council, in the Allegiance Council and the scholarship program.

Transformations have always taken place in Saudi Arabia; we have witnessed them before the discovery of oil, and during the oil era. We’re now talking about the post-oil era and discussing how to build the Saudi economy on the basis of strategic investments where the Saudi investment fund becomes a non-depleting “natural resource.”

This huge transformation, which falls under the umbrella of a vision for Saudi Arabia, is a significant phase in the country’s history - a phase, which like the ones of the kingdom’s founder and his successors, will also have its own challenges to overcome.

Politics is politics, and it’s only the image of the challenge which differs. We are now before the biggest Saudi challenge.



How Saudi Arabia Is Planning A New Economic Era

By Nathan Hodson

24 April 2016

On April 25, Saudi Arabia is expected to announce a comprehensive economic plan aimed at pivoting the kingdom away from its heavy reliance on oil. The much-touted creation of a $2 trillion sovereign wealth fund will be one pillar of this plan.

Another will be the National Transformation Program, which includes a wide variety of reforms, from tax increases to spending cuts. This strategic reform initiative will build on the multimillion-dollar advice of several prominent consulting firms, a preview of which was given in a December 2015 McKinsey report.

The many challenges facing Saudi Arabia are well known. But if McKinsey’s assumptions and calculations prove correct, then the magnitude of required reform is truly astounding. According to their report, “Even if the government were to freeze the level of public expenditure in nominal terms to contain the deficit and intervene in the labour market to stem rising unemployment by limiting the influx of foreign workers, these reactive changes would be insufficient to maintain current Saudi living standards or sound public finances.”

There can be little doubt that the government is serious about economic transformation. But how far and how quickly they can push reforms are two important questions

In other words, things are challenging. McKinsey’s baseline scenario requires two enormous policy shifts and still won’t save Saudi Arabia from severe economic hardship. Instead, it calls on the kingdom’s leadership to be even more ambitious, focusing their efforts on increasing labour productivity, building a stronger business environment, and managing finances sustainably. What McKinsey has proposed is nothing short of revolutionary. For example, under its full-potential scenario, the consulting firm presumes non-oil government revenue will increase more than ten-fold between 2013 and 2030.

Steps toward Change

Saudi Arabia has already taken a number of steps toward reform. The Saudi Arabian General Investment Authority (SAGIA) has simplified licensing procedures for foreign investors. The government has raised the price of fuel and electricity. And the kingdom has also already begun raising money both domestically and internationally, in the midst of credit downgrades from major rating agencies. Meanwhile, Saudi leadership has also recognized that much more needs to be done, including fiscal consolidation and working to eliminate the budget deficit in the next five years.

However, there is reason to be sceptical about the government’s ability to deliver. As the Economist pointed out, “Saudi Arabia has promised reform before, only for its efforts to fizzle into insignificance. Its capital markets are thin and the capacity of its bureaucracy thinner.” It is much easier to pen a strategic plan than to execute it. Previous plans have often fallen far short of their goals. Productivity growth in Saudi Arabia has been low in recent decades. Even if the government can somehow take immediate concrete steps to make the business environment better functioning and more transparent and can also lop off unproductive government spending, overhauling the education system and reforming the civil service are monumental tasks.

Every piece of the elaborate reform puzzle comes with its own challenges. In order to have a real impact on housing and development, the tax on unused land must be accompanied by the execution of reforms in the mortgage market and on regulations. Meeting proposed deadlines to adopt international accounting standards seems nearly impossible given a shortage of qualified accountants in the kingdom and difficulties ensuring Sharia compliance.

This is to say nothing of domestic political concerns. The government should simultaneously placate the princes, garner the support of the business community, and be careful not to upset or overburden the masses with new taxes, reduced subsidies, and fewer government jobs. There has already been some pushback from consumer groups about water prices. And while targeted cash transfers to low- and middle-income Saudis will help relieve some of the burden, the fact remains that Saudi citizens will still be asked to work harder in jobs that pay less than they are accustomed to.

There can be little doubt that the government is serious about economic transformation. But how far and how quickly they can push reforms are two important questions. It is one thing to call for improvement in government delivery, a breakdown of barriers in the private sector, and improved accountability. It is another thing to deliver on these promises. However, even if Saudi Arabia can pull off only a fraction of the proposed reforms and falls short of its lofty goals, it will be a meaningful start to real economic transformation.



Hurt Saudi Arabia: Iran’s Oil War and Policy Politicization

By Dr. Majid Rafizadeh

25 April 2016

The defiant Islamic Republic of Iran has ignored proposals, from members of the Organization of the Petroleum Exporting Countries (OPEC) as well as other major oil-producing countries, to discuss freezing of oil production in order to boost prices and tackle global oil surplus.

Many argued that Iran would become more cooperative after it re-joined the global financial system. Nevertheless, it remains a delusion to make the argument that Iran will join other heavy-oil suppliers to address low oil prices anytime soon, even though the plunging oil revenues have wreaked havoc on several nations. The uncooperative behaviour of the Iranian leaders highlights several crucial issues economically and geopolitically.

Mixing Economy, Oil Policy And Politics

Iran’s oil policies are not solely driven by economic factors, like other rational state actors, but by geopolitical parameters as well as Tehran’s regional hegemonic and ideological ambitions.

When it comes to shaping and controlling oil policy, two major institutions play crucial roles and have the final say in Iran; the office of the supreme leader, Ali Khamenei, and senior officials of Iran’s Revolutionary Guard Corps. They hold the monopoly and enjoy significant control over Iran’s oil and gas reserves and resources.

First of all, when it comes to Tehran’s oil policy, these main decision-makers do not allow room for manoeuvring or cooperation. Other governmental figures, such as the President or foreign ministers, are either not influential or they follow Khamenei’s policies.

Secondly, Khamenei and the IRGC do not analyze supply, demand, and inventories in the market in order to adjust their oil output and oil prices. From their perspectives, Iran’s military expenditures, its geopolitical and ideological influence in the region, as well as the regional balance of power guide its oil policies.

Iran’s oil policies are not solely driven by economic factors, like other rational state actors, but by geopolitical parameters as well as Tehran’s regional hegemonic and ideological ambitions

As a result, for Khamenei and the IRGC leaders, they consider only if their country’s defiant attitude of increasing oil production will inflict harm on the economic prowess and national interests of Tehran’s regional rivals.

Finally, Iran is not harmed by the current oil prices. Khamenei used to be satisfied with oil at less than $20 a barrel. As long as the oil prices are even at the current low prices, Khamenei and IRGC leaders will be satisfied with the revenues that they are receiving. They are also increasing their output to four million barrels a day. That would increase Iran’s revenue to over 500 percent, in comparison to the time when Iran was under economic sanctions.

Oil And Military

Iran’s foreign policy is increasingly being defined by the vicious cycle of interaction between soft power and hard power. The soft power in this case is the Islamic Republic’s employment of economic and financial prowess to exert its influence the region. The hard power is deploying its military and Qud Forces (branch of IRGC), using proxies for wars, as well as setting up military bases outside Iran for offensive purposes and support of its allies.

As the IRGC military influence and stranglehold is escalating in several countries – including in Syria, Iraq, and Yemen – its need for financial means is increasing. The Islamic Republic is spending billions of dollars every year in order to maintain Bashar al-Assad’s power, preserve its military, security and intelligence influence in the Iraqi government, in Lebanon through Hezbollah, in Yemen via the Houthis, and in Bahrain through some Shiite groups.

Thanks to the nuclear deal, the United Nations Security Council’s sanctions relief has finally provided the senior official of the IRGC and the supreme leader, Ali Khamenei, with the required financial means to buttress its military stranglehold across the region. More importantly, with Iran’s revenue increasing due to its ramping up of oil exports, the country will invest more in its hard power across the region to tip the balance of power of its favour.

For Iran to become cooperative with other OPEC member and major oil producing nations, the oil prices have to significantly drop even below the current rate Or, if the regional countries put pressure on Iran through soft power – such as cutting diplomatic ties with Iran – and if they isolate the Iranian leaders, that could also force the Iranian leaders to recalculate their oil policies since geopolitical issues and oil policies are mixed together for them.

Iran views itself as the leader of the Islamic world (not only the Shiites but also the Sunnis). As a result, being isolated by Muslim nations is as powerful as economic sanctions – when it comes to trying to change Iran’s uncooperative behavior and the shift in its aggressive and interventionist policies.