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Multi-million national green growth plan launched

Multi-million national green growth plan launched

A Multi-million national green growth plan launched today is reported in this article of the Jordan News Agency.

Amman, July 6 (Petra) — Jordan on Monday launched a multi-million ambitious green growth plan as part of a broader national drive towards a green economy and sustainable development.

The six-pronged 2021-2025 National Green Growth Plan, which was announced by Minister of Environment and Agriculture Saleh Kharabsheh, comprises executive plans targeting the key sectors of water, waste management, energy, agriculture, tourism and transport.

In part, the blueprint is intended to help build sustainable sectors that are more resilient and adaptive to adverse phenomena, including climate change and the fallout of emergencies, such as the coronavirus pandemic. It was drawn up in collaboration with the Global Green Growth Institute (GGGI).

Kharabsheh told a teleconference with government representatives and global stakeholders that the plan is designed to ensure alignment between green growth, climate change and sustainable development goals within the sectoral strategic framework.



Marshall Brown, Senior Officer/ Jordan Program at the GGGI, underlined the importance of multi-stakeholder cooperation to translate the plan on the ground, and said that the private sector and international partners have a key role to support this effort.

In the energy sector, the plan envisages the development of a smart electric grid, backing the Jordan Renewable Energy and Energy Efficiency Fund’s bid for the Green Climate Fund’s accreditation and a public-private partnership for the construction of EV charging stations at a total cost of $85 million.

The plan sets $965 million as the total cost of water projects, which include the rollout of a financial mechanism to support water harvesting projects, in addition to carrying out a technical project to rationalize industrial water use. Also in the water sector, the plan envisages the construction of an industrial wastewater treatment plant in Zarqa.

With regard to waste management, the plan includes the establishment of an excellence center for waste management, research and development, a feasibility study for the launch of projects aimed at separating organics from municipal solid waste, and finally a pilot project on the extended producer responsibility in the e-waste sector. The total cost of projects in the waste management sector is put at $248 million.

Turning to agriculture, the plan includes an information management and communication capacity-building project within the green growth framework. It also pursues a resource management project in the production of olive and olive oil. Other key projects in this area includes investing in hydroponics and a national afforestation project. The combined cost of these projects stands at $194 million.

Another key focus of the plan is the transport sector, where the total project cost is envisioned at $167 million. The projects in this domain include the rollout of smart transport systems, the establishment of a transport excellence center and the introduction of environmentally-friendly transport solutions in Irbid, Zarqa and Madaba.

As for tourism, the plan contains a set of ambitious projects, which include the establishment of an excellence center aimed at developing the tourism industry and maximizing ecotourism in protected areas, as well as a project for resource rationalization in the tourism and hospitality sectors for a total cost of $173 million.

//Petra// AA

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MENA countries of today are still divided

MENA countries of today are still divided

With the “Oil for Protection” pact with the United States in 1945 and the contribution of petrodollars, Wahabism took off. It was exposed outside the kingdom, notably to Egypt, Syria, and Iraq. This export was a defence system against the ideological incursions of neighbouring republics states, all friends at the time of the Soviets, and sworn enemies of the Saudi monarchy. The MENA countries of today are still divided along the same lines of governance; those of republics versus monarchies. One thing though ties all the countries is the autocratic reality that underpins all systems. These stem fundamentally from the following.

Wahabism is the school of religious thought initiated by Md Ibn Abdel Wahab in the 18th century, itself derived from the Hanabalite current of thought. This school advocate a return to the religious precepts of the time of the prophet and does not tolerate any other interpretation of the sacred texts other than those disclosed by the first caliphate.

During the Cold War and to counter the Soviets in Afghanistan, the U.S. trained Islamists extremist militants in resistance and guerrilla methods. Saudi bin Laden came to be known as the head of an organization of freedom fighters against the Soviet invasion of Afghanistan. The cold war ended with the Berlin wall collapsing bringing the end of the USSR and thus the withdrawal of the Soviet troops from Afghanistan. From then on, the U.S. was a dominant power in this part of the world with later, a visible presence in the Middle East’s Gulf region. The experts in U.S. geopolitics then discovered a new enemy to manage, that is Iraq and eventually Iran. But many terrorism victim states pointed the index at Saudi Arabia’s Wahabism, denouncing it as the spiritual support and backer of these terrorist organizations.
It is an undeniable fact that the Wahabi Islam has done great harm to the Islamic world as much as to Islam itself.
On the other hand, the cultural vacuum operated by authoritarian socialist regimes in most of the republic states in the MENA region was an ideal breeding ground for the implantation of ideologies imported from the Arabian Peninsula.

It would, on the other hand, be more accurate to talk about shared responsibility between the Arab states and the U.S. rather than to focus it on Arabia alone.
Mohammad Bin Salman (MBS) wants to reform Arabia but with the excellent advice of the U.S. and its ally, Israel. With the terrorist strikes of the nine-eleven 2001, the Americans had apparently decided to tackle the source of the evil, i.e. the Saudi Wahhabism that they had supported themselves before.

Trump and his allies have turned a blind eye to MBS’s notorious behaviour which by opening the country to “emancipatory” Western ideas and certain financial benefits in the medium term, looked like promoting the “right path” of Saudi society first, then of the entire Umma, i.e. the Muslim world community, after that. A programme that is best to start by emancipating women. The woman as guardian of traditions needed to be able to contribute and to do this, the first and most obvious idea: unveil it.
The Saudi woman should live according to the Western model, the American style of preference, libertine, and more spendthrift. From this perspective, the concept of the two-parent family (father, mother, children) that is protective, and guardian of moral values should be banned. It is true that women in these Middle East countries still live under the dictates of an oppressive, repressive, and reductive secular mentality due mainly to pre-Islamic ancestral practices rather than to the religious fact as divine precepts.

Black Lives Matter in the MENA region

Black Lives Matter in the MENA region

Dnyanesh Kamat, Political analyst in Columns on Black Lives Matter across the MENA region states that From Basra to Beirut and from Tunis to Tel Aviv, anti-Black racism exists in various forms across the region. Here it is :

Black Lives Matter: Racism in the Middle East and North Africa — and how to combat it

29 June 2020

While much of the Western world remains convulsed with Black Lives Matter protests, the Mena (Middle East and North Africa) region should use this moment to address its own anti-Black racism problem. From Basra to Beirut and from Tunis to Tel Aviv, anti-Black racism exists in various forms across the region.

In the Mena region, it is mostly the consequence of centuries of slavery, with Black Africans enslaved and sold in slave markets across the Indian Ocean and Arabian Gulf. Indeed, in some parts of the Gulf, slavery was abolished only as recently as the 1970s. This is also why racial insults hurled at Black people in these countries often refer to them as “slaves” or “servants.”

This racist mindset also leads to widespread systemic discrimination against Black people throughout the region. Basra in southern Iraq is home to the majority of the country’s estimated 1.2 million Black population. Black Iraqis have long complained of systemic racism, with limited access to housing, education, healthcare and all but the most menial jobs.

While Black communities in some Mena countries grapple with the legacy of slavery, others still face modern-day slavery or conditions akin to it. Mauritania is one of the last countries on the planet where slavery continues to this day. The Global Slavery Index of 2018 estimates there are approximately 90,000 Black Mauritanians, or roughly 2.4 per cent of the population, bound to a caste system that is a form of modern-day slavery, with their enslavement inherited from ancestors and passed down to their children. Slavery was abolished in 1981 but it was not until 2007 that it was made a crime, and that too in response to international pressure, with successive governments failing to eradicate the scourge.

A similar caste-like Black community exists at the margins of society in Yemen. They call themselves the Muhamasheen (“the marginalized”), but other Yemenis refer to them pejoratively as the Akhdam (“the servants”). Many survive by begging. Needless to say, this community has borne the brunt of Yemen’s ongoing civil war.

While countries like Mauritania and Yemen grapple with centuries-old practices, others have seen slavery rear its ugly head in modern times. Black Africans have long used Libya’s long Mediterranean coast as a staging post from which to attempt to reach Europe. Several migrants have been enslaved and tortured by Libyan militias, and subsequently sold in open-air slave markets.

Popular culture in the Mena region is also rife with anti-Black racism, from caricatures of Black people used for comedy to erasing them completely from depictions of national culture. The national media in countries like Tunisia portray the country’s citizens as light-skinned. It might come as a shock that 15 per cent of Tunisians are black.

Iran has a sizeable Black population living along the country’s southern coast. Their contribution to the culture of that region – whether in terms of cuisine, spirituality or to the unique bandari music – is immense. But Iranian popular culture would have us believe the country is populated only by fair-skinned Persians. This comes largely from the “Aryan myth” of Iranian nationalism. Depictions of Black people are limited to stereotypes or pale-skinned people in “blackface” – theatrical make-up used to portray racist caricatures of Black people. Indeed, early Iranian theatre often featured a type of comedy performance known as Siah Baazi, a term meaning “playing black.”

In the Arab world, more recently, several Arabic-language networks have come in for criticism for their racist depiction of Black people in hidden camera-practical joke reality television shows.

Almost a year ago, protesters marched through cities in Israel calling for an end to anti-Black police brutality and discrimination in housing, healthcare and education. One of the most horrifying examples of anti-Black racism in Israel occurred in 2016 when the government admitted to having given Ethiopian-Israeli women long-term contraceptives without their consent. The community’s birth rate has halved over the past decade.

Perhaps the most egregious form of institutionalized racism in the Mena region is the kafala system of hiring migrant workers in Lebanon and parts of the Gulf, which has been described as a modern-day form of slavery. The kafala system, which is not covered by regular labour laws in Lebanon, gives employers total control over the legal residency of “their” workers. Every so often, horrific kafala-related stories emerge of migrant workers, most of them African, being made to work long hours without pay, tortured, sexually abused and even murdered, with little or no recourse to the law for help. Racism also pervades the tourism and hospitality sector in Lebanon and parts of the Gulf, with African and South Asian tourists complaining of being denied entry to trendy bars and clubs.

If there is to be any impetus for change in the Mena region, it is likely to come from civil society. For example, recent protests against Lebanon’s corrupt political class were led by the youth of the country and included calls to abolish kafala. In 2018, Tunisia became the first Mena country to pass a wide-ranging anti-racism law.

But much more needs to be done. Mena countries need to rethink their concept of nationalism, redefine the meaning of citizenship and re-negotiate the social contract between citizen and state. If there is to be any hope of dismantling racism and every vestige of slavery in the region, those are fundamental imperatives. Let the Black Lives Matter movement be the catalyst.

In arrangement with Syndication Bureau

Qatar Now Ranked 2nd in MENA Region for . . .

Qatar Now Ranked 2nd in MENA Region for . . .

CROWDFUNDINSIDER By Omar Faridi reported that Qatar Now Ranked 2nd in MENA Region for . . . Early-Stage Entrepreneurial Activity as Fintech Sector Expected to Grow Rapidly as the MENA Region Is Poised To Be The Next Fintech Hub.

June 26, 2020

Qatar Now Ranked 2nd in MENA Region for . . .

Randy Rivera, Executive Director of FinTEx, a member-led community focused on promoting innovation and collaboration within Fintech in Qatar and the MENA region, has said that his organization continues to work with international financial services industry participants.

During a June 23, 2020 virtual panel discussion (hosted by the US-Qatar Business Council) on “Qatar’s Growing Fintech Sector & Business Opportunities,” Rivera stated:

“We [aim to] … match talent with opportunity and what is going on in Qatar fits as an attractive platform not just for the Fintechs involved but for the Qatari market and the Middle East overall.”

He added:

“The design of these programs reflects thoughtfulness, broad participation and commitment of the right mix of leaders who can affect change and attract the talent to make that change uniquely impactful, not just to the market, but to the regional fintech community as well.”

Qatar is now a major financial hub in the Middle East. The country’s human development index (HDI) value is around 0.85, which puts it in the “very high” human development (and quality of life) category.

Qatar is ranked at 41 out of 189 countries and territories. Its HDI value has increased from around 0.75 to 0.85 in the past two decades – which indicates that the living standards of its residents may have improved significantly due to its booming economy.

As mentioned in a release shared with CI, Qatar aims to further support and develop a strong business community and a competitive environment that will help local SMEs while also attracting foreign SMEs.

The release revealed:

“Qatar has advanced 18 spots in the national level of entrepreneurial activity, securing the 15th rank globally and the 2nd in the MENA region for the Total Early-Stage Entrepreneurial Activity (TEA) index, according to the Global Entrepreneurship Monitor (GEM) Report 2019/2020.”

Amy Nauiokas, founder and CEO at Anthemis, a VC investment platform with over 100 portfolio firms, believes Qatar provides “a promising environment and set of opportunities for Fintech growth.”

Nauiokas, whose company supports an ecosystem of over 10,000 investors, incumbents, and high-potential Fintech firms, globally, stated:

“We look forward to solidifying some key relationships in Qatar as Anthemis further builds our MENA strategy.”

Mohammed Barakat, MD of US Qatar Business Council, who also attended the webinar, said:

“Considering Qatar’s large payment processing and remittance market and its strategy to become a regional gateway for a huge market, I foresee rapid growth in Qatar’s FinTech sector.”

The US-Qatar Business Council aims to support trade and investment between the two nations and to also build strategic business relationships.

As noted in the release, there are over 120 wholly-owned US firms operating in Qatar, and over 700 U.S.-Qatar joint projects currently active in the Middle Eastern nation.

As reported recently, the Qatar Financial Center will launch “Fintech Circle,” a co-workspace for qualifying financial technology firms free of charge for a year.

The Middle East’s coronavirus crisis threatens the environment too

The Middle East’s coronavirus crisis threatens the environment too

Arab News tells us How Middle East’s coronavirus crisis threatens the environment too. Let us see what all is this about. How different is it to North Africa, say to Libya?

  • The importance of hygiene has led to an exponential increase in use of disposable plastic products
  • COVID-19 may have set the world back on a slippery slope with regard to overuse of plastic products

DUBAI: The COVID-19 pandemic has set the world back on the slippery slope of plastic overuse, just when it seemed as if plastic reduction was becoming an achievable goal, experts fear.

The priority of hygiene to combat the spread of the virus has led to a sharp increase in the consumption of disposable plastic products — gloves, single-use water bottles, cutlery, packaging and medical supplies — across the world.

In some Gulf cities, many dine-in customers are being served up to three plastic plates, cups and sets of cutlery for a single three-course meal.

The Middle East’s coronavirus crisis threatens the environment too
https://docs.google.com/gview?url=https://www.arabnews.com/sites/default/files/userimages/1036116/15062020_covid_gulf.pdf&embedded=true

“It’s a disaster,” said Tatiana Antonelli Abella, founder and managing director of the UAE-based green social enterprise Goumbook. “The pandemic has undoubtedly impacted every aspect of our lives, from work to school and our daily tasks.

“It is unfortunate that sustainable practices that have taken a lot of work to implement have now been replaced, due to sanitization (requirements), by the use of single-use plastic bottles, cutlery and crockery in restaurants and delivery services.”

Last year, some communities across the UAE banned plastic use in restaurants, while supermarkets planned to charge customers for their plastic bags. Almost overnight, the initiative has taken a back seat.

In this photo taken on May 13, 2020, Gary Stokes, founder of the environmental group Oceans Asia, poses with discarded face masks he found on a beach in the residential area of Discovery Bay on the outlying Lantau island in Hong Kong. (AFP/File Photo)

“It is a contentious matter, as many would argue against any evidence that using reusables, if sanitized correctly, could in any way be dangerous,” Abella told Arab News.

“Dish-washing machines, high temperatures and dish soap have always been 100 percent efficient (as sanitizers) and always will be. And most of the plastic used is also not fully recyclable.

“Unfortunately, if plastic is not properly washed and cleaned, it is considered contaminated and will end up as general waste in landfills.”

Other sustainability experts concur. “If restaurants clean their tableware and cutlery with hot water and detergent after every use, there is no need for single-use items,” said Amruta Kshemkalyani, a UAE-based sustainability adviser and founder of Sustainability Tribe.

The Middle East’s coronavirus crisis threatens the environment too

Women wearing masks for protection against the coronavirus, sit at a restaurant in the Mall of Dubai on April 28, 2020, after the shopping centre was reopened. (AFP/File Photo)

“Restaurants just need to pay extra attention to their tableware cleaning process. COVID-19 shouldn’t be used as an excuse to create unnecessary waste and harm the environment.”

Peter Avram, director of the Dubai-based Avani Middle East, which produces disposable packaging solutions and compostable plastic alternatives, said there had been a surge in the use of disposables during the current pandemic.

“Regrettably, due to the current economic situation, plastic is being preferred to the eco-friendly options simply because of costs,” he said. “Eco-friendly disposables are 20 to 30 percent more expensive.”

The UAE consumes an average of 450 plastic bottles of water per person per year – or more than four billion bottles annually.

“It hurts to see so many years of hard work from environmental organizations going ‘to waste’,” Abella said. “The relaxation on the [consumption of] single-use plastics, even if temporary, could quite likely have long-term consequences on consumer behavior.”

When Kshemkalyani started a zero-waste lifestyle in 2015, almost no restaurants and cafes in Dubai were aware of the concept of serving food and drinks in reusable containers.

The environmental cause is expected to return to the foreground when the crisis passes.

 Peter Avram, Director of Avani Middle East

Since then, the #zerowasteUAE social initiative and Sustainability Tribe have made tireless efforts to bring awareness to the community on waste issues.

“Now, in the name of hygiene and convenience, if the disposable culture gets popular again, it will be a big hurdle in society’s progress towards sustainable habits,” she said, especially when there is no evidence that a switch to single-use items is imperative during COVID-19.

The Middle East’s coronavirus crisis threatens the environment too

Emiratis wearing masks for protection against the coronavirus, buy coffee at a shop in the Mall of Dubai on April 28, 2020, after the shopping centre was reopened. (AFP/File Photo)

Kshemkalyani questioned whether restaurants are recycling their plastic waste or just dumping it. “We do not want more waste in landfills that will further contaminate and pollute our land, water and air,” she said.

“Restaurants can start using their reusable serving sets and intensify the right cleaning and hygiene procedures. Instead of spending on single-use items, they have an opportunity to keep their manpower and use it wisely for intensified cleaning – this would also help employment.”

Kshemkalyani also recommended that restaurants allow customers to bring their own plates, cutlery and glasses. “Restaurants can also use environmentally friendly disposables, like palm leaf and wood [cutlery], as a temporary measure,” she said.

According to Abella, “It is important to keep the conversation going to use your consumer power to campaign for these changes.”

The Middle East’s coronavirus crisis threatens the environment too

Garbage litters the shore of Zouk Mikael, north of the Lebanese capital Beirut, on January 22, 2018. (AFP/File Photo)

Although some outlets are seeking to offer alternatives, consumers should also vote with their wallets and ask restaurants to use sustainable alternatives, she said.

She said: “We should try to cook more at home and, if need be, choose restaurants that make an effort to serve their food in eco-friendly packaging.”

She pointed to the trend of people ordering more items than usual during the lockdown, with many of the items delivered in plastic containers, “wrapped in plastic and bagged in more plastic.”

Avram said that sustainability and recycling efforts must continue, pointing to the uptick in home composting procedures that many residents have begun to undertake to dispose of eco-friendly takeaway items.

The Middle East’s coronavirus crisis threatens the environment too

A man wearing a protective mask, as a precaution against COVID-19 coronavirus disease, walks outside an empty cafe along Tahlia street in the centre of the capital Riyadh on March 15, 2020. (AFP/File Photo)

“That has been very encouraging,” he said. “It is expected that the environmental cause will return to the foreground when the crisis has passed.”

Shams Hasan, air quality and corporate environmental responsibility expert at Envipro Consulting in the US, told Arab News: “The COVID-19 pandemic has created strange problems. Plastic items that were being phased out are at least temporarily back in use. The … fear is that during any crisis, society will start looking at an easy way out and apply ‘band-aid’ solutions instead of working on long-term strategies and solutions.”

Kristin Hughes, director of Global Plastic Action Partnership and a member of the executive committee, World Economic Forum, pointed to the challenge facing the world.

“We stand at the junction of two diverging paths,” she said. “One is a stop-gap solution that puts us solidly on track toward a not-so-distant future in which there is more plastic in the ocean than fish. The other is a sustainable model of living and working that will benefit us long into the future – one that will create a healthier, more equitable and more livable future for all.”

The Middle East’s Threat Multiplier

The Middle East’s Threat Multiplier

Authors Olivia Macharis is a researcher at the Issam Fares Institute for Public Policy and International Affairs at the American University of Beirut and Nadim Farajalla is Program Director of the Climate Change and Environment Program at the Issam Fares Institute for Public Policy and International Affairs at the American University of Beirut. They came up with this realistic picture of the Middle East’s Threat Multiplier. It is published on Project Syndicate of 12 June 2020.


The picture above is that of An Egyptian boy holding bread and flashing the victory sign shouts slogans at Cairo’s Tahrir Square on April 1, 2011 as he joins tens of thousands of Egyptians who gathered, issuing calls to “save the revolution” that ousted president Hosni Mubarak and to rid of the country of the old regime. AFP PHOTO/STR (Photo credit should read -/AFP/GettyImages)


Although many factors contributed to the mass protest movements in Iraq in recent years, and in Egypt a decade ago, climate change was the common denominator. By exacerbating endemic problems such as water scarcity and food insecurity, global warming threatens to plunge an already unstable region into the abyss.n Egyptian boy holding bread and flashing the victory sign shouts slogans at Cairo’s Tahrir Square on April 1, 2011 as he joins tens of thousands of Egyptians who gathered, issuing calls to “save the revolution” that ousted president Hosni Mubarak and to rid of the country of the old regime. AFP PHOTO/STR (Photo credit should read -/AFP/GettyImages)
Survey the Middle East and North Africa (MENA), and you will find no shortage of crises, from escalating tensions between the United States and Iran to the cycles of violence in Libya, Syria, Yemen, and elsewhere. Countless young people across the region feel a sense of despair as they confront the daily realities of poor governance, economic immobility, and sectarian violence. Now, the COVID-19 crisis is putting increasing and unprecedented pressure on the global economy, state institutions, and livelihoods. It has also highlighted the dire consequences of health, social, and economic inequality. And as bad as these problems are on their own, all will be exacerbated and magnified by an even larger crisis: the devastating impacts of climate change.
With its largely arid conditions, the MENA region is particularly vulnerable to the physical impacts of climate change. It is one of the world’s most water-scarce regions, with a high dependency on climate-sensitive agriculture. Along with rising temperatures, the region is already experiencing a wide range of deteriorating environmental conditions, including decreased rainfall in Iraq, longer droughts in Syria, more severe flash flooding in Jordan and Lebanon, increasingly intense cyclones in Yemen and Oman, and rising sea levels. There is also evidence of rapid desertification regionwide, as well as unprecedented heat waves and increasingly frequent and intense dust storms.
Looking ahead, researchers warn that summer temperatures in the region will increase twice as fast as average global temperatures. This will lead to increased evaporation rates and accelerated loss of surface water, which will reduce the productive capacity of soils and agricultural output. Projections by the Intergovernmental Panel on Climate Change also warn of rising sea levels and an increase in the frequency and intensity of extreme weather events. In large parts of the region, the combination of worsening heat waves and increasing air pollution owing to sand and dust storms will likely compromise human habitability and force people to migrate.
Climate change not only has serious implications for the environment and public health, but also for economic growth, livelihoods, and peace. Climate-induced impacts have the potential to reinforce factors that lead to or exacerbate conflict and instability. For one, resource scarcity may undermine the livelihoods of vulnerable households and communities, potentially leading to increasing competition, which may turn violent in the absence of conflict resolution institutions. Most vulnerable are fragile states and communities with a history of violence. In Iraq and Syria, the occurrence of devastating droughts between 2007 and 2012, combined with governments’ inability to provide relief to vulnerable populations, favored radicalization and recruitment efforts by jihadist militias, including the Islamic State.
Other risks of conflict arise when growing resource scarcity is met with inadequate government action, which may cause grievances among the population and increase tensions along ethnic, sectarian, political, and socioeconomic lines. Water scarcity and contamination have already triggered recurrent protests in Iraq, and rising food prices have fueled protest movements in Egypt and other countries. The region desperately needs to start developing and implementing more robust adaptation strategies before it is too late.
UNPREPARED FOR THE WORST
Most countries in the region are woefully behind when it comes to preparing for the physical effects of climate change on the environment and for the socioeconomic effects on much of the population. Many governments are unable or unwilling to tackle issues related to poverty, slow and unequal economic growth, high unemployment, lack of basic services, and widespread corruption.
Instead, the region’s governments have long relied on what political scientists call the “authoritarian bargain,” an implicit contract in which the state provides jobs, security, and services in exchange for political loyalty (or at least obeisance). This contract assumes that the population will remain politically inactive. But protest movements over the last decade, from the Arab Spring to more recent demonstrations in Algeria, Iraq, Lebanon, Jordan, and other countries, have shown that people across the region want to renegotiate.
In many countries, the protests are the result of worsening economic and political conditions, many of which stem from strained government resources that have led to a decline in the provision of public services. With climate change projected to put additional pressure on water and food security, livelihoods, health, and overall living standards, public discontent is likely to keep growing in the coming years, resulting in a heightened risk of political instability and conflict.
The linkages between climate change, resource scarcity, and social unrest are of course complex. Examining two cases – one dealing with water scarcity and contamination, the other with rising food prices – can help shed urgently needed light on these dangerous dynamics.
WATER POLITICS IN IRAQ
A good place to start is by considering Iraq’s water resources, which have been under increasing stress for more than three decades. As a result of both natural and anthropogenic causes, water quantities have decreased and water quality has deteriorated. The natural phenomena include increasing climate variability and lower annual precipitation, resulting in a lack of snowfall in the headwaters of the Tigris and Euphrates. The anthropogenic causes center around increasing water demand, inadequate government policies, and dam-building by upstream neighbors Syria, Turkey, and Iran.
The Tigris and Euphrates are Iraq’s most important sources of freshwater. These twin rivers converge in al-Qurna, in the southern Basra governorate, to form the Shatt al-Arab River and drain toward the Gulf (see map). Both rivers originate in Turkey, with the Euphrates cutting through Syria before reaching Iraq. Several of the rivers’ tributaries originate in Iran, with the Greater Zab, the Lesser Zab, and the Diyala flowing into the Tigris. In total, more than 50% of the country’s renewable water resources originate outside of its borders.

Of particular concern to Iraq is Turkey’s controversial Southeastern Anatolia Project (GAP), which is located at the Euphrates-Tigris Basin in the upper-Mesopotamian plains. At an estimated cost of $32 billion, the GAP is one of the world’s largest river-basin development projects. Other serious concerns include Iranian dam-building activity and an expected increase in Syrian water usage. Regional cooperation to improve water management is limited, and political negotiations have so far fallen short of concluding a legally binding, comprehensive, and long-term agreement.
On the domestic front, while rapid population growth, urbanization, and increasing industrial production have driven up water demand, decades of conflict and sanctions, along with inadequate government policies and the lack of a regulatory framework for sustainable water management, have undermined investment in supply. The main challenges include chronic deterioration of infrastructure, inefficient irrigation and drainage, lack of water treatment facilities, and weak regulation of agricultural runoff and discharges of sewage, industrial waste, and oil byproducts. In addition, the continuous decline in the water levels of the Shatt al-Arab has led to severe saltwater encroachment from the Gulf into the river.
DISASTER AREA
Basra, a port city with direct access to the Persian Gulf, was once glorified as the “Venice of the East” for its myriad of freshwater canals lined with palm trees. The surrounding governorate accounts for most of Iraq’s oil production, with nearby West Qurna considered to be one of the world’s most lucrative oilfields. But these strategic assets have not benefited the public, because government mismanagement and negligence have turned Basra into a decrepit and dysfunctional city, plagued by strained utilities and broken infrastructure. Its waterways have become open sewers that are poisoning the population.
In the summer of 2018, Basra became the epicenter of an environmental and socioeconomic disaster that threatened the stability of the entire region. In July, Iraqis took to the streets to demand basic services such as clean drinking water, electricity, jobs, and an end to pervasive corruption. Then, in August, an outbreak of gastrointestinal illnesses, most likely caused by water contamination, sent tens of thousands of people seeking medical assistance in increasingly overwhelmed hospitals. Later that month, the UN-affiliated Independent High Commission for Human Rights called on the Iraqi government to declare Basra a “disaster area.”
The water supply problems fueled further public outrage. Street protests resumed and gradually intensified. By September 2018, the protests had turned violent, with deadly clashes between protesters and security forces. Demonstrators burned government and political party offices and attacked the headquarters of the popular mobilization forces and the Iranian consulate, voicing anger over the growing influence of Iran-backed militias in the city. By early October, 18 civilians had been killed, and another 155 had been injured.
While a wide range of long-neglected issues fueled the protests, water scarcity was cited as the most immediate cause or trigger. According to one civil servant quoted in The Independent, “The water shortages have made all the other problems gather and explode. It’s so extreme because it’s water, it’s essential for life.” Concerns remained that the health of the Iraqi people would continue to be affected unless the water situation improved drastically and quickly. Despite efforts to contain the outbreak of waterborne diseases and despite promises by the government to improve water infrastructure, it did not.
In October 2019, the unrest spread to Baghdad, where protesters demanded economic reform, an end to corruption, and the provision of basic services, including clean water and electricity. A brutal crackdown by security forces resulted in more than 100 deaths in the first five days. Still, the demonstrations gained momentum, with protesters going so far as to call for an overhaul of the entire sectarian political system. According to the UN’s special envoy to Iraq, more than 400 people were killed, and another 19,000 were injured, just between October 1 and December 3 last year.
EGYPT’S TROUBLED WATERS
Likewise, climate change and politics have become inextricably intertwined in Egypt, where agricultural production and food security are threatened by acute water scarcity and other climate-related challenges. Egypt is also heavily reliant on food imports, which makes it all the more vulnerable to the impact of adverse weather events on global output and prices.
Similar to the situation in Iraq, increasing water stress in Egypt reflects not only climate change, but also rapid population growth and resource mismanagement. The government bears a significant part of the responsibility, as a lack of treatment facilities, poor infrastructure maintenance, and weak regulations against dumping domestic, agricultural, and industrial effluent have all created water scarcities.
Egypt’s water dependency ratio is one of the world’s highest, with the Nile River providing more than 95% of its total supply. Approximately 86% of the Nile’s total volume comes from the Ethiopian Highlands, flowing through Sudan before reaching Egypt (see map). As a result, water allocation has long been a source of political tension among Egypt, Ethiopia, and Sudan.
The biggest challenge to Egypt’s water supply currently comes from the Grand Ethiopian Renaissance Dam project. At an estimated cost of $4.8 billion, the dam’s construction is a crucial step toward energy security for Ethiopia. For Egypt, however, the project poses a significant threat to its water supply, especially with Ethiopia becoming the dominant power in the Nile River Basin.

Egypt’s economy is highly dependent on agriculture, which itself is almost entirely dependent on irrigation, accounting for over 85% of the country’s total water usage. Egypt’s food production is thus severely restricted by rising temperatures and more frequent droughts, which translate into higher water demand and lower agricultural yields.
Worse, climate models show that Egypt’s national food production could decline by anywhere from 11% to 50% by 2050, depending on the level of warming. Moreover, the Nile Delta, Egypt’s breadbasket, is subsiding and extremely vulnerable to sea-level rise. Higher sea levels are expected to affect around 30% of fertile land in the Nile Delta within this century.
With tightening resource constraints and a growing population, Egypt’s dependence on imported food is growing, as is its vulnerability to supply and price risks on the global market. The Egyptian population was hit particularly hard by the global food crisis of 2006-08, which came at a time when the country’s domestic production was weakened by severe water scarcity and debilitating agricultural reforms.
BREAD, FREEDOM, AND SOCIAL JUSTICE
As world commodity prices rose in 2007, Egypt’s government was unable to contain domestic food price inflation, owing to increasing resource scarcity, a corrupt and unsustainable food-subsidy system, and other structural problems. The annual rate of growth in food prices soared from 6.9% in December 2007 to a peak of 31% in August 2008, compared to an average of only 4% in the early 2000s. Rising food prices eroded the purchasing power of the population, causing poverty and food insecurity to rise. Between 2005 and 2008, the incidence of extreme poverty – defined as the inability to meet basic food needs – increased by about 20%, and a growing share of the population became dependent on government-subsidized bread.
When the government struggled to meet demand, bread shortages became the focus of a wave of anger at perceived official incompetence, indifference, and corruption. On April 6, 2008, in response to low wages and rising food prices, Egyptian textile workers in the northern town of Mahalla al-Kubra organized a strike. Residents took to the streets, participating in the biggest demonstration that Egypt had seen in years. Police responded with live ammunition to disperse the crowds and arrested more than 300 people. The strike spread to other cities, including Cairo, albeit not with the same intensity. According to news reports, the demonstrators’ complaints were mainly economic: higher food prices, stagnant wages, and “unprecedented” inequality. Many view the Mahalla protests as a precursor to the Arab Spring less than three years later.
Then, in 2010, fires in Russia and floods in Pakistan disrupted global wheat and rice markets, and the prices of basic foods in Egypt rose again (see graph). By the end of the year, Egyptians had been pushed to the brink by the sharp increases in food prices, escalating unemployment, chronic government corruption, rigged parliamentary elections, lack of political freedoms, growing concern about police brutality, and crackdowns on the media and universities. Resentment toward Egyptian President Hosni Mubarak’s 30-year-old regime was growing. Social media had raised awareness of state repression and the fall of Tunisian President Zine El Abidine Ben Ali on January 14, 2011, gave Egyptians hope that political change was possible.

Two weeks later, thousands of protesters poured into Cairo’s Tahrir Square, demanding dignity, democracy, and better livelihoods for all. One of the popular chants called for “bread, freedom, and social justice” (“aīsh, huriyya, adala igtima‘iyya”). As the call for “aīsh” indicates, the accessibility and affordability of food was part of the population’s key grievances against the government. And although rising food prices were not the main factor behind the uprising, they likely played an important role in the sequence of events that led to nation-wide demonstrations and deadly unrest. Protest movements were met with extreme police violence and the excessive use of force by the military. Reported deaths in January and February amounted to 846 persons, in addition to mass arbitrary arrests and many cases of abuse and torture.
THREATS, MULTIPLIED
Resource scarcity and the lack of basic services are feeding public frustration, social unrest, and broader instability throughout the MENA region. In Iraq, water scarcity and contamination have given rise to recurrent demonstrations in Basra, and also contributed to the protest movement that started in Baghdad in October 2019. In Egypt, steep increases in domestic food prices led to riots and sporadic protests in 2008 and contributed to the uprising in 2011.
Basic services such as running water, sanitation, stormwater drainage, solid-waste management, electricity, and access to staple foods, but also – as highlighted by the COVID-19 pandemic – basic health care, social protection, and emergency response mechanisms, are the pillars on which governments build relationships with their citizens. The collapse of one or more severely erodes public trust and can lead to social upheavals, as demonstrated again by the recent uprisings in Lebanon, Jordan, Sudan, and other countries.
At the heart of the water and food scarcities in Egypt, Iraq, and other countries lie poor governance, weak regulation, and a lack of cross-border cooperation. But looming large in the background is a changing climate, which has exacerbated these problems. As the ultimate threat multiplier in a region that is extremely vulnerable to its effects, it must not be overlooked.
Given the risks, it is crucial that governments in the MENA region make adaptation efforts a top priority. If anything, the COVID-19 pandemic has underscored this need. Countries with preset plans have contained the spread of the coronavirus and managed its consequences much better than those with no plans. Likewise, confronting climate change requires developing comprehensive national and regional strategies that take into account the projected effects on water resources, agriculture, and human health. It is up to MENA governments to start building more resilience. The climate will not wait for them.

a

The Expats are leaving Dubai

The Expats are leaving Dubai

Business Maverick tells us the Expats are leaving Dubai and that’s bad news for the economy

By Bloomberg
It’s a choice facing millions of foreigners across the Gulf as the fallout from the pandemic and a plunge in energy prices forces economic adjustments.

“Dubai is home for me,” said Sissons, who owned a small cafe and worked as a freelance human resources consultant. But “it’s expensive here and there’s no safety for expats. If I take the same money to Australia and we run out of everything, at least we’ll have medical insurance and free schooling.”It’s a choice facing millions of foreigners across the Gulf as the fallout from the pandemic and a plunge in energy prices forces economic adjustments. Wealthy Gulf Arab monarchies have, for decades, depended on foreign workers to transform sleepy villages into cosmopolitan cities. Many grew up or raised families here, but with no formal route to citizenship or permanent residency and no benefits to bridge the hard times, it’s a precarious existence.

The Expats are leaving Dubai
A letting sign sits on display outside a commercial property available to let in Dubai on June 8. Photographer: Christopher Pike/Bloomberg

The impact is starkest in Dubai, whose economic model is built on the presence of foreign residents who comprise about 90% of the population.

Oxford Economics estimates the United Arab Emirates, of which Dubai is a part, could lose 900,000 jobs — eye-watering for a country of 9.6 million — and see 10% of its residents uproot. Newspapers are filled with reports of Indian, Pakistani and Afghan blue-collar workers leaving on repatriation flights, but it’s the loss of higher earners that will have painful knock-on effects on an emirate geared toward continuous growth.

“An exodus of middle-class residents could create a death spiral for the economy,” said Ryan Bohl, a Middle East analyst at Stratfor. “Sectors that relied on those professionals and their families such as restaurants, luxury goods, schools and clinics will all suffer as people leave. Without government support, those services could then lay off people who would then leave the country and create more waves of exodus.”

With the global economy in turmoil, the decision to leave isn’t straightforward. Dubai residents who can scrape by will likely stay rather than compete with the newly unemployed back home. The International Labor Organization says more than 1 billion workers globally are at high risk of pay cuts or job losses because of the coronavirus.

Some Gulf leaders, like Kuwait’s prime minister, are encouraging foreigners to leave as they fret about providing new jobs for locals. But the calculation for Dubai, whose economy depends on its role as a global trade, tourism and business hub, is different.

The crisis will likely accelerate the UAE’s efforts to allow residents to remain permanently, balanced against the status of citizens accustomed to receiving extensive benefits since the discovery of oil. For now, the UAE is granting automatic extensions to people with expiring residence permits and has suspended work-permit fees and some fines. It’s encouraging local recruitment from the pool of recently unemployed and has pushed banks to provide interest-free loans and repayment breaks to struggling families and businesses.

A Dubai government spokesperson said authorities were studying more help for the private sector: “Dubai is considered home to many individuals and will always strive to do the necessary to welcome them back.”

Expat Exodus to Hit Spending in Mideast's Consumer And Business Hub
Residents spend time on the beach at the Jumeirah Beach district on June 8. Photographer: Christopher Pike/Bloomberg

Dubai’s main challenge is affordability. The city that built its reputation as a free-wheeling tax haven has become an increasingly costly base for businesses and residents. In 2013, Dubai ranked as the 90th most expensive place for expatriates, according to New York-based consultant Mercer. It’s now 23rd, making it the priciest city in the Middle East, though it slipped from 21st place in 2019 as rents declined due to oversupply.

Education is emerging as a deciding factor for families, especially as more employers phase out packages that cover tuition. Though there’s now a wider choice of schools at different price points, Dubai had the region’s highest median school cost last year at $11,402, according to the International Schools Database.

That will likely lead parents to switch to cheaper schools and prompt cuts in fees, according to Mahdi Mattar, managing partner at MMK Capital, an advisory firm to private equity funds and Dubai school investors. He estimates enrollments may drop 10%-15%.

Sarah Azba, a teacher, lost her job when social distancing measures forced schools online. That deprived her of an important benefit; a free education for her son. So she and the children are returning to the U.S., where her 14-year-old son will go to public school and her daughter to college. Her husband will stay and move to a smaller, cheaper home.“Separating our family wasn’t an easy decision but we had to make this compromise,” Azba said.

Expat Exodus to Hit Spending in Mideast's Consumer And Business Hub
A cyclist rides past a commercial property advertised for rental in the Jumeirah district. Photographer: Christopher Pike/Bloomberg

For decades, Dubai has thought big, building some of the world’s most expansive malls and tallest buildings. From the desert sprang neighborhoods lined with villas designed for expat families lured by sun and turbo-boosted, tax-free salaries. New entertainment strips popped up and world-class chefs catered to an international crowd. But the stress was building long before 2020. Malls were busy but shoppers weren’t spending as much. Residential properties were being built but there were fewer buyers. New restaurants seemed to cannibalize business from old.

The economy never returned to the frenetic pace it enjoyed before the 2008 global credit crunch prompted the last bout of expatriate departures. Then, just as it turned a corner, the 2014 plunge in oil prices set growth back again. The Expo 2020, a six-month exhibition expected to attract 25 million visitors, was supposed to be a reset; it’s now been delayed due to Covid-19.

Weak demand means recovery will take time. Unlike some Middle Eastern countries, the UAE isn’t seeing a resurgence in Covid-19 infections as it reopens, but its reliance on international flows of people and goods means it’s vulnerable to global disruptions.

Emirates Group, the world’s largest long-haul carrier, is laying off employees as it weighs slashing some 30,000 jobs, one of the deepest culls in an industry that was forced into near-hibernation. Dubai hotels will likely cut 30% of staff. Developers of Dubai’s man-made islands and tallest tower have reduced pay. Uber’s Middle East ride-hailing unit Careem eliminated nearly a third of jobs in May but said this week business was recovering.

Dubai-based Move it Cargo and Packaging said it’s receiving around seven calls a day from residents wanting to ship their belongings abroad. That compares with two or three a week this time last year. Back then, the same number of people were moving in too. Now, it’s all outward bound.

Marc Halabi, 42, spent the past week reluctantly sorting belongings accumulated over 11 years in Dubai. Boxes line the rooms as he, his wife and two daughters decide what to ship back to Canada. An advertising executive, Halabi lost his job in March. He’s been looking for work that would allow the family to remain but says he can’t afford to hold out any longer.

“I’m upset we’re leaving,” Halabi said. “Dubai feels like home and has given me many opportunities, but when you fall on hard times, there isn’t much help and all you’re left with is a month or two to pick up and move.”

Read more in related :

The Expat Life Is Struggling to Survive Covid-19

MENA’s trade performance, and its projected growth

MENA’s trade performance, and its projected growth

Rebecca HardingCEO of Coriolis Technologies, invitee of Trade Briefing, discusses MENA‘s trade performance, its projected growth and key political risks for 2020.


Note on the impact of Covid-19: 

This report was compiled before the Covid-19 pandemic and therefore refers to patterns and trends based on data that was current at the time of writing in February 2020. The full impact of Covid-19 on trade is unknown, but the World Trade Organization estimates that trade will fall by anything between 13% and 32% globally during 2020. Alongside this, and ahead of any impact on trade, the Mena region was already being affected by the collapse in global oil prices, which happened in March and, again, was not factored into this report. However, the points in the report remain valid: that the region’s dependency on oil will have an impact on its trade and economic performance, greater in net oil exporting countries than in net oil importers.

There are other general concerns amongst trade finance professionals around the role of the trade credit insurance sector, which is now heavily exposed to the sharp downturn in global trade. Inventories are collapsing as just-in-time distribution models struggle to cope with restrictions on the physical movement of goods. This is affecting invoice payments and, while it is too early to say exactly how this will affect the recovery from the current crisis, it is undoubtedly the case that many businesses in supply chains worldwide will not survive. As a result, the role of government agencies at present is vital in supporting exporters. In addition to fiscal support, countries will also need clear and robust strategies to rebuild economically once lockdowns are lifted.

GTR: 2019 was a sluggish year for trade. How was MENA affected by this general climate of uncertainty?

Harding: Mena has had a tough few years and last year was not really any different. The combined effects of the trade war between the US and China, the UK’s exit from the EU and enduring intra-regional tensions, particularly between the US and Iran, made 2019 a poor year for trade.

This follows five years of sluggish growth. A weak or volatile oil price over the period since 2013 to the end of 2018, which is where the data is actual rather than forecast, has meant that export revenues have dropped at an annualised rate of 6% in Mena – the highest decline of any global region (Figure 1). This has had a spill-over effect on the region’s economies as well, with imports falling back by nearly 3% annually over the period, suggesting weaker demand both within Mena and globally for the goods that are re-exported from the region.

MENA's trade performance, its projected growth

The Mena region is particularly vulnerable to underlying uncertainties globally. It is highly dependent on two things: oil prices and global demand for the goods that are shipped through the Gulf via its largest ports. As a result, the overall picture for the region in 2020 is likely to be mixed and show no particularly clear pattern of recovery from the uncertainty that has dominated the last few years in terms of oil prices, and 2019 in terms of broader geo-economic and geopolitical issues (Figure 2). The collapse of oil prices, following an OPEC meeting in early March, was a product of Saudi Arabia’s decision to launch a price war; this will have major repercussions for the region.

What stands out from Figure 2 is that, in spite of the difficult environment around sanctions and its fraught relationship with the US, Iran is projected to fare well in trade terms during 2020, especially in terms of its exports. That said, care should be taken when interpreting Iran’s data as a lot of its trade is hidden or executed with poor reporting partners.

MENA's trade performance, its projected growth

Even if the figure of a 55% increase in the projected value of Iran’s exports seems extreme, it arguably reflects a slowdown in trade in 2018 as a result of US sanctions, and a pick up into 2020 as the country finds a way to work around the restrictions it now faces. Its largest export partner is China and the projections suggest an increase in export trade during 2020 of around 8%, alongside imports from China of around 17%. But it is not just China where Iran is seeing trade growth. Exports to the UAE are set to grow by nearly 39%, to the Republic of Korea by over 52% and, perhaps most intriguingly of all, to parts of Asia not indicated elsewhere (Asia NIE) of more than 2,000% year on year.

Asia NIE is Iran’s second largest export partner. It is an amalgamation of trading partners that are too small or too unreliable in their reporting to be classified individually as countries in trade statistics. The fact that it is both a large partner and that its growth is volatile but substantial during the course of the coming year suggests some of this growth is a reaction to the political and economic uncertainties that exist in the region.

Morocco is another country in the region which is predicted to see export growth in 2020. This reflects its position as a non-oil-dependent trading nation with an increasingly strong manufacturing base. Its top five trading partners are European, which points to its role as a gateway for trade between Mena, Europe and Africa. Its imports from Spain, for example, are increasing rapidly, with growth predicted at 8% during the course of the coming year. While oil and gas are important imports to Morocco from Spain, machinery and components, automotives and electrical products and equipment imports are also large and growing sectors. Spain has also taken over from France as Morocco’s largest export partner.

Nonetheless, the region remains vulnerable to global trade’s broader fragilities. These are likely to continue into 2020, not least because there is no sense that trade tensions have gone away, even if in an election year for the US there may be a slightly toned-down rhetoric. Trade growth remains negative or flat for most of the region’s countries and this will affect the extent to which GDP picks up.

GTR: Is there any sign that Mena has increased its resilience into 2020 and beyond?

Harding: The real measure of resilience in the region is the extent to which it is managing to reduce its dependency on oil. This is most evident in its imports (Figure 3). The region’s GDP expansion has failed to pick up since the collapse of oil revenues and, according to the IMF, is likely to be around 1.6% in 2020, down from 2.2% in 2017.

The fact that economic growth looks to have slowed somewhat has had an impact on the region’s imports. For example, imports of machinery and components (which includes computer machinery as well as tools for infrastructure development projects), will decline by 0.6% in 2020. The longer-term outlook to 2023 also points to an annual drop in imports of 0.3%. Iron and steel products, aircraft and automotives all exhibit a similar pattern.

MENA's trade performance, its projected growth

This could arguably be a function of two things. First, the region’s infrastructure has gone through a growth phase as ports and airports have been constructed to support its increased role as a trade hub. The slowdown now may well be because this construction process has slowed as more projects have been completed.

The second cause may be a slowing of regional or global demand, as might be suggested by the drop in automotive imports. This could suggest that there is a bigger picture to the sluggishness of trade in the region.

However, the data does not support this interpretation. The Mena region imports over US$75bn in automotives each year and exports just US$13bn. Exports are forecast to increase both in 2020 and for the next few years (Figure 4). This suggests that the region is potentially becoming more important as a hub, and that it will be re-exporting more in the coming years. The slowdown in imports therefore looks as if it can be attributed to the region’s economic fortunes. Indeed, the fact that iron and steel product imports are also declining indicates that there is less construction work going on.

MENA's trade performance, its projected growth

Even so, the projected growth in exports is encouraging. The region has a trade deficit in all of its largest sectors except mineral fuels and some of the import sectors where growth is slower, such as infrastructure products like iron and steel, may simply be a function of the fact that a lot of resource has been put into catching up over the past couple of decades and that this development is now slowing. Growth in exports of other infrastructure sectors such as machinery and components, aluminium and electrical products, alongside growth in automotives, suggests that the region’s role is changing – and this will mean that its long-term resilience is somewhat more assured.

GTR: How is intra-regional trade developing in Mena?

Harding: Mena will see an increase in intra-regional trade from 2019 to 2023, and this is noticeable in comparison to the pick-up in intra-regional trade in other net oil exporting regions such as South America and Sub-Saharan Africa (Figure 5). The only other region with faster intra-regional trade growth is Asia Pacific (APAC).

While oil remains the dominant traded sector in Mena, this greater intra-regional trade indicates either that the region’s oil dependency is declining or simply that there is a greater amount of cross-border trade within the region.

MENA's trade performance, its projected growth

Could this therefore mean that more export diversity across the region is behind the growth in regional trade? A first glance suggests not. The top five countries for intra-regional exports are the UAE, Saudi Arabia, Iran, Iraq and Oman. In terms of export growth, the UAE, Iran and Saudi Arabia are growing quickly, but Iraq and Oman are falling back. Similarly, the top five countries for intra-regional imports are the UAE, Saudi Arabia, Egypt, Iran and Oman. All of these countries are likely to see growth in intra-regional import values between 2019 and 2020 (Figure 6).

A couple of points stand out from this chart: first, the impact on Qatar’s trade because of the blockade, which began in June 2017, is evident. Intra-regional trade values fell back between 2013 and 2018 at an annualised rate of over 20%. While this initially aligned with the collapse in oil prices, an annualised decline of 16.1% in imports between 2016 and 2019 covered the pick-up in oil prices and the onset of the blockade, while intra-regional exports over the same three-year period fell annually at over 22%. The data suggests that this will continue into 2020.

MENA's trade performance, its projected growth

Furthermore, Morocco’s trade with the region looks set to decline at the same time it increases with the EU27 and Spain and France in particular. The country’s trade with Mena spiked during the financial crisis, largely because of an uptick in gold prices, with a three-year growth in imports of over 300%, albeit from a low base. Other imports, such as automotives, clothing and accessories, and milk and dairy products have remained on a consistent downward trend since 2014.

Morocco exports hard commodities and plastics to the rest of Mena, and these have also been on a downward trend since 2014 because of weak commodity prices. In other words, the structure of Morocco’s trade with the rest of the region is very different to its trade outside of the region, which is focused on intermediate manufactured goods.

This leads to the conclusion that, in fact, growth in intra-regional trade has been driven by a rise in oil prices, rather than any diversification efforts. Indeed, between 2017 and 2020, intra-regional trade in oil and gas grew by nearly 6% annually. The UAE, Egypt, Jordan and Bahrain have been major beneficiaries of this pattern, which looks set to continue.

GTR: Geopolitical tensions between the US and Iran have added a layer of uncertainty into the 2020 outlook. How will this play out during the course of the year?

Harding: On January 3, US forces carried out a drone strike near Baghdad International Airport killing Qasem Soleimani, commander of Iran’s Quds Force and right-hand man to Ayatollah Ali Khamenei, Iran’s supreme leader. Khamenei vowed “severe revenge”. Five days later, on January 8, 16 short and medium-range ballistic missiles were launched at two US airbases in Iraq (Ain al-Asad and Erbil). No fatalities were reported, which US officials attributed to an effective satellite early warning system known as the Space Based Infrared System. It is likely that Iran’s response was an example of ‘escalation for de-escalation’; by providing the US with a degree of early warning, casualties could be minimised and direct conflict with the US avoided, while still demonstrating to Iran’s domestic base that action had been taken. From the US perspective, President Trump was equally unlikely to be willing to become embroiled in a costly war during an election year.

Although tensions between Iran and the US are unlikely to lead to direct conflict, there are two real risks to the region. The first is that of miscalculation – in other words, the danger that either Iran or the US misinterprets the actions of the other and acts accordingly. For example, had the US had any fatalities from the Iranian response, there may have been a more severe, escalatory response. This risk is always there but the fact that neither side appears to have much appetite for conflict means that it is unlikely to be the major issue affecting trade during the course of the year.

Of more consequence is the second risk that is apparent in the region at present, which is that it is increasingly caught in the power struggle between Russia, China and the US. As Coriolis Technologies has been observing for some time now, Russia is increasing its influence in the region. Our data suggests that the average annualised growth in imports from Russia for the period 2016-2020 will be around 14%. While much of this is oil and gas, the period 2015-2018 saw a worrying exponential growth in so-called commodities not elsewhere specified – trade in which closely correlates with conflict around the world. This reflects Russia’s role in Yemen and Syria in particular.

The consequence for trade of this type of uncertainty is obvious. It holds back investment as businesses outside of the region tread cautiously to avoid conflict. However, while Russia’s engagement in the region provides a backdrop to traditional “hard” power, the US is now using its financial power rather than military means to support its regional objectives.

The tightening of sanctions on Iran since the US withdrew its support for the Iranian nuclear treaty (JCPOA) has affected the way in which banks can operate in the region. The risk of secondary sanctions, for example inadvertently using the US dollar for a transaction, as well as the direct risk of trading with a sanctioned entity or person is the core way in which trade with the region will be affected.

Mena continues to be dominated by trade with areas not elsewhere specified (Areas NES), which is an agglomeration of countries which are either too small or report too irregularly, potentially indicating hidden trade. Exports to this partner were worth US$519bn in 2018; US$97.1bn of these exports were in commodities not elsewhere specified. The region’s exports to Asia NIE were worth US$19bn in 2018.

What this says is that trade in the region remains opaque. While this continues to be the case, it is very difficult for dollar-denominated trade finance to work with banks in the region. Swift has shut down its messaging services to Iran; and although European government officials announced in April that Instex, a trade vehicle set up to bypass US sanctions on Iran, has successfully completed its first transaction, there remain doubts over the viability of the mechanism. China, Russia, Iran and Turkey have been building an alternative to the Swift network, but as this would be subject to the same sanctions constraints as other regions, unless and until US strategy changes, the opacity and political nature of trade will be a core challenge for the region as a whole.

GTR: The largest ports like Dubai are increasingly focusing on their role as trading hubs for re-exports. How will this expand in the coming year?

Harding: The best way of approaching this question is to look at trade with free trade zones (FTZs). These are the economic areas around ports or airports which are specific to a sector and which enable re-export activity by providing tax and customs duty incentives to overseas investors and trading businesses. Dubai alone has more than 30 of these zones; the UAE has the greatest number of FTZs of any country in the region.

Because countries report exports to FTZs, but FTZs do not report imports as a country in their own right, the data depends on the reliability of the partner country and, as a tax and duty payment mechanism rather than as a trading partner, the numbers tend to be small. The Mena countries are amongst the least reliable reporters globally, so the data is somewhat erratic but nevertheless tells an interesting story:

  1. Mena as a region exported some US$981mn to freeports in 2018. The dominant products that the region exported were electrical products and equipment, precious metals and stones (gold and diamonds), commodities not elsewhere specified, machinery and components and mineral fuels (oil and gas).
  2. Mena imported some US$220mn of goods from freeports in 2018. The dominant sectors were commodities not elsewhere specified, mineral fuels, electrical products, machinery and components and coffee and tea.
  3. Exports to FTZs declined between 2013 and 2018. However, Coriolis Technologies is expecting growth in exports to be nearly 150% between 2018 and 2019, and to fall back to around 2% between 2019 and 2020.
  4. The trade with FTZs is not necessarily attributable to hidden trade as such. By way of comparison, the region trades over US$519bn with areas not elsewhere specified and US$27.5bn with Asia not elsewhere specified. Since these have been shown to be highly correlated with sanctions avoidance and conflict as discussed, the distinction is an important one to be made.

These patterns tell an interesting story about how FTZs may be utilised at present. Oil and gas, precious metals and stones and commodities not elsewhere specified are sectors which hide other patterns in trade. However, trade in electrical products, automotives, machinery and components and coffee and tea suggest that something else is happening given the expected overall growth in trade with FTZs.

Because trade looks to have grown so quickly between 2018 and 2019, FTZs clearly play an important role in the region’s trade. The data is naturally opaque, so any conclusion is to some extent speculative. However, tighter sanctions and the risk of secondary sanctions against Iran from the US means that trade with one of its main trading partners became very difficult for Mena during that year. Alternative mechanisms, such as FTZs, mean that trade technically does not touch either Iran or its financial institutions. As a result, FTZs may become a route to continued legal trade with sanctioned countries.

GTR: China is playing an increasingly active role in Mena. What are the key developments and are there any particular sectors of interest?

Harding: One cannot overstate the importance of China to the Mena region. Imports from China were worth US$146bn and exports worth US$169bn in 2018.

Mena’s exports to China are dominated by oil and gas, which makes up nearly 76% of the total at US$128bn.

Imports from China are far less concentrated. The top five imports from China are electrical products and equipment (US$38.1bn), machinery and components (US$22bn), knitted clothing and accessories (US$4.6bn), iron and steel (US$6.2bn) and automotives (US$6.2bn).

China is strategically focused on its electronics exports and, in 2019, Mena is estimated to have imported US$9.2bn of specialised electronic equipment from China. This represents an annualised growth of 27% since 2016, when President Trump came to power in the US and China became more explicit about its global aspirations. While China’s imports from Mena may well be focused on energy security, it is extending its reach into the region through technology.

Yet trade growth overall has been sluggish. Over the period between 2013 and 2018, imports from China grew at an annualised rate of 1%, while exports increased by just 0.6%. This is largely because of oil price related economic weakness in Mena, which has affected both domestic demand as well as the value of exports to China.

Even so, Mena’s trade with China is twice the size of trade with its second largest country-level export partner, the US. China overtook the US as the region’s largest country partner (excluding blocs like the EU27) in 2009. The growth in the trading relationship was particularly evident between 2002 and 2014, likely driven by Chinese investment into the energy sector, given that post-2014 growth has trailed off amid lower oil prices (Figure 7).

MENA's trade performance, its projected growth

Despite China’s expansionary policy through the Belt and Road Initiative (BRI) to develop infrastructure more generally, it is energy security that seems to underpin its trade with the region. Investment has supported that with the majority going into the energy sector. This highlights the fact that China invests for its strategic purposes, although real estate (construction) and transport have featured strongly. In effect, then, the BRI has just given a name to an investment trend that has been growing gradually since before the financial crisis (Figure 8).

Up to 2013, all investments by China into Mena were classified as non-BRI, but since 2014, all investments have been classified as BRI – this is again a reflection of how China is now categorising its investments. The pattern is clear, though: the general trend is for more investment in the region, both in terms of consistency and in terms of value. The fact that investments appeared to drop in 2019 may reflect two things: first, the general uncertainties during the course of the year that arose from the US-China trade war which held back investments globally. Second, and as a result of the dispute, China was relatively quiet about the BRI during the course of the year having been very public about its intentions the previous year – perhaps as a signal to the US that it was growing its economic power.

Whatever may be the case, what is important is that the investments appear to support China’s trade aspirations in the region.

MENA's trade performance, its projected growth

GTR: What are the key upside and downside risks to growth in the region in 2020 and what are the consequences for trade finance?

Harding: Trade within the region is substantial and the value of bank-intermediated trade finance from intra-regional trade alone is as much as US$122bn per year. Electronics trade between countries in the region has grown by 36.7% since 2016, machinery and components by nearly 19% and, against the odds perhaps, Iran’s intra-regional trade is growing by an annualised figure of 47%.

Much of the growth in trade finance will depend on the risk appetite of the region’s financial institutions. There is plenty to invest in, as is clear from this report, but the region itself has a number of challenges which banks will need to overcome: Coriolis Technologies risk indicators for the region, particularly around the risk of terrorism, the risk of repression and threats from regimes, are among the highest in the world. While businesses on the ground are trying to reduce the region’s dependency on oil, particularly in technology and digitalisation, this reputational risk cannot be ignored.

The region is particularly prone to commodity price fluctuations. The collapse of oil prices since the beginning of 2020 presents a serious threat to Mena’s economic wellbeing. Saudi Arabia is unlikely to be able to thrive economically at an oil price below US$70 a barrel. With 82% of its export revenues coming from oil and gas (approximately US$455bn in 2019) and its next largest export products like plastics also being heavily oil dependent, its overall trade is 96% correlated with the price of oil.

Russian influence in the region is growing as a result of the US strategy to withdraw militarily and, in reality, economically as well. Since the global financial crisis, imports from Russia have grown from US$11.8bn in 2009 to US$27.8bn in 2018. Similarly, exports have grown over the same period from US$1.9bn to US$4.2bn. Increased trade with Russia and China is likely, not least because of the sanctions that are now associated with any trade in US dollars that might touch Iran. This will have the effect of limiting trade and investment – and the role of global banks – in the region if there is any compliance risk from supporting intra-regional trade in particular. Meanwhile, greater Russian involvement in Mena will add to the complexity of already fraught relations between countries in the region, with the potential of an escalation into broader conflict.

The Covid-19 pandemic has caused widespread economic disruption around the world. This is a key risk which could impact events in the region, travel and tourism and, of course, oil trade. These are risks that are the same for everywhere in the world at present, but the potential for a global recession is obvious. The extent to which the region’s reforms over the past few years have created economic resilience are likely to be tested during the course of this yea

MENA Region Is Poised To Be The Next Fintech Hub

MENA Region Is Poised To Be The Next Fintech Hub

SCOOPEMPIRE‘ s TECH wondering Why The MENA Region Is Poised To Be The Next Fintech Hub, its Scoop Team on June 4, 2020, answered by posing another question such as What is Fintech, and where is it most prominent in this essay.


As the world braces itself for a potential global recession, it’s hard to countenance the idea of growth markets or lucrative industries. However, entities such as the fintech sector undoubtedly challenge this mindset, with the global market worth an impressive $127.66 billion by the end of 2018.

The market is also poised for further expansion in the near-term, with a compound annual growth rate rate of 25% forecast through 2022. This will create a fintech sector worth approximately $309.98 billion, while also helping to drive significant innovation and technological advancement in the wider financial services space.

Interestingly, we’re also seeing the geographical diversification of fintech, with locations in regions such as Africa and the Middle East now competing with established financial powerhouses like London. But why exactly will the Middle East and North Africa (MENA) jurisdiction become the next major fintech hub?

What is Fintech, and where is it most prominent?

In simple terms, fintech refers to financial technologies, while it continues to drive a diverse range of innovations and applications within the financial services sector.

Historically, it was used almost exclusively by financial institutions themselves, but over time it has continued to evolve to represent emerging technologies in their own right and the widespread disruption of the traditional financial services sector.

MENA Region Is Poised To Be The Next Fintech Hub

The history of fintech can also be traced back to the origins of the 21st century, while over the course of the last decade it has evolved into a rapidly growing and advancing customer-oriented spectrum of services. This is true across a number of financial industries too, although it’s fair to surmise that the impact of fintech innovation has been more prominent in some markets than others.

Take the foreign exchange, for example, which has been gripped by a fintech revolution that remains largely unchecked to this day. Make no mistake; the impact of fintech has been felt throughout every aspect of forex trading over the course of the last two decades, from the emergence of online and mobile brokers to the implementation of high-frequency trading tools and automated risk-management measures.

These fintech innovations have helped to make the forex market far more accessible to a wider international audience, while enabling everyday and non-institutional investors to trade variable derivatives and forex trading sessions.

This includes lucrative and high-volume entities such as the Asian trading session (which operates between the hours of 12am and 9am GMT), along with an entire basket of emerging currencies and asset classes associated with regions such as Africa and the Middle East).

The rise of Fintech in MENA – a marriage made in heaven?

Of course, this is just one measure of the growing relationship between fintech and the MENA region, and one that becomes increasingly formidable with every passing year.

This is borne out by the figures too; with the fintech market in the MENA region expected to account for 8% of the areas’ total financial services revenue by 2022. This growth has been largely inspired by a rising number of fintech startups in sectors such as forex, combined with increased mobile Internet penetration and sustained economic reforms throughout the region.

Overall, the number of fintech startups offering fiscal services in the MENA jurisdiction will peak at 250 by the end of this year, up from a paltry 46 back in 2013. This evolution has also been driven by sustained investment in the sector, with the Dubai International Financial Centre (DIFC) having launched a notable $100 million fintech fund back in November 2017.

The main purpose of this investment was to accelerate the growth and influence of fintech in Dubai and the Middle East as a whole, and this has already had a marked impact in terms of achieving this objective. This also involved market-leading financial institutions such as HSBC, who have recently committed to renewing their participation for the third year.

This means that the region’s most dynamic and profitable fintech startups will continue to benefit from sustained support and nurturing, paving the way for the MENA region to become increasingly influential in the marketplace and challenge established entities such as London and Hamburg.

WE SAID THIS: The region is booming in more ways than you know!

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Following The Likes Of Other Platforms, LinkedIn Introduces Stories,…Jun 3, 2020

Beyond the Line in the Sand

Beyond the Line in the Sand


In Carnegie Middle East Diwan write up by Armenak Tokmajyan and Walid al-Nofal in Beyond the Line in the Sand seems to have encapsulated a situation of contentious borders of the modern states. This article highlights the human down to earth life aspects that continue unabated for millennia.


Syria’s conflict has transformed the conditions of tribal clan notables who have sought refuge in Jordan.

The social fabric on both sides of the Syrian-Jordanian border has remained similar, notwithstanding the fact that a century has passed since the Sykes-Picot agreement that divided the region between Britain and France. Communities on either side of the separation line remain similar, with extended families and clans (sub-tribes or ‘ashireh) dominating the social landscape. They remain linked by family and kinship ties, as well as shared customs and traditions.

But this so-called “line in the sand”—the boundary dividing British and French areas of control drawn during World War I—has also left its mark. Relations between tribal clans and their respective states differ markedly between Jordan and Syria, both in terms of their roles in the state-building process and the space that clan notables have been given to exercise traditional authority within their societies.

With the increasing levels of violence in Syria after 2011, many Syrians, especially from the border governorate of Dar‘a, sought refuge in Jordan. Statistics from the United Nations High Commissioner for Refugees show that the largest concentration of refugees is located in Amman Governorate, Jordan’s economic heartland. The second-largest is present in the northwestern border areas of the kingdom, which resemble nearby parts of Syria in their climate, geography, and even architecture. Not only is the environment similar, but many Jordanian and Syrian families have family ties and relationships from before the conflict. This helped Syrians integrate into Jordanian society after they had fled Syria.

After settling in Jordan, many refugees found that the state’s relationship with clans were different than what they had encountered in Syria. Throughout the decades of Ba‘th Party rule, the Syrian state sought to weaken tribal clan authority. Half a century of such policies prior to the uprising, along with changing ways of life, gradually reduced the role of clan notables. Still, the state used what remained of these notables’ influence for its own ends. For example, it took advantage of their authority to contain and resolve major disputes between large families and keep the peace in rural peripheries of the country.

Jordan’s tribal clans, in turn, face few of the restraints and pressures experienced by their Syrian counterparts. Instead, they remain a major power center with considerable authority and influence in the kingdom. Tribal tradition plays a crucial role in Jordanian society despite growing opposition to it. Even today, the king derives some of his legitimacy from his status as the leader of the kingdom’s tribal leaders, a historical legacy dating back to Jordan’s foundation. Despite rare bumps in ties between the state and tribal clans, especially for economic reasons, these relationships have remained essential for the stability of Hashemite rule.

The new reality in Jordan makes some Syrian notables claim that there is more respect for the clan in Jordan than in Syria. Indeed, in Jordan tribal traditions and customs similar to those in Syria are more widely practiced. This continues to strengthen the clans’ traditional authority, which gives them positions of leadership with judicial, customary, and even political roles as intermediaries between their communities and the state—far more than in Syria.

The situation in Syria has brought about deep changes in the relationship between state and society, including with clan notables. Early on in 2011, notables in Dar‘a broke with their traditional roles and were at the forefront of anti-regime protests when Brigadier General ‘Atif Najib, the head of the Political Security Directorate in Dar‘a, humiliated notables who had gone to seek the release of children arrested and tortured for writing anti-regime slogans. This is widely seen as the incident that sparked the uprising.

Tribal customs remained, and perhaps were strengthened, amid the absence of state institutions in Syria. As a result, some known personalities lost their social status as notables, while others turned the crisis into an opportunity. They gained authority and prominence within their extended families and clans and became new intermediaries with the state. These transformations are ongoing and the political role of clan notables in Syrian society today has yet to become clear. For now, many seem to have lost the roles they played before the uprising, becoming rivals and targets of the state.

The lives of Syrian clan notables in Jordan differ greatly from their lives before the uprising and from the situation of Syrians who are living in Dar‘a today. Many certainly face the hardships of being refugees and do not enjoy the same privileges as their Jordanian counterparts. Yet they live in a sociopolitical environment in which they are able to exercise their traditional authority more widely over their communities and without the fear of being targeted by the state. In that sense, despite living in exile, they are in a more favorable social and political setting than where they had been.

*Walid al-Nofal is a journalist in Dar‘a, Syria.

Grim short-term Forecast for the Coronavirus-era Economy

Grim short-term Forecast for the Coronavirus-era Economy

‘The immediate issue for all businesses, in whichever industry they’re in, is survival’ – Shehab Gargash by Bernd Debusmann Jr who on 30 May 2020 reports that Gargash Group managing director and CEO Shehab Gargash has a grim short-term forecast for the coronavirus-era economy. But out of the ashes, opportunity will arise.
10 Scenarios for the MENA region in the year 2050 elaborated by @Eubulletin amongst many others predicted similar outcome, even though the world was not going through the same exceptional circumstances.

Grim short-term Forecast for the Coronavirus-era Economy
Gargash believes many companies in the UAE are preoccupied with survival, rather than in longer-term outcomes

Like most globetrotting travellers and businessmen, Shehab Gargash’s office has souvenirs of his trips. But these souvenirs aren’t postcards, fridge magnets or cheap trinkets. Gargash collects boarding passes – hundreds of which are kept in a massive glass display case in his office, atop of which sits a silver and red aircraft wing.

“Oh! I have slipped the surly bonds of earth,” reads a sonnet on the case, written by American poet and pilot John Gillespie Magee Jr, killed flying a Spitfire over England during the Second World War. “And danced the skies on laughter-silvered wings.”

This, I think to myself when I see it, is a man who really loves his travel. His Instagram account proves it.

From India and China to Barcelona, Monaco and the Maldives, Gargash gets around – and that’s just in the last year alone.

But like the rest of us, Covid-19 has put a damper on Gargash’s travel plans.

“When will I travel again? That’s a good question,” he tells me, chuckling through the grainy screen of our video teleconference meeting.

“If I’m going on holiday, I want to enjoy it.  So I’m not itching to get back on a plane. I don’t think we’ll be there anytime soon.”

In the current climate, an Instagram-worthy trip is the least of Gargash’s concerns. At the moment, he’s preoccupied with facing the impact of the coronavirus pandemic, both on Gargash Group – of which he is managing director and CEO – and on the wider economies of the UAE and GCC.

Some estimates – such as that of the International Monetary Fund (IMF) – forecast that the GCC economies will collectively record negative real GDP growth in 2020, with the UAE slipping to -3.5 percent from 1.3 percent growth last year.

When it comes to the crisis, Gargash’s warm smile and friendly banter come to a stop. This isn’t a situation he minces words about.

“The immediate issue for all businesses, in whichever industry they’re in, is survival,” he tells me. “I think we are facing worldwide, industry-wide, existential issues that a lot of us have never even dreamed of. It’s all-encompassing and covers all sorts of areas of the economy.”

Hard times ahead

When it comes to the pandemic-related issues that the UAE’s economy faces, few are in a better position to comment than Gargash. A scion of one of the country’s most prominent Emirati families, Gargash leads the Gargash Group, which has diverse interests including automotive, real estate, hospitality and financial services. He’s also the founding chairman of Daman Investments – not to mention a long-time banking industry and prolific socio-economic commentator.


Gargash Enterprises is the authorised distributor for Mercedes-Benz in Dubai, Sharjah and the Northern Emirates

In the short-term, he says with startling matter-of-factness, the forecast is grim. He predicts that many businesses will not last.

“People aren’t looking at their strategies, or their plans. They’re looking at the daily details of expenses, revenue, cash in the bag. The immediate oxygen for the business to live through this,” he says. “Many businesses will not appreciate the impact of what they thought were very small elements, like levels of leverage and borrowing that seemed manageable a few weeks ago. These will deal a fatal blow to a lot of businesses.”

Perhaps more alarmingly, Gargash believes that most businesses are “nowhere near” a stage in which they can even think of what the future holds. What businesses will look like, and how they can adapt to new realities, are still unknowns.

“We haven’t even considered that future yet. A lot of businesses, through no fault of their own in many cases, will not survive simply because they have underappreciated the need to have that safety cushion,” he adds.

‘Soul searching’

According to Gargash, the businesses that do survive the immediate impact of the pandemic over the coming weeks and months will soon have to start thinking of their next moves.

“You can’t afford to be firefighting too long. Over the weeks and months, [companies will] regain their balance. Subsequent to that, strategy kicks back in,” he explains. “Where am I going as a business? What are my priorities? What are new opportunities, and what’s a dying, sunset industry?

“It’s time we ask ourselves these questions as businesses, as they’ll define how we act, post the shock-therapy. Once we do that, our priorities are better defined, and actions put together accordingly,” Gargash adds. “That’s the kind of soul searching that will occupy our minds this year, and possibly into next year.”


The company has diverse operations in financial investment and real estate

Gargash Group is far larger than most businesses that operate in the country. For the average resident, the company is most readily associated with the automotive sector, being the authorised distributor for Mercedes-Benz in Dubai, Sharjah and the Northern Emirates. It is, however, much more than that, offering a wide range of financial, investment and real estate services in various sectors.

But the company’s size and status did not spare it from the impact of the coronavirus. “We went through shock and panic, and saw revenues tumble to extremely low levels, and like everyone had to grapple with a 24-hour lockdown,” Gargash recalls. “Those were the issues that we dealt with as a group in the early days of the pandemic. Nobody knew how to deal with Covid-19.”

And although Gargash says it is “far too early” for decisions to be made on the company’s future, it has already begun a soul-searching process he advises for companies across the wider economy.

“That’s where we are at right now. Let’s say I have 10 lines of business. Which ones are still valid propositions? The ones that aren’t, do I adjust them? Do I integrate them into something else? Or do I just cut the rope and let them sink?,” he says. “Those kinds of questions are still being tackled.”

While it may be too early to determine what the group’s focus will be going forward and what it may need to be cut loose, Gargash says he isn’t particularly worried. The group’s core businesses – automotive, real estate, and financial services – will form a key part of the post-Covid economy in some form.

In fact, he adds, the shock of the pandemic may end up being a blessing in disguise that forced the company to become “more daring in its implementation.”


Businesses that will survive the impact of the pandemic over the coming months will soon have to start thinking of their next moves, Gargash believes

“We’ll try new ideas, new thoughts, concepts and industries that in the past I dismissed,” he explains. “Let’s imagine, for a second, potato farming. Potato farming has been proven to be a strategic source of nourishment. That’s a silly example, but understand, I’m obliged to become a more entrepreneurial business, and regardless of how ‘classic’ I’ve been in the past. I must investigate new avenues. I have the same eagerness to survive as a brand new start-up.”

A new GCC?

Gargash is undoubtedly an optimist. Even while speaking about the challenges of the economy, he peppers his comments with reminders that, sooner or later, things will return to something resembling normality. As he puts it, the masks will fall off, and the glove won’t be a necessity – even if the “trauma” of the event stays with us.

Even widespread job losses, he says, will eventually lead to something better. “In the longer term, jobs will be replaced, rather than lost. We still [in the UAE] have an economy serving 10 million people, and a broader GCC economy with 50 million or so. Jobs will be created, possibly in new industries and in new roles.”

These new roles – which Gargash admits he isn’t sure what will be, exactly – will require many employees, from blue-collar workers to managers, re-skill themselves, or learn entire new professions. Although challenging, he is confident the region’s youth in particular will manage.

“This [trend] will disproportionally [benefit] young people,” he says. “They’re more adept and more able to align themselves with industry trends.”

These ‘new roles’ don’t just apply to employees. The pandemic, he believes, may ultimately change the UAE’s economy as a whole by encouraging more home-grown entrepreneurs to step up with fresh new ideas.

“Most of the businesses that are set up in the UAE are in the ‘last-mile’ economy: the delivery of a product or service that has evolved somewhere else, or was manufactured somewhere else. Your control over what your supplier gives you is fairly limited. I can’t invent a better wheel, so to say. I’m just distributing the wheel that was manufactured somewhere else.”


Young people could align themselves with industry trends, says Gargash

What we’ll see instead, Gargash hopes, is an opportunity for motivated entrepreneurs to try and forecast where the future is headed and where they can step in with an idea.

“In a post Covid-reality, we’ll be asking what is going to drive businesses, and what those businesses will look like,” he says. “There needs to be a proper reading of what demands will need to be fulfilled. Businesses will need to alter their offerings to suit the new realities.”

He adds, “It’s by no means an easy task. There’s still a lot of projection and reading into the future that is required.”

Once that’s done, he says, the UAE’s economy will be able to take off – as will he, on his next trip abroad. For Gargash, that day will be welcome news.

“I have a fear of losing my frequent flyer miles,” he laughs. “But that’s another story.”


Advice for investors

When asked what advice he’s given to would-be UAE investors in the pandemic, Gargash responds without hesitation: “hold on to it and watch what happens.”

“Do not rush into investments today. I do not think there will be an imminent, overnight bounce back of growth and activity,” he says. “It’s going to come back, but it will be more deliberate.

“It’ll take more time. If I was an investor with AED1m, I’d hold back and watch and observe. I’d make a convinced decision before I take that plunge and go into one asset class.”

Green economy saving the day

Green economy saving the day

Sally Farid, an associate professor of economics at Cairo University thoughts on this Friday 29 May 2020, are to put it in few words as only a Green economy saving the day would be a viable way out of this traumatic conjecture. This is at a time when Egypt presses on with a new capital in the desert amid virus outbreak, and its Officials seeing these mega-projects as the key source of jobs, the author of this article advises the following.
The world needs to adopt a green economy to enhance growth and job creation amid the crisis of the Covid-19 pandemic

Green economy saving the day

A green economy is the means to salvation for the global economy after the coronavirus pandemic has affected 81 per cent of the world’s workforce. After millions of people had been infected and thousands had died due to the virus, the tourism and travel industries collapsed and the oil and gas sector plummeted owing to the preventive measures countries have adopted to curb the spread of the coronavirus.

However, a green economy would allow countries to achieve growth and generate jobs in the wake of the pandemic. The coronavirus has brought the green economy to the fore as the virus is expected to negatively impact the world’s economies for years to come.

Austria has announced that 13 European countries are joining hands to support economic activities that reduce toxic emissions, for example. The European states are also discussing emergency measures at the cost of more than half a trillion euros to stimulate their economies after controls on the spread of the coronavirus led to airline stoppages, factory closures, and restrictions on public life. The leaders of the European Union countries have vowed to focus on environmentally friendly policies to revive their economies.

The measures adopted to recover from the repercussions of the virus should encourage clean solutions instead of the current infrastructure that causes pollution. They should also encourage electric transportation technology and a reduction in the use of fossil fuels. Green projects, such as enhancing the use of renewable energy, can create more jobs, bring in more revenues, and be cost-effective in the long run. The world is standing at a crossroads at present: either to pursue zero-emissions goals or to fall under the mercy of fossil fuels once more.

The industrial countries should focus on supporting their material infrastructure, such as wind farms, solar plants, renewable electric and clean energy networks, and the use of hydrogen. They should carry out modifications to improve the quality of construction and invest in education, training, and clean-technology research.

The green economy is an opportunity to benefit from its advantages in terms of growth, food security, and the provision down to the village level of energy, clean water, housing, sewage networks, and public transport. These opportunities can create jobs, help to eliminate poverty, achieve sustainable development, preserve natural resources, and give access to green technology that reduces pollutants and increases production.

Egypt launched a work plan to promote the green economy in Africa in 2019, and Africa’s financial centres now have a golden opportunity to transform their sister countries into global green hubs.

According to the United Nations Environment Programme (UNEP), the green economy can improve human well-being and reduce social inequalities in the long run. It can help to decrease the risk for future generations to be exposed to environmental degradation and ecological depletion. It is necessary to help to protect the environment and create an economic system that generates jobs and covers the whole social spectrum.

Global estimates now put the increase in greenhouse-gas emissions responsible for global warming across the world at around 70 per cent, giving rise to temperatures that could go up by four to six degrees Celsius by the end of this century. According to the UN, water scarcity will become a chronic phenomenon in many parts of the world by 2030, imposing vast challenges to policies and the costs of acquiring clean water.

The international community is therefore looking at the green economy as a means to economic recovery and sustainable development by encouraging investments in the environment to achieve sustainable economic growth, or “green growth”, and to reduce poverty. For the green economy to be successful, environmental elements should be incorporated into economic development models, policies, and projects at the earliest stages of their preparation.

In its simplest form, the green economy is one in which carbon emissions are reduced and the efficient use of resources is maximised. It covers all social groups whose incomes increase with their opportunities for work. This kind of economy is driven by public and private investments that help to prevent the loss of biodiversity and preserve a healthy environment.

These investments should be supported by amended policies and regulations as well as public spending. The development of a green economy should help to maintain, enhance, and rebuild natural capital, seeing this as a source of public benefit, particularly to the poor whose security and lifestyles depend on natural resources. Africa remains the wealthiest continent in the world in terms of mineral resources, including fossil fuels. However, many African countries have been attempting to adopt a green economy as a means for growth, including Botswana, Ghana, Kenya, Nigeria, and South Africa.

Many countries have applied different economic policies to encourage the conversion to a green economy, whether by investing in green energy, providing financial facilities and loans at low interest rates, applying preferential tariffs and prices on products in which renewable energy is used, taxing products produced by non-renewable energy sources, or imposing taxes on waste and cash transfers.

The conditions necessary for the growth of a green economy include the application of policies and visions for sustainable development, coupled with legislative, institutional, and financial procedures, social awareness, and coordination between all the parties concerned.

Legislative measures include reformulating and amending laws, adapting them to the principles of the green economy, and clarifying implementation mechanisms.

Institutional procedures are concerned with adopting a national strategy for developing and identifying priority sectors that can easily go green. This is in addition to incorporating environmental considerations into five-year national plans and development strategies, while preparing government authorities, educational entities, non-governmental organisations, civil society, and the private sector for a green transformation.

It is the role of present economic policies to transform the economy in the long run into a green economy through, for example, licensing laws, incentives, and pricing policies, modifying import restrictions, financial aid, fines and taxes that give preference to the proper use of resources, and the integration of the cost of pollution and the use of natural resources within the total cost of goods and services.

Financial procedures include investing in green infrastructure and modern technologies and encouraging the private sector and civil society to be incorporated within a green system.

This batch of measures should be adopted in tandem with national studies to identify the opportunities for going green and the factors of success and challenges associated with this transformation, as well as developing research, monitoring, and environmental knowledge management.

*A version of this article appeared in print in the 21 May, 2020 edition of Al-Ahram Weekly

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