issue 1544 EN

Al-Qaeda’s Traveling Ideology

The Vanguard of Liberalization

A Gentlemen’s Disagreement

Fawaz A. Gerges

Professor Jagdish Bhagwati

Guy de Jonquières

Keynes TradeBy Mark Razeen Sally

Issues 1544, 8 February 2010

Editorial

Cover

Established in 1987 by Prince Ahmad Bin Salman Bin Abdel Aziz

Established by Hisham and Mohamad Ali Hafez

Editor-in-Chief

ADEL Al TORAIFI

Managing Director TARIK ALGAIN

Published by

Dear Readers, to The Majalla Digital, this week our issue W elcome brings to you an analysis of the impact of the

financial crisis on protectionism. In the feature, Razeen Sally, Director of the European Centre for International Political Economy, Brussels, looks at how protectionist policies do more harm than good in the context of a crisis. This week’s issue also brings to you an article which discusses Al-Qaeda’s travelling ideology by Fawaz Gerges, Professor of Middle Eastern Politics and International Relations at the London School of Economics.

We invite you to read these articles and much more on our website at Majalla.com/en. As always, we welcome and value our readers’ feedback and we invite you to take the opportunity to leave your comments or contact us if you are interested in writing for our publication.

The Majalla Magazine HH Saudi Research & Marketing (UK) Limited Arab Press House 182-184 High Holborn, LONDON WC1V 7AP DDI: +44 (0)20 7539 2335/2337 Tel.: +44 (0)20 7821 8181, Fax: +(0)20 7831 2310

Sincerely, Adel Al Toraifi Editor-in-Chief

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Issues 1544

05

Contents 08 Geopolitics Al-Qaeda’s Traveling Ideology

11 In Brief Around The World Quotes Of The Week Magazine Round Up Letters

18 Features Keynes Trade Mark

25 News Analysis More sanctions to come as “psychological war” around Iran steps up

28 Ideas The Nuclear Road THE MAJALLA EDITORIAL TEAM London Bureau Chief Manuel Almeida Cairo Bureau Chief Ahmed Ayoub Editors Paula Mejia Stephen Glain Wessam Sherif Daniel Capparelli Editorial Secretary Jan Singfield Webmaster Mohamed Saleh 8 February, 2010

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33 People Profile The Vanguard of Liberalization

Interview

Terrorists or Liberators?

Issue 1544, 8 February 2010

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41 Economics International Investor A Gentlemen’s Disagreement Markets

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47 Reviews Books

The Keys to Change Readings Reports

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54 The Political Essay

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07

Geopolitics

Al-Qaeda’s Traveling Ideology

Al-Qaeda’s travelling ideology reflects the gradual transformation from a highly centralized organization in the 1990s in Afghanistan, into a fluid, globalized, all-encompassing ideological umbrella. This transnational ideology bridged the divide between class, space, and recruitment techniques. However, al-Qaeda’s bottomup recruitment, largely through the internet, is a marginal phenomenon, and one that exposes the structural crisis of al-Qaeda Central.

T

he heads of major U.S. intelligence agencies told a Senate committee Tuesday that an attempted terrorist attack on the American homeland in coming months is "certain."

Coinciding with the first anniversary of the Obama presidency, Osama bin Laden issued two new audiotapes claiming responsibility for the Christmas Day airline bombing attempt and vowed further attacks. He also blamed global warming on the US and other big industrial nations and urged a boycott of the US dollar.

Missing the big point, Western governments and commentators tried to decipher what bin Laden said and to unlock the riddle of his short recordings.

Over the years messages broadcast by bin Laden, Ayman al-Zawahiri, al-Qaeda’s secondin-command, and their allies stressed the plight of persecuted Muslims from Palestine to Kashmir. Blaming the West for all injustices against Muslims, bin Laden and his cohorts incite the youth to militarily strike against Westerners.

In his new recordings, what bin Laden said does not matter as much as that he is still alive and transmitting his message. At the heart of his static voice lies a relentless, systematic drive to promote al-Qaeda’s traveling, transnational ideology, one that 8 February, 2010

by a bottom-up process, one that is extremely difficult to track.

Fawaz A. Gerges

resonates with a tiny segment of politically radicalized young Muslims worldwide.

Al-Qaeda’s traveling ideology rests on two interrelated claims.

First, the West, particularly America and Britain, are waging a crusade against Islam and Muslims. And, second, that it is the personal duty of every Muslim to join in jihad against the enemies of Islam and in doing so sacrifice blood and treasure.

As to why some self-radicalized

Today, al-Qaeda’s traveling ideology finds home in the stricken urban slums of the Muslim world

activists fall for al-Qaeda’s ideology, it is the only game in town that sanctions the killing of the enemies of Islam, including civilians and fits different temperaments and backgrounds. Al-Qaeda’s topdown recruitment of would-be terrorists has long been replaced

Although al-Qaeda developed in a particular Afghan context with a highly centralized and hierarchal structure in the 1990s, the organization has evolved and morphed into a fluid, globalized, all-encompassing ideological umbrella. This accessible ideology offers a powerful weapon of choice for a socially diverse mix of radicalized religious activists who feel that their Islamic identity and culture are under attack.

Today, al-Qaeda’s traveling ideology finds home in the stricken urban slums of the Muslim world and refugee camps in Palestine, Lebanon, Sudan, Somalia, Yemen and Algeria as well as among a few professionals and college students in the Gulf, Britain, America, and elsewhere.

The global jihad temptation transcends socioeconomic and educational barriers.

Recent cases show clearly how al-Qaeda’s traveling, transnational ideology bridged the divide between class, space, and recruitment techniques. It served as an attractive magnet for high-achievers like the Christmas day bomber, Nigeria's Umar Farouk Abdulmutallab, an engineering graduate of London University, Fort Hood's 08

Maj. Nidal Malik Hasan, five integrated American Muslims from Northern Virginia, and a Jordanian doctor, Humam alBalawi, an informant-turned suicide bomber who killed seven US intelligence agents on the CIA base in Khost province, near the Afghan-Pakistan border.

What these individuals had in common was that they were radicalized online, on their own, while living an integrated life mostly in the West. According to his family, Israel’s 2008 war in Gaza enraged Dr. al-Balawi and drove him to militancy arms. Maj. Hasan publicly raved about the US-led invasion and occupation of Iraq. America’s war in Afghanistan-Pakistan led the five US Muslims from Northern Virginia to Pakistan’s battlefields.

After being self-radicalized, these individuals turned to alQaeda’s mentors like the USborn and educated Yemeni radical preacher Anwar al-Alwaki for guidance, reassurance, and religious legitimation. They initiated the contacts and took action into their own hands.

crisis of al-Qaeda Central.

Bin Laden’s organization has suffered a catastrophic military setback and faces a massive crisis of authority and legitimacy, particularly decline of Muslim public support.

While at the height of power in the late 1990s, al-Qaeda was made up of about 3,000 to 4,000 fighters. Today, bin Laden's ranks are down to about 400 to 500.

According to the most credible intelligence estimates, perhaps 100 al Qaeda operatives are in Afghanistan and another 300 in neighbouring Pakistan. Most of its seasoned field-lieutenants have been either captured or

Recent opinion surveys confirm that an overwhelming majority of Muslims are more than just unsympathetic to the ideology of bin Laden and his followers

of Muslims are more than just unsympathetic to the ideology of bin Laden and his followers; they place the blame squarely at his feet for the harm he has caused to the image of Islam and the damage his movement has wrought within Muslim societies.

The new trend speaks volumes about the moral discrediting of al-Qaeda in the eyes of Muslims and the failure of the global jihad in general. There exists no evidence of any notable Muslim opinion support for the new terrorism. The key to solving the mysteries the lone-wolf suicide bomber is to work closely with Muslim social networks to preventively identify early warning signs before they mutate. The first and most effective line of defense against terrorism is the Muslim community.

Terrorism perpetrated by alQaeda and its transnational ideology will continue over the next decade, including attempts aimed at the US homeland or Britain. But this reality, frightening as it is, should not distract from the selflimiting nature of the al-Qaeda Ironically, the families of the challenge. Western governments five Virginia men and again with must resist overreaction, Abdulmutallab’s father warned hyper-inflation of threats, and the US authorities about their discrimination against ordinary sons’ radicalization. In the case killed replaced by unskilled and Muslims. These measures are of Maj. Hasan, he had indirectly ineffective operators; and new counterproductive because they pleaded to be medicated and skilled recruits are hard to come help sustain and nourish altreated before he murdered his by.

Qaeda’s traveling ideology. comrades.

Equally important, now, more The good news, if there is any, and more Muslims view alis that bottom-up recruitment Qaeda through a prism that Professor of Middle Eastern Politics and International Relations at the is a fringe and marginal focuses on the monstrosity London School of Economics. Among phenomenon. A sign of weakness, of killing of non-combatants. his books is The Far Enemy: Why not strength, the lone-wolf Recent opinion surveys confirm Jihad Went Global (Cambridge bomber exposes the structural that an overwhelming majority University Press, 2009).

Issues 1544

09

In Brief Around The World

Quotes Of The Week

Magazine Round Up

Letters

Š getty images

Karroubi calls for demonstrations on 31st anniversary of Iran's revolution Prominent reformist Iranian leader Mehdi Karroubi called upon his supporters to participate in demonstrations on 12 February, the anniversary of Iran's Islamic Revolution; despite threats by conservatives against protesters.

In a statement to mark the revolution led by the late Imam Khomeini in 1979, Karroubi said that recognizing the rights of the people and heeding their opinions, expressed in elections, is the only way out of the current crisis in the country. Karroubi, also a cleric, called upon religious authorities, Islamic scholars and political figures to intervene to save the country Issues 1544

and the people from troubles.

Elaborating, he said that Iran’s crisis threatens everybody, and warned that extremists could infiltrate the planned demonstrations.

"The 'green protest movement' must keep infiltrators and their extremist slogans away from demonstrations on the anniversary of Islamic revolution," he urged.

regarding extremists, perpetrators of violence and unauthentic religious people. Karroubi also called for fully enforcing the Constitution and respecting the rights of voters. He urged that constitutional institutions carry out their duties, noting in particular the Council of Experts, which is entrusted with assessing the performance of the supreme leader.

Karroubi, who said that he recognized the government of Ahmadinejad as a fait accompli because the supreme leader Ayatollah Ali Khamenei inaugurated him, also demanded that Khamenei swiftly expel flattering authors, writers and figures. The same was urged

Karroubi also called for the unrestricted and unconditional release of political prisoners; and for restoring the free press and ending the climate of panic and police repression in the country. "The ruler who does not comply with the Constitution is unjust," he added.

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In Brief - Around The World

Around The World

4

1 Iran

9

Iran's atomic chief said that his country will inform the U.N. nuclear watchdog that it will begin enriching uranium to 20 percent on. Iran's envoy to the International Atomic Energy Agency, Ali-Asghar Soltanieh, said his country handed over a letter to the agency stating its intention.

3 Israel The stalled peace process with Syria could bode ill for the future of the Middle East, Defense Minister Ehud Barak warned. Speaking to the Israel Defense Forces top brass, Barak said: "Just like the familiar reality in the Middle East, we will immediately sit down with syrian after such a war and negotiate on the exact same issues we have been discussing with them for the past 15 years."

2 India India's army chief, General Deepak Kapoor said that India will try to create a counterbalance to both Pakistan and China adding that the "two directions – the south-western and the northeastern – will be considered equally important for India. Pakistani officials slammed the Indian army chief for his remarks immediately but China’s reaction to India’s remarks was much less emotional.

8 February, 2010

4 USA House Speaker Nancy Pelosi took the falling unemployment rate as evidence of Democratic-led success in reversing the economic downturn.

The speaker also promised a renewed emphasis on job growth and health care reform as she addressed the increasingly anxious leadership of her party at the Democratic National Committee's winter meeting.

5 North Korea Officials from the two Koreas met in North Korea to discuss their joint industrial complex just days after an exchange of gunfire at sea emphasized the constant security threat on the divided peninsula.

Pyongyang called it a military exercise, and South Korean officials reported no casualties or damage.

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In Brief - Around The World

8 Saudi Arabia 5

3 10

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Afghan President Hamid Karzai left for Saudi Arabia to discuss his reintegration plan aimed at persuading Taliban militants to switch sides.The U.S.-backed Afghan leader, who was heading a delegation that includes new Foreign Minister Zalmay Rasoul and key religious leaders, planned to make a pilgrimage to Mecca, then meet with King Abdullah. The two leaders will discuss Afghanistan, the region and possible "solutions for reconciliation".

9 Venezuela Venezuela's securities exchange commission has seized control of three brokerage companies, citing ties to banks that recently got into financial trouble.In recent months, Chavez's government has taken over the management of more than a dozen banks and brokerage firms, citing alleged violations of banking laws.

6 Sri Lanka Sri Lanka’s president sacked a dozen senior military officers whom the defence ministry said were a “direct threat to national security” after last week’s presidential elections.

President Mahinda Rajapakse had accused the defeated opposition of planning to assassinate him after he beat former army general Sarath Fonseka in the bitterly fought January 26 poll.

Issues 1544

7 Kuwait Kuwait-based multi-billion-dollar logistics company spawned by the U.S. invasion of Iraq, is scheduled to be arraigned on criminal charges of overbilling U.S. taxpayers for food supply contracts in the Iraq war zone that were worth more than $8.5 billion. If the lawsuit is successful, the company could owe the U.S. government as much as $1 billion.

10 Sudan Sudan is being threatened by the flow of heavy weapons from such rivals as Chad and Libya officials said the United States has been tracking the flow of weapons to insurgents and secessionists in southern Sudan.

"The weapons are coming from all directions," U.S. envoy to the United Nations, Susan Rice, said.

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In Brief - Quotes Of The Week

Magazine Round Up

Quotes Of The Week

"The rebels would have to return six Saudi missing soldiers if they wanted hostilities to end " Saudi Assistant Minister of Defence Prince Khaled bin Faisal referring to the conflict with the Houthis

"If there is intention of making peace, this file could be closed through a prisoners swap,"

The Leader of the Shiite Houthi rebels Abdel Malik al-Houthi making a peace initiative.

"Israel has no bigger friend," Prime minister Binyamin Netanyahu to the Italian Prime Minister Silvio Berlusconi, who begins an official visit to Israel accompanied by half a dozen ministers

"My greatest desire, as long as I am a protagonist in politics, is to bring Israel into membership of the European Union."

Berlusconi told Netanyahu in the context of his visit to Israel

8 February, 2010

1

Magazine Round Up 1 Time The Rebuilding of Haiti.

In words and images, Time takes an indepth look into the aftermath of the Haitian earthquake and what it will take to restore basic services to the devastated population.

James Natchwey’s photos illustrate the urgency of a sustained humanitarian response.

Moving on from the drama of last minute rescues of those trapped beneath rubble, these images capture the resilience of the population. The paradox of being an observer and an actor in the tragedy is acknowledged in the writings of Natchwey, whilst stressing the media’s ability to encourage people to help the Haitian population.

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2 The New Republic Obama in the Balance

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The recent difficulties that Obama’s Presidency has been encountering are discussed in the cover story of the current issue of the New Republic. John B. Judis argues that the President’s agenda is being compromised by a failure to engage with the working class population of America and generate enthusiasm for his policies. Judis cites several issues which have devilled plans to reform health care and hindered Obama’s attempts to extricate America from the mess which he inherited. The article argues that Obama must better address the concerns of Middle America if his fledging Presidency is to be considered a success by the American population.

3 Newsweek Blowing the Whistle on Anti depressants.

This week’s cover story takes a look at the controversy surrounding the effectiveness of anti depressant pills and argues that studies show that the benefit in taking these pills may derive more from a placebo effect than any medical effect. The author references several medical studies which support the claims in this article and given the huge sway which such pills hold with much of the American population, the conclusions of this cover story are likely to prove highly controversial.

3 Cover Of The Week

Cover of the Week The Economist

The Book of Jobs

The leader article of the Economist delivers an excellent analysis of the inventiveness of Apple and the genius of Steve Jobs as jokingly depicted on the cover. The power of new Apple devices to transform tired industries is heralded with reference to the IPod and IPhone and the potential of the newest gadget, the Ipad.

Issues 1544

15

In Brief - Letters

Letters

Thanks, But No Thanks!

There is no doubt that the American invasion of Iraq primarily targeted oil. The United States did not take into account the security risks and the consequences of this before the invasion. In fact, a few companies did demand security guarantees during the auction conducted on Iraq's oil fields, however that does not mean that the United States would not benefit from these fields, we would be mistaken thinking otherwise.

Ayman Abdallah

8 February, 2010

LAST ISSUE

Algeria President Bouteflika has managed to create a big difference in Algeria, where he was able to end violence and terrorism bringing peace and tranquility, he was also able to build a developmental infrastructure for the country.

Wael Al Ameri

Mixed Signals Al-Qaeda is a terrorist organization and does not differentiate between civil and uncivil, and therefore that the task of the Government of Karzai and the coalition forces and is not an easy one, thus coalition forces and the government of Karzai should cooperate to counter balance Al-Qaeda's threat

Mohammed Simari

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In Brief - Magazine Round Up

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Features

Š getty images

8 February, 2010

18 18

Keynes Trade Mark By Razeen Sally

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Features

Keynes Trade Mark International Trade and Emerging Protectionism since the Crisis Razeen Sally

Although relentlessly compared to the Great Depression of the 1930s, the Global Financial Crisis has not produced an equally catastrophic collapse of the trade regime. What one does see is a change in official discourse, a come back to the era of big government. This trend, however, is not without consequences to the global economy.

France's President and current European Union president Nicolas Sarkozy (C) poses for a family picture with Eurogroup heads of state and government, European Commission chief Jose Manuel Barroso and the president of the European Central Bank, ,Jean-Claude Trichet © getty images

2009 was a crisis year for international trade, which suffered its steepest decline since the 1930s. Protectionism returned, reversing an almost three-decade trend of trade liberalisation. But, contrary to expectations, it has not returned with a vengeance, rather creeping to the surface in subtle ways. It is time, therefore, to take stock of trade policy after the crisis, and consider its outlook at the beginning of this century’s second decade.

history. International trade increased sevenfold between 1980 and 2008, outpacing the increase in world GDP in the same period. World foreign direct investment (FDI) far outpaced both, increasing almost thirtyfold. The global economy had its “Goldilocks” moment in the half-decade from 2002. Growth, trade and FDI soared to ever-greater heights. Financial globalisation soared even higher.

The Goldilocks global economy

Rapid globalisation had two driving forces: technology and policy liberalisation. The West had its Reagan, Thatcher and European Single Market revolutions in the 1980s and early 1990s. Developing countries liberalised massively and integrated into the global

The pre-crisis global economy enjoyed golden conditions. The quarter-century up to the crisis saw the fastest increase in economic growth, globalisation and prosperity in 8 February, 2010

economy in the 1980s and ‘90s, with ex-Soviet economies following from the early 1990s. Average tariffs in developing countries fell from about 30 per cent in 1985 to just above 10 per cent in 2005.

Deglobalisation The financial crisis that exploded in September 2008 transformed a benign global political and economic context into something more malign. A sharp contraction in global growth ensued.

This was reinforced by even sharper contractions in trade, FDI and other channels of globalisation. The world suffered its worst “deglobalisation” since the Second World War. 20

Features Contractions in growth, industrial output and trade bottomed out towards mid-2009, followed by a halting recovery. By year-end the latter remained anaemic and uncertain in the West, but Asia rebounded quickly. China led the Asian bounceback, helping to lift other east-Asian countries out of the crisis, and India recovered fast as well. Thus the crisis seems to have accelerated the shift of economic gravity to the East. It has given rise to sunny Asian optimism, which contrasts sharply with Western gloom. Nevertheless, the global economic outlook remains uncertain, probably with turbulent times ahead.

That Asia cannot escape. Moreover, Western and Asian – notably Chinese – policy responses to the crisis are storing up a lot of trouble (of which more later).

To put flesh on the bones of crisisinduced deglobalisation: The last IMF World Economic Outlook forecasts a decline of 1.1 per cent in world GDP in 2009, split between a decline of 3.4 per cent in developed economies and an increase of 1.7 per cent in developing economies. The Asian Development Bank forecasts growth of 4 per cent in developing Asia in 2009, going up to an almost Tigerish 6.4 per cent in 2010. China is expected to post growth of 8 per cent or higher, and India 5-6 per cent, in 2009.

Deglobalisation has been most dramatic in finance. International capital flows shrunk by 82 per cent in 2008, and global wealth shrunk by USD 29 trillion in 2008 and the first half of 2009. The IMF forecasts the volume of international trade in goods and services to contract by 11.9 per cent in 2009, split between a contraction of 14 per cent in developed economies and 7 per cent in developing economies. This is concentrated in trade in merchandise goods, linked tightly to the collapse of global industrial output in the last quarter of 2008 and the first quarter of 2009. Parts of trade in services suffered equivalently, especially transport (related to goods trade), financial services and tourism.

But other services, mainly business and professional services, were much more resilient, even registering modest growth. According to UNCTAD, global FDI decreased by 15 per cent in 2008 and is forecasted to decrease by an extra one-third (to USD 1.2 trillion) in 2009. UNCTAD expects migrants’ Issues 1544

to inflationary threats. Collateral damage will include crowding out of capital for emerging markets, as well as making it more expensive.

The microeconomics and politics of financial bailouts and profligate macroeconomic policies are at least as vexing. It is stupefyingly naïve to expect these measures to be well-targeted and effective, while avoiding arbitrary interventions, wasteful pork-barrel spending and long-term entitlements.

This will stifle private-sector incentives to save, invest and innovate. It will restrict competition and raise costs for businesses and consumers.

remittances to fall by 5-8 per cent in 2009. The World Tourism Organisation projects international tourist arrivals to fall by 2-3 per cent in 2009.

Trade and the economy The global economic crisis has triggered a big shift in ideas and policies against free markets and in favour of government interventionism. “Crisis interventions” are bunched in two key areas: huge bailouts, especially but not confined to financial services; and fiscal stimulus packages, usually combined with loose and unorthodox monetary policies.

Bank bailouts were probably unavoidable in the extreme conditions of late 2008. So were extra loose monetary policies to inject a superdose of liquidity. But it is highly debatable whether massive fiscal pumppriming – Keynesianism on steroids – was necessary. Sceptics doubt the effectiveness of the Keynesian fiscal multiplier, especially in complex open economies (in which some of the extra demand leaks abroad through imports).

Oceans of public debt will mean higher taxes and real interest rates, in addition

One aspect of the new conventional wisdom is the belief in “Keynes at home and Smith abroad”. Greater government macro- and microeconomic interventions at home are needed to stimulate recovery and preserve social stability – and thereby prevent a slide into protectionism. But this should proceed in tandem with open markets abroad, which require robust international policy coordination (sometimes labelled “global governance”). This idea is based on a contradiction. Big Government at home, with its discretionary power and panoply of competition-restricting regulations, will inevitably spill over into protectionism. Keynes at home is Keynes abroad. After all, Keynes turned to protectionism in the 1930s, not least to make activist fiscal policy work in a “closed-economy” setting.

Here historical parallels are in order.

It is fashionable to make comparisons between the recent crisis and that of the 1930s. But in one important respect this is highly misleading. Then, tit-fortat trade protection rapidly followed the Wall Street Crash, and the world splintered into warring trade blocs.

This has not happened today, and it is unlikely to happen anytime soon.

Rather the appropriate comparison is with the 1970s. Then, a series of shocks triggered more government intervention. New labour-market and capital-market regulations, subsidies, fiscal-stimulus packages and priceand-wage controls were all rolled out.

These measures exacerbated initial crises and prolonged stagnation. But they also spawned protectionism.

Industry after industry, coddled by government support at home, demanded 21

Features protection from foreign competition.

The result was the “new protectionism” and “managed trade” of the 1970s and 1980s.

Unlike 1930s-style protectionism, this was not an up-front declaration of a trade war with tariff hikes, blanket quotas and draconian foreign-exchange controls. Rather it was more subtle, deploying non-tariff barriers such as “voluntary export restraints”, “orderly market arrangements”, subsidies, public-procurement restrictions and onerous standards requirements. It did not spiral out of control; rather it unfolded slowly and insidiously, and lasted over a decade-and-a-half.

It created overcapacity in several industrial sectors, and probably delayed global recovery and globalisation.

That, not a melodramatic 1930s scenario, is the danger facing us today.

Emerging protectionism Perhaps the biggest surprise is that the world has not hurtled into tit-fortat protectionism. According to the WTO, new trade measures since the crisis started affect a maximum of 1 per cent of world trade in goods.

New protectionism is concentrated in sectors that have long been protected: textiles, clothing, footwear, iron, steel, consumer electronics and agriculture.

New anti-dumping, safeguards and countervailing-duty investigations have increased, but they still affect a tiny share of world trade. And up to onethird of new trade measures have been liberalising.

Global Trade Alert (GTA) paints a more alarming picture. It counts at least 297 trade-discriminatory measures since November 2008. And protectionism in the pipeline is trending upwards. It estimates that one-third of new protectionist measures are bailouts to financial services, automobiles and other sectors. Thus the good news on remarkably mild “traditional” protectionism (mainly border barriers) is balanced by worrying signs of non-traditional, behind-the-border protectionism.

“Financial mercantilism” is at the top of the latter list. One aspect of it is home-government pressure on bailed8 February, 2010

© getty images

out banks to “lend local”, i.e. to lend at home at the expense of foreign lending (e.g. through foreign subsidiaries).

A second aspect is pressure from home governments and regulators to concentrate more financial trading activities at home, with accompanying restrictions on cross-border trade.

Finally, regulatory proposals may end up with a cordon sanitaire around mammoth banks deemed “too big to fail”, with alarming implications for global competition as well as moral hazard.

There are other non-traditional protectionist instruments deployed in the wake of the crisis. First, industrial subsidies. These have gone overwhelmingly to the automobile industry. Direct support has gone to domestic firms and could well fall afoul of WTO disciplines on trade-distorting subsidies. Second, public-procurement or “buy-national” restrictions. Third, restrictions on migrant labour. Fourth, FDI restrictions or “investment nationalism”.

Fifth, standards protectionism.

Anecdotal reporting points to more restrictive application of technical and food-safety standards on imports since the crisis started. But the climate-change agenda is set to be the Trojan Horse of new standards protectionism. Because cap-and-trade schemes, especially in the United States and EU, will impose substantial compliance costs on energyintensive sectors at home, there will be more pressure to impose similar costs

on cheaper, carbon-intensive production elsewhere not subject to carbonreduction policies. Hence the spectre of trade sanctions on “free riders”– China in particular. “Carbon tariffs” have been threatened. But climatechange protectionism could also include “green subsidies” that discriminate in favour domestic producers, and all sorts of discriminatory standards.

The credit for restraining traditional protectionism should go to markets and globalisation, not to summitry and palaver in the G20, WTO and other international fora. G20 pledges not to increase protection have been serially broken. And WTO disciplines on developing countries, even on tariff bindings, are very weak. Rather global market integration has imposed spontaneous disciplines on governments and businesses. They realise that upfront protectionism raises business costs, invites retaliation, excludes them from the benefits of globalisation, and damages wealth and welfare at home.

More worrisome is the non-traditional regulatory protectionism in the pipeline, on which WTO disciplines are weak to non-existent. The danger is that, if not contained, it will spread gradually to cover bigger swathes of international trade. That is the 1970s scenario to worry about.

A review of the troops Now turn to the major players in trade policy and see how they have 22

Features mechanisms take market reforms backwards. And there is the real risk of surplus manufacturing capacity flooding into shrinking export markets in Europe and North America, thereby inviting protectionist retaliation against China.

Commendably, the Beijing leadership has not rocked the boat during the crisis: it has not resorted to aggressive mercantilism. But stalled trade and FDI liberalisation, the absence of domestic structural reforms and creeping protectionism threaten future trade tensions.

Dominique Strauss-Kahn, managing director of the International Monetary Fund IMF © getty images

responded to the crisis. Start with the United States. President Obama has powerful protectionist forces inside his tent, especially among Congressional Democrats and organised labour. His record to date shows a balancing act, giving way to domestic protectionist forces at one moment, but cushioning their impact and maintaining open markets the next moment. Nevertheless, this administration’s overall approach is defensive; and trade policy is very low down its list of priorities. Above all, the administration is not leading with open-market initiatives; and the President seems extremely disinclined to face down his union supporters and protectionists in the Congress. That is no surprise: a left-liberal administration given to domestic intervention left, right and centre is not the sort of administration to take the fight to protectionists at home and lead international cooperation to open markets worldwide.

This is bad news. The United States is abrogating its traditional leadership role in world trade. It leaves a global vacuum, for there is no substitute leader to forge international cooperation to contain protectionism, open markets and strengthen multilateral rules – not the EU, not China, not anyone else.

The EU is also in defensive mode.

Generally, when the Single Market is opening up and integrating, EU trade policy is more outward-looking and proactive. When the Single Market is under stress from internal protectionism, EU trade policy turns to navel-gazing and gives way to protectionism against Issues 1544

outsiders. That is roughly the situation today.

National crisis responses within the EU included the effective suspension of rules on state aid, which restricted competition from other member-states.

The Lisbon Agenda of market reforms to boost EU competitiveness has been forgotten – one of the big casualties of the crisis. Externally, trade policy is defensive. With the exception of the (yet to be ratified) FTA with South Korea, trade negotiations are stuck. True, the EU has not markedly increased traditional protectionism (e.g. tariffs and simple non-tariff barriers), but there are signs of regulatory protectionism, especially on product standards (some of it to do with the EU’s climate-change agenda).

Finally, the Lisbon Treaty confers the European Parliament greater power in EU trade policy. Market-sceptical forces and single-issue fetishists in the EP may complicate decision-making and tilt policy outcomes in a more protectionist direction.

What about China? Liberalisation has stalled since about 2006, corresponding with more industrial-policy measures to promote selected sectors and “national champions”, mainly SOEs. China’s crisis response – essentially an investment binge – bolsters the public sector and state power at the expense of the private sector. It has succeeded in arresting growth slowdown in 2009, but it exacerbates China’s structural fault-line of over-investment and underconsumption. Its command-and-control

And now what?

The global economic crisis has ushered in a new age of Big Government.

Keynesian macroeconomics is back in fashion, as is Pigovian welfare economics – microeconomic interventions to fix alleged market failures. A socialengineering mentality – the belief that superior technocratic minds can solve complex social and economic problems with targeted interventions – is in the ascendant. Welcome to the world-view of Mr. Bentham. That of Mr. Hume, Mr. Smith and Mr. Hayek – the belief that governments cannot possibly have enough knowledge to “fine-tune” outcomes with detailed, prescriptive regulations; that they “fail” through human fallibility, political pressure and corruption; and, consequently, that regulation should err on the side of caution to allow markets to operate effectively – is much less popular at the moment.

The short-term challenge is to arrest the slide to Big Government at home and creeping protectionism abroad. The medium-term challenge is to get back on track with trade and FDI liberalisation combined with domestic structural reforms. That is primarily a matter for unilateral action by governments and competitive emulation among them. It can be reinforced by international policy cooperation in the WTO, G20 and other fora, but not too much can be expected of cumbersome global-governance mechanisms.

Co-director of the European Centre for International Political Economy (ECIPE) and on the faculty of the London School of Economics 23

News Analysis

More sanctions

to come as “psychological war” around Iran steps up Issues 1544

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News Analysis

More sanctions to come as “psychological war” around Iran steps up US President Barack Obama I twhowassaid when he picked up his

To begin with, the defensive buildup in the Gulf is not new, as Iran said so itself. The headlines were fed to an American and Israeli public. The message is that Iran’s offensive missile capabilities have been contained and that there is still time for diplomacy.

Nobel Peace Prize that “instruments of war do have a role to play in preserving the peace.” Perhaps he was foreshadowing February, when the bulk of war posturing over Iran’s defiant nuclear program would inevitably come.

Saber rattling and the diplomatic tit for tat in the past few days are intrinsically related to Washington’s efforts to impose more sanctions on Tehran by March. But does this mean the region is gearing up for a fight, as many pundits argue?

Quite the opposite, actually. Iranians and Americans, and a myriad of other military powers including Gulf countries, China, Europe, and Russia, are playing for time.

The main goal—shared by all with the exception of Israel—is to give diplomacy more time to work, even if that means sanctions.

Iran sees the bet and launches animals into orbit, that is, a non-military use of technology that can be adapted to intercontinental missiles Consider the recent poker game: the US publically boasts its defensive naval build-up surrounding Iran with deployments of a US missile interceptor fleet and of upgraded and more precise Patriot missiles batteries 8 February, 2010

Andres Cala stationed in Kuwait, Bahrain, the United Arab Emirates, and Qatar.

Iran sees the bet and launches animals into orbit, that is, a non-military use of technology that can be adapted to intercontinental missiles. Washington calls the bluff and says the act is a provocation that should trigger more muscular sanctions.

Both sides meanwhile test-fire missiles and missile interceptor technology, ahead of a Munich security meeting over the weekend where world diplomats debated sanctions.

Iranian President Mahmoud Ahmadinejad switches rhetoric and suddenly says Iran is close to a deal over its nuclear enrichment program, and Western powers again call the bluff and say there is no such thing in the horizon.

Ahmadinejad doubles up by ordering nuclear scientists to enrich uranium up to 20 percent (at least 80 percent is required for nuclear weapons) and opening 10 more enrichment plants around the country, accompanied by a beefed up air defense system. The response from the West is obvious: sanctions must come now.

But all this is precisely to avert war.

Iran is also playing for time. It has significantly improved its defensive capabilities in the past few years, at the expense of its offensive ones. By now most agree its nuclear program would survive any Israeli and US strike, baring a nuclear one.

The reason is that its best deterrent is its nuclear program. Tehran wants to show the world—especially Israel—it could build a nuclear bomb, without actually doing so. Already militarily surrounded, that ability is a better safeguard than any other weapon.

Surely sanctions will come, although unilateral and ineffective without China onboard. Iran will continue to fight it out diplomatically. But the end

Ahmadinejad doubles up by ordering nuclear scientists to enrich uranium up to 20 percent and opening 10 more enrichment plants around the country game is to disengage Israel. Too much is at stake for all to risk a regional war.

And this is just one deal of the cards.

Expect more. The outcome is in the entire game that will be played out throughout this year.

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Ideas

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8 February, 2010

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The Nuclear Road Ramon Pacheco Pardo Issues 1544

29

Ideas

The Nuclear Road

Between Tehran and Pyongyang

Ramon Pacheco Pardo Recent events implicating a nuclear partnership between Iran and North Korea amount to one of the greatest fears of Western and Israeli security experts. Nuclear collaboration between North Korea and Iran dates back to the 1990s. The risks, however, that the potential of such an alignment could have on Middle East security should not be underestimated.

A general view of Bushehr nuclear power plant at the Iranian Persian Gulf port of Bushehr

May 2009, North Korea I nconducted its second-ever nuclear

test. Allegedly, one of the goals of the test was to show the progress in Pyongyang’s nuclear know-how to Iranian officials. In July, the United Nations Security Council Sanctions Committee, following from the Security Council’s resolution 1874, imposed sanctions on three North Korean companies and one Iran-based company. In August, the United Arab Emirates, also in compliance with resolution 1874, 8 February, 2010

seized a North Korean ship carrying weapons to Iran. In December, Thailand held a plane also carrying North Korean weapons. American officials declared that the cargo’s probable destination was Iran.

These events, whether real or alleged, underscore one of the foremost fears of Western and Israeli officials and security experts: cooperation in the development of nuclear and missile programmes between Tehran and Pyongyang. Or more specifically,

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North Korea’s transfer of nuclear and missile technology, materials and know-how to Iran.

Nuclear collaboration between North Korea and Iran dates back to at least the 1990s. The Islamic Revolutionary Guard Corps, or Iran Revolutionary Guards, has been the organisation in charge of dealing with Pyongyang when it comes to nuclear matters since then. Being a branch of the military actively involved in the development of 30

Ideas Iran’s nuclear programme, the IRGC is well-positioned to negotiate with the North Korean military, which is the main driver behind North Korea’s nuclear activities. Reports about talks between both first surfaced during the North Korean nuclear crisis of 1993-94. Iranian leaders, wary of a possible nuclear arms race in the Middle East in the midst of the uncertainties that followed the end of the Cold War, decided to turn to the far-flung Asian country for help with their indigenous nuclear programme.

From a market perspective, Iran and North Korea are the perfect nuclear business partners. Tehran has cash and abundant energy resources, two elements that Pyongyang desperately needs. Meanwhile, North Korea’s nuclear programme is much more developed than Iran’s, making its technology transfers and technical know-how precious commodities in the Middle Eastern country.

Moreover, from at least 2003 North Korean experts and officials have been spotted in Iran, working to modify Tehran’s Shahab missiles in order to allow them to fit nuclear warheads. Reports also indicate that North Korean experts have been actively involved in developing Iran’s underground nuclear facilities.

Myong Lyu-do, a well-renowned North Korean specialist on the development of these facilities, has been travelling back and forth to Iran since early 2005.

Cooperation between these two countries in the nuclear field has internationalized, further compounding the fears of Western and Israeli security experts. Iranian and North Korean officials were working together in the development of the Al Kibar plutonium nuclear reactor, in Northeast Syria, which Israel bombed in September 2007.

Intelligence reports suggest that an undisclosed number of IRGC and up to ten North Koreans were killed in the bombing. Joint work in other facilities throughout the Middle East yet to be discovered is a real possibility.

Missile transfers from North Korea to Iran are a second area of concern for international officials and security experts. Transfer of this type of weapons is one of the main sources of capital for cash-strapped North Korea. Iran has been one Issues 1544

of its major clients since the mid1980s, when Pyongyang transferred Scud-B missiles. These, along with those offered by Libya and Syria, served Tehran to start developing an indigenous missile programme.

For over two decades, North Korea has been Iran’s most reliable missile technology, material and know-how supplier. The Shahab class, which includes medium-range, long-range and satellite-propelling missiles, is to a large extent based on North Korea’s Nodong and Taepodong missiles. As is the case with nuclear cooperation, the IRGC is Iran’s main point of contact with the North Korean military when it comes to missilerelated transfers. In fact, cooperation in the fields of nuclear and missile weapons is closely interlinked. The Shahab-3, a medium-range rocket with an estimated reach of up to 1,600 kilometres, is the missile that Iranian technicians and their North Korean counterparts have been trying to modify to fit a nuclear warhead.

The Shahab-3 can hit Israel, which explains Tel Aviv’s preparations for strikes on Iranian nuclear and missile facilities.

Hezbollah is one of the main beneficiaries of cooperation between Iran and North Korea. Hezbollah’s close links with the IRGC are well-known. The IRGC has been acting as an intermediary between Hezbollah and North Korea since the late 1980s. The Asian country has transferred arms to the Lebanonbased organisation and trained its members for over two decades now.

Collaboration between both was upgraded during the 2000s, when the Korea Mining Development Trading Corporation, a governmentcontrolled North Korean company, brought experts and equipment to Southern Lebanon to construct underground facilities. Western and Israeli security experts concur that these facilities could eventually host nuclear materials.

Nuclear and missile cooperation between Iran and North Korea is at the top of the security agenda in the United States and Israel. The fear of a North Korean nuclear or missile attack on the United States is negligible. In contrast, proliferation to Iran has been ongoing for over two decades. Therefore, it does not come as a surprise that Barack Obama

and Hillary Clinton have called for both countries to halt their nuclear programmes and for North Korea to refrain from proliferation, implicitly suggesting that the two issues are linked. Similarly, resolution 1874, which the United States was instrumental in drafting, focused on halting Pyongyang’s arms transfers.

Earlier, Condoleezza Rice made the link between North Korea’s proliferation and Iran’s nuclear programme clearer, connecting the talks aimed at curtailing Pyongyang’s nuclear programme to the resolution of the Iranian nuclear issue.

Israel is arguably the country with the greatest interest in halting cooperation between Iran and North Korea. However, whereas the United States has to a large extent concentrated on the country of origin of nuclear and missile technology and material, North Korea, Israel has focused on the other end, Iran.

And while the United States has so far emphasized dialogue, Israel has called for strikes on Iranian military facilities. Tel Aviv understands that its leverage over Pyongyang is nonexistent, so it has focused on the threat closest to home.

Ultimately, integration of North Korea within the world economy seems to be the only plausible way of putting an end to its proliferation and cooperation with Iran. Pyongyang’s nuclear programme does not significantly boost North Korea’s security from a possible American military strike.

Its defensive and offensive weapons of mass destruction suffice for this. However, a well-developed nuclear programme is an excellent instrument to raise capital. Absent competition from the A. Q. Khan network, North Korea is the main player in the nuclear proliferation business. If this revenue stream were to be replaced by proper integration in the world economy, including access to the American and Japanese markets, North Korea would almost certainly give up nuclear proliferation. However, as long as Pyongyang is not part of the world economy, IranianNorth Korean nuclear and missile cooperation will continue.

Researcher in counter-proliferation and East Asian politics 31

8 February, 2010

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People

The Vanguard of Liberalization Professor Jagdish Bhagwati Š getty images

Issues 1544

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People - Profile

The Vanguard of Liberalization Professor Jagdish Bhagwati Professor Jagdish Bhagwati’s work has been at the forefront of trade liberalization research. Having been described as the most creative international trade theorist of his generation, his academic and policy achievements have made him a leader in the fight for free trade.

I

It is during times of financial crisis that trade liberalization comes under the most scrutiny.

Fearing competition during times when the market is difficult often leads to claims that protectionism is the solution to the harsh conditions at hand. In the field of economics, however, Jagdish Bhagwati has dedicated his career to proving that the opposite is true.

A maverick at heart, Bhagwati understands that his take on liberalization policies is at times unpopular, but he is never afraid to voice his opinion on the subject. ‘I have been alone, but I hang in there… Usually the world comes around.’ Equipped with passion and sarcasm (no doubt a legacy from his days 8 February, 2010

spent in England), Professor Jagdish Bhagwati’s work has been at the forefront of trade liberalization research.

With over three hundred publications on the subject, Bhagwati is renown for his various theses on the benefits of liberalization, with his latest book, In Defense of Globalization, attracting international acclaim.

Yet Professor Bhagwati is not just another academic preaching from an ivory tower. In addition to his position as Professor at Columbia University, Bhagwati is also a Senior Fellow in International Economics at the Council on Foreign Relations. Having been

described as the most creative international trade theorist of his generation, his academic and policy achievements have made him a leader in the fight for free trade.

Bhagwati was born in Mumbai in 1934 although he pursued his undergraduate degree in Economics at Cambridge University’s St. John’s College.

After receiving his degree in 1956, he pursued a doctorate in Economics at the Massachusetts Institute of Technology in the US. Once he completed his degree he returned to his native India to teach at the Indian Statistical Institute, and at the Delhi School of Economics.

Although he later left India to teach at MIT and Columbia 34

People - Profile University, an important portion of his research focused on the economics of his home country. Now, at 76 Bhagwati’s accomplishments have put him on the shortlist of candidates for the Nobel Prize in Economics.

Bhagwati’s research is not only commendable for its insight, its also respected for his commitment to defend his ideas in the face of its staunchest critics. His book In Defense on Globalization has been described as a point-by-point response to the questions that critics of liberalization have posed. In an interview with Reason magazine Bhagwati explained that an important objective of this book was, in fact, to address to the concerns that people have of globalization.

‘When I was in Seattle in 1999, when everything went haywire as far as trying to get a new round of trade negotiations, I realized that people who were agitating… were not interested in whether trade was good for national income and prosperity.

They were claiming that globalization has an adverse affect on social issues… they were concerned globalization lacked a human face.’

In this book, Bhagwati manages to demonstrate that liberalization can have positive effects on the lives of individuals. One of the many examples In Defense of Globalization provides is how liberalization helps reduce the gender gap in wage inequality.

In managing to demonstrate both the macroeconomic benefits of liberalization, and providing the public with the type of reassurance they demand from proponents of economic reform, Bhagwati sets himself apart from other academics in the field of economics.

In fact, this is probably what Issues 1544

has made him such a popular professor at Columbia University.

Students there explain that beyond his contribution to highlevel research, it is his ability to simplify complicated results that make his courses so coveted.

An example of this skill is his breakthrough contribution to trade theory. If in previous interviews he has described his theory as “simple” it is only because he has the ability to distill key information from complicated economic processes in a way that makes his conclusions appear self-evident.

His theory explains that for a long time free trade was criticized because protectionists argued that the benefits of free trade only existed when markets were

Bhagwati manages to demonstrate that liberalization can have positive effects on the lives of individuals

perfect—that is, only when they reflected true social costs could prices guide allocation correctly.

His research proved that instead of discarding trade when the market wasn’t perfect, what you could do was ‘fix the market’ so it reflected costs accurately.

Bhagwati’s ability to explain his research in a comprehensible way is undoubtedly an important advantage for this free-trade defender. By making his research approachable he has made himself the right-hand man to many policy makers and international organizations responsible for developing trade policies. In addition to his

position at the Council on Foreign Relations and at Columbia University, Bhagwati’s position as an economic policy advisor to the Director General of the GATT, a special advisor to the UN on globalization, an external advisor for the WTO, and an academic advisor to Human Rights Asia speak to his ability to cooperate with the policymaking sector.

Despite Bhagwati’s reputation as a vanguard of liberalization, he does not associate himself to any established political or ideological label. Rather, this fiery man told to the New York Times that he preferred to consider himself ‘a public nuisance’, that is, someone who challenged established policies and picked apart conventional beliefs.

Politically difficult to pinpoint, his critics actually claim that as an economist his recommendations are also inconsistent. Namely, they point to his departures from laissez-faire economics, and his opposition to policies such as the enforcement of intellectual property rights in countries like Brazil and India.

Yet, his point of view is not inconsistent, that is, if you can see him as an adherent to a relativist philosophy of economic reform. Bhagwati argues that different countries have different priorities, and it is their needs that should dictate policies like intellectual property enforcement, rather than adhering to blanket policies on the subject. Whatever label his followers and critics may bestow upon Dr. Bhagwati, all we can be sure of is that his policy recommendations are based on the belief that together democracy and free-trade can encourage both growth and social reform.

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People - Interview

Terrorists or Liberators?

Akram al-Kaabi, Leader of Asaeb Ahlulhaq In this interview, Akram al-Kaabi, the leader of the Iraqi organization "Asaeb Ahlulhaq", talked with The Majalla about the group’s origins, its links with other groups, a few of its operations, and its activities against American and British troops in Iraq. Al-Kaabi also confirmed that his organization currently holds a British citizen and an American citizen hostage, and revealed the existence of an agreement with the Iraqi government for the exchange of the hostages held by the group for a few detainees held by the government.

Qais al-khazaali, head of firebrand Shiite leader Moqtada al-Sadr's office in Baghdad

T

In an exclusive interview with The Majalla, Akram al-Kaabi, the leader of the Iraqi organization "Asaeb Ahlulhaq", discussed the group’s origins, links with other groups, and talked about the targeting of American and British troops and vehicles, stressing that these operations will not come to an end until the US and the UK withdraw from Iraq. Al-Kaabi, who is listed by the United States as a terrorist, expressed his views about the current political situation in Iraq, and also about the issue of civilian deaths. Al-Kaabi confirmed to The Majalla that Asaeb Ahlulhaq currently holds a British citizen and an American citizen hostage, and revealed that a secret agreement has been concluded between Asaeb Ahlulhaq and the Iraqi government to exchange hostages held by the group 8 February, 2010

for detainees held by the government.

The Majalla: Could you tell us about the Ahlulhaq Organization and Hezbollah Brigades, what is the difference between them? How have they been founded?

Who are their most prominent founders?

Ahlulhaq organization, formerly Ahlul Kahf, was founded after the end of Najaf battle in 2004. This was due to several reasons, including occupation forces violating Iraq's security, pursuing their arrogance, looting the country's wealth, and controlling the political situation. At the same time, Muqtada al-Sadr decided to halt military operations, though a large number of field commanders joined the resistance hoping that it would continue.

Thus, we have worked on arranging our

© getty images

ranks independently, and we tried hard to change the method of resistance, based on our experiences in battles against the occupation in 2004. During those battles, I and Sheikh Qais Khazuali were general supervisors on the army of Imam Mahdi—May God hasten his glad advent—during their resistance to the occupation at the time. I was leading the battle in Najaf, and Sheikh Qais Khazuali was leading the battle directly in Baghdad.

We commissioned fellow Mujahedeen to do the same in the other provinces.

We have learned much from both successes and failures. Our new approach was to work in guerrilla-style as a strategic principle, which is very different from the way the battle was run previously regarding the tactical 36

People - Interview and security aspects and methods of combat in general. Goals might be the same, but methods to achieve them were completely different and new, in terms of adopting the principle of manoeuvre, using attrition tactics against the enemy, and safeguarding elements of resistance.

Hezbollah is defending Arabs and Muslims against the Israeli threats.

Therefore, it is an honour for us to have relations with them.

Indeed, with God's help, we realized a big difference between the two methods.

Guerrilla war depends on manoeuvre that compensates for the difference in forces and number of troops. We were joined by revered Mohammad Tabatabai— blessings upon him—after he was released from detention of the occupation.

I'm sorry I cannot answer this question, for security reasons.

and national duty that we liberate them.

What is taken forcefully can not regained but with force. It is a legitimate right to undertake operations for taking their soldiers and elements hostage, to get our fellow Iraqis back. Therefore, we planned and implemented the operation by heroes of Iraq’s Asaeb Ahlul-Haq. Hiding them is in Iraq under certain arrangements that can not be disclosed.

The Majalla: Have the Lebanese fought with you?

The Majalla: Is Iran involved in this kidnapping operation?

No people other than Iraqis have fought with us at the battle field.

No, Iran is not involved in this operation.

Concerning Hezbollah Brigades, there is no difference between us, because we have the same goal and the same enemy.

We have good relations with them. We wish them victory and support from God.

Iran is a neighboring Muslim country. We respect and have a good relationship with that country, because the Islamic Republic supports all the resistance movements

The Majalla: Does Iran have a direct relationship with the two organizations?

Iran is a neighboring Muslim country. We respect and have a good relationship with that country, because the Islamic Republic supports all the resistance movements such as Hezbollah in Lebanon, and Hamas and Islamic Jihad in Palestine.

The Majalla: What is the relationship of the Revolutionary Guards with the organization?

The Revolutionary Guards are a group of Mujahideen adhering to principles of the Islamic Revolution in Iran. They include many scholars and clerics who have graduated from the Hawza in the holy cities of Qom and Najaf. They have good relations with most Iraqi political and other parties – and even with regional parties.

The Majalla: From whom do you get your funding and weaponry?

From some bodies of the believers and strugglers who support resistance and liberation of Iraq.

The Majalla: What is your relationship with Lebanon’s Hezbollah and Mr. Hassan Nasrallah?

Mr. Hassan Nasrallah—God bless him—is the best Arab Mohamddi model for resisting arrogance. The victorious

The Majalla: Do you train your followers in Lebanon?

The Majalla: What is your relationship with Imad Moghniyeh?

The martyr Imad Moghniyeh is a great icon for Islamic resistance in the world. Rejecting world arrogance and occupation links us with him. Though we are in distant countries, our hearts are unified and have the same goals.

The Majalla: We would like to know more details about the British hostages. When and how have you kidnapped the hostages and where have you hidden them?

The American occupation of Iraq is illegitimate, they are usurpers.

In addition, they take our fellow Iraqis, leaders, and scholars, hostage.

Consequently, it is a religious, ethical

The Majalla: Did you move the hostages inside Iran?

No, they have not left Iraq at all.

The Majalla: How would they be treated in case of illness?

We allocated a doctor who examines them regularly.

The Majalla: Please could you tell us more details about the daily life of the hostages and how they spend their time?

We provide them with all what they need to feel comfortable and unstressed. They knew that only their government, which occupies Iraq, has the solution that would enable them to return to their country.

The Majalla: What about the circumstances related the death of two hostages'?

Those who were in charge of guarding the hostages allowed them to walk and exercise sports activities freely. However, they tried to escape when they heard the noise of US patrols nearby. Those who were in charge of guarding them have no choice but to kill them.

The Majalla: Why did you kill Iraqis?

The operation was executed without firing a single shot. No one was killed when the hostages were captured, either Iraqis or not.

The Majalla: Were there any Iraqis among them?

Yes, them

there were Iraqis among in the building. We took 37

People - Interview the way in which he has become the secretary general of Asaeb Ahl Al-Haqq, according to the bylaws of the group, the Board of Trustees had to select the secretary general. There was a consensus that Al-Khuzali be the Secretary General of Asaeb Ahl Al-Haqq. The Board of Trustees consists of founders of resistance in Iraq in the middle and the southern areas and certain areas in north of Iraq.

They are experienced, professional leaders with an honorable Islamic history.

The Majalla: And what's Muqtada Al-Sadr's stance towards the Asaeb?

Iraqi Shi'ite cleric Moqtada al-Sadr

Hezbollah leader Hassan Nasrallah Š getty images

only the five British nationals.

The Majalla: Please provide us with more details about the kidnapping operation.

In brief, the operation took place in an Information Center of the Ministry of Finance. This Center is located at Palestine Street in Baghdad which was under strict security measures.

The Center was frequently visited by British experts and guards who were previously soldiers belonging to the occupation troops in Basra governorate.

They worked in military intelligence and after they completed their military service, they were designated for guarding those experts. After we had sufficient information, we bought cars similar to those used by security forces and trained one hundred fellow effective Mujahideen who had the ability to break into the building, leave it safely and execute military maneuvers. We completed the operation successfully on Monday 29/5/2007 at 9:00 a.m. We did not incur any losses and we left the place victoriously.

The Majalla: How have negotiations with the British side taken place?

We did not make direct negotiations with the British side. Our negotiations were always mediated by the Iraqi 8 February, 2010

government, which in turn makes negotiations with the British side.

The Majalla: Who does represent the Iraqi side and who have represented the British side in the negotiations?

The Iraqi side is represented by the cabinet that commissioned Mr. Samy AlAskary to represent them.

The Majalla: Has Engineer Abu Mahdi played any role in the operation or the negotiations?

No, he has not played any role.

The Majalla: Who is Qais AlKhuzali and how did he become Secretary General of the Asaeb?

Sheikh Qais Al-Khuzali was a student of the grand religious leader Martyr Mohammed Al-Sader and one of his reliable men. He was a member in his office and represented his thought and school of intellect which has been widespread among the Iraqi people in general and the followers of Al-Sader approach in particular. Al-Khuzali is an icon for Iraqi fair noble resistance, unstained with bloods of Iraqis. He is also the symbol of martyrdom and sacrifice.

He did his best for the sake of liberating the Iraq soil and people. Concerning

Muqtada Al-Sadr is a national and political Iraqi figure. He has his own style in activity and we have ours. We hope that we will be united one day to liberate our country, Iraq. We also look forward to avoiding disagreements from which the enemy takes advantage. We want to avoid fabricating accusations to each other.

Our cause is virtuous and honorable. We do our religious duties. Therefore, it is time to shun disagreements and unite to confront our common enemy.

The Majalla: What is your opinion of the political process?

We support the political process which set liberation, unity, sovereignty and independence of Iraq as a top priority.

The Majalla: Will you participate in the next elections?

No, we will not participate in the coming elections.

The Majalla: What were your major military operations?

Some of our major military operations include the Karbala’s hostage operation in 2007, which was, according to the commanders of the occupying forces, the largest operation that targeted their forces in the Middle East; the burning of the US Falcon base in Baghdad, which resulted in the killing of more than a hundred soldiers of the occupation forces; the downing of the British aircraft in the Maysan province in 2007, which resulted in the killing of more than seventy soldiers of the occupation forces; the shooting down of a helicopter in Basra in 2006, which resulted in the killing of five soldiers from the Israeli forces, including the commander of the British 38

People - Interview air fleet; targeting a convoy of the U.S. military commander in Najaf and killing him; and the operation of seeking to hold the Polish Ambassador hostage, which have not succeeded, but the convoy was almost completely destroyed, and he was severely injured, as the enemy admitted afterwards. There were also many other successful military operations on which we have published on many websites.

The Majalla: What is your position towards the Sunni resistance?

We refuse to say that there are two kinds of resistance, Sunni and Shiite.

We are one united Iraqi resistance that performs its legitimate functions. We both have a common goal, which is to liberate Iraq from being occupied. We pray for the same god, read the same Koran, and follow the same prophet.

The Majalla: What is your stance towards the bombings in the cities, assassinations, and the killing of Iraqi police officers and politicians? Do you approve of killing them for cooperating with the occupation forces?

Those who perform such heinous criminal acts are violating morals and teachings of Islam and teachings of the Prophet Muhammad. He has forbidden us from cutting trees, giving them sanctity of their own. Furthermore, he has forbidden us from killing children, women and civilians whose lives are protected and respected under the Islamic law. Anyone who kills women, children and civilians is alien to Islam and the teachings of the Prophet Muhammad. That person will be no different from the soldiers of the occupation forces, and is helping them implement their colonial agenda of killing peoples. We respect the Iraqi blood, whether it is that of a civilian, politician or a policeman. We support the stability of the country's security, and shun chaos that gives justification for the occupation forces to commit genocide crimes. Chaos gives an excuse for occupation forces to remain in our cities that reject its existence.

Therefore we call upon all Iraqis to forget about their differences and unite.

The occupation forces are attempting to plant seeds of sectarianism among us.

This is a colonial goal and a trap that we must not fall into. There are no real sectarian differences between Iraqis.

They are no more than false claims by Issues 1544

Egyptian Prime Minister Ahmed Nazif

© getty images

the occupying forces. Not so long ago we were praying in the same mosque. But this is the way the occupying forces work – they search for gaps and differences which they might use to make us fight each other, while they sit safely away watching us do this. That is what they managed to do in Palestine, despite the fact that the Palestinian factions are followers of the same religious doctrine. The same thing also happened in Afghanistan, Lebanon and many other countries once they became occupied countries.

WeareMuslimIraqiresistance.Ourmaingoal is the liberation of Iraq from the occupation.

The Majalla: And what about the killing of Sunnis?

The Majalla: What do you think of the translators who work with the U.S. forces and other occupying forces?

The Majalla: What do you think of making alliances with other organizations?

We are targeting U.S. vehicles. Anyone inside is a follower of the Americans, and they have only themselves to blame.

We hope that the resistance groups in Iraq be united under one alliance. Our hearts are opened before our arms for such alliances.

The Majalla: Are you involved in the murder of women and barbers in Basra?

The Majalla: Are you currently holding Britons hostage?

This is far from our goals, behavior and ethics. We only target the armed occupiers.

Any other differences we might have with other people we prefer to solve them by persuading the other party through dialogue and discussion.

Yes, we have a British and an American hostage. And, we are willing to release them once the Iraqi government meets our demands.

The Majalla: Are you involved in the murder of former officers and Baathists?

Interview conducted Mohamed Ali

I stated previously that we are Muslims and Iraqis. We will not allow the occupiers and their supporters in Iraq—who claim to be resisting the occupiers, while in reality they are supporting them— to divide us and make us fight each other. We refuse the targeting of both Sunni and Shiite Iraqis, and all other Iraqi ethnicities and races.

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Najah

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Economics International Investor

Markets

A Gentlemen’s Disagreement

Guy de Jonquières

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Economics - International Investor

A Gentlemen’s Disagreement Why global solutions to common problems are so hard to find.

Though politicians preach multilateralism as the answer to global problems, it is not working very well. The reason is that seismic shifts in geopolitics and the world economy have made international agreements harder to achieve.

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and EU are as unwilling to commit to legally enforceable WTO ceilings on their existing farm subsidies as developing countries are to cap their tariffs at current levels.

decade separates the collapse of the World Trade Organisation’s meeting in Seattle in 1999 and December’s messy climate change summit in Copenhagen. But the parallels are compelling. Both gatherings promised much and delivered little. Both exposed, rather than bridged, wide gaps between governments. And both ended in bitter recrimination.

The two events, and a string of other inconclusive international meetings in between, demonstrate how hard it is to put into action politicians’ pious commitments to multilateralism.

For all the fine words about seeking common solutions to global problems, the will to achieve them remains frustratingly elusive. What has gone wrong?

Our ideas of multilateralism are still shaped by the architecture that emerged after the second world war.

It was embodied in such institutions as the IMF, the World Bank and the General Agreement on Tariffs and Trade. All were designed, in different ways, to promote international order by establishing agreed frameworks of rules and conduct.

But the “old” multilateralism grew out of special, arguably unique, circumstances.

Paradoxically, it took a hegemon, the US at the height of its global power, to design, promote and sustain it. Not only did the US set the agenda and keep other nations in line; it exercised constructive leadership by taking a long, and generally enlightened, view of its own interests that transcended shortterm national advantage.

However, the end of the Cold War undermined both the geo-political rationale for such policies and Americans voters’ willingness to support them. Meanwhile, Europe had become an economic, if not a diplomatic, heavyweight. New economic powers, first Japan and now China, emerged to challenge US preeminence. High oil prices encouraged more muscular diplomacy by energyexporting countries. And globalisation spread prosperity more widely around an inter-connected world.

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Guy de Jonquières But no other global leader has stepped up to replace the US. Nor is any likely to soon. The EU lacks the necessary political cohesion and clout. Neither China nor India, both preoccupied with challenges at home, wants the costs and responsibilities that leadership entails. Japan is equally reticent. In any case, none of these Asian countries would be accepted as a leader even by others in their region.

As a result, influence has been diffused among different power centres; none can bend others to its will, but the consent of all is needed to reach multilateral deals. That has set up awkward tensions between global institutions’ legitimacy, in terms of their inclusiveness, and their decisionmaking efficiency. Even relatively minor players can now flex muscles and thwart consensus, as happened in Copenhagen and, repeatedly, in the WTO’s troubled Doha round.

The Group of 20, which has supplanted the old G8 as the pre-eminent global economic forum, is the most recent attempt to reconcile those tensions.

So far, its diverse members have hung together in the face of the economic crisis. But it is unclear whether it will prove any more effective than the G8 as a catalyst for decisive joint action once the crisis passes.

Furthermore, there is a growing reluctance among governments to submit to binding external rules. That used to be a US prerogative. Now it is increasingly widespread. It partly explains the problems in Copenhagen and in the Doha talks, where the US

Perhaps the bar has just been set too high. The goals for Copenhagen were probably unrealistically ambitious, while the economic case for the Doha round always looked questionable.

But if the “new” multilateralism is to become more than a pretext for empty political posturing and point-scoring, other lessons have to be learned.

One is the need to build trust.

Globalisation has flattened barriers and made economies more interdependent.

But politics has not kept pace.

Big gaps still exist between the priorities and perceptions of different governments and the domestic constituencies they answer to. Mutual misunderstandings abound, breeding suspicions and rivalry – above all between superpowers - frustrating the quest for common ground.

A second lesson is that effective multilateralism begins at home.

Hopes that big international meetings can create consensus are doomed to disappointment unless participants are seriously prepared to make the commitments needed to reach agreements – and to fight for them against domestic opposition.

Of course, peer pressure can help persuade foot-draggers, though only if they are ready to be persuaded. But trying to impose solutions from the top down, when the ground below is shaky, is pointless or self-defeating.

In the absence of strong global leadership, governments need to concentrate less on creating grand overarching designs and more on building multilateralism from the bottom up. That will take time, perseverance and political courage.

Success is by no means certain. But unless the effort is made, muddling through may be the only alternative.

Senior fellow at the European Centre for International Political Economy. He previously worked for The Financial Times.

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Now you can follow the majalla anywhere anytime on your

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Economics - Behind the Graph

Trade and the Global Financial Crisis When compared to the collapse of world trade system in the 1930s, the financial system has proved resilient during the 2007-2009 Global Financial Crisis (GFC). Although trade flows have indeed plummeted since the outbreak of the crisis, this has been a consequence of market pressures rather than of a rise in tariffs and quotas. Thanks to the World Trade Organization (WTO)’s General Agreement on Tariffs and Trade and its Dispute Settlement Mechanism, countries have been unwill-

ing, and more importantly, unable to raise tariff levels and quotas during the GFC. What we have observed, instead, was a rise in trade remedies, i.e. antidumping, safeguards and countervailing duties measures, which allow countries to impose temporary tariffs until the WTO investigates any unfair pricing practices in the exporting industries.

Although these measures are often protectionist in intent, they are temporary in nature. Furthermore, As thoroughly explained in this week’s

feature article, the protectionism observed during the crisis has been of a regulatory kind, imposing subjective and often unjustified quality standard requirements to imported goods. Unlike trade remedies, the multiplication of these standards poses a long-term problem. A further trend observed is that this time around, these protectionist measures have been instituted primarily by developed countries.

Exports and the Crisis (BRICS and the TRIAD)

Exports of merchandises have suffered enormously during the GFC. With the collapse of Lehman Brothers in September 2008, world trade initiated its free fall. For the first time since 1948, the world experienced negative growth rates in international trade. From the first quarter in 2006 through the beginning of the third quarter in 2008, exports of merchandises had grown consistently in the major world economies. All this ended in the middle of the third quarter of 2008.

By the end of the third quarter of 2009, all the major economies were experiencing negative growth rates to the year. Since the end of the third quarter of 2009, the trend seems to be reversing as these economies leave recession.

Global Oil Demand Growth 2008-2010, Mns of Barrels As the the GFC spread to the major world economies either ushering recession or, at best, considerably slowing their economic growth rates, global oil demand collapsed. The United States, as the source of the crisis was particularly hard hit in 2008, while Europe and Latin America still experienced growing demand. As the crisis spread, to Europe, demand plumeted in 2009. In the developing and emerging world, these trends were somw hat different.

Latin America, dispite lower growth rates, experienced a growing demand throughout the crisis. Asia, the least affected region by the crisis saw its oil demand grow from 2009 onwards, very likely stimulated by the massive Chinese stimulus package. 2010 bodes well for the whole world, as the world economy recovers, oil demand is on the rise again.

Exports and the Crisis (Selected MENA Countries)

The Middle East and North Africa (MENA) economies were not spared from the crisis. As their main export markets entered the recession, exports from the region also plummeted. The case was particularly dire for oil exporters. As oil demand fell, so did the price of oil—which experienced a free fall from June 2008 onwards. Lower demand coupled with falling export prices imposed significant difficulties on the region’s oil exporters (in the figure, Iran, Bahrain and Kwait). Th latest figures, however, point to economic revival, mainly driven by unexpected positive economic figures from Saudi Arabia. This bodes well for the GCC countries.

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Reviews Books

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Readings

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Reviews - Books

The Keys to Change Forces of Fortune The Rise of the New Muslim Middle Class and What it Will Mean for Our World Vali Nasr Free Press 2009 In his latest book Nasr argues that the key to political reform in the Middle East is through economic change. Namely, the growth of the middle class stands to alter the political priorities of the countries in the region, and lead to the warming of ties with the West.

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he relationship between the West and the Middle East is one filled with numerous tensions to say the least. Nowhere has Huntington’s call of a clash between civilizations seemed to resonate more than between the diplomatic comings and goings of Western liberal countries and their reputedly less-liberal Middle Eastern counterparts. Vali Nasr’s latest book, Forces of Fortune, takes a look at the underlying opportunities that are present in the region which could encourage a new and improved relationship between the Middle East and the West.

Nasr, following Hume, argues that the force of change within the Muslim world is found in the business-minded middle class. This group, he maintains, is key for future engagement with the West, as their growing economic power will put them in an important position to decide the future political inclinations of their native countries. ‘It is time’ Nasr notes ‘to think less about civilizations clashing and to recover the great insights… about the transformative power of markets and commerce…’ Citing Hume he states ‘Commerce… softens manners and makes a politics based on reason and deliberation, rather than fighting and romanticism far more imaginable’ (27).

In describing the growing power of the middle class in the region, Nasr focuses 8 February, 2010

particularly on how Iran could stand to benefit from this phenomenon. Iran is a particularly interesting case study, as it is one of the most influential countries in the region, and has the capital necessary to promote its interests. However Nasr notes there is one fundamental difference between Iran and the emerging powers of the day. The recent emergence of new powers, like the BRICS, has had very little to do with hard power—military capabilities that is. Rather, these countries are ‘economic stars;’ recognizable drivers of growth in neighbouring regions. Unlike these emerging powers, however, Iran has closed itself off from the world economy—a fact that seriously hinders its great power ambitions.

Particularly illustrative of this point, is one of Nasr’s many insightful observations, as he compares the different avenues that India and Pakistan have followed since attaining nuclear capability. Despite their parity in this regard, only one of them has emerged as a regional power. The lesson to be learned therefore is that Iran should focus less on developing a nuclear program, and more on engaging in the world market if its true ambition is to extend its influence.

Iran’s economic influence in the region is severely hampered by the fact that it is the 151st most isolated country in the world, out of a list of 160, and the sixteenth most

isolated in the Middle East, out of a list of seventeen. Nasr’s message is explicit to Iran and the West, as both stand to gain much from seeing Iran seriously engage its resources in the world economy. Such a strategy would boost Iran’s influence, and its economic reform would trigger the type of political “softening” Hume predicted.

Although Nasr’ s analysis of the important weight that economic trends have on the politics of the Middle East, his assumption that political reform follows economic reform is not clear. While he uses the case of China to support his conclusion, arguing that since China has opened its economy it has implemented some political reform. The question that should have been addressed by Nasr is whether political reform in China was sufficient to support the conjecture that economic liberalization is necessarily followed by political liberalization.

While there must undoubtedly be some sort of time lag between the political reform that is initiated by the rise of a powerful middle class, the evidence in favour of the bourgeoise-equalsdemocracy formula is found wanting.

Another important question raised by the relationship Nasr defines between political liberalization and economic success is how the financial crisis might affect the ability of the economy of the

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Reviews - Books Arab world to encourage reform. After all, Nasr is explicit about the important role that the rising power of the middle class has in encouraging change. Yet after 2008, one must assess whether the middle class in the region continues to thrive. While the Middle East was purportedly less hard hit by the crisis than Europe and the US, it was still affected.

The IMF, for one, claimed in October that the crisis had slowed down economic growth, and despite improvements growth would remain relatively subdued.

The impact of the economy on political reform thus presents various questions for the potential warming up of relations between the Middle East and the West, such as, would a reverse trend in the economy promote the more isolationist tendencies of the region and thus reduce the likelihood of a rapprochement with the West? If this is the case than is economic reform truly an ideal means for the West to assess the regional influence of countries in the Middle East, and more over, use this measure as a means to organize their foreign policy in the region?

On the other hand, the attention Nasr pays to Iran in Forces of Fortune is commendable if only for his ability to accurately portray the country’s importance in the region.

Arguing that Iran changed the political make-up of the region in 1979 and could do the same again, gives important weight to the recommendations he puts forth.

Furthermore, his ability to underscore the importance of Western rapprochement with Iran, highlighting that Western interests are in ‘seeing Iran line up with, not against, the logic of economic change’ (25) point once again to Iran’s ability to amplify a similar trend throughout the Arab world.

Filled with anecdotes from visits to the region, and complemented with concrete statistical evidence, Nasr is able to paint a clear picture of the situation in the Middle East today. In addition to his original theory highlighting the way in which Iran’s economic engagement could symbolize a turn-around in the politics of the region, Nasr also takes time to address misconceptions the West has about the Middle East. From secularism to fundamentalism, Nasr’s work is complete in covering the potential avenues for change in the region and thus makes a strong case for the idea that economics has much to do with the political developments of the Arab world.

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Vali Nasr © getty images

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Reviews - Readings

Readings Books The Muslim Brotherhood and Egypt's Succession Crisis: The Politics of Liberalisation and Reform in the Middle East

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Mohammed Zahid The dynamics of democratisation in Egypt are explored in this book which discusses the increasing influence of the Muslim Brotherhood and the politics of succession. The evolution of the Muslim Brotherhood to a political movement has been accompanied by a rise in demands for reform and change and the impact of this upon the grooming of Gamal Mubarak, son of President Mubarak, to inherit power is discussed by Zahid, an independent scholar of the Middle East. This book is intended to enable the reader to better understand the evolving political and social dynamics of the country and the potential challenges faced by Egyptian leadership.

The Clinton Tapes: Wrestling History in the White House

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Taylor Branch This book provides a fascinating insight into the machinations of a presidency through a chronological narrative and is appealing not just for those with an interest in world politics but also to those who are interested in the more mundane yet revealing intricacies of life in such a position of power. A body of 78 frank interviews with President Clinton recorded by the author over a course of 8 years provides the backbone of this book. These interviews are intermeshed with the author’s own observations as to the pressures of power. This book provides unrivalled insight and stands as an important work on life in the White House.

Dubai: The Vulnerability of Success Christopher M. Davidson.

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The story of Dubai, from its origin as a small fishing and pearling community to a massive metropolis with an increasingly diversified economy is remarkable. This synthesis of the country demonstrates how pioneering development strategies were implemented and the problems which the country may potentially face in maintaining initial success. The need for sustained foreign investment encourages reforms which may affect the legitimacy of the traditional monarchy is discussed by Davidson, one of the most eminent experts on the country and region. Davidson offers a historically grounded and topical discussion of the so called ‘vulnerabilities of success’ and contributes to the body of literature on one of the world’s most headline grabbing cities.

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Reviews - Readings

Reports The Northern Distribution Network and the Modern Silk Road, Planning for Afghanistan’s Future

Andrew C. Kuchins, Thomas M. Sanderson, David A Gordon Center for Strategic and International Studies December 2009

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With the ongoing US military presence in Afghanistan, American planners have opened the Northern Distribution Network (NDN) serving as their new logistical lifeline. The NDN cuts through Central Asia, Russia and the Caucasus to the Baltic and Black Sea ports. The labelling of the NDN as the ‘Modern Silk Road’ may be a sign of hope for the future of Afghanistan’s home-grown revenue and transport infrastructure. CSIS emphasises the necessity to harness the potential of the NDN in order to develop Eurasian commerce. The network therefore plays a key role in the stability of the region by providing sustainable economic channels from Afghanistan to Eastern Europe.

Stateless Again: Palestinian-Origin Jordanians Deprived of their Nationality

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Human Rights Watch January 31, 2010 More than half of the citizens of the Hashemite Kingdom of Jordan are of Palestinian origin. Having been forced to leave their homeland and settle in neighbouring Jordan, they again find themselves stateless. The Jordanian government has been removing Jordanian nationality from Palestinian refugees since 1988, relegating them to second class status. Non-Jordanians are severely handicapped in their options for employment and education; school and university fees increase and there is no employment under the state. HRW makes recommendations to the Jordanian government to reinstate Jordanian nationality to those of Palestinian origin and in doing so return their rights to be treated as equal to their fellow compatriots.

Interview Should Guantanamo Bay Be Closed?

Shayana Kadidal, Senior Managing Attorney, Guantanamo Global Justice Initiative Council on Foreign Relations January 21, 2010 January 2009, President Barack Obama orders the closure of Guantanamo Bay within the next 12 months. One year on and the prison walls still stand strong on America’s annexed corner of Cuba. Kadidal claims that the attempted attack on flight 253 by Nigerian student, Umar Farouk Mutallab has no bearing on the closure of Guantanamo. He asserts that, for the safety of the United States, the prison should be closed, suggesting that the US government needs to avoid alienating foreigners, a vital error in pushing the disillusioned into the arms of extremist groups.

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The Edge of Darkness Yemen: Fear of Failure Ginny Hill Chatham House January 2010

Yemen is increasingly becoming a liability to the stability of the Arabian peninsula. International actors should cooperate with regional powers to promote initiatives that will improve Yemen’s current situation. From development programs to counterterrorism measures, the Chatham House report explains which policies would best help Yemen at this crucial moment.

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emen’s increasing instability has gradually become an important challenge for Western diplomats seeking to decrease the number of countries that function as de facto terrorist safe-havens. The multiplicity of socio-economic and political problems that Yemen faces have fostered a crisis and only worsened the state’s ability to govern over the country’s remote areas.

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Acutely aware of the challenges that Yemen’s potential as a failed state poses to regional security, Chatham House’s Ginny Hill revises a previous report on the current obstacles facing the Yemeni state. By building on prior research, the report, Yemen: Fear of Failure, is able to highlight the areas in which the security situation has worsened and why. As such,

the report provides insightful policy recommendations for Yemen’s government, its regional partners, and its Western allies.

Of the various themes explored

by Chatham House, the fact that Yemen is at an important crossroads stands out as its most important message of the report.

Development figures that confirm its standing as the poorest nation 52

Reviews - Reports in the Arab world—struggling with 27% inflation, 40% unemployment, rapid population growth—stand in stark contrast with Yemen’s legacy as the Arabian Peninsula’s first democracy.

How did it come to this?

prince’s house after passing several security checks.’ The AQAP has acknowledged its responsibility in the plot, claiming it was a response to American led missile strikes that had taken place earlier in the year.

In addition to problems regarding state presence in remote regions of the country, the civil war in the North, the separatist movement in the South, and the resurgence of terrorist groups in the country have done little to help Yemen take the reigns of its own future.

In addition, the report highlights that economic factors have had an important role as drivers of instability. ‘The state budget is heavily dependent on revenue from dwindling oil supplies.

Yemen’s window of opportunity to shape its own future and cerate a post oil economy is narrowing.’

Terrorism, however, is not the only security problem Yemen faces.

The Chatham House report notes how significant Yemen’s location is for various regional interests, and how the rise in insecurity could jeopardize important initiatives that would affect the entirety of the region. For one, its position on the Red Sea makes the rise in piracy coming from Yemen problematic.

Other security concerns have had negative implications for the security of shipping routes, including the transit of oil through the Suez Canal. Moreover, it is argued that the instability of Yemen could spread ‘a lawless zone stretching from northern Kenya, through Somalia and the Gulf of Aden.’

Unfortunately for Yemen, these conditions are not improving.

Rather, they are encouraging the development of a vicious cycle in which a lack of economic opportunity encourages violence and instability, which in turn hinders the possibility of economic development.

An important example of the vicious cycle created in Yemen is the growing presence of terrorist groups. The report noted more specifically that in 2009 al Qaeda’s branches in Yemen and those in the rest of the Arabian Peninsula merged to form a single transitional organization: al Qaeda in the Arabian Peninsula, or AQAP. In August, the report notes, ‘Saudi Arabia’s Deputy Interior Minister, Prince Muhammad bin Naif, narrowly escaped assassination when an al Qaeda affiliate blew himself up at the Issues 1544

Needless to say, both Yemen and stakeholders in the region have a vested interest in seeing the security situation of the country improve.

Underscoring this point, the report makes important observations, particularly for the West, of how to help Yemen (or, more specifically, how not to help Yemen). With regards to the necessity of a political settlement, Hill argues that external mediation will be a fundamental necessity so as to improve the government’s legitimacy and support their conflict resolution measures. However, the report is very clear about the way in which Western governments should not become involved noting that ‘Direct Western mediation would inappropriate and counterproductive.’ This approach would likely, it is argued, encourage

backlash and undermine the legitimacy of the government.

On the other hand, the report explains that Arab states, working in partnership with key international actors, have an important role to play in direct mediation. This recommendation is insightful in its ability to gauge the suspicion Yemenis have of direct intervention, and the alternative recipe is likely to provide the intended results. Nonetheless, as the report indicates, Yemen is a wild card with regards to very important Western interests and it is unlikely that many Western governments are going to stand back completely if they see that conditions are not improving.

Furthermore, one should question what the report means by regional cooperation with Western governments. Would these include US led military attacks against terrorist in the country? These are important questions that are left unanswered by the report.

However, the Yemen :Fear of Failure explores the importance of economic aid, arguing that it should be a priority for international actors to encourage President Saleh to revive the stagnant reform process and improve elite compliance.

Hill notes that ‘Since 2006, international donors have pledged $5 billion in development aid but only a fraction of the money has been spent.’ As local donors and investors, members of the GCC are designated an important position in the future development of Yemen. A concerted regional approach thus appears as the fundamental recommendation for ensuring the future of the state.

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The Political Essay

Sunnier Skies?

The future of Iraq’s foreign policy

Due to its geopolitical importance, a still unstable political system, and inevitable ties with major players like Iran, Turkey and the US, it is assumed that the nature of Iraq’s external alliances will be largely dictated by foreign interests. Nevertheless, the future of Iraq’s relations with its powerful neighbours can be determined by an all-inclusive national project and be relatively immune to external pressures.

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uring the Bush Administration years the following joke did the rounds of the corridors of politics: “Do you know who the Vice-President of Iraq is? It’s Dick Cheney”. This idea that, after Saddam Hussein, the evolution of the political landscape in Iraq would be dictated by foreign players and interests is still alive today. Thus, and by the same logic, the future of Iraq’s foreign policy will also be hostage of outside interference, namely from the US or Iran.

At present, it is still very hard to characterize Iraq’s foreign policy, maybe because its government still lacks a foreign policy doctrine with clearly defined goals.

This is natural given all the challenges that still prevent Iraq from achieving relative stability. The tensions marking the preelectoral climate – such as the polemic list issued by the Accountability and Justice Committee, the inability to prevent largescale suicide bombings, and the ever present threat of a return to sectarian violence, are among the main concerns.

The most likely outcome of the forthcoming March elections is the formation of another coalition. As Foreign Minister of Iraq Hoshyar Zebari recently told The Majalla “the next government coalition will likely be composed of a wide coalition. Most probably, one bloc will not be able to form a government, and the parliamentary blocs could be many.” The formation of such an eclectic government means that any country that seeks to influence the foreign policy of Iraq, be it the US or Iran, will have major problems in doing so in a decisive way.

So, what predictions can be made about the future orientations of Iraq’s foreign policy, particularly in relation to its most powerful neighbours? Looking north, Turkey is Iraq’s biggest trading partner, and Iraq is one among many of the region’s countries being courted by Erdogan’s renewed foreign policy. Although there have recently been tensions regarding the 8 February, 2010

Manuel Almeida Turkish army intrusions in Iraqi territory to deal with Kurdish rebels, Turkey seems destined to be a close partner. Furthermore, Turkey is a strong opponent of a Kurdish autonomous region and even more of an independent Kurdish state, and thus an important ally for the government in Baghdad also in this regard.

Looking west to Syria, things seem more complicated. As a recent article published in The Majalla has shown, the relationship between the two countries is sort of a paradox. On the one hand, there is the growing economic and cultural interdependence between Syria and Iraq, with great benefits for both sides. On the other hand, this bilateral relation has been marked by serious political tensions.

In particular, the Iraqi government has a profound distrust regarding what it considers Syria’s poor job in containing the destabilizing activities of militants and former Baathists who find refuge in Syrian territory. Last year, when Al Maliki’s government requested Syria to deport a few former Baathists, Syria declined and responded if they were to do that, they would have deported Al Maliki in the past [in an allusion to Saddam Hussein’s request]. It is not uncommon to see a bilateral relation marked by tense political ties and strong economic ones, and this might well be the case for the near future of Iraq-Syria relations.

Further south, the relationship between Maliki’s government and Saudi Arabia has been strained. This was aggravated by an episode that took a bigger dimension than it should, when a Saudi preacher (televangelist) called Iraq’s Ayatollah alSistani an “atheist” and “debauched”, among other accusations against Iraqi Shiites. Although this declaration was severely criticized within Saudi Arabia, Al Maliki issued a harsh verbal response, accusing Saudi religious institutions of having a hostile attitude towards Shia Muslims. Saudi Arabia still doesn’t have an embassy in Iraq, contrary to Egypt and several other Arab countries – though security concerns do play an important role in this absence.

Finally, eastwards, there is the powerful and nosy Iranian neighbour. As Iraq’s Foreign Minister explained to The Majalla “Iran has influence and maintains wide diplomatic and consular presence in Iraq and has extensive relations with all Iraqi parties. There is an Iranian insistence on maintaining presence in Iraq, unlike Arab countries which are not that insistent.”

However, the assumption that the Shia factor makes it inevitable that Iran will determine the future external behaviour of the Iraqi government is misleading. In particular, it presupposes that all Iraqi Shiia parties, in particular the Islamic Dawa Party and the Supreme Council, share the same views about what ought to be the nature the Iranian presence in Iraq. And yet, a close bilateral relationship, at the political, economic and cultural levels between Iraq and Iran is inevitable. It is in the interest of both countries and the region that it works.

The future of Iraq’s foreign policy and the nature of its alliances will mainly depend on how the internal political game in Iraq will unfold. If a national identity and all-inclusive national project can gain momentum, there is no reason why Iraq’s external relations will have to be limited to what foreign interferences seek to dictate.

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