Egypt’s Historic Vote is Underway!

At long last, voting is underway in Egypt!!! Citizens queued from early hours to vote for the first president since overthrowing Hosni Mubarak in February 2011. It’s been a tumultuous road to get to this day, but even from thousands of miles away I can sense the excitement of my Egyptian friends and family, many of whom voted today for the first time in their lives. I happen to be a junkie of political cartoons and have been collecting many along the way to Election Day.

Here are a couple I wanted to share. (I will be writing an editorial on the election in a few days when we have a better indication of how the people voted).

Which one is your favorite?!! (I think the one of Obama is my favorite!)

 

Al Jazeera’s (R)Evolution?

Here’s a study I was pleased to contribute to a new-ish e-zine called Jadaliyya which focuses on Arab affairs.

by Vivian Salama

Jadaliyya (click here for original link)

In March of 2011, an unusually forthright editorial by an anonymous writer made its way into The Peninsula Qatar, an English language daily bankrolled by a member of the emirate’s ruling family. At the time of publication, protesters had already toppled the presidents of Tunisia and Egypt, uprisings were in full swing in Libya and Yemen, and in the Persian Gulf, Bahrainis were gearing up for what would prove to be a bloody battle, only days after the op-ed ran.

“Businesses and institutions are treated as ‘holy cows,’” the author wrote in the editorial, entitled “Why are we so timid?”

“What essentially ails the Qatari media (English and Arabic-language newspapers) is the absence of a comprehensive law that specifies its role in a clear-cut way and seeks to protect it against the people and interests opposed to free expression or those who cannot appreciate criticism,” the op-ed read.

It was at about the same time that this editorial ran that Al-Jazeera Arabic, the renowned television network that essentially put Qatar on the map, started facing a dilemma. The network has found it increasingly difficult to distance itself from the growing political ambitions of its patron, Qatar, particularly as it is kept alive by the one hundred million dollars it receives annually from the Qatari government. Moreover, the wave of information now available to the masses via the Internet and satellite television has exposed the gaps in its reporting of issues that do not fall in line with the government’s agenda, while also highlighting its biases in the various uprisings. (more…)

The U.A.E.: 40 and Fabulous?

Abu Dhabi at 40 //Photo by Tala Al Ramahi (@journalist_tala)

 As some of you may know I just moved back to New York last week after living in the Middle East for much of the last 10 years, most recently in the United Arab Emirates, which is today celebrating its 40th anniversary. There is no doubt that the UAE has accomplished pretty spectacular things in 40 years, fueled greatly by the abundant oil wealth of Abu Dhabi, which holds more than 90 percent of the crude in the country, and about 7 percent of the world’s proven oil reserves, according to BP data.

Burj Khalifa // Photo by Vivian Salama

The country is home to the world’s tallest building, the Burj Khalifa in Dubai, one of the world’s biggest malls, the world’s largest dancing fountains (I must confess, the fountain is rather amazing), the only manmade island visible from space and one of two gold vending machines in the world!

Dubai dancing fountain // Photo by Vivian Salama

It is, undeniably, a remarkable accomplishment given that just 40 years ago the emirates, prior to unification and the discovery of oil, earned much of their income from pearl diving and exporting dates.

The pride of its citizens is something to be admired, and for weeks (even before I departed for the US), skycrapers were covered from top to bottom in lights of white, green, red and black, the colors of the UAE flag. Emiratis, the citizens of the UAE, wore scarves and jewelry with the colors of the flag, and cars were covered, literally, in photos of leaders past and present.

But a challenging road lies ahead for the UAE, particularly after this year’s events in the Middle East, where longtime dictators were forced out by popular uprisings. There is one clear advantage the UAE has over countries like Egypt, Syria, Libya and Yemen: it’s citizens are not poor. There are parts of the country that are in great need for updated infrastructure – roads, power lines, etc – but citizens are, at worst, comfortable thanks to lifetime handouts by the government. (Click here for my story Abu Dhabi’s Spending on Soccer and Skyscrapers Masks Slower Times at Home)

But citizens of the UAE are hungry for one thing: opportunities. Currently, foreigners make up about 85 percent of the country’s population – the majority hailing from countries on the Indian subcontinent. British/Western European, Canadian, Australian and South African expats hold many of the high paying white-collar positions, in SOME cases because they are better trained to do so, leaving few high profile jobs for the locals.

Emiratization, a policy now enforced by the government in many workplaces, seeks to boost Emirati employment whether by providing training and education for Emiratis, or setting quotas in certain sectors for Emirati employment. Ultimately the government is trying to prevent their own talented citizens from being lured to the West. But many critics believe that the UAE cannot afford to lose its foreign workers as they may have been the driving force for the country’s speedy success in the first place. In the meantime there is growing resentment among foreigners who, despite making up the majority of the population,  have few rights. There is no legal protection on property rights, and police, in practice, do not need a reason to stop, question or even detain people.

Another challenge is maintaining the “vision” set by the country’s founders some 40 years ago. Seldom was there a day in the UAE that I did not hear someone refer to the “vision.” Abu Dhabi and Dubai have set urban planning roadmaps for diversifying their economies away from oil and expanding certain sectors (services, real estate, alternative energy, etc). However, the global economic crisis dealt a massive blow to the once seemingly invincible UAE and its seemingly invincible real estate market. Slowly we’ve seen the country scale back, but its officials still maintain that the overall “vision” is intact and on track. We shall see.

Photo by Vivian Salama

Finally, a problem facing many of the Gulf sheikhdoms: succession. The country’s founder Sheikh Zayed bin Sultan Al Nahyan has been dead for 7 years now but his legacy undeniably lives on. The question is whether his sons, the current President Sheikh Khalifa and Abu Dhabi’s Crown Prince Sheikh Mohammed, can continue the vision he laid out for the country 40 years ago. Many experts I’ve spoken with believe that the vision of the two brothers has grown less cohesive, and the two have developed mini “kingdoms” – investing money in projects that are too different, both from each other and from that envisioned by their father.

The government is so private in nature (painfully so) that it’s always hard to know exactly what is going on behind the scenes. But given Dubai’s economic disaster and, more recently, Abu Dhabi’s problems, it raises a lot of questions as to who is calling the shots. The country enjoys making a splash, and it’s served them well, but if it genuinely wants to keep out of the spotlight during tougher times, it may want to adopt a more humbled approach over the next 40 years. (ie, no more $20 million hotel debut parties, ok?)

Dubai Atlantis Hotel Opening Show - December 2008

Good luck UAE. I am excited and eager to see what you have up your sleeve for the next 40 years!!

U.A.E. Citizens Vote for Second Time Ever for Council

(click here for original story)

By Vivian Salama

Sep 24, 2011

Bloomberg – The United Arab Emirates is today holding the second election for its government advisory board in the federation’s 40-year history

About 15 percent of citizens are eligible to vote for 450 candidates vying for 20 seats on the Federal National Council. Another 20 seats are selected by the rulers of the federation’s seven emirates.

While the U.A.E. hasn’t experienced the level of political protest that swept across other Arab countries, activists circulated an online petition in April demanding that balloting for seats on the council be held through universal elections. The petition, signed by about 140 people including academics and journalists, also called for amending the constitution to give the body full legislative and regulatory authority.

Five of the activists, including a professor at the Abu Dhabi branch of Sorbonne University, are were arrested and are on trial for insulting President Sheikh Khalifa bin Zayed al Nahyan and his brother, Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed al Nahyan.

The U.A.E. includes Abu Dhabi, the capital, Dubai, Sharjah, Ajman, Umm-al-Quain, Fujeirah and Ras Al-Khaimah. About 130,000 U.A.E. nationals can vote under the country’s electoral college system. That number is 20 times higher than the first election in 2006. The winners of today’s election will be announced on Sept. 28.

Abu Dhabi’s Spending on Soccer and Skyscrapers Masks Slower Times at Home

By Vivian Salama - Sep 21, 2011

Bloomberg — Ramy Kaddourah got the keys to his apartment in Abu Dhabi’s Raha Beach development two years late as the boom in the United Arab Emirates capital started to wane.

“Everyone got really excited about the plans to build up Abu Dhabi, then out of nowhere everything came to a stop,” said Kaddourah, 31, who runs a local private hospital and invests in property to rent. “If this can happen here, I don’t want to imagine what’s happening in the rest of the world.”

Abu Dhabi internationally is the oil-rich emirate spending billions of petrodollars on English soccer team Manchester City, the iconic Chrysler Building in New York and London’s Gatwick Airport. Yet that image is masking pressure at home as the government supports its six neighboring emirates while financing a $500 billion development plan.

In a year that saw uprisings in almost a dozen Arab countries, citizens in the U.A.E. will head to the polls for only the second time in the country’s 40-year history on Sept. 24 to choose members of a council that will advise the sheikhs in control. In the background are deteriorating infrastructure and rising unemployment in the northern emirates and an end to the breakneck investment in Dubai and Abu Dhabi.

“We’re starting to see chinks in the armor,” Christopher Davidson, author of “Power and Politics in the Persian Gulf Monarchies.” “The bottom line is they can’t keep distributing the wealth to an ever-growing, ever-developing population.” (click here to read more…)

Gulf Rulers Welcoming Arab Democracy Anywhere But Home May Store Up Unrest

By Alaa Shahine and Vivian Salama

Bloomberg (click here to view original)

Persian Gulf rulers say they understand that this year’s wave of pro-democracy uprisings has changed the Middle East. So far, they haven’t allowed it to change their own countries.

(l to r) Bin Ali, Saleh, Qaddafi, Mubarak

None of the region’s monarchies has taken steps to broaden political participation that match the spending pledges they have offered since the start of the unrest that toppled Tunisia’s Zine El Abidine Ben Ali andEgypt’s Hosni Mubarak. Instead, the rhetoric about a new era in the Arab world, and the cash handouts for homes and social security, have been accompanied by police repression.Protests have already reached Bahrain, Oman, Kuwait and the eastern province of Saudi Arabia this year. The reluctance of the Gulf Arab leaders, who control about two-fifths of the world’s oil, to loosen their grip on power may leave more of them vulnerable to the wave of unrest that has already pushed crude prices up more than 20 percent.“What we have learned from the uprisings in general, and from Tunisia and Egypt in particular, is that it’s really a matter of when,” said Shadi Hamid, director of research at Brookings Institution’s Doha Center, in a telephone interview. “Autocracies don’t last forever.”Oman’s Foreign Minister Yusuf Bin Alawi Bin Abdullah told Arab counterparts in Cairo last month that regional leaders need “new thinking” to deal with the “Arab renaissance.” In Abu Dhabi, then-GCC Secretary-General Abdul Rahman Al-Attiyah said that “political participation has become a key demand for development.”

‘Hydrocarbon Dictatorships’

Qatar’s ruler, Sheikh Hamad Bin Khalifa Al Thani, said in February that change was coming to the region and that Europe shouldn’t support “hydrocarbon dictatorships” in return for economic benefits, according to Al Sharq newspaper. He didn’t say which countries fall into that category.Qatar, Oman, Saudi Arabia and the other three Gulf Cooperation Council members are listed as authoritarian regimes in the 2010 Democracy Index of the Economist Intelligence Unit.The region’s leaders must convert ideas about change into concrete steps that will “improve the relationship between the state and the people,” said Prince Turki Al-Faisal, former Saudi ambassador to the U.S. “We have to change words into actions, actions that are arduous,” he said in a lecture in Abu Dhabi March 21.Some countries have begun to act. Sultan Qaboos of Oman agreed last month to boost the powers of the nation’s consultative council; the United Arab Emirates announced Sept. 24 elections to the Federal National Council, an advisory body; Saudi Arabia said it will hold municipal elections in September, while backtracking from earlier signals that women would be allowed to vote.

Saudi ‘Counter-Revolution’

Those measures, though, don’t involve real transfers of power, Hamid said. Repression has been a more typical response, with Saudi Arabia as “the leader of the Arab counter- revolution,” he said. “They are fighting change tooth and nail.”Saudi Arabia’s Information Ministry declined to comment and no one was available to comment at the Saudi Foreign Ministry or the U.A.E.’s federal government or Federal National Council, in response to repeated phone calls over two days.The prospect of unrest spreading to the world’s biggest oil exporter drove the benchmark Saudi stock index into a 13-day losing streak through March 5, the longest since 1996. Crude for May delivery rose above $112 a barrel last week, the highest since September 2008.

‘Not Very Worried’

The political upheaval in the Middle East has left markets “pricing in an element of uncertainty,” said Arthur Hanna, an industry managing director at Accenture Plc.Saudi oil wealth will help it escape the wave of unrest even though unemployment is high and civil rights limited, said Kai Stukenbrock of Standard & Poor’s. “We are not very worried about that scenario,” Stukenbrock, S&P’s director of sovereign ratings for Europe, the Middle East and Africa, said March 7.Simon Henry, chief financial officer at Royal Dutch Shell Plc (RDSA), also backed the kingdom to navigate through the political tensions. “It has the resources, it has the established capability to handle some of the unrest it may face,” Henry said on March 8.One risk to Saudi stability is the succession to King Abdullah, who turns 87 this year, Henry said. Crown Prince Sultan is also in his 80s. Next in line is Prince Nayef, the septuagenarian interior minister who filled central Riyadh with police to block a planned demonstration March 11, after rallies by Shiite Muslims in the oil-producing eastern provinces.

Bahrain Crackdown

Saudi rulers offered asylum to Ben Ali, backed Mubarak before his ouster, and sent troops to Bahrain to support a crackdown by Sunni royals that has left more than 20 protesters dead, mostly from the country’s Shiite majority.The violence in Bahrain showed unrest can be expensive even when it doesn’t lead to regime change. It pushed borrowing costs more than 150 basis points higher and Bahrain’s credit rating at Standard & Poor’s three steps lower, and dented efforts to compete with Dubai as the region’s business hub.Qatar and the U.A.E. both sent troops to Bahrain to help the government quell protests. InLibya, they are on the opposition’s side, backing a U.S.-led military campaign to help the rebels fighting Muammar Qaddafi. Qatar will “look at” the possibility of providing defense equipment to the insurgents, Prime Minister Hamad bin Jasim Al-Thani said yesterday.

‘Digging In Heels’

Dubai police on April 8 arrested Ahmed Mansour, a human rights campaigner, promptingHuman Rights Watch to criticize the U.A.E. for “digging in its heels” against democratic reforms. Two more activists, including an economics professor at the Abu Dhabi branch of France’s Sorbonne university, were arrested in the next two days. In Oman, two people have been killed as police broke up protest rallies.Saudi Arabia has also led the spending spree. King Abdullah ordered $128 billion of measures, including $90 billion on house-building and home loans, that will help the economy grow 6.6 percent this year, Standard Chartered Plc estimates.“The enormity of the stimulus package will help the region overall,” as it’s too much for the Saudi economy to absorb alone, and reduce the risk of civil unrest, Said Hirsh at London-based Capital Economics said in a March 21 report.GCC spending is another reason to expect high oil prices, according to John Sfakianakis, chief economist at Bank Saudi Fransi. Saudi Arabia needs a price of at least $80 per barrel, higher than previous breakeven figures, to finance its budget, he calculated.

‘Money Lying Around’

The GCC has promised $10 billion apiece to Bahrain and Oman to help assuage protesters. The U.A.E. allocated $1.6 billion for water and infrastructure projects in northern emirates that lag behind Dubai and Abu Dhabi.Spending conceived as a way of avoiding political change may end up fuelling popular demands, said Christopher Davidson, author of “Power and Politics in the Persian Gulf Monarchies.”

“You have the people in Saudi Arabia, for example, now asking: ‘If all that money was lying around all this time, why wasn’t it used on us earlier?’,” Davidson said. “These rulers are just reacting to the events around them, and their citizens know it.”

Al-Qaeda Fears in U.S. Buy Time for Saleh as Clashes in Yemen Escalate

By Vivian Salama and Glen Carey

Bloomberg

Click here to get original link

Yemeni President Ali Abdullah Saleh is facing down mass protests and defections with backing from the U.S. and Saudi Arabia, who are betting it’s safer to let a key ally against al-Qaeda leave on his own terms.

Like Muammar Qaddafi in Libya, Saleh justified his violent crushing of anti-government protests by arguing his downfall would lead to anarchy and a greater threat from Islamic terrorists. The difference is Saleh, who called Yemen a “time bomb,” has support in Washington and Riyadh.

This year’s wave of Arab unrest has shown the U.S. is willing to dump longtime partners like Egypt’s Hosni Mubarak as well as more recent ones like Qaddafi. In Yemen, the poorest Arab state and already a base for al-Qaeda attacks, Saleh’s army, government and much of his tribal base have abandoned the president, yet the U.S. is reluctant to do so. The standoff adds to the risk of a Libya-style conflict as violence escalates.

“Two weeks ago, it was really looking like game over for Saleh, then all of a sudden he seemed to have gotten a second wind,” said Gregory Johnsen, a Yemen scholar at Princeton University. “The only two foreign voices that matter for Yemen are the U.S. and Saudi Arabia. They are scrambling now with the reality that Saleh’s days may be numbered.”

U.S. Defense Secretary Robert Gates said last week that he saw the possible fall of Saleh as a “real problem.” Mark Toner, acting deputy spokesman for the U.S. State Department, said on April 4 that while Saleh must respond to public demands, “it’s not for us to impose a solution.”

Crackdown Hardens

Saleh’s treatment of the protest movement, now in its third month, has hardened. The shooting of 46 protesters by police and snipers in the capital, Sana’a, on March 18 sparked a wave of defections from the regime.

This week, at least a dozen protesters were killed in the town of Taiz when they battled with police, and in Sana’a there were reports that soldiers from a rebel-led division clashed with Saleh’s supporters.

Saudi Arabia, holder of the world’s biggest oil reserves, this week invited Yemen’s government and opposition to Riyadh as part of an effort by the six-member Gulf Cooperation Council to resolve the crisis and preserve “stability and security” in Yemen. The official Saudi Press Agency said Saleh, 68, welcomed the mediation. He had earlier offered to stand down provided there was a transition plan, and then said he would make no more concessions to opposition “arm-twisting.”

‘Key Solution’

The prime minister of GCC member Qatar, Sheikh Hamad Bin Jasim Bin Jaber Al Thani, said the group is hoping to broker an accord that would involve Saleh stepping down, according to the state-run Qatar News Agency. The Joint Meeting Parties, Yemen’s main opposition coalition, welcomed its invitation to join the Riyadh talks and called Saleh’s departure “the key solution.”

Yemen is the ancestral home of al-Qaeda leader Osama bin Laden. It was the site of the 2000 attack on the USS Cole that killed 17 U.S. sailors, and the breeding ground for plots including the attempt to bomb a Detroit-bound plane in December 2009. In October, Dubai police said they intercepted two parcel bombs en route from Yemen to U.S. synagogues.

When a blast at a weapons factory in the south last week left about 100 people dead, the government pointed to al-Qaeda and the opposition charged Saleh with fomenting chaos and then posing as the only bulwark against it.

‘Complete Breakdown’

“If there is a complete breakdown of order in Yemen, al- Qaeda Arabian Peninsula could have more freedom of operation,” Gregory Gause, a professor at the University of Vermont, said in response to e-mailed questions.

The U.S. gives Yemen $300 million a year mainly in military aid. It has done less to tackle the social problems that help militants flourish, said Will Picard, co-founder of the Yemen Peace Project, which is based in California and Sana’a and aims to promote dialogue between the countries.

The government in Washington “looks at Yemen through one lens, the lens of counter-terrorism,” Picard said. “It’s always going to be harder to impress Congress with water catchment systems and pre-natal health clinics than with predator drones and covert strike teams.”

Saudi Arabia funnels about $1 billion a year to Yemen in an attempt to keep the country “contained” and buy tribal support, according to Mustafa Alani, director of the security and terrorism program at the Gulf Research Center in Dubai.

Assassination Attempt

Al-Qaeda’s Yemen-based wing tried to assassinate the top Saudi anti-terrorism official, Prince Muhammad bin Nayef bin Abdulaziz, in 2009. The same year, Shiite Houthi insurgents in northern Yemen seized a sliver of Saudi territory and killed a Saudi soldier, prompting retaliation with air attacks.

King Abdullah sent troops into Bahrain, another neighbor, last month to help quash Shiite-led protests. The risk of military intervention in Yemen, though, is that “it is very easy to get in but would be very difficult to get out,” Alani said. “It’s like Afghanistan with the geography, a tribal system and a heavily armed society.”

Yemen is the second most-heavily armed in the world, after the U.S. on a per-capita basis, with 54.8 guns per 100 people, according to the Small Arms Survey 2007 by the Geneva-based Graduate Institute of International Studies. Tunisia, where protesters ousted their president in January and triggered the season of uprisings, placed last in the study.

‘Factions in Uniform’

The challenges also stretch beyond security. The country faces water shortages, declining oil output and a society where more than half the 23 million people are under 20 years old. About 40 percent of Yemen’s population, forecast to almost double by 2030, lives on less than $2 a day.

Yemen also lacks a unified military that could oversee a transition. Ali Mohsen al-Ahmar, the commander of the First Armored Division, has joined the opposition and his troops clashed with government supporters in Sana’a this week.

“We don’t have a military, we have tribal factions in uniform,” Abdul Ghani Aryani, an independent political analyst, said from Sana’a. “They cannot be a safeguard for social order and stability. They are only a source of threat.”

Egypt Calls on Nations to Provide Economic Assistance

By Vivian Salama and Mariam Fam

Click here for original story

Feb. 15 (Bloomberg) — Egyptian Foreign Minister Ahmed Aboul Gheit called on the international community to offer support for the economy, saying it “has been greatly affected by the political crisis that has rocked the country.”

The protests that culminated in the Feb. 11 ouster of the former president, Hosni Mubarak, have led businesses to shut down, scared off tourists and pushed up Egypt’s borrowing costs. The Mubarak-appointed government, now running the country under military oversight pending elections, is forecasting slower growth. It has promised a stimulus plan to address the economic complaints of the demonstrators, such as high unemployment.

Egypt’s finance minister, Samir Radwan, said yesterday the country’s budget deficit will widen to about 8.4 percent — less than some analysts forecast — as spending increases and economic growth slows after Mubarak’s fall. The Institute of International Finance in Washington predicts the budget gap will be 9.5 percent of gross domestic product, rather than the 7.9 percent previously forecast by the government.

The turmoil has cost the nation about $1.5 billion of tourism revenue, according to Central Bank Governor Farouk El- Okdah. It has also forced companies to close and sent the currency skidding to a six-year low. Before Mubarak’s resignation, the benchmark EGX30 Index tumbled 16 percent in one week. The bourse has been closed since Jan. 27.

Economic Growth

Aboul Gheit said U.S. Secretary of State Hillary Clinton, as well as British Foreign Secretary William Hague and Saudi Foreign Minister Faisal bin Abdulaziz bin Faisal al-Saud were among the officials who have called him to discuss support and developments in the country, according to a statement posted on the ministry’s website late yesterday. (click here to read more…)

Canadian Troops to Quit U.A.E. Base After Dispute Over Commercial Flights

By Vivian Salama and Theophilos Argitis - Oct 12, 2010

(Bloomberg) — Canada is preparing to remove troops based in the United Arab Emirates after a dispute between the countries over landing rights for commercial flights.

“Canadian Forces are planning contingencies for the relocation of CF military assets presently located at Camp Mirage,” Alain Cacchione, a spokesman for the Department of Foreign Affairs and International Trade, said in response to e- mailed questions today, without giving a reason.

Camp Mirage, a military logistics camp near Dubai, serves as a jump-off point for Canadian forces in Afghanistan. Canada currently has a 2,800-soldier force serving in Afghanistan. The government aims to end its operations in the country next year.

The U.A.E. said it is “disappointed” by Canada’s refusal to grant additional landing rights to U.A.E. airlines, the Gulf state’s official WAM news agency reported on Oct. 10, citing the country’s ambassador to Canada, Mohammed Abdullah al-Ghafli. He called the negotiations “protracted and frustrating.”

U.A.E. carriers including Emirates have been seeking dozens of new landing slots in Canada, contending that the six weekly flights currently allowed are not enough to cover demand. Transport Canada, the government agency that oversees the airline industry, and Air Canada opposed granting more slots on concerns that U.A.E. carriers may eat into Air Canada’s traffic to cities such as Frankfurt.

Failure by Canadian authorities to come to an agreement with the U.A.E. “undoubtedly affects the bilateral relationship,” al-Ghafli’s statement said.

‘Amicable Resolution’

Emirates Chief Executive Officer Tim Clark said today his airline “regrets these developments but respects the positions taken by both the U.A.E. and Canadian governments,” in an e- mailed response to questions. “We sincerely hope there will be an amicable resolution in the future,” he added.

A U.A.E. government spokesman declined to comment about the relocation of Canadian forces or the aviation dispute. No one at the U.A.E.’s General Civil Aviation Authority was available for comment.

“The U.A.E. is becoming more confident, more assertive, and more aware of its own power and influence in the region and in the world,” said Fawaz Gerges, a professor of Middle East politics at the London School of Economics and Political Science. “They have the resources and the means to exercise their power because power isn’t just about military power anymore.”

Trade Partners

The U.A.E. is the largest trade partner with Canada in the Middle East and North Africa, with more than $1.5 billion of business in 2008, according to U.A.E. government figures. As many as 27,000 Canadians live in the U.A.E. today.

Last week, Waterloo, Canada-based Research In Motion Ltd. averted a ban on its BlackBerry smartphone in the U.A.E., after the country’s phone regulator said the company’s messaging services now comply with local security regulations.

“The message here is if they want to do business with the U.A.E., it’s going to be on the U.A.E.’s terms,” said Theodore Karasik, director of research at the Dubai-based Institute for Near East and Gulf Military Analysis. “This is a trend we’re seeing in both their regional and extra-regional policies.”

Abu Dhabi Bankrolls U.S. Students as NYU Joins Sorbonne in “Uber-Swanky” Gulf

By Vivian Salama

Click here for original story.

Sept. 15 (Bloomberg) — When U.S. teenager Anthony Spalvieri-Kruse was considering which college to attend, he got an offer he couldn’t refuse from 7,200 miles away in Abu Dhabi.

“I’m receiving a full ride to attend, including flights and an allowance of $2,000 a year,” said Spalvieri-Kruse, now ensconced in what he calls “uber-swanky” accommodation in the United Arab Emirates. “It was pretty incredible considering that I was looking at $30,000 a year from other places.”

The 18-year-old from Kalamazoo, Michigan, is among the first students at New York University’s Abu Dhabi campus, which began classes this week. The college is being bankrolled by the emirate as it tries to underpin a $500 billion development plan by more than doubling investment in education this year.

NYU follows Paris’s Sorbonne University, which started offering courses in Abu Dhabi in 2006. Mubadala Development Co., an investment arm of the emirate, agreed last year to build a 93,000 square-meter campus for the French institution.

Of the 162 branch campuses in the world today, half are located in the Persian Gulf, with 25 percent in the U.A.E. alone, according to the Observatory on Borderless Higher Education, a London-based information service. Branch campuses differ from overseas programs offered by U.S. universities in that they usually function independently from the main school and have academic and administrative support on site.

‘Urgent’ Investment

The need for investment in higher education “is absolutely urgent,” said Rafic Makki, executive director at the Office of Planning and Strategic Affairs and Higher Education at the Abu Dhabi Education Council. “We are definitely on the right track, but we are nowhere near where we need to be.”

While Dubai, located an hour and a half across the desert, built skyscrapers and glitzy malls to turn itself into a hub for tourism and finance, Abu Dhabi is trying to become a cultural center with branches of the Guggenheim and Louvre museums and visits from the New York Philharmonic.

Abu Dhabi has the means to do it. The emirate, which spent $20 billion bailing out Dubai’s excesses, holds about 7 percent of the world’s oil supply. Under its 22-year economic development plan, the Abu Dhabi government estimates that non- oil industries will contribute half of total gross domestic product by 2015 versus about 40 percent today.

“From a fundamental development point of view the first and most important goal should be human capital development,” said Giyas Gokkent, chief economist at the National Bank of Abu Dhabi. “It takes a long time to establish a good university. You need experienced professors, libraries, campuses.”

Closing Shop

Some U.S. universities have been and gone in the U.A.E. Washington-based George Mason University shut its doors last year in Ras al Khaimah, one of the northern emirates, citing the global economic crisis. Michigan State University closed its Dubai campus in July, six months after the bailout by Abu Dhabi.

One of the challenges is convincing students to make Abu Dhabi or Dubai their college town instead of Boston, New York or Chicago. In the 2008-2009 academic year, U.A.E. enrolment in U.S. universities jumped 24 percent from the previous year as student visas increased to pre-September 2001 levels, according the New York-based Institute of International Education.

The Abu Dhabi government plans to spend more than 1.3 billion dirhams ($350 million) on education this year, compared with 655 million dirhams in 2009 and more than six times the expenditure in 2008, according to statistics included in a preliminary government-guaranteed bond prospectus in July.

Research Spending

As much as $1 billion in academic research investments is needed per year through 2018 for Abu Dhabi to compete globally with some of the top universities in the world, Makki said.

Other colleges represented in Abu Dhabi include New York Institute of Technology, which offers a degree program, and U.A.E. University. Australia’s University of Wollongong and Canada’s University of Waterloo offer programs in Dubai.

Similar efforts have been made in Qatar, where Georgetown University and Texas A&M are among a half dozen American schools now operating in Doha’s academic hub, a 2,500-acre campus known as Education City. Like NYU, these campuses receive their funding from a government-run foundation.  (Click here to read my story on Qatar’s Education City)

The NYU campus, situated in a temporary facility near Abu Dhabi’s waterfront, will relocate to Saadiyat Island, a manmade plot by the emirate’s Tourism Development & Investment Co., known as TDIC. It’s scheduled for completion in 2013.

‘Strategic Investment’

Along with paying all costs associated with the university, Abu Dhabi will reimburse NYU for the expense of replacing the faculty staff relocating to the Middle East. Abu Dhabi has also made a $50 million gift to NYU, John Sexton, the university’s president, said in an interview earlier this year.

Of the 150 students in the first intake, about a third are American citizens and about 8 percent from the U.A.E. The rest hail from countries including China, Hungary and Russia.

Bringing NYU to Abu Dhabi “is a strategic investment just like everything else we are doing here,” Mubarak Hamad Al Muhairi, managing director of TDIC, said in an interview.

Hasnain Zaidi, 23, an Abu Dhabi native who graduated from Duke University in 2008 and now works as a consultant in the U.S., said partnerships with more universities may also convince many of the Gulf’s foreign college-bound students to stay.

“Public service, athletics, social life, personal development — none of those things was readily available at any of the options in the U.A.E.,” he said. “That’s slowly getting better, but still not completely fixed.”

Spalvieri-Kruse plans to major in mathematics and relishes the idea of classes with no more than 20 students, he said.

“Abu Dhabi doesn’t even fall in the realm of college environments most American kids consider,” he said by e-mail. “Actually seeing the town for myself totally changed things. My visit gave me the impression that everyone involved was highly invested in the success of the incoming class.”

To contact the reporter on this story: Vivian Salama in Abu Dhabi at vsalama@bloomberg.net