Tag: Saudi Arabia
Nuance in regional reactions to the Iran deal
On Wednesday, the Wilson Center hosted a panel on “The Iran Nuclear Deal: The View from the Region.” Speakers included Muath Al Wari, Senior Policy Analyst at Center for American Progress, Deborah Amos, International Correspondent for NPR, Shlomo Brom, Visiting Fellow at Center for American Progress and Fahad Nazer, Political Analyst at JTG Inc. The event was moderated by Henri J. Barkey, Director of the Middle East Program at the Wilson Center.
Al Wari analyzed the UAE response to the nuclear deal. He claimed the UAE concern is less about the nuclear aspect and more about the fact that Iran ran a clandestine program under the authority of a state that is willing to undermine other governments in the region. However, Emiratis have decided to look towards the future, believing President Obama secured the best deal possible. The UAE is now looking at what the deal means for future Iranian encroachment in the region and what the US and other P5 countries will do to constrain Iran. The UAE hopes that Iran will normalize its regional behavior. In the coming days, the Emiratis will study the outcomes of King Salman’s visit to the US.
Al Wari criticized the sectarian portrayal of the nuclear deal. Regional concerns about the deal are linked to the geopolitical security competition. Sectarianism is exacerbated by the competition and contributes to it. His belief is that the deal is an American tool to prevent escalation in the Middle East—the agreement is a formal check on Iranian hegemony and encroachment.
Amos explained that the deal so far is unsurprisingly irrelevant to daily life, but the consequences of the agreement will be tested on the ground. She reiterated Al Wari’s words—the Gulf States want to know if attention will be paid to non-nuclear developments that are heating up. That said, the deal unlocks significant trade potential regionally (especially for the UAE and Oman) and globally. The calculus of power has already shifted, with Europeans sending trade delegations and major American companies, such as Apple, preparing to tap into the Iranian consumer market.
Brom delved into the nuances of the Israeli stance on the nuclear deal. For Israel, Iran’s nuclear program and the possibility of it acquiring nuclear weapons has always been a central issue. Indeed, Iran’s nuclear program is the centerpiece of Netanyahu’s foreign policy. He believes he won the elections because of his strong security agenda and perceives Iran as an existential threat. Many Israelis think the combination of a religious and ideological regime with nuclear weapons could lead to Iran striking Israel. However, Netanyahu’s opinion isn’t representative of all Israelis. Many dissenters coming from the Israeli security and foreign policy community, including Brom, believe the agreement is not perfect, but still better than no agreement. A better agreement would have been unlikely.
Like Brom, Nazer also cautioned against making generalizations about regional players. He thinks it is too simplistic to assume that all Saudis think the nuclear deal will usher in an Iranian hegemony with American blessings. Instead, he thinks the Saudi position has shifted slightly. The Saudis are no longer committed to preventing the deal from being implemented. The Saudis support any agreement that prevents Iran from acquiring nuclear weapons and guarantees the reinstatement of sanctions if Iran doesn’t comply. After Saudi Foreign Minister Al Jubeir’s visit to Washingon, he openly commended the robust inspection of the verification regime and provision of “snapback” sanctions.
At the same time, the Saudis are maintaining a wary position on the deal. Saudi Arabia is not depending on the US and hoping for the best. High-level Saudi officials have had meetings with Russians, Europeans and other key leaders. Prince Faisal has also said Saudis will expect the same nuclear standards for themselves and should be permitted at least the same levels of uranium enrichment capability as Iran. Prince Bandar has compared the Iran agreement to the nuclear agreement President Clinton signed with North Korea. He feels President Obama is not keeping the lessons of Korea in mind.
The US and Saudi Arabia also have differing threat perceptions. President Obama thinks Saudis need to worry less about an external threat from Iran and focus on the internal implosion stemming from a generation of youths with few hopes for the future. Conversely, the prevailing sentiment in Saudi Arabia is that Iran constitutes a serious threat. Saudi Arabia and Iran have been on polar opposite ends in Syria, Yemen, Iraq and Lebanon. Nazer believes there is a serious credibility gap between Saudi Arabia and Iran, which could lead the Saudis to take matters into their own hands, as they have done in Yemen.
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Education and change in Saudi Arabia
On Tuesday, Atlantic Council hosted a panel discussion entitled Saudi Arabia’s Scholarship Program: Generating a “Tipping Point”?. Panelists included Stefanie Hausheer Ali, Associate Director, Rafik Hariri Center for the Middle East, Atlantic Council, Dr. Rajika Bhandari, Deputy Vice President and Director of the Center for Academic Mobility Research and Impact, Institute of International Education, Samar Alawami, American University graduate of the King Abdullah Scholarship Program and researcher at the King Salman Center for Innovative Government Anne Habiby, Director, King Salman Center for Innovative Government, and Ambassador James Smith former US Ambassador to Saudi Arabia. Ambassador Francis Ricciardone, Director, Rafik Hariri Center for the Middle East, and Vice President, Atlantic Council, moderated. The panelists discussed the transformative impact of the King Abdullah Scholarship Program on Saudi society and put this program in the context of foreign exchange programs worldwide.
Ambassador Ricciardone opened the discussion by recounting his visit to Saudi Arabia in May. People think of Saudi Arabia as backward and conservative. He found young people with international exposure who wanted to effect change. Ambassador Ricciardone attributed this to the King Abdullah Scholarship Program, which has made it state policy to send Saudis abroad to study. It is similar to the Fulbright Program, which promotes American interests by sending Americans abroad to see how others think. He asked the question of whether, à la Malcolm Gladwell, Saudi Arabia is reaching a tipping point where returnees from the program will transform the country.
Ali explained that she started studying the King Abdullah Scholarship Program because she met a number of Saudis from the program while studying at GW. King Abdullah met with George W. Bush in 2005 and made the case that more Saudis should study in the US. Bush agreed, and the number of Saudis studying abroad has skyrocketed from 5,000 in 2005 to over 200,000 today. In 2014, only China, India and South Korea sent more students to the US than Saudi Arabia. Approximately 30% of participants in the King Abdullah Scholarship program are women. The program is merit-based and doesn’t just include wealthy Saudis. Approximately 11% of Saudi higher education students are educated abroad; the average time abroad is 5 years. In the US, they do ESL for a year or two, then a degree program. Over half come to the US, but Saudi students are studying in 23 countries. The program costs $6 billion/year or 3% of Saudi Arabia’s budget. Saudi students contributed $3 billion to the US economy in 2014 and help break down Americans’ stereotypes about Saudis. Such stereotypes may include:
Dr. Bhandari spoke about the rapidly expanding number of globally mobile students. Most study abroad programs focus on graduate students, because they provide a greater multiplier effect for their host countries, but the Saudi program involves many undergrads too. These programs often promote vertical mobility. Governments launch such programs for several reasons:
1. Promoting national development.
2. Increasing human capacity in key areas.
3. Reforming organizations or entire sectors.
4. Improving linkages with other countries.
5. Creating opportunities for disadvantaged societal groups.
More needs to be done in these programs to:
1. Engage alumni.
2. Provide students with re-entry support.
3. Study the impact of these programs.
Habiby spoke about the King Salman Center for Innovative Government. It is the first private, nonprofit, Saudi think tank focused on improving government performance. It tries to connect national government, local government and economics. There is a lot of research in Saudi Arabia, but the Center makes this research more accessible. Habiby stated that Alawami’s first project was to map the Saudi government from the 1920s to the present. They look at case studies of which Saudi institutions are working. The King Abdullah Scholarship Program is one of them.
Alawami explained that she is a product of the King Abdullah Scholarship program and obtained a bachelor’s in International Studies from American University. The program is transforming Saudi Arabia into a knowledge society and giving Saudis the opportunity to meet those from other backgrounds, increasing tolerance in a traditionally tribal society. Saudi Arabia starts teaching English in 6th grade, so the program improves participants’ English skills. Saudis also learn better problem-solving skills. They come back with best-practice advice for the Saudi education system. The program opens up areas of study unavailable in Saudi Arabia, such as International Studies, and women in the program can study Petroleum Engineering, which they can’t do at home. Saudis do internships abroad, which are uncommon domestically and provide essential practice. When the students return to Saudi Arabia, they transform existing organizations or create new ones.
Ambassador Smith explained that the exponential growth in Saudi students in the US wasn’t planned or foreseen. When he began his term in 2009, he figured that the King Abdullah Scholarship Program had plateaued and envisioned a focus on business, healthcare, and domestic education. However, early in his term he realized that visa wait times were a major issue. King Abdullah asked him to do what he could to make sure Saudi students succeeded. Ambassador Smith ensured that students would be first in line for visas, and streamlined the system to reduce wait times for visa appointments from 6 months to under a month. When the State Department switched to an online system, he streamlined the system further and the wait time was reduced to only a few days. This sent a message that the US cared about Saudis. Then in 2010, the US increased the number of Saudi students allowed in. In the past 15 years, Saudi went from 8 universities to 32. Many returnees from the King Abdullah Scholarship program become professors.
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Energy markets: US up, Middle East down
Thursday, the Atlantic Council hosted a talk on energy policy entitled “The Future of Energy Markets: The Other Middle East Revolution.” The event featured Majid Jafar, Chief Executive Officer of Crescent Petroleum as the key speaker. Richard Morningstar, Founding Director of the Global Energy Center at the Atlantic Council moderated the event.
Jafar recounted the changes in the energy markets in the past 15 years. In 2000, the price of oil was in the low teens and natural gas was $10. The US was an importing country, which meant it was building LNG terminals everywhere. The Middle East was relatively stable. More than a decade later, the price of natural gas has plummeted again, but the US has become an exporting country. The shale oil and gas boom has led the US to convert its LNG terminals for export. Equally if not more importantly, the Middle East has become very unstable.
US Private Sector
Jafar also emphasized the power of US private sector. He claimed the energy breakthrough was despite rather than because of government policy and lauded the US for its long-term strategic energy planning. The US has experienced a large drop in carbon emissions while seeing huge job creation in the oil and gas sector. In contrast, European countries, such as Germany, set ambitious targets like zero fossil fuels and made a mad dash for renewable energy sources. This move stifled the Germany economy and inflicted huge costs on Germany households and industries. Ironically, Germany is experiencing rising emissions and is having to import coal from the US.
Lessons Learned
The CEO shared three lessons he had learned from his experience in the energy industry:
- Do not underestimate the power of the US private sector, especially in the energy industry. Huge innovation can drive many changes.
- Never underestimate the ability of the Chinese public sector to complete their plans. The East-West pipeline is a classic reflection of the Chinese capability in completing large-scale projects.
- Never underestimate the ability of the Middle East public sector to get things wrong.
Jafar added that the unique US ecosystem cannot be replicated elsewhere. It includes infrastructure, capital markets, energy trading hubs, many small companies and a system of mineral rights. However, other countries can learn to provide better access to finance, encourage competition and transparency, and expand their private sectors.
The Middle East
The Middle East contains half the world’s proven oil and gas resources but accounts for less than a 1/3 of global oil exports and less than a 1/6 of global gas exports. The region has experienced a declining market share due to numerous conflicts, years of Iran sanctions and poor policies. Energy subsidies in particular pose major problems. The region has lost $225 billion to subsidies, which do not even help the poor people who are supposed to be the beneficiaries. The good news is that the current low oil prices provide many countries the opportunity to reform subsidies, because the gap between the market price and subsidized price is small.
Egypt is a good example. It has committed to reforming energy subsidies, because they are unsustainable and divert money from important areas of investment that create jobs. Egypt’s spending has been divided between debt service, salaries and subsidies, which left the government with little to spend on investment, infrastructure and jobs.
Another problem with the region is the dominance of national oil companies, which hinder competition and positive performance. When an energy minister is also the chairman of the oil company, there is no difference between the regulator and the regulated, which hurts policymaking. Some countries, such as Kuwait, Iran and Saudi Arabia, have realized this and partnered with private investment companies. Jafar said he is not calling for complete privatization, merely a bigger role for the private sector in developing state assets.
Iraq
Jafar also detailed Iraq’s important role in the energy world. The failing state is responsible for 40% of global oil export growth despite failure to pass hydrocarbon legislation, a lack of internal consensus on energy policy and the ISIS presence. Iraq’s production is nevertheless at an all-time high, making it the second biggest producer in OPEC. If Iraq gets its act together, it could produce 6-12 million barrels of oil per day. Iraq may have larger oil reserves than Saudi Arabia—at least 300 undrilled structures lie in the Western desert.
The Kurdistan Regional Government (KRG) has done well in passing legislation, working with private companies and essentially getting the policy right. But it faces implementation challenges because the Baghdad government is unable to pay the KRG for its oil. In southern Iraq, the latest market methods have been used with transparent bidding rounds involving private companies. However, the decision to sign service contracts was a bad one, because it means southern Iraq has to pay private oil companies a fixed fee regardless of the price of oil. With the oil price collapse, southern Iraq can no longer afford to pay the companies and is discouraging investment. A new contract model is needed where companies receive a percentage of the government’s oil profits, as opposed to a fixed fee. More importantly, a stable security environment is needed to encourage continued investment.
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Fear of diplomacy
https://www.youtube.com/watch?v=3_pBnwyxGo8&feature=youtu.be
Sorry I can’t embed John Oliver’s commentary here at peacefare.net, but it is worth a few minutes to go enjoy it over at Youtube.
I can however offer this
from Connecticut’s Senator Chris Murphy, who is less funny but easily more interesting. His talk this morning at the Carnegie Endowment put the nuclear deal in the context of a Washington that is shies away from diplomacy–too risky–and tilts instead towards war, for which America is amply well-prepared. He also suggested that rejection of the deal would leave the US no other serious alternative, as the multilateral sanctions, constraints on Iran’s nuclear program and international inspections would evaporate.
This is the vital link in the logic that should lead to support for the deal even among those who don’t like it. Rob Satloff, whose writing I generally admire, argues that it is a false logic. The Congress can reject this deal, he suggests, and still get a satisfactory outcome. I find his argument thoroughly unpersuasive, stringing together an unlikely sequence of events that doesn’t even get us far into the future without resorting to war. Nor does he consider the reaction of the other countries that negotiated the deal.
Senator Murphy is far more realistic. He understands, I think, that rejection of this deal would be the equivalent in our time of Congress’ rejection of President Wilson’s League of Nations. It would put the US in the position of going to war as the only remaining resort rather than implementing an agreement four other permanent members of the UN Security Council find acceptable. Even Saudi Arabia and Israel, now strident opponents of the Iran nuclear deal, would not applaud the US as Iranian missiles rain down on Tel Aviv and the Kingdom’s oil fields. Instead they will be arguing for US ground forces to stop the barrage.
What happens if we reject the deal and refuse to destroy the Iranian nuclear program? Then Iran gets nuclear weapons quickly. Anyone worried about Iranian troublemaking in the region–an entirely well-founded concern–would then have a lot more to be concerned about. A nuclear Iran would no doubt throw its weight around more rather than less.
The Senator made a few other points worth mentioning in his post-speech conversation with Karim Sadjadpour. Even with the deal in force, he thinks the US will retain the right to impose sanctions on Iran for reasons other than nuclear issues. He suggested we would do so if Iran were to execute a terrorist bombing of Israeli tourists, for example. The Senator admitted that US companies are likely to be at a disadvantage in the competition for Iranian business. He thought US anti-bribery legislation would help to protect the business Americans do from capture by regime hardliners.
The Senator was hesitant on one issue: restoring diplomatic relations with Iran. That’s a long way off he suggested. He admitted that the US will need a real presence in Iran to ensure implementation of the agreement but was unwilling to commit to an interest section, suggesting instead that the IAEA inspectors might suffice.
In my view, they won’t, because their remit is entirely technical. I served seven years abroad in US embassies working nonproliferation issues. I think we need our own people in a diplomatically protected facility in Tehran, if only on two and three week trips. But maybe the time is not yet ripe for that proposal. Let’s get the agreement through the uphill fight in Congress first.
PS: If John Oliver didn’t satiate your taste for videos, try this less funny one from Jon Stewart last night (with President Obama).
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Peace picks July 20-24
1. Iran and the Future of the Regional Security and Economic Landscape | Tuesday, July 21st | 9:00 – 12:00 | CNAS | REGISTER TO ATTEND | Under the deal, Iran will put significant limitations on its nuclear program in exchange for sanctions relief from the international community. But the details and effects of the agreement are far from simple. Iran’s regional rivals, who are core U.S. partners in the Middle East, are deeply concerned about how the deal will change regional power dynamics. There are also questions about economic competition, particularly in energy markets, in the aftermath of
the nuclear deal. Keynote address by: Dr. Colin H. Kahl, Deputy Assistant to the President and National Security Advisor to the Vice President. Panelists include: Dr. Suzanne Maloney, Senior Fellow, CMEP, Brookings, David Ziegler, Distinguished Fellow and Director, Project on the Middle East Peace Process, WINEP, Melissa Dalton, Fellow and Chief of Staff of the International Security Program, CSIS, Elizabeth Rosenberg, Senior Fellow and Director, Energy, Economics, and Security Program, CNAS, Colin McGinnis, Policy Director, U.S. Senate Committee on Banking, Housing and Urban Affairs, Sean Thornton, Senior Counsel, Group Financial Security BNP Paribas, and Caroline Hurndall, Head of Middle East Team, British Embassy. Moderators include: Ilan Goldenberg, Senior Fellow and Director, Middle East Security Program, CNAS and Zachary Goldman, Executive Director, Center on Law and Security, NYU School of Law and Adjunct Senior Fellow, CNAS.
2. Women and Countering Violent Extremism: Strengthening Policy Responses and Ensuring Inclusivity | Tuesday, July 21st | 9:30-12:30 | USIP | REGISTER TO ATTEND | Women worldwide suffer disproportionately from violent extremism and conflict. Women’s key roles in society put them in ideal positions to prevent extremist violence. Yet, 15 years after the United Nations Security Council vowed to reverse the broad exclusion of women from leadership in security and peacebuilding, they
remain marginalized. On July 21 at USIP, experts from civil society, the United Nations, academia, and the U.S. government will discuss ways to include women in efforts to counter violent extremism. The debate will directly inform U.S. government officials preparing for major international conferences on these issues this fall. The U.N. Security Council recognized in 2000 (in its Resolution 1325) that we need women to help lead in global efforts at resolving violent conflict. Several current wars and conflicts underscore how the recent surge in violent extremism has given new urgency both to protecting women and including them in solutions. The U.N. secretary general’s special representative on sexual violence, Zainab Bangura, will discuss that imperative, having recently visited Syria and Iraq. Speakers include: Zainab Hawa Bangura, Special Representative of the UN Secretary General on Sexual Violence in Conflict, Ambassador Anwarul K. Chowdhury, Former Under-Secretary-General and High Representative of the UN, Timothy B. Curry, Deputy Director, Counterterrorism Policy, U.S. Department of Homeland Security, Eric G. Postel, Associate Administrator, USAID, Robert Berschinski, Deputy Assistant Secretary, Bureau of Democracy, Human Rights, and Labor, U.S. Department of State, Carla Koppell, Chief Strategy Officer, USAID, Nancy Lindborg, President, USIP, Chantal de Jonge Oudraat, President, Women in International Security, Susan Hayward, Director, Religion and Peacebuilding, Governance, Law and Society, USIP, and Jacqueline O’Neill, Director, Institute for Inclusive Security. Moderator: Kathleen Kuehnast, Director, Gender and Peacebuilding, USIP.
3. Islamic extremism, reformism, and the war on terror | Tuesday, July 21st | 10:00 – 12:00 | AEI | REGISTER TO ATTEND | President Barack Obama has said that the Islamic State (ISIS, ISIL, Daesh) and other extremist groups do not represent true Islam. The extremists, however, dispute this.
This leads to a basic question: What role, if any, does Islam play in fomenting terrorism? As extremist forces increasingly sow destruction, how should policymakers respond? How prevalent are moderates, and how serious are regional calls for a “reformation” within Islam? What role, if any, can the US play to encourage reform? How do anti-Islamic polemics undercut reform? Panelists include: Jennifer Bryson, Zephyr Institute, Shadi Hamid, Brookings Institution, Abbas Kadhim, Institute of Shia Studies, Zainab Al-Suwaij, American Islamic Congress, Husain Haqqani, Hudson Institute and Former Pakistani Ambassador to the United States, and Mohamed Younis, Gallup. Moderators include: Michael Rubin, AEI and Danielle Pletka, AEI.
4. Negotiating the Gulf: How a Nuclear Deal Would Redefine GCC-Iran Relations | Tuesday, July 21st | 12:00-2:00 | The Arab Gulf States Institute | REGISTER TO ATTEND | As a nuclear agreement between Iran and the P5+1 was recently finalized, few in the international community have more at stake than Iran’s Arab neighbors across the Gulf. Will the agreement usher in a new era of detente in the Middle East? Will Iran emerge as a more responsible partner, not just to the West but also to
regional powers? Can Iran and the GCC states begin to identify areas of cooperation to bring about more stability and security to the region? Will the agreement truly prevent Iran from developing nuclear weapons, or does the Middle East stand on the brink of another, particularly dangerous, arms race? Speakers include: Suzanne DiMaggio, senior fellow and the director of the Iran Initiative at New America, Jamal Khashoggi, Saudi journalist, columnist, author, and general manager of the upcoming Al Arab News Channel, Nadim Shehadi, director of the Fares Center for Eastern Mediterranean Studies, Fletcher School, Tufts University, Mohammad Ayatollahi Tabaar, fellow, Rice University’s Baker Institute for Public Policy and, assistant professor, Department of International Affairs, Bush School of Government and Public Service, Texas A&M University.
5. Russian Expansion – A Reality or Fiction: A Conversation with Elmar Brok | Tuesday, July 21st | 12:30-1:30 | German Marshall Fund | REGISTER TO ATTEND | With the Minsk II ceasefire in eastern Ukraine looking increasingly shaky, Europe risks a frozen conflict for years to come. However, is Russian President Vladimir Putin finished in Ukraine? Can the United States and Europe expect more aggression from the Kremlin or is consolidation Russia’s strategy now? What do the future of Russian relations with the European Union and Germany look like and what role do sanctions play in this calculation? Elmar Brok, chairman of the European Parliament’s Committee on Foreign Affairs, will answer these questions and provide analysis of U.S.-European views toward Ukraine and Russia. GMF, the Konrad Adenauer Foundation, and the European Parliament Liaison Office are pleased to jointly host this conversation.
6. Saudi Arabia’s Scholarship Program: Generating a “Tipping Point”? | Tuesday, July 21st | 1:oo | Atlantic Council | REGISTER TO ATTEND | Westerners most commonly associate the Kingdom with oil, religious conservatism, and a deeply unstable region. Our panelists will challenge such conventional perceptions by examining the seismic economic, social, and governmental changes underway, many of which evidently result in part from the deliberate Saudi government investment in its human capital. The panel will present the thesis that, having sent over 200,000 Saudi youth abroad in the past ten years with the King Abdullah Scholarship Program, the Kingdom is already experiencing powerfully transformative economic and social advances. Ambassador Francis Ricciardone, Atlantic Council Vice President and Director of the Council’s Rafik Hariri Center for the Middle East, will moderate the discussion. Hariri Center Associate Director Ms. Stefanie Hausheer Ali will present key data and analysis on the scholarship program’s origins and size as well as its costs and benefits from her case study for the King Salman Center for Innovative Government. Dr. Rajika Bhandari, Deputy Vice President of the Institute of International Education (IIE) and Director of IIE’s Center for Academic Mobility Research and Impact, will discuss the Saudi scholarship program within the context of other international scholarship programs and the types of impacts such programs can have. Ms. Samar Alawami, an American University graduate of the scholarship program and researcher at the King Salman Center for Innovative Government, will discuss how the scholarship is impacting her generation. Ambassador James Smith, President of C&M International, will reflect on the changes in Saudi Arabia he witnessed during his tenure as US Ambassador from 2009 to 2013.
7. Rebuilding Afghanistan: Transparency & Accountability in America’s Longest War | Tuesday, July 21st | 6:30 pm – 8:30 pm | PS21 | REGISTER TO ATTEND | As the longest running and one of the most expensive wars in U.S. history winds down, just where did the money go? PS21 is delighted to present a discussion with the man looking into that very question, Special Inspector General for Afghanistan Reconstruction John F. Sopko, and Just Security. Speakers include: John F. Sopko, Special Inspector General for Afghan Reconstruction, and Andy Wright, Founding Editor, Just Security
8. Nigeria: A Conversation with President Muhammadu Buhari | Wednesday, Jul 22nd | 9:45 – 11:15 | Located at USIP but sponsored by NDI | REGISTER TO ATTEND | Please read: Important information for guests attending public events at USIP. In a milestone for Nigeria and multi-party democracy in Africa, Muhammadu Buhari was elected president in March, becoming the first opposition candidate to unseat an elected Nigerian president through the ballot box. Following a vigorous political campaign period, Nigerians successfully managed a relatively peaceful electoral process and government transition. As the new government begins its mandate, political, economic and security pressures remain intense, including the escalating insurgency of Boko Haram and unresolved conflicts across the country. President Buhari’s remarks at USIP will come on the last of his three days in Washington, following his July 20 meeting with President Obama. All guests should arrive no later than 9:45 am to pass through security. Doors to the event will close promptly at 10:00 am.
9. Arbitrary Justice in Saudi Arabia: How Activists Have Organized against Due Process Violations | Wednesday, July 23rd | 11:30 – 1:00 | Located at Open Society Foundations but sponsored by Americans for Democracy & Human Rights in Bahrain and Amnesty International | REGISTER TO ATTEND | Americans for Democracy & Human Rights in Bahrain (ADHRB) and Amnesty International are cosponsoring an event to shed light on the absence of Rule of Law in Saudi Arabia. The discussion will outline the specific deficiencies within the Saudi criminal justice system that lead to the
commission of human rights violations, including judges’ lack of independence, practices of arbitrary and incommunicado detention, and a catch-all anti-terrorism law. Discussion will then turn to highlighting the cases of those activists, including members of the Saudi Civil and Political Rights Association (ACPRA) and human rights lawyer Waleed Abu al-Khair, who have sacrificed their independence to raise awareness of human rights abuses and bring reforms to this system. Panelists include: Abdulaziz Alhussan, Visiting Scholar at Indiana University’s Center for Constitutional Democracy and former attorney for several ACPRA members, Hala al-Dosari, Saudi activist and women’s health researcher, Sunjeev Bery, Director of MENA Advocacy at Amnesty International USA, and R. James Suzano, Acting Director of Advocacy at ADHRB.
10. On Knife’s Edge: The International Criminal Tribunal for the former Yugoslavia’s Impact on Violence Against Civilians | Wednesday, July 23rd | 12:00-1:00 | Wilson Center | REGISTER TO ATTEND | The post-Cold War era has witnessed horrific violence against non-combatants. In the Bosnian War alone, tens of thousands of civilians died. The founders of the International Criminal Tribunal for the former Yugoslavia (ICTY)—and then of the permanent International Criminal Court (ICC)—hoped these courts might curb such atrocities. However, we still know very little about their actual impact. This talk will draw on the ICTY’s experience as the first wartime international criminal tribunal to provide insight into how and when these institutions might affect violence against civilians. Speakers include: Jacqueline McAllister, Title VII Research Scholar, Ph.D., Northwestern University, Assistant Professor, Kenyon College and John R. Lampe, Senior Scholar Professor Emeritus, Department of History, University of Maryland, College Park.
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Global implications of the oil price crash
The steep decline in oil prices has been one of the most significant global economic developments over the past year. On Tuesday, the Carnegie Endowment held an event on “Oil Price Trends and Global Implications” to address the consequences. The panelists included Aasim M. Husain, Deputy Director in the Middle East and Central Asia Department of the IMF and Chair of the IMF Interdepartmental Oil Group, Uri Dadush, Senior Associate at the Carnegie Endowment and Mark Finley, General Manager for Global Energy Markets and US Economics at BP. The event was moderated by Michele Dunne, Senior Associate in Carnegie’s Middle East Program.
Husain assessed that the drop in oil prices will persist in the medium-term. Initially, when oil prices fell, futures prices did not fall with spot prices. Instead, spot prices fell around mid-year while futures prices started to fall in October. Markets expect some recovery of spot prices, but because of decline in long-term oil prices, the recovery will not be full—oil prices will not go back to $90-$100 per barrel, but they can go back to $70-$75 per barrel. Futures prices are predicted to remain in the $40-$100 range.
The drop in price was a result of decrease in demand as well as increase in supply. Unlike in 1986, when Saudi Arabia’s sudden increase in supply crashed oil prices, in 2014 the world experienced the shale gas revolution, lower extraction costs for oil and lower demand. Basically, a combination of factors led to the oil price crash, although supply factors played a larger role.
Unsurprisingly, “pass-through”—the change in oil price passed on to consumers—was minimal worldwide. Since many countries regulate or fix petroleum prices, consumers did not get the entire benefit of the oil price decline. The biggest pass-throughs were in Europe at 80% and in North America at 50%. Husain claimed that if oil prices were fully passed through, global growth would increase by 1% in a year.
The beneficiaries of the low oil prices have been governments and state-owned enterprises. What they do with revenue determines the consequences of the oil price shock. Some may increase government spending, while others may save more. The losers have been oil-producing countries that are receiving lower oil revenues and therefore have less to invest in global financial markets. Fortunately, many of these countries have accumulated large buffers that will give them time to make adjustments to the price decline.
Finley attributes lower oil prices mainly to changes in supply. In 2014, global consumption was in line with the long-term historical average, but supply was exceptionally strong—global oil production grew at almost twice the historical rate. All the net growth came from outside the OPEC countries, with the US shale gas revolution leading the way. In 2014, the US surpassed Saudi Arabia and Russia to become the world’s largest oil producer since 1985. Both Canada and Brazil also saw record increases in oil production and achieved all-time record levels on average in 2014. Global demand and non-OPEC production have begun to respond to lower oil prices, but the substantial increase in oil production means that the market remains significantly oversupplied.
Like Husain, Finley believes the persistent decrease in oil prices will continue through the medium-term. However, one must keep in mind ongoing supply disruptions in the Middle East and North Africa. Finley warned that any policy must be robust across a range of prices or be able to adapt to significant and unexpected price changes in the future.
Dadush believes oil price shocks stimulate economic activity in the short-run by redistributing income towards people who consume more with a high propensity to consume. But this effect lasts only so long. There will be—and already are—significant cutbacks in energy investment. Oil is only 2% of the world GDP when one looks at production, so an oil price change even by 50% doesn’t have a huge stimulatory effect on world supply. This means the stimulus from the oil shock is short-lived even if there is high pass-through.
With regard to the Iranian nuclear deal, the panelists agreed that the return of Iranian oil will increase supply, but it is unclear by how much because of uncertainty about Iran’s capabilities and the response of other OPEC producers. Any volume of incremental Iranian production would simply add to an already oversupplied market.
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