Great

9/11 seen as sparking Arab economic boom

AP/Washington Times:

DUBAI, United Arab Emirates — The September 11, 2001, terrorist attacks are increasingly viewed in the oil-rich Arab countries of the Persian Gulf as the catalyst for an economic boom when Arabs divested from America and reinvested at home.

Arab investors pulled tens of billions of dollars out of the United States. They were angered by perceived American hostility toward Arabs. They worried their assets would be frozen by U.S. counter-terrorism measures. And U.S. markets happened to be plummeting while economies in the Persian Gulf were on the upswing, buoyed by rising oil prices.

The results have been spectacular.

Since late 2001, economies in the six Gulf Cooperation Council countries — Bahrain, United Arab Emirates, Kuwait, Oman, Qatar and Saudi Arabia — have soared, with stock markets up a collective 400 percent. The Standard & Poor’s 500 rose 24 percent over that period.

This isn’t exactly the sort of reaction we will benefit from.

Comments

  1. I am of the opposite opinion. Investing in themselves will give them hope for their future, and something to do for their people. This should in the long run result in less people willing to be terrorists, and Arabs finally willing to take personal repsonisbility for their lives.

  2. Sam: Yes, I agree with you totally on that. And if economies and personal financal positions improve, we will probably all be better of. Unless it’s just a few upper-upper-upper crust types, of course, which could actually work against us depending on how those guys decide to spend their money. Anyway, it’s the idea that things have improved BECAUSE of 9/11, not SINCE 9/11, that won’t help if it becomes accepted common wisdom. That’s what I was thinking. I’m all for everyone improving their standards of living.

  3. I’m with you Murdoc. Krane’s assertions of causation sound like propaganda to me The emirates and GCC countries are booming, and this boom is due to astounding oil-revenues. The problem is Krane takes this opportunity to tell another tale – one of massive divestiture from America, and racial, anti-Arab animosity. He writes, ‘Arab investors pulled tens of billions of dollars out of the United States.’ And, ‘They were angered by perceived American hostility toward Arabs.’ Krane offers no evidence for his first assertion that ‘tens of billions of dollars’ we’re pulled from our markets, except for this:* ‘Before September 11, World Bank figures show Middle Eastern oil exporting countries were plowing as much as $25 billion a year into U.S. investments. For the three years of 2001-03, the figure reached $1.2 billion.’ And he thinly bases his second assertion about ‘American hostility’ on the words of one Dubai businessman, Walid Shihabie of Shuaal Capital, and unnamed ‘others.’ Krane writes, ‘Mr. Shihabie and others cited anger at U.S.-led wars and Middle East policy, and general hostility toward Arabs as another reason for the financial exodus.’ My question is, why would Krane choose to get side-tracked by capital-flight and ‘perceived American hostility toward Arabs’ instead of telling the story his own experts* told; that of burgeoning oil revenues causing a regional boom? Could it be AP Bias? -Steve *This paragraph is semantic brownie-batter. The singular/plural discontinuity obsures the real figures. The use of the superset ‘Middle Eastern oil exporting countries’ confuses all MEOEC’s with the GCC countries’ subset performance. Kranes use of ‘as-much-as’ obfuscates the actual statistic he would like his reader to consider. Not his best work. ** Quotes – Boom Due to Oil, from Kane’s own article: 1. –