Middle-east Arab News Opinion | Asharq Al-awsat

From Abqaiq to the Stock Market: Is our wealth Blessing or Curse? | ASHARQ AL-AWSAT English Archive 2005 -2017
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Confusion does not allow many of us to explain our feelings openly concerning a certain reality. Matters become even more complex when one observes members of society harming and each other somehow because of that reality. I often ask myself is it a violent love affair?

February 24 saw two young Saudi men who belonged to the Al Qaeda network drive two cars loaded with horrifying amounts of explosives in to the Abqaiq oil processing facility in Eastern Saudi Arabia. The attack was thwarted, the two cars blew up as a result of gunshots by security guards, and the two young drivers, Abdullah Al Twaijari and Mohamed Al Ghaith, along with the cars, exploded.

For three years now, the Saudi shareholders in the kingdom’s stock market observe fearfully following a major fall in the largest stock exchange market of the Middle East. The market’s share index dropped by 979 points and most shares retreated to the lowest possible value. The total value of the enlisted shares fell from 3.1 trillion Saudi Riyals to 2.94 Saudi Riyals.

Thus, a number of people lost some or almost all of their savings and loans borrowed from banks in order to profit in the stock market, which many have described as the largest field to re-invest in Saudi. The Saudi stock market, prior to Friday’s attack, was regarded a phenomenon well beyond a simple market of shares and has now become part of the Saudi National Security strategy. The latest statistics show that 80% of Saudis are part of the stock market in some way or another.

The attack at Abqaiq and the drop in the market, what some people have called “Black Sunday,” took place during the same week. These two events led many to ask the popular question, whether wealth is a blessing or a curse. Formerly, the question was specifically related to oil when that was the only source of wealth in the Gulf countries; now however the question refers to other resources after the rise in the oil prices led to the unusual growth of the Saudi stock market due to the high financial liquidity and limited venues for investments.

According to an economic report by Al-Riyadh daily newspaper, the Saudi stock market has seen large increases in the number and volume of transactions. In 2001, the number of transactions totaled 605 000, while in 2005 the number reached over 46 million. The total value of shares jumped from 83.6 billion Saudi Riyals in 2001, to 4.1 trillion Saudi Riyals in 2005. This shift put the Saudi stock exchange market amongst the world’s twenty biggest stock exchange markets.

Will this growth continue without limits? Some analysts see that there are no limits for capital growth. Especially that investment in shares and stocks are the only available channel for Saudi investors. Others saw that the whole situation was odd and that the index should drop to 12, 000 points.

Anyhow, this is a detailed discussion that should be left to specialists. The purpose of my article is rather to highlight the complex relationship between the people of the Gulf and their oil-generated wealth with the Arabs of the water-rich areas, also known as the Arabs of the center or the Arabs of the fertile lands. The latter have consistently sought to stigmatize the gulf Arabs for their oil, as if oil is a curse.

According to the Kuwaiti writer Dr Mohamed Al Rumaihi, this sort of defamation and slander bears some elements of racism. Al Rumaihi, who has written numerous books on oil over the past twenty years, coined the term “Istikhlaj,” modeled on the Arabic word for orientalism that is “Istishraq.” By Isikhlaj, Rumaihi refers to the stereotyping by the Arabs of the fertile lands of the gulf Arabs.

This love/hate relationship towards oil is also reflected internally within the Gulf nations themselves. Some elements in our societies expressed horror at what they call the “Oil Beast” that has shaken the social setup, and misplaced the criteria of society by reshuffling cards.

From the beginning, the relationship with the giant newcomer has been widely complex. Some have enjoyed the profits of oil whilst others have cursed it for its impact that has led to social disorder. In fact this ambiguous attitude towards oil as a blessing or a curse, even affected the relationship between consumers and producers. Voices from the biggest consumer, the United States, now call for ending the “oil addiction”. In an Egyptian movie called ‘Arak Al Balah,’ (Date Wine) there is a scene where employees appear almost as if they were creatures from outer space, in a poor Egyptian village to take workers to the Gulf countries whilst the women of the village scream and wail for the loss of their men. Thus, the oil dilemma was and is present everywhere, both inside and outside of the Gulf, amongst neighbors and amongst superpowers.

Oil, as Dr Al Rumaihi said, is neither good nor bad. It is totally neutral and depends only on how we use it according to Al Rumaihi. I asked him, “Do you believe that we have dealt efficiently with it so far?” The answer was an immediate “No”. He continued, “Because we have not invested our wealth in building the Gulf citizen. For example, we have many graduates and many students abroad. However, we have not established a real education system as we have only concentrated on the outer rather than the inner qualities of education such as how to acquire skill and increase knowledge. If I tell you about the levels of my political science students you would be disappointed.”

So has oil frozen our progress? Has it made us feel that we are unable to improve on economic, social, and political levels nevertheless enjoy wealth? Al Rumaihi answered, “Perhaps. We resemble a man who appears perfectly healthy on the outside, however, in reality, he is suffering from a serious illness on the inside. We have great infrastructure such as roads, airports, universities etc, however, we suffer acute poverty in the scientific, cultural, and political domains.”

Could the second oil boom that we are currently experiencing rectify this? Al Rumaihi answers, “I am not optimistic and that 90% of our latest Kuwaiti budget went to salaries and pensions rather than towards any educational or developmental projects is enough to explain my pessimism.”

Are we going to make the same mistake twice? Are we going to run after quick profits whilst ignoring comprehensive development? Let us take time to think this over. Let us think long and hard before two more members of our youth such as the would be Abqaiq bombers blow themselves up in their attempts to destroy the wealth of their homeland, the wealth that they curse just as Bandar the poet had cursed it before them.