Israel Matzav

Panic in the Gulf

There's been a massive sell-off in the Saudi stock market this week, and the reason is really quite simple: The Saudi royal family is between a rock and a hard place.

The latest sell-off was triggered by the arrest of a Shi’ite cleric in the Kingdom’s Eastern Province after he called for democratic reforms and a constitutional monarchy. The province is home to Saudi Arabia’s aggrieved Shi’ite minority and also holds the country’s vast Ghawar oilfield, placing it at the epicentre of global crude supply.

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In Bahrain, the island nation’s Sunni elite holds sway over a Shi’ite majority that is denied key jobs and has a token political voice, making it a trial run for Saudi Arabia’s near-identical tensions in the Eastern Province.

Bahraini dissidents have so far been much bolder, prompting a bloody crackdown last month when at least seven people were shot by the military. The ruling family – under intense pressure from Washington to stop the killings – has since held out an olive branch to protesters and let the radical Haq leader Hassan Mushaima return from exile, yet the crisis is far from contained.

My Mushaima said on Wednesday that protesters have “the right to appeal for help from Iran” if Saudi military units interfere in the struggle. Tanks were seen crossing the 17-mile causeway from Saudi Arabia to Bahrain on Tuesday.

“These were supposed to be Bahrain’s tanks returning from Kuwait: that is not a credible story,” said Firas Abi Ali, a Gulf expert at the risk group Exclusive Analysis.

He said the outcome in Bahrain will set the template for events across the border. “There is no good outcome from this for Saudi Arabia. If Bahrain offers concessions, the Saudi Shia will demand similar concessions. If they crack down, they risk an uprising. These people do not want to live under the House of Saud,” he said.

Saudi activists have called on Facebook for a “Day of Rage” on March 11, despite the penalty of lashing for street protest. A similar call to arms in Syria fizzled because people were frightened, and the security forces nipped it in the bud. “We will be watching closely to see how many people turn up, and how far their demands go,” said Mr Abi Ali.

Saudi King Abdullah has scant leeway. His own legitimacy stems from Wahabi clerics, who refuse any compromise with the Shia. He is 87 and in poor health, raising the prospect of an imminent succession struggle that favours the hard-line interior minister Prince Nayef. He would undoubtedly crush any protests. The monarchy has sought to gain time by spending an extra $36bn (£22bn) on welfare and salaries, but patronage politics may strike the wrong note at this stage.

Read the whole thing.

What we're seeing is the chickens from 90 years ago coming home to roost. The West attempted to divide the Middle East into nation states in the hope of making them Western-style democracies. They have failed on two counts. First, the division was accomplished by paying off the strongest tribes in the region, ignoring the inevitability that who is the strongest tribe is a cyclical notion, and that the day would come that the al-Saud's and the Khalifa's would not have the consent of other tribes to govern them. Second, loyalty in this part of the world remains the loyalty of the tribe - and in the grander scale of the sect of Islam. There is no Western-style notion of loyalty to the nation state.

I've seen a lot of comments that what's going on now is the Arab world's 1848. That might be true in Egypt, which is an ancient and cohesive society and it may even be true in Tunisia. But it's not true in countries like Saudi Arabia, Bahrain, Libya, and further down the road Jordan and Oman. For those countries, what we're seeing is 1848 in reverse: A withdrawal from nationalism in favor of tribal loyalties.

What could go wrong?

Labels: Bahrain, Saudi Royal Family, tribalism

posted by Carl in Jerusalem @ 2:13 PM