Word: gulf
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Today's accumulation of riches in the Gulf is the stuff of dreams. Soaring profits from oil and natural gas are driving the region's wealth into the stratosphere. Henry Azzam, who heads Deutsche Bank's Middle East operations from a sleek suite of offices in the Dubai International Financial Center, is relishing this historic windfall. "We're becoming the epicenter of the global economy," he marvels. But Azzam has his worries. He sees the recent fighting in Lebanon, for instance, as a proxy war between the U.S. and Iran that could lead to an American military strike on Iran...
...threats that could spoil this party. For a start, there are the wildcard geopolitical risks that can never be ruled out in a region plagued by instability. In one nightmare scenario, Tehran would respond to a U.S. strike on Iran's nuclear program by lobbing missiles at cities in Gulf states like Qatar that are closely allied with Washington; in another, a terrorist group such as al-Qaeda would target Dubai, scaring off the tourists and white-collar expats helping to drive its heady growth...
These and other potential risks were among the topics of discussion in a May 20 debate in Sharm el-Sheikh, Egypt, on the subject of what could derail the Gulf boom. The session was co-hosted by TIME and the World Economic Forum on the Middle East. For all of the panelists, political stability was a fundamental concern. Citing the war in Iraq, the turmoil in Lebanon and the failure to achieve peace in Israel, Mohammed Shafik Gabr, chairman of Egypt's Artoc Group for Investment & Development, warned that "things are not getting any better" in the broader region...
Another panelist, Saad al-Barrak, deputy chairman and group CEO of Kuwait-based mobile-phone operator Zain, argued that the greater political challenge may be internal, with Gulf countries making poor progress toward democratic reform. While the region has built key "hardware" such as roads, schools and skyscrapers, al-Barrak said it has yet to develop the "software" required to fulfil its potential - an efficient legal system, regulatory transparency and free elections. "That is what creates sustainability," said al-Barrak. "That anchors the future." He also criticized the Gulf's bloated public sector, joking that Kuwait has so many government...
Likewise, Nasser al-Shaikh, chairman of Amlak Finance, the largest publicly owned Islamic finance firm in the United Arab Emirates, spoke of the need to unlock the Gulf's human potential by improving education and training, and luring more skilled workers from overseas. The region's ambitions are vast - from the new economic cities being planned in Saudi Arabia to the huge construction projects rising up in Dubai to the renewable energy research being funded in Abu Dhabi. "But can we attract the talent to execute the projects we have in mind?" asked al-Shaikh...