Arabian Business Weekly Update 13 February 2005

It is time the Palestinian president sought peace with militant groups. JUST over a month since being elected president of the Palestinian Authority, Mahmoud Abbas has delivered. His unexpected peace deal with Israel is a personal triumph against all expectations. But his real test comes now: doing a peace deal with the rest of Palestine. The wave of optimism that has swept the region suggests that Abbas may ultimately succeed where his predecessor Yasser Arafat could never dream of venturing.

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By  Anil Bhoyrul Published  February 13, 2005

Abbas must embrace Hamas |~||~||~|It is time the Palestinian president sought peace with militant groups. JUST over a month since being elected president of the Palestinian Authority, Mahmoud Abbas has delivered. His unexpected peace deal with Israel is a personal triumph against all expectations. But his real test comes now: doing a peace deal with the rest of Palestine. The wave of optimism that has swept the region suggests that Abbas may ultimately succeed where his predecessor Yasser Arafat could never dream of venturing. Given the personal invitation he has received to Ariel Sharon's ranch in Israel, there is clearly a strong and positive dialogue based on trust between the two men. It is not out of the question that Israel may call a permanent halt to settlement constructions and home demolitions. It is no longer an impossible dream that the political issues at the core of the conflict, such as the final status of Jerusalem and the rights of millions of Palestinian refugees to return home, could ultimately be resolved. The sight of Abbas and Sharon shaking hands is akin to the first hand-shake between Nelson Mandela and F W De Klerk in South Africa. Both men went on to win the Noble Peace Prize. But ultimately, Abbas's biggest hurdle may come within Palestine. The militant Hamas group says it is not bound by the ceasefire, but will embrace it for now. Abbas must seize this opportunity and in turn embrace Hamas into the political process, for the sake of the region. He must look beyond their boycotting of the recent Palestinian elections, and persuade them that negotiation, not destruction, is the only way forward. ||**||Bahrain moves ahead|~||~||~|The Saudi Arabian government is less than impressed with recent events in Bahrain, where a free trade agreement has been signed with the US. If it goes into effect, the FTA would result in an immediate lifting of duties on 100% of consumer and industrial products and 81% of US agricultural exports. The agreement would also give US goods a foothold inside the Gulf. Not surprisingly, the deal has raised serious concerns among Gulf Cooperation Council (GCC) members. Saudi Arabia is particularly concerned that such unilateral moves undermine the GCC’s economic integration efforts. It fears that the forging of separate economic and security agreements with foreign powers will weaken Gulf solidarity. The Saudis have a good point. Unfortunately, their own “special relationship" with the US makes that point irrelevant. ||**||Phone wars|~||~||~|A battle for supremacy in the mobile devices market is raging stronger than ever. This week we feature i-mate founder Jim Morrison on the cover. In three years, he has taken his company from nothing to the brink of a flotation that could value his group at US$800 million. Not bad for an operation that employs just 94 people around the globe. If he succeeds, the flotation will be proof that mobile devices are the new dot.coms when it comes to stocks. Of course, we all know what happened to dot.coms in 2000: they crashed faster than they rose. The challenge for the likes of i-mate is to roll out new products that customers keep coming back for. So far, i-mate claims 30% of its customers return to buy the next product on sale. If true, Morrison will be everybody's mate in the stock market. ||**||

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