Arabian Business Weekly Update August 14, 2005

Women’s rights should be at the top of the agenda as Iraq drafts its constitution. This week will see the initial deadline pass for Iraq’s constitution to be drafted, but it looks pretty unlikely to be met. Brokering an agreement would be an extremely difficult challenge during peacetime, let alone the present climate in the country. At the time of writing, Iraq’s competing ethnic and sectarian factions are still at loggerheads over many issues, including the reach of Islamic law and rights for minorities. But reaching a deal will be crucial. If ever there was an example of how you can’t create a nation just by drawing some lines on a map — as Britain did with Iraq in the 1920s — this is it.

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By  Richard Agnew Published  August 14, 2005

Keep to family values|~||~||~|Women’s rights should be at the top of the agenda as Iraq drafts its constitution. This week will see the initial deadline pass for Iraq’s constitution to be drafted, but it looks pretty unlikely to be met. Brokering an agreement would be an extremely difficult challenge during peacetime, let alone the present climate in the country. At the time of writing, Iraq’s competing ethnic and sectarian factions are still at loggerheads over many issues, including the reach of Islamic law and rights for minorities. But reaching a deal will be crucial. If ever there was an example of how you can’t create a nation just by drawing some lines on a map — as Britain did with Iraq in the 1920s — this is it. One thing is almost certain, though — women’s rights are not going to be progressed by the constitution, whether it’s completed this week or months down the line. The US has warned Shia leaders that there will be ‘no compromise’ on the issue of gender equality, but the signs aren’t good. Last year, campaigners managed to block legislation that would have allowed polygamy, honour killings, and stoning and beheadings of women for alleged adultery. But now it is back — initial drafts state that Shari’a will take precedence over international law, and family law will be a matter for the country’s individual religious sects. It is vital for Iraq that this doesn’t happen. In the future, the country will depend greatly on its women. The appalling violence of the past 30 years has meant that the majority of Iraq's population is female. It is also estimated that the bulk of this majority are heads of households, as widows or wives of the country’s ‘disappeared’. Despite the difficulties Iraq’s leaders face in drafting this constitution, this is a unique opportunity for them to build a workable framework for its future. Excluding most of the population wouldn’t be a good start. ||**||The US$64 dollar question|~||~||~|AS US diplomatic missions in Saudi Arabia closed last week because of a threat of attack, the price of oil rose to above US$64 a barrel. The scenario, while not as bad as that at the very start of the Iran-Iraq war in 1980, which saw prices rise to above US$80 a barrel, is nonetheless indicative that the geopolitical situation in the Middle East continues to play a dominant role in shaping market sentiments. It also highlights that much more is at stake than supply and demand. China’s impressive annual 10% growth rate for the last 10 years or so is not the only underlying factor. Market psychology remains, and will continue to be, a major issue. The key for governments that depend on black gold to fuel their economies is to find an alternative. By the same token, it would be prudent for oil producing states that haven’t diversified their economies to seriously consider doing so while the iron is still hot. ||**||VAT’s manageable|~||~||~|The news last week that the UAE’s government is making preparations to introduce VAT raised quite a few eyebrows, although the move has been on the cards for some time. Local media argued it would unnecessarily affect investment, and that poorer households would be hit hardest. This could well be true, but the move could also have numerous benefits. For the government, one obvious one would be to diversify its earnings away from oil and gas. If VAT takings were used to improve public services, it would also be a positive move. Firms, however, will probably end up shouldering the burden. When it is introduced, every firm will have to reshape their accounting systems, and have to bear higher costs. With the UAE recording huge budget surpluses, the question remains: would the move actually be worth it?||**||

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