Deals, dreams and democracy in 2005

It has been a roller-coaster year for the Middle East, with record profits for the likes of Emaar Properties and Emirates Airline, democratic elections in Iraq and Palestine, and seismic changes to the political landscape in Lebanon. Anil Bhoyrul and Tamara Walid take a look back at the major events of the last twelve months.

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By  Anil Bhoyrul and Tamara Walid Published  January 1, 2006

|~|collage-copy-200.jpg|~||~| January kicked off with election fever gripping the Middle East, with historic votes in both Palestine and Iraq. As expected, Mahmoud Abbas swept to victory in Palestine. After years of having the late Yasser Arafat at the helm, the peace process emerged with a new figure to deal with. However, it was clear that Abbas had many obstacles to overcome as the new Palestinian leader, including the continuing violence between the Palestinians and Israelis as well as the hindered peace process in the Middle East. Meanwhile in Iraq, interim prime minister Iyad Allawi went to the polls in the country’s first genuine democratic election. But it has also turned into his last, as Iraqi voters gave him the thumbs down. Although the elections were intended to strengthen the spirit of Iraqi national unity, they only increased the tensions simmering among the country’s ethnic groups. Iraq’s new democratic process was firmly under way, but there has been no sight whatsoever of an end to the bloodshed. With the beginning of February, the fragile peace, which had held sway over the many different religious and political factions in Beirut for 15 years, had begun to shatter. At 1.46pm on St Valentine’s Day, February 14, the equivalent of around 1000kg of TNT ripped through a convoy of vehicles passing St George Hotel in Beirut, one of them carrying former prime minister Rafik Hariri. Peace in Lebanon ended. Syria suffered the impact of Lebanese and international fury at the incident due to its strong military and intelligence presence in Lebanon as well as the public dispute that occurred between Damascus and the former PM before his last resignation. His murder has brought seismic change to the region, which as 2006 approached, is still on-going. At that time, the world could only watch the horrific ending of the man known as “Mr. Lebanon.” Nearly a year on, the after effects of his death are still being felt. March saw the fall-out from the death of Rafik Hariri encompassing most of the region. Millions of Lebanese took to the streets, in unprecedented mass protests. They wanted the occupying Syrians out, as well as free and fair elections. The winds of democratic change suddenly appeared to be sweeping throughout the Middle East — Iraq, Palestine, Saudi Arabia and Egypt all got a taste of differing degrees of democracy. In Lebanon, the demand for Syrian troops to leave the country was at an all time high. But were they ready to leave? In April the United Nations released its interim report into the killing of Rafik Hariri, with explosive claims — Syria’s hand was suspected, with the report going into great details over the truck used for the bombing and the timeline. On the business front, the debate over the plans for a single currency within the GCC had started to take shape. It may still be several years away, but given the problems the Europeans have faced, the debate has already started. The six oil-rich states have set a goal to unify their dollar-pegged currencies in the period of five years, and have put restrictions on debt, interest rates, budget deficits and inflation in order to move their economies closer together. Meanwhile, Intel boss Craig Barrett visited the region for a round of “farewell” interviews before his retirement. As May approached, property giant Nakheel took some 200 guests out to visit its first show-home on ‘The World.’ The trip lived up to all expectations. But questions remain on how many islands have actually been sold. Kuwait’s Rola Dashti took a stand for women’s rights in Parliament, with success. Dashti played the role of the main coordinator of the women’s rights rally in Kuwait earlier this year, and declared that ‘extremists’ would not impede the process of fighting for women’s rights. In Britain, prime minister Tony Blair secured a record third term in office for his ruling Labour party, but with a significantly lower popularity — due in part to his Middle Eastern policy. Blair said that the British people wanted to go back to a Labour government ‘but with a reduced majority’. He also expressed his concerns about Iraq being an issue of dispute for some time in the country, but that he also hoped to unite it again for a better future. His victory brought an immediate end to the leadership of Conservative party boss Michael Howard, who within hours of the defeat said he would be stepping down. The fight for the party’s leadership had begun and it took months before it was resolved. In June, Said Gaddafi spoke out for the first time on Lockerbie, WMDs and the Iraq war. Rolls Royce boss Ian Robertson visited the Middle East to drum up interest in the car-maker's products, followed within days by senior Jaguar executives. It became clear that the battle for the luxury car market would be won and lost in the Gulf. Emaar chairman Mohammed Alabaar also made his way back into the news, after Israeli deputy prime minister Shimon Peres revealed details of the now infamous Alabaar meeting. The visit sparked outrage in the Arab world. Israeli media reported Alabbar saying he would pay US$56 million for 21 Jewish settlements to be evacuated in the Gaza strip. Israel said it might knock down the homes but keep other infrastructure. At the time the country was preparing to evacuate the Gaza Strip of its 8000 settlers and the troops that defended it. Meanwhile, Arab League secretary general Amre Moussa was busy defending the very purpose and existence of the embattled Arab League. In July, the region’s financial community mourned the death of Arab Bank chairman Abdul Majeed Shoman. He was the head of one of the biggest privately owned banks in the Middle East as well as one of the most prominent financial institutions in the Arab world. His burial took place in the royal cemetery in Amman on the command of King Abdullah II. Meanwhile Etisalat chairman Mohammed Omran detailed how the UAE telecoms giant will deal with the competition in any liberalised market. Meanwhile, in Lebanon, Saad Hariri’s party swept to victory in elections. Although he did not take over the leadership of the party, he was more than happy to set its agenda — effectively the same as that set by his late father Rafik. Earlier that month North Korea’s leader Kim Jong-il declared during a meeting with a Chinese diplomat that he hoped for a nuclear-free Korean Peninsula. He was also reported by an official Chinese news agency saying that six-party international talks with the two Koreas, US, China, Russia and Japan might be the first step to achieving that goal. The comments came as a surprise given Jong-il’s previous history of standing defiant in the face of the US in favour of maintaining nuclear power. In London, suicide bombers launched a major attack on the tube network. It occurred during the morning rush hour when four explosions ripped through London’s public transport system. Three bombs exploded in London Underground trains whereas the fourth was detonated on a bus at Tavistock Square. The attacks took the lives of fifty-six people including the four suicide attackers and 700 injured. Egypt suffered its own day of terror in August, with a devastating bomb attack on the Sharm el-Sheikh resort. About 88 people were killed and 200 injured in the overnight explosions. The first attack occurred in the Old Market followed by two in Naama Bay, causing severe damage to a hotel. The president of Egypt, Hosni Mubarak, promised to prolong the ‘battle with terrorism’ while passing through the scenes of the attacks. Most of the victims were Egyptians, however there were foreigners as well. The attacks marked the worst in the country’s recent history. Meanwhile, the search for those behind the London bombings a month earlier continued, with British police revealing that the first wave of bombers on July 7 all died in the attacks they carried out. Wataniya Telecom, meanwhile, revealed further plans in its bid to build a regional mobile empire, while in Iraq the proposed new constitution began taking shape. But fears grew over women’s rights, and there were worries that most voters would cast their ballots purely on religious lines. In the event, that happened. The month also witnessed the publishing of the second annual Arabian Business RichList, with once again Saudi’s Prince Alwaleed coming out on top of our wealth charts. After years of planning, the Dubai International Financial Exchange was finally launched in September. The launch was a great success for Dubai and its vision of becoming a world-class financial centre. The ceremony took place at the Dubai International Financial Centre (DIFC), where the exchange is located. The DIFX has been marked as the first exchange in the region to list securities from numerous different countries. Although initial trading on the exchange was low, interest from around the world quickly gathered pace. No expert was prepared to bet against its success. And the race was on between several Gulf States to claim to be the region’s premier financial centre. Despite a difficult launch phase and several changes of key personnel along the way, Dubai looked set to have a head start. October revealed dramatic new research suggesting that HIV might be losing its killer potency after 20 years of affecting millions around the world. A leading industry analyst report also said that the current Middle East shopping frenzy would last for several years to come. Which was just as well for Dubai, as the first phase of the incredible Mall of the Emirates finally opened — including a gigantic ski slope. Big retailers such as Virgin Megastore rushed to open what they claimed to be the biggest of their stores around the Middle East. It was early days, but all the signs seemed good. During November, the Dubai Air Show saw the double decker Airbus A380 take to the skies over Dubai. But Boeing also had much to be pleased about — Emirates Airline placed orders for 42 brand new Boeing 777 planes. At the show, Boeing claimed victory saying over its European rival, saying it had secured over US$10 billion of new orders. As the show came to an end its declared on-site order sales hit a total of US$21.3 billion, the highest in its history. The show featured 726 exhibitors from 46 countries, 15 national pavilions and over 100 aircraft. It was held at Dubai Airport Expo and was 25% bigger than the previous due to the construction of a third exhibition hall. All in all, the show was a major success and some experts had already dubbed 2005 ‘The Year of the Aviator.’ Nobody was more pleased than Emirates Airline chairman Sheikh Ahmed, who now runs the world’s most profitable airline. And all indications were looking promising for the carrier. As December approached so did the trial of Saddam Hussein. It started to take shape, but did not seem less chaotic. The former dictator appeared in the dock, but only sporadically — after many stops and re-starts for trivial reasons. He and his seven co-defendants pleaded not guilty to charges of manslaughter and questioned the validity of the court. Nobody can predict when it will end. But the final round of elections in Iraq passed relatively peacefully. However, Saddam Hussein still managed to steal the limelight. He accused the US of torturing him, and claimed he was too ill to attend the trial. Qatar’s financial regulator Philip Thorpe sounded a note of caution as the year moved toward its end, predicting that several of the region’s stock markets are in line for a big crash. December also saw the new executive networking group, Consortium Dubai welcoming a number of high profile individuals at its ‘In Honor of Africa’ Benefit Dinner at the Jumeirah Beach Hotel. Guests included His Excellency Mohammed Al Gergawi, executive chairman of Dubai Holding, prime minister Benazir Bhutto, Willem Botes, South African consul general — as well as keynote speakers Sir Bob Geldof, Adel Imam, Sundeep Waslekar, Barbara Castek, and Anant Singh.||**||

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