Iraqi tribes put more pressure on oil companies in Basra

Extra security forces have been deployed to Basra as tensions escalate. (File photo: Reuters)
Updated 12 July 2018

Iraqi tribes put more pressure on oil companies in Basra

  • More than 13 tribes unite in anger over killing of protester
  • Protesters plan “to restrict the movement" of oil and gas workers

BAGHDAD: Tribes in southern Iraq blocked more roads and deployed extra protesters on to the streets as demonstrations against foreign and local companies running the region’s oil fields escalated on Wednesday.

Anger has grown in Basra, the country’s main oil hub, after police opened fire on Sunday to disperse demonstrators who had gathered at the entrance of an oil company to demand jobs. One man was killed and three were injured. 

The tribe of the victim demanded that the Iraqi forces hand over the perpetrators for punishment or reveal their identities. But the Iraqi government's refusal to respond to the request has fueled anger in the city which is the main source of the country’s wealth but where the local population see little of the benefit.

More than 13 tribes on Wednesday announced they were backing the request of the Bani Mansour, the tribe of the killed protestor. 

Meanwhile thousands of protesters took to the streets in downtown of Basra and its outskirts. 

Hundreds more blocked the main roads leading to Rumaila, home of the biggest oil fields in the country “to restrict the movement of the workers of the oil and gas sector,” an organizer of the demonstrations told Arab News. Some roads were blocked with dirt barriers while burned tires were positioned across others. 

Iraqi security forces in Basra have been on high alert since Sunday and additional armed troops were deployed along the roads leading to the headquarters of oil companies and oil fields. Foreign oil companies have evacuated their senior staff from West Qurna to southern Rumaila and “have activated their contingency plans to address any potential risks,” a local security advisor of oil companies told Arab News.

The Iraqi Ministry of Oil, which supervises the work of hundreds of foreign, Arab and local oil companies in Basra, also issued new instructions to its local staff to organize their work according to “(the urgent) security conditions and roadblocks.” The advisory said they should be working more than 12 hour shifts to help cover any shortfall in labour and to use alternative routes to reach work sites.

A statement signed by the heads of Basra’s tribes laid out their main grievances. 

“We ask the oil companies to improve the infrastructure of the towns and villages where these companies are operating in Qurna and Medaina,” the statement said.

It called for improving water and electricity supplies, and improving hospitals and roads.

Iraq has suffered from a severe lack of basic services since 1991. 

The southern provinces, especially Basra, are among the most affected by high poverty and unemployment.

Local officials insist that 139,000 locals from Basra are employed in the oil and gas sector there, compared to more than 50,000 foreign and Iraqi workers from outside Basra. But the demonstrators have demanded the expulsion of workers from outside the region to provide more employment opportunities for locals.

“It is true that the largest number of workers in these (oil and gas) companies are from Basra, but it is still unsatisfactory,” Ali Shaddad al-Faris, the head of Oil and Gas Committee within the Basra Provincial Council told Arab News.

“We have already asked the big oil companies to open centers to qualify the locals for more jobs. 

“They (the companies) have expressed their readiness but the Ministry of Oil, which is the only body authorized to ask them, is not interested in developing the skills of youth or improving the situation.”

Sunday’s demonstration was initially protesting against severe electricity shortages but the anger was quickly redirected towards the oil companies.


A female entrepreneur brings crowdlending to Saudi Arabia

(Photo/Shutterstock)
Updated 25 January 2020

A female entrepreneur brings crowdlending to Saudi Arabia

  • Shariah-compliant peer-to-peer lending platform called Forus to be launched this year
  • Founder Nosaibah Alrajhi aims to help businesses and small investors in the Kingdom

RIYADH: It is no secret that small businesses struggle with obtaining funds to expand, with one avenue being particularly tricky in the region: Trying to rely on a national bank for help.
While things are improving, they are not doing so quickly enough. These longstanding problems have inspired Nosaibah Alrajhi, a former investment banker, to launch Forus, a Shariah-compliant peer-to-peer lending platform that she hopes can help bolster Saudi Arabia’s economic growth and enrich both business owners and small investors.
“It’s very straightforward: We bring together investors and SMEs (small and medium enterprises). Crowdlending will provide a steadier and safer return than say, investing in stocks or investment funds,” said Alrajhi, who serves as co-founder and chief executive.
“If you compare it to real estate, for example, you need a lot of cash upfront to invest in property, but with P2P (peer-to-peer) lending it provides almost everyone with the opportunity to invest and get a return.”
Having received a special license in July 2019, Forus will launch its platform in early 2020. For investors, it is quick and easy to register: You just need to complete a standard know-your-customer (KYC) process, and you will then be able to lend SR500 ($133) to SR10,000 to whichever companies you choose.
For would-be borrowers, Forus will undertake a credit and risk analysis that usually takes about 10 days.
“We do all the due diligence, and once companies meet our benchmarks, they’re listed on the platform, giving investors — individual and institutional — the opportunity to lend them money,” said Alrajhi. “We call it income investments — investors get their money back, plus fees.”
Companies listed on the online platform are rated according to risk — the bigger the risk, the larger the return for lenders. Companies can borrow up to a maximum of SR2 million.
“Investors can look at the companies’ financial reports, their strategy, their team, their products, as well as specific financial ratios that will help them make their decision,” said Alrajhi.
A company will request to borrow a certain amount, and once this is fully pledged by investors, it will receive the loan. Forus, in turn, earns a small commission. Loans are for six to 48 months.
“Our marketplace is providing investors with diversified alternative options (for) investing, while businesses are empowered with an opportunity to grow and scale,” said Alrajhi.
“We achieve this by minimizing friction, streamlining the customer experience and providing a seamless, secure and transparent platform.”
Alrajhi holds an MBA from Madrid’s IE Business School, where her research led her to spot a gap in the market for a fintech-based, P2P lender in Saudi Arabia.
“If you look at the market today, there’s only a few banks who are willing to lend to SMEs, which banks see as quite high risk,” said Alrajhi. “In Saudi, there are roughly 16,000 SMEs looking for loans.”
Forus uses a murabaha — cost plus financing — structure for its loans, which are not interest-bearing and so are Shariah-compliant.
In English, Shariah-compliant lending will refer to a profit rate rather than an interest rate, although in Arabic there is no such linguistic distinction.
Nevertheless, Forus’s loans are Islamic. “In Saudi, the biggest market is for Shariah-compliant financial services,” said Alrajhi.
She hopes her platform will provide a win-win for investors and SMEs — investors can earn a bigger return on their money, while SMEs can obtain the funds needed to expand their operations and increase profits.
In the longer term, Forus plans to expand to Egypt and Pakistan, but for now Alrajhi’s focus is firmly on her native Saudi Arabia.
“One of the main impacts we aim to have is transparency, which will then enable financial inclusion and help increase GDP (gross domestic product),” she said.
“We’ve talked to so many SMEs, and we found that almost all are facing challenges when it comes to borrowing.”
She leads a team of 10 staff at Forus, and is a female trailblazer in the Kingdom’s male-dominated financial services sector and more broadly in Saudi Arabia, where women constitute less than 25 percent of the workforce.
“Within the next five years, Saudi’s financial sector will look completely different,” said Alrajhi.


This report is being published by Arab News as a partner of the Middle East Exchange, which was launched by the Mohammed bin Rashid Al Maktoum Global Initiatives and the Bill and Melinda Gates Foundation to reflect the vision of the UAE prime minister and ruler of Dubai to explore the possibility of changing the status of the Arab region.