Also, these channels were considered among the best options for political reasons and for other considerations.
Nowadays, capital owners in the US and Europe are thinking harder about their strategies and they are starting to look for investment alternatives in order to protect their capital from the failing financial system, which had become insecure.
Some of them are trying to reduce risks by choosing other geographical places for their investments by investing in developing countries (e.g. in emerging markets: Africa, China, India, Russia, and South American countries such as Brazil).
They are trying to adopt “selective investment methods” that are totally different from traditional financial instruments or gold and other commodities.
For that reason, it is not a surprise to face some increases in investment portfolios of those countries and in the prices of gold and other precious commodities.
What we have faced since 2008, (which began the start of the real estate crisis with “the subprime,” ie the collapse of some of the oldest financial institutions eg Lehman Brothers Holding Inc., the sovereign debt crisis in some countries located in the heart of the capitalist system, and the reduction of credit ratings of important countries i.e. US in addition to other developments), warn us that we are facing a new financial development, which is not yet clear, because such change is not part of the economic cycle (recession, growth ... etc) but it is a fundamental problem in the economic structure, in addition to the fact that it does not accommodate the basic human principles (justices and morals) and it does not fairly treat the economic dimension (the huge gaps between classes — where the rich class became richer, the middle class vanished and the poor became even poorer).
The consequences of these developments caused the increase of charges and living costs, high unemployment rates, huge competitive losses in the industries of some developing countries, which forced them to make fundamental changes in their industries and products (shifting more from industrial sector into service sector and then into quantitative one), and the start of the countdown of the unsettled financial system (massive public demonstrations in the US and Europe in the heart of the financial markets due to what their people face in terms of financial suppression which is similar to the political suppression which caused what is known as “Arab Spring” that toppled Arab regimes and leaders, taking in consideration that there are intentional media and political blackout aims to reduce the circle of demands and financial complaints.
Now, we hear reports about the “Western financial spring” and slogans calling for the toppling of the financial system. (The prime ministers in Greece and Italy lost their jobs as a result of these campaigns and other leaders also may lose their positions soon).
The financial system is straggling in a desperate attempt to control its monetary and financial instruments which caused the deeds and the notes, issued by the Western financial system, to become worthless for both parties; the investor (the GCC countries) in terms of the investment’s evaluation and for the debtor/borrower (Western countries and US) that is like pouring oil on fire.
The monetary policy lost the efficiency of its most important tools for managing the economy through (discount rate and Fed rate) or through (expansion/contraction).
On the other hand, a new financial term has been invented which is called “the quantitative ease of money” which means printing more banknotes to cover the shortage with no financial basis or economic justification.
If we take a careful look at the investments of Arab and GCC countries, which have been looking to invest in the Western financial system (the investments of the GCC countries in the US exceeds $1.5 trillion including reserves, investment equities, banknotes coverage, sovereign and non-sovereign investments) we will discover that one investment’s portfolio in one of the GCC countries is heading to one of the capitals of that system, which its debt became more than its GDP, with an investment offer of more than $1 trillion.
If we consider such offer from economic and financial point of view, we find it very unrealistic and irritating offer in addition to the fact that such offer does not have logical reasons which can convince the nationals of that country of its feasibility; this is what we call in the financial jargon “good money chase bad money in bad situation.”
To be more precise, we can describe the situation as follows:
In the capitalist system, the financial developments are scary and the system is falling quickly where we witnessing the bankruptcy of old entities and countries, even there are many countries in such system which are on the brink of bankruptcy, in addition to the financial, real estate, and industrial falls and the big losses which forced some countries like US to offer some of its equities for sale (an island owned by the government of the US is for sale in New Jersey, in order to help the government to pay some of its public debts which exceeded $16.2 trillion).
Such figures are historical, massive, and scary by all means because they affect the structure of the financial system and not only its economic role in light of the gradual increase of the public debt which has no chance in being restructured except for external reforms and the political ignorance based on false promises.
The political developments in such countries made senior leaders of such countries declare that their principles are based on their interests and they will do anything in order to secure resources for the sake of their interests.
Now we are facing drastic political changes because those countries in the past used to lecture about the principles of human rights, democracy, peace, and freedom, but now those countries have extremely changed their position and they do not feel shy to say it clearly and without hesitation.
The last statement in this regard came from John McCain, the US senator from the Republican Party, who said frankly “Our principles are linked to our interests"!
This means that when we invest in such countries through any financial instruments i.e. deeds, notes, equities, shares... etc, we are financing such unclear systems in terms of their current situation and future principles, taking into consideration that such systems have more military, media, and judicial powers than us.
So how can we guarantee the retrieval of our investments?
In actual fact, the Western financial system has entered the phase of bankruptcy where its debt exceeds 100 percent of its GDP.
So, it is not reasonable to lend our cash to such systems and then to seek returns from those channels if we take their military, media, and judicial superiority into consideration.
The judicial system in the capitalist regimes is dedicated to serving their roles irrespective of their claim of independence and neutrality of jurisdiction.
We should not forget the lessons we learned in the past and from the financial lawsuits which were filed against some of the most important Arab and Islamic countries in order to demolish their financial systems after 9/11.
Also, there are many financial cases against Arab businessmen and investors, especially from GCC countries. They became victims of such lawsuits.
The sad thing is that such governmental, institutional and individual cases affect the savings of future Arab and Islamic generations which were lost due to the callousness of Western financial system and bankers who admit that their system has lost its morals and the very system itself starts referring to Western bankers as “rats and snakes.” How can we trust the international culture which is based on opportunism and trapping others under the pretext of law?
How can we trust the regime, which unleashed its judicial system against us using all excuses to confiscate our money and properties as if they are mere loots?
Such concerns are growing the absence of Arab or Islamic juridical bodies, which can protect Arab and Muslim money and interests in the West like pro-Israel lobby groups such as AIPAC (American Israel Public Affairs Committee).
In terms of the media, there is no doubt that the Western media is manipulated in a professional and even brutal way to serve the interests of the stakeholders in West that casts doubts over its reporting objectivity.
The presence of the Arab or GCC investors is almost missing in the mass media, and such investors are treated as if they are oil barrels or unsophisticated aliens whom are suspicious.
In the light of such inferior prospective and systematic blackmailing scenes, which we see at embassies, airports, films, and in real life, it is sad to notice that we, as individuals, did not take any action on such issues (as if it is not our business or as if this problem is the problem of others because we vary in ranks), while if a Jew is attacked in anywhere in the world, the media in the West and even in the whole world would condemn the assailant jurisdictionally, socially and through the media and accuse him/her of anti-Semitism, even though we the Arabs are Semites.
So, what is the use of capital and investment if such money does not serve our interests and goals, does not directly benefit the people of the region in terms of human rights, and if such money brings trouble, bad reputation, and contemptuous treatment by some nationalist and racist Western elements in the absence of any rights or protection for Arab or Muslim investors in media or legal system.
It needs to be noted that Saudi Arabia is one of the biggest economies in the world, a member of the G20 group, own the biggest financial reserves in the West and the biggest bank remittances are issued from our region.
It is time to reconsider our dealings with the Western financial system and to re-organize our priorities by stressing on the dignity of the Arab and Muslim character.
We should not accept the ethnic and religious classifications they are using against us because of the actions of a very small group rejected by us.
We should also insist on our demands in terms of legal and media rights by having (official lobbying group) for such money which they take.
Also, we should get free facilitations to be added to the financial return in light of their laws known as “soft dollar” i.e. transferring technology, training, sophisticated systems...etc.
They should also provide us with legal guarantees to protect our money, character, and religion in order to avoid what happened in the past.
There should be also Islamic lobbying groups to protect Muslims and to condemn whoever insults us and revered religious figures.
There should be media protection where the GCC countries, through their money invested in the falling system, should improve the image and the reputation of the Muslim individuals and to enhance media and Internet forces, serving such purposes, in order to be able to enjoy coexistence with them in the West taking in consideration that we are the one who lend them and supply them with money, natural resources, and with information.
So it is normal to have in return a mutual respect especially if we know that money is power and if there is no benefit from it then there is no need to feel proud and give assurances to the people of the region.
Also, I would encourage all GCC private and governmental capitals to invest in the region because of our resources, space and unique and attractive business opportunities in accordance with international investment standards.
It is not a secret that the GCC investments in the region are safer than the investments in other places.
This is because GCC countries have in terms of political stability, security, legal and banking standards, which are known and accepted by the people of the region, and the assets which are close and reachable by investors in the Islamic countries.
We have great investment opportunities, which the GCC, Arab, and Islamic countries can take.
It is a time for financial and economic alliances where we should have an Islamic economic alliance in order to build an Islamic common market and create Islamic products based on financial Islamic system to save the humanity from the collapsing Western financial system which has ugly, scary, and unclear features as it was called by “Occupy Wall Street Group.”
The financial system of the West is falling apart. So we should not wait for others to wrap the Islamic system and its products and re-sell them back again to us with high prices and strict conditions. We must realize the fact that we have a wholesome banking industry that is based on economic pillars, human virtues and morals which will serve the whole mankind and will direct the investment for the sake of our society without wasting such resources in vain.
After all we are all — West and East — in it together.
— Sami Al-Nwaisir ([email protected]) is the chairman of Al-Sami Holding Group.
