|Friday 03rd of January 2020
He is a canny, ruthless military leader - and Iran's greatest defender. Has the US fundamentally misconceived the motives of this commander, and by extension, Iran itself? @prospect_uk H/T @TamerBadawi1
Law & Politics
He is a canny, ruthless military leader—and Iran's greatest defender.
Has the US fundamentally misconceived the motives of this commander,
and by extension, Iran itself?
In the summer of 2014, Islamic State (IS) blindsided Iran by occupying
a third of neighbouring Iraq.
The self-styled caliphate captured a town only 20 miles from the
border with Iran named Jalawla, where Islam’s second caliph Omar
defeated the Persian Empire in 637.
Jalawla was also where, 1,377 years later, the Iraqi dictator Saddam
Hussein had invaded Iran. For Iranians, the enemy was once more at the
Within days, Tehran dispatched Qasim Soleimani, the commander of its
overseas paramilitary forces.
There he co-ordinated the supply of 140 tons of military equipment per
day to the Iraqi army and Shia paramilitary groups: small arms,
mortars, Ababil surveillance drones and tank and artillery ammunition.
The United States-led international coalition against IS would pick up
the slack later in 2014. But right then Iran’s early intervention, led
by Soleimani, was the only thing keeping Iraq together.
Iran also began deploying Soleimani on another front: launching a
propaganda war centring on the self-styled “noble warrior,” a man who
could appeal to both nationalists and religious conservatives.
The “Commander of Hearts” became a fixture on domestic news. Iranian
elites who would refer to him tongue-in-cheek as “Soleiman the
Magnificent,” after the Ottoman sultan who so intimidated Europe,
presented him as the nation’s protector against the barbarism of IS
and the imperialism of the US.
Tehran authorised the translation into Farsi of western articles that
cast Soleimani as a formidable agent of Iranian regional power.
Instagram accounts dedicated to him sprung up, many with hundreds of
thousands of followers.
They showed Soleimani posing with children; Soleimani reading Gabriel
García Márquez; Soleimani in a Palestinian keffiyeh; and Soleimani
posing alongside Iran-backed paramilitary fighters in Iraq and Syria.
Increasingly, he was also held up as a pious and humble servant of the
Islamic Republic. When a state-run news agency asked his father why
America feared him so much, he responded: “They’re afraid of Islam,
not of my son.”
Soleimani has enemies closer to home too—in October Iranian officials
claimed they had foiled an assassination attempt against Soleimani,
pinnng the blame on Israeli and Arab agents.
Soleimani commands the Qods force, an elite paramilitary army that
reports directly to the Iranian Supreme Leader Ayatollah Ali Khamenei.
He gathers intelligence, builds political alliances and creates a
hostile environment for foreign forces opposed to Tehran. The methods
have been consistent, even as the enemies changed.
In Iraq, the enemy was first Saddam and later IS, and—indirectly—the
US; in Syria, it has been the various rebel groups opposed to
President Bashar al-Assad; in Lebanon, the Israelis who are ranged
against his Hezbollah allies; and in Yemen, it is the official
government that is being propped up by western-backed Saudi bombing.
Throughout Soleimani’s two decades at the top, he has had to navigate
the forces unleashed by the US and British invasion of Iraq and
Afghanistan, the associated rise of jihadist insurgents and, later,
the democratic protests of the Arab Spring.
Although his success has a lot to do with him capitalising on his
enemies’ failures, he is a remarkable tactician. More than that, his
life story is that of the generation of revolutionaries who control
Iran today, and helps us to understand the choices Tehran makes, and
does not make, in its Middle East interventions.
But in 1997 Rezaee was fired and Supreme Leader Khamenei promoted
Soleimani to head the Qods brigade.
A year later, the US-led invasion of Iraq caused a national security
crisis for Iran. Soleimani was faced with three problems.
The first was the occupation. Iran feared that the US would establish
a client state in Iraq that could serve as a base to challenge Iran
along the 900-mile border. This wasn’t just paranoia.
In Bush’s first term, the refrain among hawkish neocons was “Boys go
to Baghdad, but real men go to Tehran.” But as America got bogged
down, the threat ebbed away.
His second problem was Saddam’s ousted Baathists, many of whom had
joined the Sunni insurgency against both the US and Iraq’s
newly-ascendant Shia majority.
Soleimani supported the Shias and especially the Supreme Council for
the Islamic Revolution in Iraq (SCIRI), a coalition of Iraqi Shia
political exiles, which Iran had nurtured and planned to establish as
an incoming government if they had won the 1980-8 war.
Soleimani drew on SCIRI’s military wing to assassinate Saddam-era
officials—partly to forestall any attempt for Baathists to return to
power and partly for simple vengeance.
Ironically, though, the biggest challenge for Soleimani was not the
US, Sunni militants or former Baathists. It was a 29-year old Iraqi
nationalist Shia cleric named Muqtada al-Sadr.
In a message to the US ambassador to Iraq, Soleimani wrote: “I swear
on the grave of Khomeini, I haven’t authorised a bullet against the
US,” but acknowledged that his Qods brigade had targeted the British.
He may have protested too much, but his capacity for restraint is
real. Attacking the US was risky. And while he did funnel arms to
so-called “special groups” that attacked US troops, he was happy to
patronise other forces who worked with the Americans against the Sunni
Soleimani was less animated by his anti-Americanism than his
determination to advance Iranian regional interests.
“[The US] is stuck in the mud in Iraq,” warned Rafsanjani in 2004, and
added a warning: “that if Iran wanted to it could make their problems
Still, he was deeply entrenched with Iran’s security services and
would provide a bulwark against American domination of the new Iraqi
During this same period, Soleimani was also focusing on Lebanon.
Tehran was helping the Shia militant group Hezbollah to build a
military capability to deter Israel both from invading Lebanon (after
its withdrawal in 2000), and from acting on its threat to bomb Iranian
Non-interventionists argued that defending Assad would be unpopular,
doomed and expensive. Interventionists, including Soleimani, believed
that if Syria fell to US-backed rebels, Iran would be next.
“If we lose Syria, we cannot keep Tehran,” warned an influential
The Iranian system of governance is often said to combine democratic
and theocratic elements, but Soleimani has increasingly demonstrated
the independent clout of a third arm of power: the military.
It was he who, in 2012, broke the deadlock by persuading Iran’s
Speaker of Parliament Ali Larijani to join the interventionists.
Soleimani flew to Syria and established the National Defence Forces
(NDF), local paramilitary militias, whose leaders received training
from Hezbollah in Lebanon and his own Qods force in Iran.
In Soleimani’s view, the Syrian Army, which had suffered mass
defections, was “useless.” The NDF’s immediate job was to fight the
insurgency, but it was also a back-up military network in case Assad
In 2014, Soleimani was dispatched by Tehran to Iraq to help Shia
militias fight a new force: IS. Its rise, both in Iraq and Syria,
initially turned the tide against Assad.
Turkey, Saudi Arabia and Qatar, which until then backed different
rebel groups in Syria, overcame their differences and threw their
weight behind a separate coalition of rebels, the Army of Conquest.
Rebels secured major victories in Idlib, eastern Homs and Daraa, while
IS took Palmyra.
Iran needed another ally. In July 2015, Soleimani went to Moscow to
meet the Russian defence minister and, -reportedly, President Vladimir
Putin. The plan was for Iran to defeat rebel strongholds on the ground
with the support of Russian air power.
Two months later Russia started bombing, generating waves of refugees.
Within three months of the intervention, Soleimani was pictured in
Aleppo’s Old City, following its bloody recapture by the regime, a
major turning point in the war.
The past three years have been characterised by the slow but
inevitable destruction of IS and myriad rebel groups that grew out of
Syria’s failed revolution. Soleimani, a born revolutionary, was now
deploying Iranian power to shore up a brutal and secular established
In an Iranian television documentary aired following Iran’s intervention
in Syria, Soleimani is shown watching footage of himself as a
commander in the Iran-Iraq war. The clip shows him before a squadron
of troops weeping inconsolably, naming martyrs recently fallen in
“My heart aches,” says the young Soleimani. “Their bodies lay on the
front, glowing even under soil.” Soleimani and other men in his
generation that fought to overturn a US-client monarch, the old Shah,
shared a definite ideology.
They believed in the revolution’s restorative value not only for
Iranian Muslims but also Muslims across the world dispossessed by
western imperialism. Like Trotsky (but unlike later Soviets), they
envisaged their revolution spreading across national borders.
US foreign policy gurus continue to view Iran through the lens of the
1980s. Mike Pompeo, the US secretary of state, refers to “Iran’s
violent export of revolution”: he sees the Trump administration’s
protection of Israel and opposition to Iran as a God-given mission
that he will pursue until “the rapture.”
But while the Americans still regard Iran as an agent of revolution,
for Iran’s elites revolutionary talk has become mere rhetoric.
You can see it in Soleimani’s career, which has just as often pursued
counter-revolution in the Islamic world as the opposite—propping up
the Iraqi and Syrian governments against revolutionary, often
millenarian, currents in their societies.
What he offers the country is not ideology, but rather the ruthless
pursuit of Iranian interests as he sees them.
“The Islamic Republic of Iran has a specific strategy in the region,”
said Soleimani’s adviser Sadollah Zarei in a recent speech.
“We have definite principles, friends, and capabilities. And we have a
coherent understanding of our enemy and we know where we should stand
in the next 20 years.”
And, despite the sanctions and isolation, Soleimani’s single-minded
approach is working. Even the US admits that its strategy is blowing
in the wind when it comes to countering Iranian influence in the
“Soleimani’s accomplishments are, in large part, due to his country’s
long-term approach toward foreign policy,” wrote Stanley McChrystal,
the former commander of US forces in Afghanistan, earlier this year.
“While the United States tends to be spasmodic in its responses to
international affairs, Iran is stunningly consistent in its objectives
The truth is that Iran’s original expansionist revolutionary ideology,
which was seen from Tehran as a means to protect Muslims worldwide,
but by America as a means to spread terrorism, died during the
Iran-Iraq war along with half a million Iranians.
Khomeini’s declaration that his acceptance of a ceasefire with Iraq in
1988 was akin to “drinking from the cup of poison” acknowledged the
pain he felt in breaking with this ideology.
After that war, Iran became just another nation seeking to preserve
its territorial integrity and pursue its own economic and national
Soleimani understands this better than anyone. While Iran’s elites
have moved on, their US counterparts are stuck in the past.
13 MAY 19 :: Iran is at the Hunter S. Thompson[Ian] edge
Law & Politics
Iran is at the Hunter S. Thompson[Ian] edge. “There is no honest way
to explain it because the only people who really know where it is are
the ones who have gone over''
if the US thinks that Tehran will just roll over, which appears to be
the case, then they are exhibiting the same deluded ideas that they
exhibited a day before the peacock Throne got plucked. Iran is a
geopolitical bleeding edge.
Revelation 6:12-13: When he opened the sixth seal, I looked, and behold, there was a great earthquake, and the sun became black as sackcloth, the full moon became like blood
Law & Politics
Revelation 6:12-13: When he opened the sixth seal, I looked, and
behold, there was a great earth- quake, and the sun became black as
sackcloth, the full moon became like blood, and the stars of the sky
fell to the earth as the fig tree sheds its winter fruit when shaken
by a gale.
@TullowOilplc Slumps After Guyana Oil Find Is Smaller Than Expected @markets
Tullow Oil Plc discovered light oil at its Carapa-1 well in Guyana,
but the reservoir was smaller than the troubled company had expected
prior to drilling. Shares fell as much as 20%.
The independent oil producer’s first discovery of the new year comes
after a calamitous 2019 in which its stock declined 64% and the chief
executive officer and exploration chief stepped down.
The commercial viability of Tullow’s previous offshore discoveries in
Guyana remains in doubt after the reservoirs were found to contain
“The Carapa-1 result is an important exploration outcome with positive
implications” for both blocks the company has in the South American
country, Mark MacFarlane, Tullow’s chief operating officer, said in a
statement on Thursday.
“While net pay and reservoir development at this location are below
our pre-drill estimates, we are encouraged to find good quality oil.”
About four meters of net oil pay were encountered. That was lower than
pre-drill forecasts, but Tullow highlighted positive aspects of the
well that “suggests the extension of the Cretaceous oil play from the
Stabroek license southwards into the Kanuku license.”
“Expectations were high going into this,” said David Round, an analyst
at BMO Capital Markets. “There will be a level of disappointment about
Tullow shares were 4.5% lower at 61.14 pence as of 9:55 a.m. in London
trading. That’s down about 95% from the company’s 2012 peak.
Rig site testing indicated that the oil is 27 degrees API with a
sulfur content of less than 1%, according to Tullow.
The well will be plugged and abandoned and a detailed laboratory
analysis of the oil quality will follow. Tullow has a 37.5% stake in
the Kanuku block. Repsol SA is the operator with 37.5% and Total SA
“We will now integrate the results of the three exploration wells
drilled in these adjacent licenses into our Guyana and Suriname
geological and geophysical models before deciding the future work
program,” MacFarlane said.
The latest well concludes Tullow’s “high-impact exploration program in
Guyana,” and while the company made three “technical discoveries,”
none are expected to be commercially viable, Will Hares, a senior
analyst for Bloomberg Intelligence, said in a note.
The Guyana results come as Tullow searches for a new CEO after Paul
McDade, and exploration director Angus McCoss, quit on Dec. 9. At the
time the company forecast its total production this year will be
70,000 to 80,000 barrels a day -- lower than in 2019 -- because of
weaker expectations from its main fields in Ghana. A process to reduce
its stake in a Uganda project has been delayed for years.
“The Guyana results emphasize Tullow’s increasingly challenged growth
outlook amid its Ghana project issues and East Africa delays,” Hares
Meet the Economy That the IMF Sees Growing 86% in 2020 @economics
South America may be battered by weak growth, unrest and austerity but
one of its smallest countries is about to experience the fastest
economic growth on the planet.
Guyana, a country of 780,000 that neighbors Brazil and Venezuela in
the region’s northeast corner, will see its economy balloon 86% next
year after expanding 4.4% this year, according to the International
That’s 14 times the projected pace of China and driven by Exxon Mobil
Corp.’s discovery of oil.
“We’re moving from a very low base to a stratospheric leap,” Finance
Minister Winston Jordan said in a telephone interview from Georgetown.
South America’s only English-speaking nation owes the anticipated
windfall to offshore oil deposits discovered in 2015.
At the moment, the country doesn’t produce any crude, though its
neighbor Venezuela holds the world’s largest reserves.
While Guyana’s $4 billion annual gross domestic product is about a
tenth the size of Vermont’s, it will expand to about $15 billion by
2024, according to the IMF.
The government plans to use some of the money derived from its
royalties to build highways to connect coastal towns to the sparsely
populated interior, which has gold, diamond and bauxite deposits,
The oil sector will represent about 40% of the economy within five
years, the IMF calculates.
The fund says its forecast may be subject to large revisions, since
even small changes to the projected oil output in 2020 would result in
big swings in the overall economic performance.
Exxon has partnered with Hess Corp. and China’s CNOOC Ltd. to develop
one of the world’s biggest new deepwater oil discoveries off the
Exxon said it will begin pumping from its first well next month, and
by 2025 Guyana will produce at least 750,000 barrels a day.
Total SA, Tullow Oil Plc and Repsol SA are also among the companies
exploring for oil in Guyana’s waters.
The government expects the initial $300 million a year in revenue from
profit-sharing and royalties to more than double after a second
offshore well starts production around 2022.
That money will go directly to a sovereign wealth fund the country
established this year, which will be used for “inter-generational”
savings, to protect against oil price swings, and to fund development
plans, Jordan said.
Constructing Commercial Empire: The United Arab Emirates in the Red Sea and the Horn The Century Foundation
Almost a decade ago, the late Ethiopian prime minister Meles Zenawi
described a “nightmare” he had for his country: “an Egyptian agenda
that is financed by Gulf money.” Zenawi, an ex-rebel and an
intellectual, was expressing his fear of expanding Egyptian influence
in the Horn of Africa, made possible by the financial power of the
“Imagine how much weaker Ethiopia’s position will be with the [United
Arab Emirates] controlling every port we use,” Zenawi warned.
In 2019, in the midst of dramatic Middle Eastern expansion into Red
Sea ports, Zenawi’s words seem almost prophetic.
But Zenawi was only half correct. His nightmare has come true, sans
the bogeyman of Egypt—it is a Gulf agenda financed by Gulf money.
Today, the Emirates and other Gulf states control a vast array of
commercial ports and military bases along the coast of the Red Sea and
the Gulf of Aden, transforming the political geography of the Horn of
Africa. And the scenario he imagined seems to be a subplot in a much
Most analyses tend to read the changing politics of the Red Sea and
the Horn of Africa as simply the result of competition between rival
Gulf states, especially in the wake of the 2017 Qatar diplomatic
While this framing helps to explain some recent developments, it does
not explain why Gulf expansionism has specifically taken place in
these regions. The interests and actions of commercial entities are
equally important in understanding what Gulf policy looks like on a
more molecular level.
This report examines the issue of Gulf expansionism through the case
study of the Emirates-based company Dubai Ports World (DP World), a
leading global port operator and logistics giant.
DP World is an aggressively expanding privately owned enterprise with
strong links to Emirati ruling families. In many ways, it is
spearheading the aspirations of both the Emirati private and public
sectors in the Red Sea and the Horn.
Perhaps more than any other commercial or government entity, the story
of DP World illustrates a convergence of state and capital that has
echoes in many other Gulf states.
In turn, the story of DP World—and of the interests of Gulf capital
more generally—illuminates the factors that influence state formation
and fragmentation in the Horn of Africa and the Red Sea. Such
fragmentation is, of course, a dire concern.
Somalia has been shattered for nearly thirty years, and is only
becoming increasingly splintered. The war in Yemen, nearly half a
decade old, rages on. Ethiopia and Eritrea, bitter and sometimes
warring rivals, have been involved in a fragile rapprochement since
the summer of 2018.
The precise nature of Emirati and Gulf power affects all these
future-shaping processes. Private Emirati infrastructure projects in
the Horn of Africa are not neutral economic projects. Rather, these
ports, highways, security installations, and water and sanitation
facilities are intimately linked to Emirati foreign policy.
They are important mechanisms for the expansion of both Emirati
capital and power. This expansion is, in essence, imperial—it is a
marriage of international economic and political ambitions.
This is not yet imperialism on the scale of, say, nineteenth-century
Britain, but it is imperialism, nonetheless. Its aim is to exert
political influence in the region and aggressively control and expand
key trade routes and markets.
Further, it is a hallmark of imperialism that the trade and strategic
interests of Gulf states are not distinct. Rather, they are
co-constitutive—they establish and reinvent each other.
In the Red Sea and the Horn, the nexus of state and commercial
involvement in counterterrorism, counter-piracy, maritime security,
and supply chain protection reveals fundamental realities—both about
those regions, and about why Gulf state rivalries are so potentially
Further, understanding that Emirati policy in the Red Sea and the Horn
follows the logic of empire helps us better confront some of the
drivers of disastrous state fragmentation in the region.
The Birth and Rapid Growth of Dubai Ports World
DP World traces its roots to the establishment of Port Rashid, Dubai
in 1972, named after Dubai’s ruler at the time, Sheikh Rashid bin
Saeed Al Maktoum.
In 1979, Sheikh Rashid completed the ambitious Jebel Ali Port, and in
1991, the two ports were brought together under the directorship of
the newly formed, state-owned Dubai Ports Authority.
As the Emirates increased its financial clout, largely from growing
oil-based wealth, the country witnessed rapid urban and demographic
changes, and extensive infrastructural development.
During this time, Jebel Ali grew dramatically, and the combined ports
handled more than a million shipping containers’ worth of cargo
(termed twenty-foot equivalent units, or TEUs, in the industry).
Increasingly becoming a regional and international hub for trade,
Jebel Ali also developed as a favorite port of call for the U.S. Navy.
In fact, following the United States-led wars in Afghanistan and Iraq
(beginning in 2001 and 2003, respectively), Jebel Ali profited
immensely from the presence of Halliburton employees, private
mercenaries, and American soldiers en route to Baghdad and Kabul.
It has been described as the busiest commercial terminal in the world
for the United States’ wars in the Middle East.3 But while Jebel Ali
grew to be a key logistical hub underpinning U.S. militarism in the
region, corporate and state leaders looked beyond the shores of the
Emirates for important investment opportunities.
In 1999, the government established Dubai Ports International (DPI) to
manage and operate container terminals outside the Emirates in Jeddah
(Saudi Arabia), Visakhapatnam (India), Dolareh (Djibouti), and
Constanta (Romania), on the Black Sea coast.
And in 2005, DPI and Dubai Ports Authority merged to form DP World,
becoming one of the largest port operators in the world.
The historical trajectory of DP World suggests a tight-knit
relationship with state power, and its current structure and
leadership is also deeply wedded to the Emirates’ ruling families,
blurring the lines distinguishing the state from private capital.
Overseeing the management of one of Dubai’s primary revenue-generating
infrastructures, DP World is the lifeblood of Dubai’s ruling classes.
As such, those classes have a vested interest in shaping the future of
DP World’s CEO, Sultan Ahmed bin Sulayem, comes from one of Dubai’s
most prominent business and political families. In fact, his father
was a key advisor to the ruling Al Maktoum family.
Moreover, Dubai World—a global holding company that is an investment
arm of the government of Dubai—owns 80 percent equity in DP World,
essentially giving the ruling family ultimate control.
In further evidence of the interlocking relationship between state and
private capital, bin Sulayem was himself the chairman of Dubai World;
the chairman of Istithmar World, the investment arm of Dubai World,
which specializes in private equity; and the chairman of Nakheel, the
global property development company incorporated by the government in
2001 to establish and develop the real estate sector in Dubai
This is not to suggest an equal standing between CEOs and Dubai’s
ruling families. A year after the 2009 Dubai debt crisis, the ruler of
Dubai, Sheikh Mohammed bin Rashid Al Maktoum, removed bin Sulayem as
chairman of Nakheel and Dubai World (though bin Sulayem retained his
position as chairman of DP World).
The Dubai ruler replaced bin Sulayem with his uncle, Sheikh Ahmad bin
Saeed Al Maktoum, as chairman of Dubai World; Al Maktoum also
appointed his close confidants Mohammed Al Shaibani and Ahmad Al Tayer
as board members.
In fact, the debt crisis served as a moment to solidify and
concentrate ruling class power in the Emirates. Members of Dubai’s
historic mercantile families, such as Al Tayer and Al Lootah, gained
prominent positions in companies such as Dubai World, Nakheel, and
Meanwhile, at DP World, where Bin Sulayem had previously overseen the
extensive growth of the company, he resumed the company’s two-pronged
strategy: acquiring rivals and bidding aggressively for port
The Emirates insists that DP World is a private enterprise, but its
activities move in lockstep with the country’s strategic interests.
But 2009 undoubtedly marked a rupture in intra-Emirati relations.
Following Dubai’s crucial $10 billion bailout from oil-rich Abu Dhabi,
the latter tightened its grip over political decision making in the
While political decision making in the federal monarchy of the
Emirates remains relatively opaque, researchers and commentators
generally agree that Abu Dhabi has taken the lead following the
Although DP World insists that it operates independently from Emirati
foreign policy, the changing atmosphere has clearly affected the firm
The Emirates “always say[s] DP World is a private company and is
acting out of commercial interests,” said a Western diplomat quoted in
a 2018 International Crisis Group report. “But clearly those interests
align with Emirati foreign policy.”12
The interlocking relationships between state and private capital, the
growing authority of Abu Dhabi over political decision making, and an
increasingly expansionist Emirati foreign policy have all served to
ensure that the activities of DP World continue to move in lockstep
with the “strategic interests” of the Emirates.
Commercial Interests in the Red Sea and the Horn
Following the Arab uprisings that began in 2010, and especially in the
wake of the destructive Saudi Arabia- and Emirates-led war in Yemen,
which began in 2015, the Emirates has led a concertedly aggressive
The rise of China’s globally ambitious Belt and Road Initiative,
Indian ambitions in the Indian Ocean, and Western states’ efforts to
retain military hegemony in the region, have also meant that Gulf
states are positioning themselves as mediators of maritime routes and
territorial hinterlands surrounding the Arabian Peninsula, as scholar
of Gulf political economy Adam Hanieh has explained.
As such, Emirati strategic interests and commercial interests have
developed in tandem, like a helix.
In order to fully understand why commercial and strategic interests
have dovetailed so closely in the Emirates, it is worth untangling
some of the distinct features of Emirati commercial interests in the
Red Sea and the Horn, especially prior to 2015.
Commercially, the Horn of Africa has been an important market to
capture for a range of Emirati conglomerates and other investors based
in the countries of the Gulf Cooperation Council (GCC).
In the middle of the first decade of this century, companies based in
the GCC aggressively bought farmland in countries such as Sudan and
Ethiopia in an attempt to shield themselves from food insecurity and
commodity price volatility.
The Emirates, which imports approximately 90 percent of its food,
sought to improve its food security by centralizing capital and
exerting control over entire supply chains, from farm to shelf.
Powerful conglomerates such Al-Dahra, flush with cash, were able to
purchase vast swathes of land in the Horn. In addition to agriculture,
Gulf-based companies made significant investments in the Red Sea and
the Horn of Africa in manufacturing, construction, real estate, and
However, many of these expanding investments were predicated on robust
trade infrastructures between the Gulf and the Horn. Ethiopia, with a
population of more than 100 million and an economy that has grown an
average of more than 10 percent a year for the last fifteen years, is
one of the largest and fastest growing economies in all of Africa, let
alone the Horn—and thus an attractive destination for Gulf investors.
However, Ethiopia is entirely landlocked. Developing port
infrastructure in Ethiopia’s coastal neighbors thus became a
cornerstone for Gulf commercial expansion.
As such, one of the first overseas investments that DPI (precursor to
DP World) made during its phase of global expansion was in Djibouti.
In 2000, DPI and the government of Djibouti established a joint
venture and signed a twenty-year concession to operate the Port of
Djibouti.16 Six years later, DP World signed a thirty-year concession
with the government to design, build, and operate the Doraleh
Container Terminal at the port.
With a capacity to handle 1.25 million TEU, it became the most
technologically advanced container terminal on the African continent.
For Ethiopia, the port was a lifeline. Some 95 percent of trade
destined for Ethiopia passed through the Port of Djibouti, with DP
World responsible for handling operations.
But Ethiopian leaders became cautious about their overreliance on a
single port and company.
Notwithstanding Ethiopian fears, access to the Horn has continued to
be a key pillar for Emirati and GCC commercial expansion.
Another commercial mainstay for the Emirates—but more importantly, for
Dubai and DP World in particular—is the maintenance of the Jebel Ali
Port as the preeminent transshipment and trading hub in the Indian
Accounting for 33 percent of Dubai’s GDP and employing 15 percent of
the emirate’s workforce, the Jebel Ali Port and Free Zone continuously
generate significant cash flows for DP World.
With a handling capacity of 22.1 million TEU, service to 140 other
ports, the largest and busiest maritime terminal in the Middle East,
and the ninth-largest container terminal port worldwide, Jebel Ali’s
leading regional and global position appears incontestable.
However, Jebel Ali’s success may, ironically, be the biggest threat to
its primacy. Across the GCC, governments and global port operators,
often through public–private partnerships, are replicating the Jebel
Ali model by developing large-scale port infrastructure with
intermodal transport networks such as airports, roads, rail, and free
These projects are centered primarily around economic diversification
and intra-GCC regional integration.
But Rafeef Ziadah, a scholar of Middle East political economy, argues
that the political hierarchies of the GCC and the competitive
pressures of capitalist economies raise the possibility of port
overcapacity, duplication of development initiatives, and
Qatari and Omani ports’ emulation of the Jebel Ali model may overtake
the handling capacity of the Jebel Ali Port itself. Even within the
Emirates, Jebel Ali faces stiff competition from the development of
Abu Dhabi’s Khalifa Port and its enormous free zone.
Gaining a competitive edge, however, does not only boil down to
increasing handling capacity. While undoubtedly significant, the
regional importance of ports is also defined by the ways in which they
seamlessly weave together different ports, logistical corridors, free
zones, and trade routes.
On a local level, DP World has gone to great lengths to oversee,
control, and extract rents from different points of the supply chain.
In December 2014, DP World agreed to purchase the Jebel Ali Free Zone
for $2.6 billion, thereby integrating logistical functions and gaining
ownership of a revenue-generating infrastructure that accounts for
more than 20 percent of Dubai’s GDP.
In the breadth of its growth, DP World is singular in the Middle East.
The company also sees global and regional expansion as a way to
underscore the preeminence of Jebel Ali, stifle potential competitors,
and sustain a competitive bottom line. In the breadth of its growth,
DP World is singular in the Middle East.
By expanding port developments and pursuing a tactic of aggressive
port acquisition, DP World is better situated to crowd out potential
competitors and maintain Jebel Ali as the dominant port for smaller
feeder ports in the surrounding zones, particularly in the Arabian Sea
and the Red Sea.
For example, when the Yemeni government signed a deal with DP World to
develop and run the Port of Aden, there were accusations that DP World
was purposely running the Yemeni port under full capacity to maintain
the preeminence of Jebel Ali.
In the Red Sea, one of DP World’s initial expansions was the
establishment of a container terminal in Djibouti. Given that
approximately 10 percent of global maritime trade (cargo worth $750
billion) passes through the Red Sea, acquiring ports throughout its
littoral is clearly of the utmost importance to the company.
This was undoubtedly a major consideration in DP World’s initial
expansion into Djibouti. Not only do these port expansions reproduce
the global significance of Jebel Ali—they also provide DP World with
the opportunity to tap into the revenues that emanate from one of the
most lucrative trade routes in the world.
Counter-Piracy and Counterterrorism
Expansion in the waters surrounding the Arabian Peninsula has profound
strategic considerations and implications. Port acquisition, logistics
integration, and increased shipping lines are ultimately
preconditioned on the security of maritime trade routes.
The policing of these maritime routes and combating of piracy have
pronounced imperial precedents. During the colonial era, Britain used
its navy to impose its empire’s political hegemony in the Indian Ocean
and the Persian Gulf under the banner of protecting free trade and in
pursuit of the abolition of slavery.
Contemporary geopolitics today are, of course, markedly different from
those of nineteenth-century British imperialism. However, legally
fluid maritime spaces remain sites of imperial contestation and
This is not to suggest any insincerity on the behalf of the Emirates
and other Gulf states in their counterterrorism and anti-piracy
But neither have other imperialist powers always been insincere in
their justifications. It is simply a quality of imperial logic that
political and commercial goals abroad converge.
Following the bombing of the USS Cole in 2000 near Aden, and the
increase in piracy off the coast of Somalia later in the first decade
of the new millennium, international efforts at countering terrorism
and piracy were ratcheted up dramatically.
In 2003, the United States established Camp Lemonnier in Djibouti as
the headquarters of the Combined Joint Task Force–Horn of Africa, as
part of the global war on terror.
In 2008, a series of UN Security Council resolutions permitted the use
of military force within sovereign Somali waters and inland territory.
EU and NATO naval operations sprawled the region, and by 2009, the
Combined Task Force 151 (CTF-151) was established as a multinational
naval group to stop piracy attacks in the Red Sea.
Even private military contractors thrived in this increasingly
militarized environment; mercenaries were happy to meet the increasing
demand for their services
Moreover, the lines separating commercial and military obligations
became so blurred that it became difficult to distinguish one from the
For example, in April 2009, Rear Admiral William Baumgartner of the
U.S. Coast Guard described “the unimpeded flow of maritime commerce”
as “the lifeblood of the global economy;” the International Chamber of
Shipping, on the other hand, argued that, “pirates in Somalia threaten
the lives of seafarers and the security of world trade.”
The frenzy surrounding maritime trade routes permeated multiple areas
of responsibilities and interests, with commercial and security
officials sounding increasingly like one another.
In effect, the dual mandates of counter-piracy and counterterrorism
served to unite a diverse set of actors such as transnational
corporations, nation-states, supranational governing bodies, and
private military contractors, all in defense of supply-chain security.
The Emirates was by no means leading these efforts, but this
militarized context provided the backdrop for the proliferation of
Emirati military and commercial developments.
Prior to 2015, when the war began in Yemen, the Emirates invested
significant resources in antipiracy operations in the Red Sea. In
fact, of the thirty states participating in the Combined Task Force
(CTF), four were from the GCC: Bahrain, Kuwait, Saudi Arabia, and the
According to a report from the Arab Center for Research and Policy
Studies, “although not all GCC states are members of the CTF, their
navies participated in, or contributed to, the military activities of
the three CTF divisions—CTF-150, CTF-151 and CTF-152.”
On a more local level, the Emirates also created partnerships with
governments and paramilitaries in the Horn of Africa. In the early
2010s, the Emirates offered support for counter-piracy operations,
which ultimately transformed into counterterrorism efforts aimed at
defeating al-Shabaab in Somalia.
In 2014, the Emirates signed a memorandum of understanding with the
federal government of Somalia, training personnel and building
infrastructure for the Somali army, marine police, and police forces
throughout the country.
It also developed specialized brigades of the Somali army and donated
armored vehicles to Somalia’s Jubaland state.
Moreover, the Emirates even trained and paid the salaries of the
Puntland Marine Police Force, allegedly to eradicate piracy,
terrorism, and illegal fishing off the coast of Somalia.
According to the 2018 report from the International Crisis Group, one
Emirati official estimated that as many as 10,000 Somalis had been
trained and continued to receive salaries from the Emirates.
So important were these maritime routes that the Emirates viewed the
Horn of Africa as “primarily part of [its] security hinterland.”
Concomitantly, DP World played a leading role in Emirati efforts to
counter piracy in the Red Sea. From 2011 to 2014, the company hosted
annual, high-level counter-piracy conferences in partnership with the
Emirates’ Ministry of Foreign Affairs.
Bringing together government and nongovernment stakeholders involved
in counter-piracy operations in the Horn of Africa, bin Sulayem, the
DP World CEO, stressed “the need for joint action both on land and at
sea,” further adding that “political, economic, legal and military
measures must go hand in hand to help mitigate the impact of piracy.”
Echoing the dual nature of commercial and military obligations, the
Emirati minister of foreign affairs, Sheikh Abdullah bin Zayed Al
Nahyan, stated at the opening of the 2011 Counter-Piracy Conference
that piracy “threatens our region’s sea lanes and indeed its
livelihood as a center of commerce and trade.”
Following the first conference in 2011, participants acknowledged the
need for more than $5 million to aid the “Trust Fund to Support the
Initiatives of States to Counter Piracy off the Coast of Somalia,”
recognizing this commitment as a “transformative moment in ensuring a
fully resourced, comprehensive public–private counterpiracy approach.”
The conference concluded that the international community must pursue
a comprehensive strategy of support to Somalia, not only assisting the
Federal Authority, but also “the regional authorities of Galmudug,
Puntland, and Somaliland.”
This conclusion would prove important. Gulf financial support for
Somalia (and especially its federal states) created path dependency
and opened up a new space for Gulf rivalries to play out.
Only half a decade after the first Counter-Piracy Conference, DP
World’s contracts with these same regional authorities listed above
would become a major sticking point between the Emirates and Somalia.
By 2018, the federal government in Somalia had entirely banned DP
World from operating in the country—a ban that has been impossible to
enforce since so many of Somalia’s states govern themselves
These conferences, which predate the war in Yemen and the current
tensions between Abu Dhabi and Mogadishu, demonstrate the convergence
of interests between state and capital in the Emirates.
While it would be inaccurate to ascribe the Emirates’ actions in
Somalia solely to DP World’s commercial interests, the extent of the
firm’s partnership with its home country’s government—as embodied by
these high-level conferences—indicates the ways in which Emirati
imperial strategy hinges on tight-knit collaboration with private
Yet trying to ascertain the precise nature of state–corporate
relations in the Emirates is certainly a futile endeavor. As a country
lacking necessary channels for political transparency and public
accountability, it is often hypersensitive to those who seek to
research such topics or criticize the government.
But it is in the periphery, and through the logic of empire, that we
are better positioned to examine the confluence of state and capital
in remaking the geographies of war, trade, and state sovereignty.
In this regard, the recent proliferation of infrastructural projects
across the Horn of Africa serves as a key case for examining the
changing politics of the Red Sea.
DP World Drops Anchor in Somalia
Following heated disputes between DP World and the government of
Djibouti over accusations of bribery dating back to 2012, the latter
ultimately nationalized and seized the Dolareh Container Terminal.
In the wake of these struggles, Somalia became the focal point for DP
World in the Horn of Africa.
Most recently, the company has struck a number of deals with Somalia’s
federal states for infrastructural development and port development
In April 2017, DP World’s subsidiary, P&O Ports, won a thirty-year
concession to develop and manage the multipurpose port in Bosaso, the
largest city in the autonomous northeastern Somali state of Puntland.
The total investments are expected to be $338 million—no small figure
in Puntland, which has a GDP of roughly $3 billion and an annual
government expenditure of only $75 million.
Similarly, in 2016, DP World won a thirty-year concession with an
automatic ten-year extension for the management and development of a
multipurpose port project at Berbera, in the Republic of Somaliland,
an autonomous northern state that has declared independence from the
rest of Somalia.
Total investments are measured at $442 million, with DP World holding
a 51 percent stake in the port, alongside 30 percent for Somaliland,
and 19 percent for Ethiopia.
The concession has also opened the door for other Gulf companies, such
as Emirates-based construction company Shafa Al Nahda, which is
responsible for expanding port capacity and establishing a free zone.
Alongside these two concessions, DP World has also been in direct
negotiations with other federal states in Somalia, such as South West
state and Jubaland, for the development of ports and other
The development of these commercial ports has entailed significant
military and strategic ramifications. Quickly following DP World’s
deal to manage Berbera Port, the Emirates signed a twenty-five-year
military agreement with the government of Somaliland to lease and
refurbish the civilian airport and old military base in Berbera.
Located on the southern coast of the Gulf of Aden, the port of Berbera
was first modernized by the Soviet Union in the 1960s, where it
constructed a deepwater port and carried out significant dredging.
However, after Somalia severed ties with the Soviet Union in the late
1970s, the port underwent commercial expansion and was used by the
United States military until the collapse of the Siad Barre regime in
The Emirates is now extending these imperial “lineages”—DP World is
now in the process of expanding the container terminal, and the
Emirati military awarded a $90 million contract to Emirates-based
Divers Marine Contracting in 2017 to build a naval base in Berbera.
Most importantly, the new military base is located close to the shores
of Yemen and was originally intended to assist in the war effort. Even
though the Emirates announced in July 2019 its intention to withdraw
from the war in Yemen, its occupation of the strategically positioned
Yemeni archipelago of Socotra, the cementing of control over southern
Yemen by Emirates-backed forces, and its military bases in Assab (in
Eritrea) and Berbera ensure unprecedented control and strategic depth
in the Red Sea.
Given that military operations are complex logistical undertakings,
commercial entities such as DP World will be further embedded in these
These relationships are symbiotic for the Emirati state and Gulf
companies. Not only will deeper Emirati control over the Red Sea
guarantee the smoother circulation of civilian and military resources
in coastal areas; it will also allow companies such as DP World to
benefit from an expanded network of existing and emerging trade
For example, Berbera Port has already signed agreements for regular
service with two of the biggest container shipping lines, Maersk and
PIL, thereby integrating the port into international trade routes and
allowing DP World to generate further revenue.
According to DP World, the transportation companies CMA CGM and
Simatech are running biweekly lines from Jebel Ali to Berbera.
Last year, Berbera Port served vessels coming from Dubai, China, Oman,
India, and Yemen, as well as consignments of humanitarian aid from the
World Food Programme and the United States Agency for International
Development (USAID)—ironically, humanitarian aid made necessary by the
war in Yemen that the Emirates has helped wage.
Moreover, with DP World now operating six ports in South Asia,
cementing control over this corner of the Indian Ocean would further
enable DP World to connect Indian, African, and Middle Eastern ports.
In Puntland, where DP World’s subsidiary, P&O Ports, operates the Port
of Bosaso, Emirati commercial interests have arrived on a field that
is already militarized.
Unlike Berbera, the Emirates has been spearheading military efforts
and security trainings in Puntland for almost a decade, most notably
(as mentioned above) training and paying the salaries of the Puntland
Marine Police Force (PMPF).
The force was formed in 2010 to counter terrorism and piracy off the
coast of Somalia. But according to a UN investigation in 2012, it had
“yet to be deployed as part of a comprehensive strategy to fight
piracy in Puntland.”
The report also found that the force had “no basis in Puntland’s
constitution or domestic legislation,” and functioned instead as “an
elite force outside any legal framework . . . answerable only to the
As explained above, the establishment of groups such as the PMPF did
not occur in a vacuum.
The proliferation of anti-piracy and counterterrorism initiatives by a
range of international and regional powers in the Horn of Africa
provided both the real and rhetorical justifications for such
Scholar Deborah Cowen notes that, in this militarized context, “poor
states neighboring Somalia are being transformed into mercenary, legal
and carceral spaces for imperial powers.”
As nearby states such as Djibouti, Sudan, and Eritrea sought to tap
into counterterrorism funds, the federal states of Somalia, such as
Puntland, also joined in with the help of external sponsors and
private mercenary groups.
In fact, while the Emirates paid the salaries of the PMPF, Blackwater
founder Erik Prince, along with a former apartheid-era South African
special forces officer, Lafras Luitingh, helped to actually create the
Yet these developments are not simply top-down processes. As the
scholar Alex de Waal notes, “just as an earlier generation of leaders
had used geostrategic rents to pursue domestic political agendas, so
too counterterrorism rent was manipulated for diverse other purposes,
all of them to do with consolidating power, and often unconnected with
defeating terrorist groups.”
According to a report by The Intercept, it’s unclear that the
millions of dollars that Emirati intelligence officers poured into the
program had perceptible results.
Some $50 million are unaccounted for; aircrafts, helicopters, and
cargo planes either went missing or were never returned, and the
United Nations reported “credible” allegations of human rights
violations stemming from corporal punishment.
Prince’s program was shut down in 2012 following the murder of a South
African mercenary by a local soldier. In fact, the local
soldier—originally hired to fight piracy—was actually a relative of a
pirate who had been targeted by the program.
Regardless of the program’s effectiveness in terms of battling piracy
and terrorism, the Emirates’ unequivocal and handsome support of
Puntland’s security forces served to strengthen its (proto-)state
capacities and regional autonomy.
The agreement with DP World’s subsidiary also undoubtedly reinforces
Puntland’s pretensions to statehood and its state capabilities (the
region declared its independence in 1998, but has not been recognized
as independent by the international community).
Like Berbera, “Puntland will benefit from an internationally
recognized port operator contributing to its economic growth and trade
potential,” bin Sulayem noted.
Puntland will further integrate into world markets, and the agreement
is set to assist vital state functions such as employment generation,
clean drinking water provisions, mobile medical services, investments
into agricultural industries, and the development of secondary and
tertiary sectors through the establishment of a free zone.
Yet, as it operates in an arena of established Emirati involvement,
the company has become embroiled within the surrounding political
landscape, sometimes in deeply destabilizing ways.
Most recently, in February 2019, gunmen posing as fishermen murdered
one of Bosaso Port’s executives, Paul Anthony Formsa.
Although al-Shabaab claimed responsibility for the attack, in a leaked
audio recording obtained by The New York Times, an unnamed businessman
close to the emir of Qatar said that the assassination was intended to
“advance Qatar’s interests by driving out its rival, the United Arab
While the intentions of the attack still remain unclear and shrouded
in gossip, the fact that DP World has been caught in the crossfire is
indicative of the unintended consequences of Emirati imperial
As many analysts have warned, the lack of a regional security strategy
and the escalating maritime rivalries in the region have the potential
to lead to an explosive and destabilizing situation.
6 AUG 18 :: The Indian Ocean Economy and a Port Race. @TheStarKenya
The Indian Ocean Economy preceded the Atlantic Ocean Economy, where
the Europeans only learnt how to ‘’crack the code’’ of the Atlantic
winds [and a new ‘Western’ culture arose on both sides of the ocean]
long after the Indian Ocean.
As we scan the Blue Economy it is worth appreciating that Maritime
shipping is the lifeblood of Africa, with over 90% of the continent’s
imports and exports transported by sea.
Today from Massawa, Eritrea [admittedly on the Red Sea] to Djibouti,
from Berbera to Mogadishu, from Lamu to Mombasa to Tanga to Bagamoyo
to Dar Es Salaam, through Beira and Maputo all the way to Durban and
all points in between we are witnessing a Port race of sorts as
everyone seeks to get a piece of the Indian Ocean Port action.
China [The BRI initiative], the Gulf Countries [who now appear to see
the Horn of Africa as their hinterland], Japan and India [to a lesser
degree] are all jostling for optimal ‘’geo-economic’’ positioning.
Overlay the Geopolitics and its worth noting that the Geopolitics has
become much more fluid. Fluidity has been engendered by the
spectacular arrival of Prime Minister Abiy in Ethiopia [which is
land-locked, of course but a key Future Taker of Port facilities] who
has made peace with President Afawerki’s Eritrea and is surely set to
undercut Djibouti and even LAPPSET, both Projects which seem to me to
have been predicated
to some degree on a permanent Freeze between Ethiopia and Eritrea.
Investments in Ports have a long lead time and I am not certain that
those same investments are able to re-calibrate at the speed with
which the Geopolitics is moving.
The Big Risk is that some these Port investments will be ‘’Hambanota’’-ed.
Ethiopia government announced that it would start the stock market by 2020 without giving a specific time frame. @Capitaleth H/T @addisstandard
The National Bank of Ethiopia (NBE) which has reintroduced the primary
money market a couple of weeks ago announced it would commence the
highly anticipated secondary market in May 2020.
The government announced that it would start the stock market by 2020
without giving a specific time frame.
Ethiopia actually had a stock marked before most other African
countries, (around 60 years ago) but when the Derg took over that
Yinager Dessie, Governor of NBE, told Capital that the central bank is
preparing the document to table it to the Council of Ministers in the
Currently finance is only accessible in a primary market that is
directly related with banks for the private and public sector or
through treasury bills (T bill) for the government.
“Capital market is another source of finance that is separate from
banks and currently in the process to commence from initial stages,”
“for instance three weeks ago the T bill has recommenced with the aim
to attract private banks and other private sector players and to make
a transition for the biggest market.”
“Based on our observation the beginning is very good that is good step
to move to the secondary market.”
He said that according to the NBE target, the secondary market will
begin by May 2020, but it depends on the cabinet decision at the
“The legal framework is under development and skilled professionals
are being prepared, while preconditions are in the process and in the
coming few months we will commence it,” he explained.
“The final go ahead will depend on the Council of Ministers’
decision,” he added.
According to the governor, the central bank will deliver the draft
document to the council that will decide whether the business would be
started by regulation or proclamation.
If the council of Ministers’ approve it as a regulation the starting
time will come soon, but if the council decides the law should be
ratified as a proclamation it would be sent to the parliament.
“As per our evaluation the T bill average interest rate offer that
banks participate in the auction is attractive and reasonable,” he
Most of them offer about 7.5 percent to 8.5 percent but some of the
banks offer up to 15 and 16 percent at the auction, according to
“Most of the offers that come from the banks at the auction is very
encouraging,” he said.
“This will show us what the market interest rate should be. When the
market goes up and people understand how to use it the capital market
structure will improve,” he added.
Recently NBE stopped the NBE bill directive enforcing banks to buy 27
percent of bonds from every loan that they disbursed for clients.
NBE has reintroduced the weekly T bill with an attractive interest
rate to attract banks and other interested players.
International partners like the World Bank are providing technical and
others support to commence the stock market.
Currently the country’s finance accessibility is very poor; most of
the citizens are not benefiting particularly from the loans.
02-JUL-2018 :: Ethiopia Rising. @TheStarKenya
On the same day he said, "we are in debt, we have to pay back but we
can't. And secondarily, we aren't able to finish projects we have
started." and announced his economic Pivot. Of course, the downside
risk of all this infrastructure is plain to see and Sri Lanka and the
Tale of its Hambantota Port is now a cautionary Tale. FX reserves were
at less than a month's worth of imports and something needed to be
done. Expectations are high. The Prime Minister needs to execute real
quick on the economic front but if he levels the playing Field, a
whole Troop of folks will be looking to pile in. That Troop will
include the Ethiopian Diaspora, Foreign Investors and i am sure our
very own Safaricom.
Abiy Ahmed Ali (Amharic: አብይ አህመድ አሊ, Oromo: Abiyyi Ahimad Alii; born
15 August 1976) was appointed the 12th Prime Minister of Ethiopia on 2
April 2018. He grew up in a Muslim family (Ahmed Ali, his Oromo
father; Tezeta Wolde, his mother) and with Oromo Muslim and Christian
grandparents. He is evidently a Virilian and Gladwellian Figure.
“To create one contagious movement, you often have to create many
small movements first.”
“Look at the world around you. It may seem like an immovable,
implacable place. It is not, With the slightest push — in just the
right place — it can be tipped.” — Malcolm Gladwell
He has been Prime Minster for 90 days. During those 90 days, he has
criss crossed the Country, he has ended a State of Emergency, released
thousands of Political Prisoners, thawed relations with Eritrea [29
Mar 2018 H.E. Abiy Ahmed @PM_AbiyAhmed - It is time. Lets build a wall
of love between #Ethiopia & #Eritrea], bagged a $1b from the U.A.E.'s
MBZ, announced a dramatic economic about-turn and thats not the end of
it. In Matters language and linguistics he has tapped into a ''Nelson
Mandela'' 1994 mood. These 90 or so days represent the most
consequential arrival of an African Politician on the African Stage
since Mandela walked out of prison blinking in the sunlight and
constructed his ''Rainbow Nation''
Kenya's struggle with the burden of Chinese loans @RFI H/T @chigrl
Austerity cuts look likely in Kenya as the servicing of massive
Chinese debt is expected to triple in 2019.
Kenya is preparing to pay Chinese State-owned lenders €710 million in
the year starting from July.
That amounts to more than half of the funds President Kenyatta’s
government spent on servicing the Chinese debt last year.
The issue of Kenya’s loan repayments is the front-page spread in
Wednesday's issue of the Daily Nation newspaper.
According to the newspaper, China now accounts for up to 72 per cent
of a whopping €2.36 billion is expected to pay in 2019 as repayments
of loans contracted from bilateral lenders.
Jaindi Kisero is former Managing Editor of the Nation Media Group in
charge of Business and Economic Affairs, and now a columnist at Daily
Nation and Business Daily.
He says the national consensus qualifying Chinese loans as being a
necessary evil is crumbling.
“China is bringing corruption in the country through the funding of
small projects which are very poorly drafted and the contracts
opaquely procured holds Kisero.
He also denounces “a small clique of ruling elite” who he believes are
feeding fat on such contracts. According to Kisera, China is now in a
position to influence Kenyan politics.
The respected columnist says there is a strong case for Kenyans to be
worried about the Standard Gauge Railway line running from Mombasa to
Nairobi and from Mombasa to Naivasha, with an extension to Malaba in
the eastern region of Uganda.
“They brought in the Ports authority to sign a take or pay, meaning
that they had to give SGR enough freight so that they can service the
Chinese loan. If not they will just take the port”, Kisera noted.
“Kisera doesn’t believe Kenya will continue with the Chinese route
because of an acrimonious debate underway at home over Beijing’s
propensity to seize critical national interests in lieu of payment in
the event of a default.
When Good Conservation Becomes Good Economics Kenya's Vanishing Herds @WorldBank
It is safari tourism, however, that generates the most employment and
economic activity across the country A recent study by Sanghi et al
(2017) found that despite a diversifying economy, wildlife-based
safari tourism is deeply integrated into Kenya’s economic fabric in
complex ways that stimulate much employment in rural areas
Official statistics of the sector’s contribution to the economy tend
to neglect the full panoply of backward and forward linkages and their
dynamic effects on poverty and rural growth.
But the wildlife that has lured travelers to Kenya by the planeload is
in dramatic decline (Figure ES 1) In the past three decades, the
country has lost more than half of its wildlife (ungulate) biomass
according to data from the Directorate of Resources, Surveys and
Remote Sensing (DRSRS)
A Computable General Equilibrium (CGE) model is used to estimate the
economic consequences of wild- life loss and compare these
consequences to alternative development pathways Finally, spatial
algorithms are developed to show how losses can be avoided and how to
create win-win solutions that maximize economic gains
The statistical model developed for this report indicates that roads
built over the last four decades have caused an 80 percent decrease in
wild- life within a 20-kilometer radius
There are currently more than 166 conservancies spread across Kenya’s
28 coun- ties (Figure ES 6) They cover an area larger than the coun-
try’s national parks, are home to more than 22 percent of Kenya’s
ungulate wildlife biomass, and have some of the highest densities of
wildlife in the country
In fact, 18 out of the 20 zones with the highest density of wildlife
are in conservancies and not parks
The overall analysis suggests that the economic impacts of natural
capital erosion have been significant, and they have received less
policy attention than seems war- ranted since these issues are viewed
as environmental problems that drain public funds, rather than an
Within three decades, Kenya has lost 68 per- cent of its wildlife
(Figure11) The declines were particularly extreme with a wide
cross-section of species that includes ungulates and predators
To be precise the declines were: warthog (–877 percent), waterbuck
(–87 8 percent), Grevy’s zebra (86 3 percent), impala (–84 1 percent),
Coke hartebeest (84 percent), topi (–82 1 percent), oryx (–78 4
percent), eland (–777 percent), Thomson’s gazelle (–75 percent), and
lesser kudu (–72 4 percent)
The declines were also severe for Grant’s gazelle (–69 6 percent),
gerenuk (68 6 percent), giraffe (–66 8 percent), and wildebeest (–64 2
In comparison ostrich (–43 4 percent), elephant (–42 3 percent)
buffalo (–36 9 percent), and Burchell’s zebra (29 5 percent)
experienced moderate declines
Similar downward trends were exhibited by the big cats and other
carnivores as their populations have also declined rapidly (Virani et
The losses have occurred across the entire country, with some
variation over the 19 counties
The highest decline was observed in West Pokot, which has experienced
a total collapse, with 99 percent of its wildlife lost
The smallest decline of wildlife was observed in Laikipia, which
experienced a 7 percent decrease in wildlife bio- mass (Figure 1 2)
The three other major tourist-dependent counties of Narok, Kajiado,
and Taita Taveta showed varying trends: Narok, despite its high
dependence on wildlife-based tourism, has lost about 70 percent of its
wildlife; in Kajiado, the decline stands at 60 percent; and Taita
Taveta registered a moderate decrease of about 40 percent
Kenya’s population has grown more than sixfold since 1961
Kenya’s road network had increased by 50 percent to cover around
11,000 kilometers of improved and paved roads as of 2017