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Thoughts on Bahraini life sentences

Martin Chulov of the Guardian reported eight Bahraini civil rights activists were sentenced to life imprisonment for “plotting a coup against the government.” And while I can certainly sympathize and no doubt agree with those activists’ aims, the court’s decision could be considered legitimate — although certainly operating in an illegitimate and rather ineffective code of law.

It’s worth noting that peaceful demonstration and free speech are not exactly protected in Bahrain. That much should be obvious. And given that societal and institutional framework, the court’s decision cannot be unexpected. Any attempt to overthrow a government will usually be met with police force and judicial response, whether you’re in Bahrain or the United States.

The freedoms offered in Bahrain are certainly more limited than the U.S. And while it’s easy to criticize the Bahraini courts for their decisions to punish dissenting voices, we are only doing so based on our understanding of society. That understanding is tainted, however, by living in a free society.

That’s not to say what Bahrain is doing is right or morally justified — it is not. The governance there is similar to what is happening in Syria, with a minority religious sect occupying power positions while the opposing majority religious sect is subordinated. But it’s all about cultural relativism.

The only way suppression of activists will end is by government overthrow. But if the government views itself as legitimate — and it does — it will try to maintain any semblance of rule of law it still possesses. That would include punishing “subversives,” which is a broader term in a country with fewer personal liberties.

Again, I am not defending the Bahraini court’s decisions — everyone deserves the right to protest. But that is simply not the case in Bahrain. A complete change in government and institutions is the only way to provide that, and the current government — especially since it is run by the minority Sunni population — is not likely to allow that.

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More on Bahrain’s Formula 1 decision

I know Formula 1 is hardly NASCAR — where event attendees makes you wonder why things like human rights even exist — but the racing league’s decision to reschedule the Bahrain Grand Prix for October sends a strong signal to the protesters that profits reigns over all.

As I noted yesterday, Bahrain gets a lot of money from its tourism industry. And when your economy is in a standstill because your army is in a standoff with civilian protesters, well, I guess you’ll do just about anything to get a kickstart.

Formula 1’s former president put it best:

Max Mosley, the former president of the FIA, who was involved in a major sex scandal after videos of him were released on a British newspaper web site in 2008, was quoted on ESPN F1 as saying: “If I was president today, F1 would go to Bahrain over my dead body (…)They will be attempting to use the grand prix to support what they are doing, almost using F1 as an instrument of repression (…) To go will be a public relations disaster, and sponsors will want their liveries removed.”

Oh, but wait! The World Council of the International Automobile Federation did its homework in regard to human rights abuses because it called Tariq Al Saffar at the National Institute of Human Rights in Bahrain. Of course, this is the same Tariq Al Saffar who was appointed to that position by the current king, who, maybe you’re aware, is the guy authorizing all those tanks to kill all those unarmed protesters. Al Saffar is also the owner of Bahrain Financial Harbour, a 380,000 square meter real estate development that is a linchpin in the country’s highly important banking and financial industry. Oh, and the company has some pretty close and lucrative ties to the government.

Let’s keep in mind here that despite lifting its state of emergency, Bahrain is still cracking down on protesters and continues prohibiting human rights organizations from operating. F1 racing is kowtowing to a government that desperately needs to sell its loyalists on something — which is of course cars that can go really, really fast. Because, you know, Bahrainis need to be able to forget their troubles for a day, too, and this revolution thing must be getting a little tiring.

 

 

Bahrain Trouble Brewing

June 3, 2011 2 comments

UPDATE: Bahrain has rescheduled its Formula 1 Grand Prix for October. It had originally been planned for March, but was pushed back because of civil unrest. That dealt a significant blow to the nation’s tourism industry. It’s unclear what kind of event spectators will get in October — expect a lot of protests. I am sure plenty of devoted racing fans will still attend, but enough people could still be wary about that nation’s situation to provide less of an economic boost than anticipated.

Bahrain has not received the sexy news coverage of its Arab Spring counterparts in Egypt or Libya, but there’s definitely reason for concern in that country that has gone somewhat unnoticed.

A Miami Herald story from Monday sums up what is going on in that tiny island vacation destination:

On May 19, President Barack Obama criticized the Sunni Muslim government’s harsh crackdown on the country’s majority Shiite Muslim population. The crackdown has featured the destruction of Shiite mosques, the jailing and physical abuse of leading opposition political figures and journalists, and official harassment and intimidation of teachers, medical professionals and others.

This is economically significant for several reasons.

The single greatest aid to economic development, aside from education, are stable political institutions. Call me old fashioned, but I don’t believe most investors think a country where there is government-backed torture and killing of peaceful protestors is a safe spot to stash their money.

Bahrain’s situation is more unique because of its advanced banking and regulatory system. The Heritage Foundation ranks it as the freest economy in the Middle East, but that all can change if institutions are overturned. And what was once considered a stable and respectful government has turned out to be something quite different, thus making for some unpredictability. Significantly, the Bahrain Islamic Bank’s credit rating was cut to junk status this week.

To that effect, Moody’s Investor Services downgraded Bahrain’s credit rating to Baa1 with a negative outlook, saying “there seems little prospect of the underlying causes of the unrest being peaceably resolved, at least over the short term.” That is the third-lowest investment rating, which will make it much more expensive and difficult for Bahrain to borrow money, which could stall or prevent large projects and lead to underfunding of various services. It also sends a strong message to investors that the political fiasco in Bahrain is not likely to turn around soon. The International Monetary Fund also readjusted its prediction on Bahrain economic growth from 4.1 percent to 3.1 percent.

Out of a sense of panic or urgency, the Bahrain government responded to the Moody’s downgrade with the cosmetic fix of lifting its state of emergency. That announcement was met with continued protests, as if nothing had changed (because, let’s be honest, nothing did aside from a few tanks pulling out of cities).

Foreign direct investment accounts for $15.8 billion of Bahrain’s economy, putting it 10th in the region. But it falls behind powerhouses such as Saudi Arabia (oil), Israel (technology, stable democratic institutions), Egypt and Qatar. For a country of its size, Bahrain gets a substantial amount of foreign investment — for the time being.

Any domestic instability has to be troubling for international markets and foreign investors. Even before the government crackdown, beatdown, showdown, whatever you want to call it, Bahrain was ranked 36th worldwide in public debt. And while many Middle Eastern nations rely on natural resources — such as oil — for a bulk of its gross domestic product, Bahrain derives 11 percent of its GDP from oil, making it one of the smallest producers of the crude stuff in the Middle East.

So where does a bulk of Bahrain’s economy come from? Tourism. And unless your fanny-packed family of four had insurrection on the travel itinerary, I think Bahrain might be pushed down the list of Middle East hotspots.

Of course, tumbling tourism dollars has been a theme of the Arab Spring — after all, the people carrying out these revolutions are hardly concerned about what John Smith and his three redheaded children think.

If the country must rely on tourism for a sizable portion of its economy, has a large debt burden and still wants to pride itself on being a progressive business economy, it must address its social unrest. This type of instability sends a bad signal to foreign investors — especially if its ability to generate revenue from tourism decreases, which directly affects Bahrain’s debt level.

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