Trump Recognizes Jerusalem as the Capital of Israel

Trump signing the historic Jerusalem document
Source: http://www.cnn.com/videos/politics/2017/12/06/trump-signs-jerusalem-document-vo-wolf.cnn

The president, Donald Trump, has declared Israel's capital to officially be recognized as Jerusalem as of Wednesday, December 6th, 2017. Trump also announced his plans to to move the United States Embassy from Tel Aviv to the highly controversial Holy City. Many believe this will only further increase tension in that region.

Trump's statement: "Today we finally acknowledge the obvious: that Jerusalem is Israel's capital. This is nothing more or less than a recognition of reality. It is also the right thing to do. It's something that has to be done."


For the past seven decades the United State's foreign policy refused to recognize Jerusalem as the capital of Israel until the Israeli-Palestinian conflict was resolved. Trump believes this is a step in the right direction to bring about peace in the Middle East.

The Holy City of  Jerusalem
 Source: http://cdn.cnn.com/cnnnext/dam/assets/171203231146-jerusalem-significance-lee-pkg-super-169.jpg

Trump has stated that his decision that the United States will recognize the city of Jerusalem to be the capital should not be taken as the U.S. taking a stance in regards to how the city will be shared. He has previously shared that he is an advocate for peace in the Middle East, but some fear this decision will only increase violence in that region.

Netflix Gets Rights to Air The Worthy

Netflix seems to be paying attention to the middle east's film industry with The Worthy.  They bought the global streaming rights to this movie.  The Worthy is a show from the United Arab Emirates that takes place in a post-apocalyptic future with a water shortage.  The movie is in spoken Arabic but will have subtitles for airing to other nations of course.  This is directed by UAE filmmaker Ali Mostafa but is produced by two American veterans, Peter Safran (The Conjuring) and Steven Schneider (Paranormal Activity).  It saw it's first release in Kuwait on February 23rd.  I was not aware of the film talents in the middle east until this article.  What's more interesting is that a United States streaming company and two American producers are involved with this movie.  Perhaps we will see more movies and television coming out of the middle east available for streaming.  It's an amazing time for the entertainment industry, without the Internet or convenient streaming services like Netflix, Americans or non-middle-easterners would probably never see this movie.  The middle east might get their own Hollywood like India's "Bollywood."  I'd love to see more interesting content and movies from other countries.

Netflix acquires rights for The Worthy

Urgent Medical Evacuation in Syria by UN

The United Nations is in the midst of desperate efforts to evacuate 500 Syrians, including 167 children, in Eastern Ghouta (a rebel-held area) due to urgent medical needs. The death toll has risen to nine in recent weeks as these citizens wait for government authorization to evacuate to hospitals.

"Collapsed buildings are seen after the Assad regime carried out air strikes in Eastern Ghouta, Damascus in Syria on 17 November 2017" (Source: https://www.middleeastmonitor.com/20171201-un-seeks-urgent-medical-evacuation-of-500-from-syrias-eastern-ghouta/)

Meanwhile, food shortages are contributing to malnutrition; which is heavily effecting children espcially. Rates regarding acute malnutrition among children has reached a shocking 12%. To put that number in perspective, this is about 6 times higher than what was reported in January and is 2% above the emergency threshold. Syria is also being bombarded with recent air and artillery attacks by government forces which has resulted in the death of dozens of civilians.

One of the 167 children in need of medical attention in Eastern Ghouta (Source: http://www.bbc.com/news/world-middle-east-42186064)

The UN is pushing for world powers to get involved by helping with medical evacuations. So far, Russia, France, Iran, and the United States have come forward to assist at the weekly humanitarian meeting. The green light has still not been given for these evacuations, but efforts are being made to get the wounded and sick to safety. 

Post Brexit Opportunities between Britain, Saudi Arabia & Jordan

Theresa May, Britain’s Prime Minister, traveled to Saudi Arabia and other countries in the middle east to discuss matters of trade and security and strengthen ties with the area throughout this past week. IN Saudi Arabia, May met with their Crown Prince to discuss cooperation for the Vision 2030 plan, which is a “blueprint that expresses long-term goals and expectations and reflects our (Saudi Arabia) country’s strengths and capabilities”. For more information, view Saudi Arabia and the missions of other countries here. Security was a main topic of discussion between Britain and SA. May described the situation as one that would work in both of their interests. Britain is invested in their long-term stability through aiding SA with regional challenges. After Britain departs from the European Union, they want to continue to strengthen their ties with middle eastern countries. Specifically, this partnership works in the interests of SA and Jordan to create a more stable region in terms of security, health and individual rights for their citizens. I find it interesting that Britain is choosing these countries particularly to strengthen ties. This seems like a power move initiated by the need for oil and other natural resources. This works in the favor of the middle eastern countries by providing them with strong ties to a powerful international player like Britain. One important note PM Theresa May made was that wants to see full humanitarian, as well as commercial access through the port of Hodeida in Yemen. This demonstrates the strong push for more clarity in Yemen’s port situation.

https://www.thenational.ae/world/mena/theresa-may-to-seek-post-brexit-opportunities-for-british-business-on-riyadh-visit-1.680056

http://www.gard.no/web/content/yemen-port-situation

Retail Boom for Bahrain

The blog post I’m writing today will be about Bahrain. Being that I had never heard of the country until today, I figured none of you have either. So, I’ve decided to write a brief summary of the country's geography and population so that there’s a better understanding of the information forth coming from the article. Bahrain is an Arabian constitutional monarchy that is located in the Persian Gulf. It consists of a main island and is surrounded by a small chain of islands that lay around it. The island is located between the Qatar peninsula and the eastern coast of Saudi Arabia. It is the third smallest nation in Asia, only 780 kilometers in size, with a population of 1,234,571 people. It has a high Human Development Index rating of 0.824, and is regarded as a high-income economy. The reason I mentioned some of this is to give a scope of how much of an impact FDI can have on such a small nation.

Recently, through government intervention, Bahrain has had an increase FDI and the real estate market of the country has gone through a positive upswing. The increase of the countries real estate market has encouraged the increase of retail space and goods. By 2020, there should be over 455,000 square meters of new retail space. The confidence of these logistics is based in the new projects of 21 retailers that have combined over $734.5 million into the growing market of retail. Bahrain will also be home to the Gulf’s largest IKEA, that will be opened at a cost of $47 million and will create 600 jobs. The entire country is going through an economic upswing and it’s markets will likely continue to grow. $734.5 million is a lot of money, but when it's being invested in a nation that is roughly ten times smaller than the U.S, you can imagine how that kind of investment will have a greater impact.

Source: Bahrain set to see $734m retail space boom by 2020.” ArabianBusiness.com, www.arabianbusiness.com/industries/retail/382952-bahrain-set-to-see-734m-retail-space-boom-by-2020.

Oil Surplus for OPEC

The UAE (United Arab Emirates) has stated that there is nearly 158 barrels of surplus crude oil that remains on the market. Such a surplus may lead to an extension of a deal made last year, in which UAE members struck an agreement to cut the total amount of barrels produced per day to 1.8 million. The reason for the cut in the output of crude oil is that the massive production beforehand had caused destabilization in the market, which was sought to be solved by the new capped limit at 1.8 million per day. To give an idea of the fluctuations in the market, oil is now $64 a barrel, when last year it was $40. The massive changes cause’s investors to lose confidence in the market, leading to them pulling investments or neglecting to make them any longer with the new loss of confidence. This is a major issue for any country involved in OPEC and countries dependent upon OPEC for their own oil consumption (which is pretty much the entire world) as oil is OPEC’s lifeblood, and a country dependent upon OPEC will face an uncertain future in oil pricing.

A UAE spokesman claims that all members of UAE are fairly unanimous in extending the deal. The actual length of the extension is still under debate and has yet to be announced. OPEC members will be holding a meeting in Vienna at the end of the month and will be urging other countries to adhere to the quota system that has been established. Urging countries such as Libya, Iran, and Nigeria to join the system of capping the amount of oil that they produce. OPEC leader, Mohammed Barkindo, also urging nations worldwide to discuss the reservation and future of energy to secure a global plan and understanding of the industry.  

Source: “UAE sees oil producers extending cuts to rebalance market.” ArabianBusiness.com, www.arabianbusiness.com/industries/energy/383436-uae-sees-oil-producers-extending-cuts-to-rebalance-market.

IMF Egyptian Reforms

Egypt has been struggling economically since the 2011 uprising, scaring away potential investors and other sources of FDI.  They are heavily importing but are trying to improve their exports.

The IMF has given Egypt a 12 billion dollar loan and are set to get the second installment.  The government is trying to gather public support with billboards on the side of their highways.

Reforms include reduced government spending, new taxes, and a "radical" currency revaluation.  Middle East economist, Jason Tuvey, says they are taking the conditions seriously such as floating the currency, undertaking subsidy cuts, and introducing VAT and other fiscal consolidation measures.

Controversy:

Some are not sure about the devaluation of the Egyptian pound.  After decades of strict bank control, they announced free float in November.  It helped investors but the average citizens are disliking their reduced purchasing power. For example, one US dollar was 18 Egyptian pounds compared to before the free float when it was pegged at 9 pounds.  That is a very large difference in exchange rate to happen so suddenly. Inflation is also estimated to be just over 30 percent.

At the same time, the government is in a tight bind with their reserves being depleting before implementing the free float.  It seems like it this is necessary for Egypt to get back on the right track.  The IMF hopes that it will strengthen their social safety net increasing food subsidies and direct transfers to the poor.  However, there is still hard ship.  For example, food subsidy cuts designed to reduce state-sponsored bread from 4000 to 500 loaves per bakery sparked protests.

The government is balancing what subsidies to cut and what to keep.  Executive chairman at Templeton Emerging Markets Group says that they should cut taxes and regulations instead.

He goes on to further say, that the IMF deal is not enough on it's own to reform the economy. 

Conclusion

When a nation is struggling economically it is a very hard situation to get out of.  Sometimes it must get worse to get better.  It's important to remember though, that economies are incredibly complicated and exactly what steps to take to improve an economy aren't always visible.  Devaluation of currency is something that can be used strategically to improve an economy or for other desires.  It's not something to be taken lightly though.