Cambridge Forecast Group Blog: Backup

TECHNO-HISTORY

The Origins of 20th-Century Progress

The internal combustion engine, the electric motor and the steam engine dominated the world’s mechanical power capacity in the 20th century, but all had their genesis in the 1880s. The only dominant innovation actually introduced and advanced in the 20th century, says Vaclav Smil, was the gas turbine. More powerful, more efficient gas turbine aeroengines were developed in the 1960s, and then at the close of the century General Electric developed the world’s most powerful turbofan aeroengine, the GE90-115 (above). From Transforming the Twentieth Century.

The Origins of 20th Century Progress

David E. Nye

Creating the Twentieth Century: Technical Innovations of 1867-1914 and Their Lasting Impact. Vaclav Smil. x + 350 pp. Oxford University Press, 2005. $35.

Transforming the Twentieth Century: Technical Innovations and Their Consequences. Vaclav Smil. x + 358 pp. Oxford University Press, 2006. $45.

These two fascinating works are not a conventional synthesis of social and technological history, but instead emerge from the intersection of technical innovations, cultural geography, economic history and environmental studies. Author Vaclav Smil teaches in the Faculty of the Environment at the University of Manitoba and has written 23 books.

The two under review, Creating the Twentieth CenturyTransforming the Twentieth Century, make a single argument, stretching from 1867 to the present. and Oxford University Press has configured them as companion volumes, with similar layouts and jacket designs. Both author and publisher declare, correctly, that each book can be enjoyed on its own, yet they deserve to be read together.

In Creating the Twentieth Century, Smil argues that the two generations before 1914 laid the foundations for an expansive civilization based on the synergy of fossil fuels, science and technical innovation. He rejects claims that the computer and the Internet have caused unprecedented economic acceleration and argues that the remarkable growth and social change of the 20th century were based primarily on refinement and development of machines and processes created before World War I. After a first chapter on the technical level of Western societies in about 1865, Smil argues for the transformative nature of electrification (chapter 2), the internal combustion engine (chapter 3), new materials and chemical syntheses, particularly nitrogen fixation (chapter 4), and new information technologies (chapter 5). He suggests that a well-informed scientist from the end of the 18th century, such as Antoine-Laurent Lavoisier, if brought forward to witness the society of 1910, would have confronted a “world of inexplicable wonders.” In contrast, “were one of the accomplished innovators of the early 20th century—Edison or Fessenden, Haber or Parsons—to be transported from its first decade to 2005, he would have deep understanding of most” of the machines and processes set before him.

Accordingly, Smil’s second volume, Transforming the Twentieth Century, concerns not technical breakthroughs but the refinement and intensifying use of previous inventions and processes. Recent decades, rather than being a period of acceleration, become largely a time of consolidation. The future, rather than appearing to be a time of almost unimaginable growth, becomes more problematic, because, as Smil takes pains to document, the environmental costs of growth often have not been included when calculating progress. And calculation is the operative word, as Smil bolsters the argument with many graphs and statistics.

Taken together, the books are neither an ode to optimism nor a tale of technological determinism. Smil himself escaped from Communist Europe in 1969 to teach first at Penn State and later in Canada. He writes from a Western point of view, but he is decidedly nondoctrinaire, rejecting both simple liberalism and Marxism. His account focuses on central Europe, Britain and the United States, although Asia emerges more fully in the second volume.

Smil largely succeeds in his synthesis, in part because of his broad and balanced perspective. Just as important is his deep understanding of science and technology. For example, in Transforming the Twentieth Century, he comfortably discusses and draws into his argument chlorofluorocarbons, changes in raw material use, new techniques of oil-platform construction, atmospheric CO₂ levels since 1200 a.d., fabrication machinery for silicon wafers, the chemical structure of thermoplastics, rocket engines and much more. The explication is assisted by illustrations, including maps, patent drawings, graphs and photographs. Smil marshals his wide-ranging knowledge into readable prose that any college graduate can understand.

Smil celebrates inventors, although he worries about the long-term results of adopting their creations. He writes about technology but pointedly eschews that word in favor of “technique.” He writes about cultural transformation without an overarching theory beyond the conviction that technical change underlies (but does not determine) social change.

Smil has an interesting thesis and many fascinating observations, but sometimes linkages are missing. In particular, by dividing his story into two books, he makes World War I disappear from the first volume. The war seems to me its logical, if disastrous, culmination. And even in the second volume, the war receives only scattered attention. Yet the very machines and processes that Smil finds so important facilitated the mass production of death. The internal combustion engine made possible trucks, tanks and bombers. Nitrogen fixation supplied endless explosives, synthetic chemistry produced poison gas, and electrification made possible a host of military technologies, as well as the assembly line’s mass production of weaponry.

Smil does not entirely overlook the military uses of these machines and processes, but he pushes warfare too far into the background. Perhaps the reason is that his books are primarily about how new technologies facilitated enormous changes in production and consumption, and only secondarily about the social, environmental, military and political consequences. Symptomatically, the atom bomb is discussed in a chapter titled “Energy Conversions.” Smil cannot cover everything, even in two books. However, the trajectory of his history would feel far different if the first volume ended with a 10-page meditation on World War I, or if the second one concluded with the conflict in Iraq.

Smil is not that sort of historian, however, but works more in the tradition of Fernand Braudel and the French annales school. They, too, focused on long-term trends, with particular emphasis on agriculture, energy, communication and transportation. Smil gives a succinct technical summary of the development of computers from 1932 to the present but devotes less space to how these machines got from the laboratory to the marketplace or their often unexpected uses. He often writes as an internalist, mostly concerned with how things were invented and how they work. Usually internalists prefer to write focused case studies, but Smil is also concerned with the changes each machine or new process makes possible. He succeeds in linking a wide range of examples in a sweeping argument that celebrates technical ingenuity, keeps in view the ecological costs of misusing this legacy and sensibly avoids both Alvin Toffler’s simplistic optimistic determinism and Jacques Ellul’s gloomy conclusion that the human will is powerless when confronted with “technique.”

Smil never mentions the American historian and man of letters Henry Adams (1838–1918), although he does draw on Adams’s younger British contemporary, H. G. Wells. This is a pity, for Adams anticipated Smil’s argument that science and technical development accelerated history and transformed society so decisively during the late 19th century that it constituted a fundamental break in human experience. Adams characterized the rupture in a letter to a friend:

A world so different from that of my childhood or middle-life can’t belong to the same scheme. It shifts from one motive to another, without sequence. . . . Out of a medieval, primitive, crawling infant of 1838, to find oneself a howling, steaming, exploding, Marconiing, radiumating, automobiling maniac of 1904 exceeds belief.

In his last years, Adams took thermodynamics as his starting point and concluded that because entropy was the unavoidable by-product of all transformations of energy, no historian could believe in progress. He feared the imminent heat death of the universe. A century later, Smil fears the consequences of global warming and asks, “Will this complex, high-energy, machine-dependent civilization survive the 21st century? We cannot know.” Rejecting determinism, he finds our future open, but uncertain.

Reviewer Information

David E. Nye is professor of history at Syddansk Universitet (SDU) in Odense, Denmark.
In 2005 he received the Leonardo da Vinci Medal for his scholarship in the field of technological history. His most recent book is Technology Matters: Questions to Live With (MIT Press, 2006).

GLOBAL UNDERCLASS: MEXICAN MAHOGANY PLANTATIONS IN B.TRAVEN NOVELS

B. Traven

B. Traven (d. March 26, 1969) was an enigmatic novelist who wrote primarily in German, and who is probably most famous for having written the novel The Treasure of the Sierra Madre (Der Schatz der Sierra Madre). This book was the basis for the John Huston movie of the same name, which starred Humphrey Bogart. Traven’s other books were ignored for years in North America while they were being acclaimed internationally and translated into numerous languages.Traven wrote many novels, including The Death Ship and the epic Jungle Novel series, which is a description of government corruption and an Indian uprising set at the birth of the Mexican Revolution.

Jungle Novels: The Jungle Novels include Government, The Carreta, March to the Monteria, Trozas, The Rebellion of the Hanged, and The General from the Jungle. These bleak, violent books powerfully portray the human basis of the Mexican revolution. They are notable for their anti-capitalist and pro-anarchist sympathies..

Traven, a German anarchist is considered one of the best political fiction authors of the 20th century.

Series

Jungle Novels:

1. Government (1931)
2. The Carreta (1933)
3. March to Caobaland (1933)
aka March to the Monteria
4. Trozas (1936)
5. The Rebellion of the Hanged (1936)
6. General from the Jungle (1954)

Novels:

The Death Ship: The Story of an American Sailor (1926)
The Treasure of the Sierra Madre (1927)
The Bridge in the Jungle (1929)
White Rose (1929)
Creation of the Sun and the Moon (1936)
The Cotton-Pickers (1956)

BANK FOR INTERNATIONAL SETTLEMENTS BIS REVIEW NOS. 31-30 2007: ISLAMIC FINANCE

BIS Review

Bank for International Settlements

Please find BIS Review No 31 attached as an Adobe Acrobat (PDF) file. Alternatively, you can access this BIS Review on the Bank for International Settlements’ website by clicking on: http://www.bis.org/review/index.htm

What’s included?

BIS Review No 31 (30 March 2007)

Ben S Bernanke: The economic outlook
Axel A Weber: Challenges posed by (financial) globalisation
Mario Draghi: Reflections on monetary and financial policy – Governor Baffi’s monetary policy
David Dodge: Promoting sound economic policies globally and locally
Torben Nielsen: Financial stability, the Danish perspective
Zeti Akhtar Aziz: Potential role of Islamic finance in strengthening the New Silk Road
Ardian Fullani: Summary of the latest macroeconomic developments in Albania
Lucas Papademos: Financial integration in Europe – March 2007
________________________________
please e-mail press.service@bis.org

Please find BIS Review No 30 attached as an Adobe Acrobat (PDF) file. Alternatively, you can access this BIS Review on the Bank for International Settlements’ website by clicking on: http://www.bis.org/review/index.htm

What’s included?

BIS Review No 30 (29 March 2007)

Zeti Akhtar Aziz: Fostering linkages in Islamic finance
Radovan Jela¹ic: Achieving a stable currency for a healthy Serbian economy
Victor Mbewe: Positive financial and economic developments in Malawi
Ernesto Gouveia Gove: The challenges in extending financial services throughout Mozambique
Ernesto Gouveia Gove: Central Bank of Mozambique’s review of 2006 and prospects for 2007
________________________________

please e-mail press.service@bis.org

BIS Review No 30 available

“Publications, Service” Publications@bis.org

Press, Service Press.Service@bis.org

Thursday, March 29, 2007

TURKEY ECONOMY: YKB

Yapi Kredi Bank

The outlook of Turkey’s economy

YKB Leading Indicators Date: Fri, 30 Mar 2007

YKB Leading Indicators Date: Fri, 30 Mar 2007

Ayçýn Yelda Yücel Karaboða yelda.yucel@yapikredi.com.tr

Ayçýn Yelda Yücel Karaboða yelda.yucel@yapikredi.com.tr

The outlook of Turkey’s economy since the second half of last year seems not to have changed very much. To sum these trends, it can be said that the industrial production has been quite robust, triggered by the strong export activity, while domestic demand indicators show signs of a slowdown, most notably in the automotive sector. It is worth to note that the Gross Domestic Product (GDP) slowed down considerably in the third quarter of 2006, not because of industrial sector which grew by a considerable rate of 6.4%, but because of a slowdown in services sectors and a contraction in agriculture. The slow growth in the services sectors reflects the moderation in domestic demand and commercial activity. In the national income figures, this can also be observed in the decelerating private consumption expenditures, which grew by only 1.3% in the third quarter of last year. Therefore, we expect to observe these trends in the last quarter of 2006 (the national income figures will be released on April 2, 2007) and probably in the first quarter of 2007, as well.

According to the monthly industrial production figures, the average growth amounted to 5.8% in the last three months of last year. In the first month of 2007, moreover, industrial production surged by 14.8%, more than that can be explained by the low base effect of the previous year. These figures already validate that the strong pace in industrial production has been continuing. That the output growth in the manufacturing sector continues to be robust has been supported by other data such as the rapid growth in imports of intermediate goods, as well. In the last quarter in 2006, the growth in intermediate goods imports amounted to 20%, not differing from the previous two quarter’s trends and in January it continued to grow by 25%.

In fact, since August last year, there has been a significant slowdown in the rate of growth of total imports. This stemmed mainly from declining consumption goods imports, as well as moderating capital goods imports. Comparing the first and second half of 2006, rate of growth in capital goods declined to 4% from 14%, while the consumption goods imports growth declined sharply to 0% from 33%. According to these figures, it is observed that imports of capital and consumption goods seem to be affected the most from the May and June volatility. Moreover, examining the details of consumption goods imports, it is observed that the decline emanated mainly from the 26% contraction in the automobile imports in the second half of 2006. Other major categories of consumption goods imports reflected some moderation with respect to the first half but, still, their growth rates were quite robust. In January 2007, those trends in the consumption goods continued.

The import taxes also verify the slowdown in total import growth.
Import taxes as of February and the strong exports figure announced by the Turkish Exporters’ Assembly imply that once again the growth rate of imports may lag behind the growth of exports in February. This has been the case since November last year, which helps to increase the exports to imports ratio and ease the concerns on trade deficit.
Examining exports more closely by differentiating the volume and price effects, it is observed that the volume of exports started speed up after May last year. The growth of volume of imports, on the other hand, declined considerably after June. On the other hand, export price (unit value) increase was more limited in 2006, while import prices, affected by the increase in international commodity prices such as steel and oil, surged by around 9%, surpassing the growth in the volume of imports.

Sectoral data from automotive and white goods industries verify the general trends in production, exports and consumption. However, as compared to the automotive sector sales, durable goods sales seem less affected from the slowdown in domestic demand. Moreover, external demand is still buoyant to sustain strong exports in both sectors.

In more detail, the production in white goods industry has not cut pace even during the third quarter of 2006 when the effects of the volatility were expected to be more definite. Exports also followed suit. However, there has been some moderate contraction in this period in domestic sales (only 4%) and it is observed that sales started recover from the fourth quarter onwards. Comparing the most recent data on white goods, namely the January-February 2007 period with respect to the same period last year, it is observed that the production in the sector grew by 25%, exports by 40% and the domestic sales by 9%.

In the automotive sector, production continues to be robust. In the January-February period, total output growth amounted to 15% and export growth was registered at 31%. Sales of both imported and domestically produced cars, however, have been continuously contracting since the second half of 2006. Breakdown of the automotive sector in terms of automobiles and commercial vehicles, on the other hand, exhibits quite different trends. The production of automobiles has been quite strong thanks to strong export growth, whereas commercial vehicle production has decelerated very significantly.
In the first two months of 2007, commercial vehicle growth was limited to only 4%. This shows not only the slowdown in domestic consumption but also the deceleration in the commercial activity, as well, since these vehicles are used mostly in the services sector and commerce.

Another indication that the problems in the automotive sector is mounting up is the continuous decline in the automobile loans. Total consumer loans increased in real terms at a moderate pace, where in details, housing and personal loans also rose in real terms in a similar fashion. In this sense, we do not observe an overall halt in the consumer loans. However, particular to automobile loans, the situation is just the opposite. In 2006, automobile loans contracted by 4.8% in real terms and the decline continued in the first two months (with a 5.5% real contraction). As of March 23^rd, the picture definitely has not changed.

Consequently, since the second half of 2006, the outlook in the economy is not dismal since the industrial sector production does not seem to have been much affected from the rise in interest and exchange rates, mostly stimulated by foreign demand to Turkish products. There are signs of slowdown in domestic demand, most dramatic contraction is observed in the automotive sector. In the coming period, trends in the services sectors and construction should be closely watched, as the former clearly exhibited signs of domestic demand moderation, while in the latter we do not have yet enough evidence of a slowdown.

In the first two quarters of 2007, it should be recalled that the high base effect of the last year’s first two quarters may lead to lower rates of growth, even if every other factor is fixed. However, the last two quarters of 2006 when the growth rates were lower may provide an opposite effect, as well, so that in the second half of 2007 we may observe higher growth. Our expectation for 2007 is that GDP growth may reach 5.4%, if the present trends in industrial production and exports continue. The risks that may hamper the growth process are the shocks that may arise both in the international and domestic economy. The former is related with the global liquidity squeezes and global imbalances, while the latter is bound to domestic politics ahead of the approaching dual elections (presidential and general elections).

Yapi Kredi Bank The outlook of Turkey’s economy

YKB Leading Indicators Fri, 30 Mar 2007

DUBAI: VLJ SUMMIT APRIL 2007

VLJ Summit in the Middle East

Very Light Jets: Flying Light Business Class

Very Light Jets: Flying Light Business Class

Monday 23rd – Tuesday 24th April 2007

Habtoor Grand Resort & Spa

Dubai, U.A.E.

Don’t miss the first:

VLJ Summit in the Middle East!

Organised by MIU Events

Speakers include:

Mohamed Abu Baker Farea, Director Aviation Safety & Security, GCAA

Tony Fitzpatrick, Executive Jets, Sales Director, Middle East

Ricardo de Paula Carvalhal, Sales Engineer – Middle East, Europe & Africa, Embraer

Matt E. Brown, Director, Brand Management & Product Marketing, Eclipse Aviation

Senior Representative of Cessna Aircraft Company

Basel Arrar, President & CEO, Royal Wings Aviation Services

Tahir Khan, Sales and Marketing Director, Eastern Skyjets

Tahir Iqbal, Operations Director, Dana Executive Jets

George Galanopoulos, Managing Director, London Executive Aviation (LEA)

Edy Pieniazek, Director, Ascend

Mike Creed, Managing Director, Action Aviation

Louis A. Sorrentino III, Senior Vice President & Managing Director,

Safety / Security, SH&E

VLJ Summit – Dubai Date: Wed, 28 Mar 2007

VLJ Summit in Dubai this April

Dr. Panagiotis Panagopoulos miu.events@ntlworld.com

Conference Sponsored by:

Embraer

Eastern Skyjets

Pre-Conference Workshop

VLJs – More Bang for the Buck?

Sunday 22nd April 2007

Analysing the business fundamentals and investment opportunities of the hottest revolution in air travel.

In association with Ascend

To register, please visit: www.miuevents.com

or contact P. Panagopoulos, email: pp@miuevents.com

Supporting Media:

SpeedNews, PMI Media, Cargo Village News, Airport Cities, LightJetAge.com

We look forward to welcoming you to the:

VLJ Summit in Dubai this April.

Kind regards,

Dr. Panagiotis Panagopoulos

Managing Director

MIU Events

This message was sent from Dr. Panagiotis Panagopoulos.

It was sent from: MIU Events

2 Canute House Durham Wharf Drive Brentford

Brentford, Mi TW8 8EP, United Kingdom.

VLJ Summit in the Middle East

With the Official Support of: MEBAA

(Middle East Business Aviation Association)

Very Light Jets: Flying Light Business Class

With the Official Support of:

MEBAA (Middle East Business Aviation Association)

Very Light Jets: Flying Light Business Class

Monday 23rd – Tuesday 24th April 2007

Habtoor Grand Resort & Spa

Dubai, U.A.E.

JERUSALEM BOARDROOM: YORAM ETTINGER

Straight From The Jerusalem Boardroom

Israel’s 2006 industrial production growth

- 1st in the world

Yoram Ettinger

Thu, 29 Mar 2007

Straight From The Jerusalem Boardroom

Shalom Merv and the bcc-ed folks,

Some 400 global companies have established sites in Israel, in order to benefit from Israel’s key economic advantage: know how, breakthrough innovative technologies, skilled manpower and US-style energetic entrepreneurship.

Enclosed you’ll find the 113^th issue of Straight From The Jerusalem Boardroom, which provides further data on the unique Israeli high tech scene.Should you wish to examine previous issues of the Jerusalem Boardroom, as well as national security newsletters and OpEds, please visit the ETTINGER REPORT at:

http://yoramettinger.newsnet.co.il

Happy Passover

(one of Passover’s Hebrew names: Chag Hakherut – Liberty Holiday),

Yoram

Straight From The Jerusalem Boardroom #113, March 29, 2007

1. Another $250MN Israel-dedicated fund has been announced by DISNEY’S INVESTMENT ARM, SHAMROCK. Shamrock investments in Israeli companies, since 1986 (e.g. Pelephone – $591MN, Koor – $250MN, Tadiran communications – $90MN, etc.), have yielded 31% annually (The Marker, March 25, 2007).

2. WARREN BUFFETT defines his $4BN investment in Israel’s Iscar, located next to the Lebanese border, as “the highlight of the year.” He added that “At Iscar, as throughout Israel, brains and energy are ubiquitous.” (Annual letter to stockholders of Berkshire Hathaway, New York Sun, March 2).

JUNIPER, the US giant of Networking and Security, expands its Israel R&D center (Israel’s Kagoor, acquired for $70MN in 2005), transforming it into its Voice Over Internet Protocol (VoIP) global center (Globes, Feb. 22).

3. LONG-TERM CONFIDENCE IN ISRAELI COMPANIES has been reflected by the L.A.-based CAPITAL GROUP, which acquired additional $15MN of Israel Chemicals stock, increasing its holdings to $400MN, 5.18% of market value (March 7).

4. ISRAEL’s ECONOMIC INDICATORS. In addition to an all time high of $23.7BN IN OVERSEAS INVESTMENTS, compared with $10.5BN – 2005 and $5.4BN – 2003, the “London Economist” reported: A 37% increase in ISRAEL’S INDUSTRIAL PRODUCTION during Jan.-Nov. 2006, compared with China’s 14.9%, Singapore’s 14.7%, US’ 3.8%, Japan’s 4.8%, EEC’s 3.6%, Russia’s 3%, Germany’s 6% and Britain’s 0.6% (Ma’ariv, Jan. 15, 2007). ISRAEL’s EXTERNAL DEBT is the lowest ever – 86% of GDP, compared with 95% in 2005 (Japan – 172%, Belgium – 98%, US – 64%, Britain – 47%). Average external debt:GDP ration in OECD countries is 78%. The reduction in external debt is attributed to the robust GDP growth, success of privatization, decreased deficit, increased tax revenues, etc. (The Marker, Jan. 8). BUDGET DEFICIT reduced to 0.88%, the lowest since 2000, compared with1.9% – 2005, 3.7% – 2004, 5.4% – 2003, 3.6% – 2002, 4.2% – 2001, 0.7% – 2000 and 2.3% – 1999 (The Marker, Jan. 10).

5. $2.7BN INVESTED IN ISRAEL BY OVERSEAS INVESTORS DURING JAN.-FEB, 2007, $1.23BN in February (directly in companies & real estate – $1.1BN and in stock market & bonds – $1.6BN), according to Bank of Israel (Globes, March 13).

6. $139MN raised, on NASDAQ, by Israel’s BigBand Networks, the fourth Israeli NASDAQ IPO in 2007 (The Marker, March 16).

7. US-based OPTIUM has acquired Israel’s Kailight Phonotics for $35MN in cash (Globes, March 29). The Waylon, MA-based CANDELA has acquired Israel’s InoLase for $16.5MN and royalties (Globes, March 12).

8. CITIGROUPG and UNTERBERG investment banks have led a $29MN round by Israel’s Tower, which could expand to $61MN if options are exercised (March 16). INTEL CAPITAL and MENLO VENTURES participate in a $20.5MN 3^rd round by Israel’s AeroScout (Globes, Feb. 26). The Boston-based GLOBESPAN CAPITAL has co-led a $16MN round by Israel’s Provigent, joined by SEQUOIA CAPITAL, Dr. ANDREW VITERBI, co-founder of QUALCOMM and ASCEND TECHNOLOGY VENTURES (Globes, March 7). SEQUOIA, ACCEL PARTNERS and EVERGREEN invested $15MN in Israel’s Pontis (Globes, Feb. 14). TAIWAN’s VENTURETECH ALLIANCE and the US-based BLUERUN VENTURES have co-led a $14MN 3^rd round by Israel’s AdvaSense (Globes, March 14). BENCHMARK and ACCEL PARTNERS invested $12MN in Israel’s Zlango’s 1^st round of $12MN (Globes, Feb. 13). BATTERY VENTURES and NORTHWEST VENTURE PARTNERS participated in a pre-IPO $10MN round by Israel’s Veraz (Globes, Feb. 12). MOTOROLA FUND and BESSEMER participated in a $7.5MN round by Israel’s ColorChip (Globes, Feb. 21). REYLOCK PARTNERS have led a $4MN round by Israel’s Pioneer (Globes, March 26). US-based DAWNTRADER VENTURES invested $3MN in Israel’s Peer39 (Globes, March 7).

Straight From The Jerusalem Boardroom

Israel’s 2006 industrial production growth – 1st in the world

Yoram Ettinger

Yoram Ettinger yoramtex@netvision.net.il

Mervyn&Mindy Schwedt mschwedt@verizon.net

Thu, 29 Mar 2007

KUWAIT: GLOBAL'S GCC ISLAMIC INDEX

Islamic finance

Global Investment House – Kuwait

research@research.global.com.kw

Global’s GCC Islamic Index

“Weekly Brief” dated 22/03/2007

Mon, 26 Mar 2007

Dear Sir/Madam,

Following the successful launch of Global’s GCC Islamic Index; and in line with the growing interest in Islamic finance, Global Investment House is proud to present a GCC Islamic Index “Weekly Brief”. The report examines the performance of GCC Shariah compliant companies (components of the index), highlighting industry as well as individual stock performances. It also entails economic and company developments, in an effort to keep investors cognizant of local and regional issues related to Islamic finance. In order to view the full report for the week, kindly click on the link below:

http://www.global.com.kw/research/islamic/22032007.pdf

To view more reports on the Kuwaiti and other markets, please visit our website:

www.global.com.kw

Regards,

Index Group – Research Unit

Global Investment House Kuwait

Tel: +965 2400 551 Ext: 169

Fax: +965 2471319

Global Investment House – Kuwait research@research.global.com.kw

Global’s GCC Islamic Index “Weekly Brief” dated 22/03/2007

Mon, 26 Mar 2007

RIYAD BANK

Riyad Bank’s Quarterly Saudi Economic Review

1st Quarter 2007

Economics economics@riyadbank.com

Wednesday, March 28, 2007

a review of global markets, the world oil market, Saudi economic performance and the first macroeconomic forecast for 2007

Riyad Bank

Head Office:

PO Box 22622

Riyadh 11416, Saudi Arabia

Attached is our first quarterly report for 2007.

It provides a review of global markets, the world oil market, Saudi economic performance and our first macroeconomic forecast for 2007. Hardcopy of this report is under preparation and will come shortly by mail. Please feel free to call or email if you have any comments or questions.

Disclaimer:

The opinions expressed in this report are those of the author and do not necessarily reflect the views of Riyad Bank.

All such information and opinions, based on the latest available data when the report was prepared, are subject to change without notice. This document is for information purposes only. No liability is accepted whatsoever for any direct or consequential loss arising from the use of this document.

This report will be available on Riyad Bank’s website: www.riyadbank.com For the latest updates on global market trends, please see the ‘‘Weekly Economic Briefing’’ on our website.

Queries should be addressed to: Dr. Khan H. Zahid, Chief Economist, Riyad Bank, Head Office, PO Box 22622, Riyadh 11416, Saudi Arabia.

Khan H. Zahid, Ph.D.
Chief Economist and Vice President
Riyad Bank
P.O. Box 22622
Riyadh 11416, Saudi Arabia
Tel: (966-1) 401-3030 x. 2534
Fax: (966-1) 401-3030 x. 2159

Mobile: (966-50) 059 3167
Email: khan.zahid@riyadbank.com

******************************************

Riyad Bank’s Quarterly Saudi Economic Review, 1st Quarter 2007

Economics economics@riyadbank.com

Wednesday, March 28, 2007

DUBAI PETROLEUM CONFERENCE: APRIL 2007

MEES Announcements

[eMEESHeadlines] Conference Announcement: MPGC 2007

Wednesday, March 28, 2007

SAUDI INITIATIVE: BEGIN-SADAT CENTER

The Saudi Initiative:

A Starting Point for an Israeli-Saudi Dialogue?

Alexander Bligh

Perspectives Paper No. 26, March 27, 2007

EXECUTIVE SUMMARY: The recently revived Saudi initiative is premised on terms permanently unacceptable to Israel.
Nevertheless, given current realities, Israel should not reject the initiative out of hand. Israel should take advantage of the initiative in order to transform it into a real opening for direct yet secret negotiations with Saudi Arabia.

The “Saudi initiative,” recently revived and pushed to the forefront of Middle East headlines, is not new. It was first raised in March 2002 by the (then) Heir apparent, today King Abdullah b. Abd al-Aziz, of Saudi Arabia. Shortly thereafter, the Arab League adopted the plan as its pan-Arab initiative for peace in the Middle East. The plan re-proposed today is similar to the original version; it supposedly offers Israel security and normalization in exchange for full withdrawal from “all occupied Arab territories” including the Golan Heights, the western Slopes of the Hermon mountain range (claimed by Hezbollah as the “Shaba farmlands”), the creation of an independent Palestinian state with East Jerusalem as its capital, and the “return” of Palestinian refugees.

Simply put, these are terms that Israel cannot accept. Given the current regional and internal Israeli political circumstances, however, Israel should not reject the initiative outright. Israel should take advantage of the tentative and problematic initiative in order to transform it into a real opening for direct negotiations with its Arab neighbors, especially Saudi Arabia.

Political Dynamics

Any serious consideration of the Saudi plan must take into account the political dynamics behind the initiative, both in Israel and in Saudi Arabia.

The Israeli leadership is in trouble. The incumbent Prime Minister, Ehud Olmert, failed to receive a 3 per cent margin in public approval ratings. He is hungry for a breakthrough in foreign and security relations in the hopes to improve his image. A new process of public peace diplomacy could provide him with the needed momentum.

The Saudi regime, on the other hand, is more self-confident after brokering a shaky ceasefire and a new division of power among the Palestinian factions. For the Saudi royal family, it is once again time to resort to the Saudi traditional modus operandi: work in secret behind the scenes and announce your success only after it is reached.

This clash of interests between public and secret diplomacies has resulted in the first Israeli mistake concerning the initiative: Israel should not have approached Washington about changes in the scheme. It should have sought and pursued direct and secret talks outside the Middle East (and away from the media) with authorized representatives of the Saudi Kingdom. In such negotiations, Israel could emphasize its common interests with the Saudis while raising its objection to some of the elements of the plan.

Shared Interests

It is self-evident that Saudi Arabia is motivated by its desire to counteract the potential Iranian nuclear threat. Any new weapon in the Persian Gulf constitutes a major challenge to this pro-American regime which controls about a quarter of the world’s proven oil reserves. Israel also shares this concern about Tehran’s ambitions. For all intensive purposes, Israel is the lynchpin holding the current Middle East together. Moreover, Israel is still the strongest country among the pro-US countries of the region. Their existence depends to a large degree on the continued existence of a strong Israel.

Dealing with Iran is not the only issue on which Israel and Saudi Arabia have shared interests. Both are trying to avoid the emergence of a radical Shi’ite regime in the wake of the future withdrawal of the coalition forces in Iraq. Creating such a regime not only would enhance Iranian interests in the region but would destabilize the current status-quo among all Middle Eastern countries. The first potential victims of such a new regime would be the smaller countries of the lower Gulf; Kuwait, the UAE, Qatar, Bahrain and Oman.
These countries comprise the Gulf Cooperation Council – a body under strong Saudi influence and a stabilizing pro-US player in that area. Israel stands to lose dramatically if these regimes are hurt in any way since most of them engage in open relations with the Jewish state.

Israeli-Saudi concerns are not limited to the Iranian and Iraqi arenas. Both are dissatisfied with recent Egyptian diplomacy. The failure of the Egyptian efforts to bridge the differences between the Palestinian factions (as opposed to the Saudi success in that field which brought about the creation of the new Palestinian government) has revived Saudi claims for a leadership position among the moderate Arab countries.

Self-assured, quiet and realistic Saudi diplomacy is precisely what Israel needs, especially at a time when Egypt seems to be moving in the opposite direction. Egypt’s ability to be a broker in Israel-Arab relations has deteriorated significantly in Israeli eyes. Egypt continues to allow large quantities of arms to be smuggled from Sinai into Gaza. Just this month, Egypt revived old and dubious allegations about the alleged killing of Egyptian POW’s by Israeli troops during the 1967 war. In this atmosphere, Saudi Arabia has gained even more traction as a quiet and reliable partner for Israel.

The Israeli-Saudi meeting of interests does not necessarily mean that Israel should accept the Saudi initiative. It is no accident that Riyadh floated its initiative again at a time of great flux in the Israeli political system and in the aftermath of a war that dangerously eroded Israeli deterrence. Moreover, the “right” of return would gut the very essence of a Jewish and Zionist state by flooding it with refugees. Arab insistence on the “right” of return within the initiative raises significant questions about the sincerity and intentions of its proponents.

And thus, the initiative as it stands now cannot serve as a basis for peace negotiations between Israel and its Arab neighbors. However, it can and must serve as a starting point for a confidential Israeli-Saudi dialogue on ways to advance their common interests in this volatile region.

Prof. Alexander Bligh is the Chair of the Department of Israel and Middle Eastern Politics & Director of the Israel National Strategic Assessment Center at The College of Judea and Samaria (Ariel) and President of Strategic Objects, a consulting firm dealing with risk assessment and coaching for the higher echelons of the Israeli political and economic scene. He is the former head of Middle Eastern Studies and Dean of Students at Jezreel Valley College and senior lecturer at the Hebrew University (Jerusalem, 1982-1996); and former deputy advisor (1987-1990) and advisor (1990-1992) to the Prime Minister of Israel on Arab affairs, specializing in impact of political radicalism among Israeli Arabs.

BESA Perspective No. 26

The Saudi Initiative: A Starting Point for an Israeli-Saudi Dialogue?

Alexander Bligh

Besa.Center@mail.biu.ac.il

http://www.biu.ac.il/SOC/besa/perspectives26.html