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rab ABringing Middle Eastern PerspectivesInsight to Washington Vol. 2 | No. 2 SUMMER 2008 | ISSN 1936-8984 EMERGING FINANCIAL & ECONOMIC TRENDS Gulf Investments in the United States Unwelcome Money JASSIM AL MANNAIE Islamic Banking Myths and Facts SARAH S. AL-RIFAEE Egyptian Islamists and Nonviolence Views from the Prison Cell DIAA RASHWAN China in the Middle East Perspectives from the Arab World MOHAMED BIN HUWAIDIN Arabs and the 2008 American Election Hopes and Predictions ALSO INSIDE » Reality Check: Conspiracy Theories in the Arab World - in the media, religious institutions and educational curricula PUBLISHER Bringing Middle Eastern Perspectives Bruce G. Blair to Washington EDITOR IN CHIEF Arab Insight, an innovative journal that features Mohamed Elmenshawy authoritative analyses from Middle Eastern experts on critical regional issues, seeks to improve the re- MANAGING EDITOR lationship between the United States and the Arab Mohamed Farahat world by cultivating a better understanding of the complex issues facing the Middle East among West- EDITORS ern policy-makers and the public at large. Elizabeth Broadwin Summer Marion Articles in Arab Insight do not represent any consen- Judith McClintock sus of opinion. While readers may agree or disagree Kathleen Miles with the ideas set out in these articles, it is our Deniz Ozdemir purpose to present a diversity of views rather than identifying with a particular body of beliefs. TRANSLATION Paul Wulfsberg The analyses, interpretations and conclusions ex- pressed in Arab Insight articles are solely those of WEB APPLICATION DEVELOPER the individual authors and should not be attrib- Mohamed Elkafoury uted to the World Security Institute or any other individuals or organizations in the Middle East or DESIGN the United States. Freerayn Graphics MEDIA INQUIRIES ADVISORY BOARD Contact our press office: (202) 797-5273 Jon B. Alterman [email protected] Center for Strategic and International Studies, Washington, D.C. SUBSCRIPTIONS To request a hard-copy subscription, Sajed Ahmed Abul al-Rikabi write to us at: School of Law and Politics, University of Basra, Iraq WSI – Arab Insight Haila al-Mekaimi 1779 Massachusetts Ave. NW, Ste. 615 Euro-Gulf Research Unit, University of Kuwait, Washington, D.C. 20036 Kuwait Tel: (202) 332-0900 Fax: (202) 462-4559 Michele Dunne Carnegie Endowment for International Peace, Or e-mail: [email protected]. Washington, D.C. Sign-up for a free electronic subscription at Amy Hawthorne, Executive Director, www.arabinsight.org Hollings Center, Washington, D.C. WSI CAIRO Abdel Moneim Said Mohamed Elmenshawy, Director Al-Ahram Center for Political and Strategic Studies, 40 A Mohamed Mazhar St. Suite #32 Egypt Zamalek Cairo, Egypt 11211 Salama Ahmed Salama Al Ahram Daily, Egypt ISSN 1936-8984 ArabInsight Summer 2008 Editor’s Note One cannot denY that conspiracies EXist in political and international relations, but it would be a mistake to explain or interpret politics – domestic or international – as only the product of behind-the-scenes machinations. This conspira- cy-orientated thinking ignores the theories, concepts and literature of political science that can help us understand these phenomena. Conspiratorial thought tends to arrive at monolithic, airtight conclusions, and proposes easy explanations that avoid the toils of real research. In the Arab world, the spread of conspiratorial thought contributes to the perpetuation of major dilemmas in Arab life. Many factors have made Arab thought ripe for the introduction of conspiracy theories; most important have been successive Arab crises that seem to have no end in sight. We have witnessed ongoing failure to put a practical end – or even lay the theoretical basis for an end – to many major problems in the Arab world, whether on a regional or national level. This issue of Arab Insight devotes several articles to understanding conspiracy theo- ries in the Arab world. The articles focus on analyzing different types of conspiratorial thought, examining their individual and shared features. An essay by Hani Nasira of the Al-Mesbar Center for Studies and Research in Dubai deals with the most prevalent model – endemic skepticism – in greater detail. Other articles address the spread of conspiratorial modes of thought within select fields, such as the media, academic cur- ricula and Islamic religious institutions. www.arabinsight.org Arab Insight Two observations are pertinent here: First, the fact that we are looking at conspiratorial thought in the Arab world does not mean we believe that Arab culture possesses a monopoly on conspiracy theories. Most, if not all, cultures know various forms of conspiracy thinking; the important distinction, however, is the degree to which such modes of thought prevail. Second, the fact that we are addressing conspiratorial thought in the Arab world does not mean that we believe Arab culture is devoid of scientific or rationalist modes of thought. These modes certainly exist, including among religious movements. Change in the Arab world Changes underway in Arab societies, within economic, social and religious realms, remain hot topics of discussion. Despite the relatively slow pace of political reform, perhaps due to the control of ruling regimes over the process, profound and com- prehensive transformations have taken place and may have a far-reaching impact on democratic reform in the medium term. We can distinguish between two major types of socioeconomic transformation. The first began largely in the early 1990s with the process of privatization and transi- tion to a market economy which, particularly in the Arab world, did not coincide with political transformation. This raised important questions about the way in which Arab states managed this process. After more than 15 years, have these programs led to real economic liberalism or given rise to a liberal reform agenda? Using the Algerian expe- rience, Dr Mohamed Ratoul, professor of economics at Al-Shalaf University, addresses some of these questions. The second set of transformations is more recent. They are linked to changes in political Islam, and are consequences of the current oil spike in the Arab Gulf and the spread of the internet. We can isolate three strands within these transformations: First is the revisionism currently underway within militant jihadi Islamist move- ments. Some of these movements are engaging in a two-fold process: they are offering a profound, fundamental critique of their past practices while also creating a new ideology that is based on a renunciation of violence and a rethinking of their dis- course vis-à-vis the “other.” Diaa Rashwan, head of the Islamist Movements Program at Cairo’s Al-Ahram Center for Strategic and Political Studies, examines the future of religious violence in Egypt and the state of international jihadism, most importantly al-Qaeda. His article offers an analytical reading of the content of recent revisions, an examination of the nature of the changes these groups have undergone, and some thoughts on the reasons for the transformation. www.arabinsight.org Editor’s Note Another aspect is the spread of electronic media in the Arab world, particularly blogs and online forums. Despite their relative novelty, the fact that broad segments of the Arab public – particularly the youth – are making political use of this new media gives us reason to inquire about the potential consequences for democratization, par- ticularly in light of increasing Internet penetration and availability. Electronic media has also become a means of political and social mobilization, as seen in the April 6 and May 4 strikes in Egypt where the Internet became an organizational tool. Kuwaiti Researcher Afraa Albabtain offers an analysis of political blogs in the Arab Gulf, in which she concludes that despite their positive contributions, they will not necessarily play a large role in fostering democratization over the short term. There remains a sizable gap between virtual political activism and traditional street activ- ism. And despite being widespread, she argues that internet penetration has not yet reached the levels necessary to have a tangible impact. The final aspect of recent changes in the Arab world is the phenomenon of sover- eign wealth funds, based largely in the Gulf. These have played a prominent role given recent oil spikes and are expected to have important consequences for the Gulf states’ relations with the global economy. They may even have consequences in the political domain as well, given moves by some funds to acquire large Western companies that are national symbols in their homelands. This may spark Western reservations about these funds, based on security fears, and spur Western countries to restrict Gulf in- vestments. In light of this, Jassim Al-Mannai, chairman of the board of the Arab Monetary Fund, asks a question: What can be done on both the Arab and Western side to over- come this crisis of trust? For the Western world, Al-Mannai suggests changing the negative image of sov- ereign wealth funds fostered by Western media, which portrays them as seeking to invade and control Western economies though they hold no more than 2 percent of the $165 trillion traded assets worldwide. In addition, Al-Mannai notes that Gulf sovereign wealth funds are long-term investments prepared to bear short-term market fluctuations, making them a stabilizing factor. These transformations are so significant that Arab Insight may devote future issues to exploring them