Tee time in Dubai
By Zvi Bar'el
Haaretz, December 31, 2004
Here's the scoop on the new neighborhood in the city of Dubai: Victory Heights, as the new development is called, will have 789 villas built around a golf course that was designed by top-ranked golfer Ernie Els. The price of a villa, depending on the model chosen, will range from $685,000 to $1.6 million. A mere pittance for anyone who wants to be close to both a golf course and an amusement park, allowing him to send both his parents and his children out to have a good time while he frolics in the swimming pool that comes with the villa. What's equally interesting about this project is the cooperation between the developer and the Bahrain-based First Islamic Investment Bank.
Islamic banking is no longer a new phenomenon. Even American banks are looking for ways to get in on the action - worth some $300 billion worldwide - especially when it comes to business deals in the Persian Gulf. Islamic banking is more than just separate lines for male and female customers in the branches, or even completely separate branches for women. It's banking that rests on the principle of "fair capitalism," as defined by the Islamic researcher Abdelwahab al-Effendi.
According to this method, every Muslim should increase his capital and his property as much as he can, because in any case the property belongs to God, so the more property he has, the more assets God has, too. However, the basic condition is that the profit must not be made by means of usurpation or without an effort. For example, taking interest is forbidden - that is profit gained without an effort - and it is also prohibited to lease a home or a field and get payment for them without an investment by the owner.
The adaptation of the rules of Islamic theory to the modern financial world in practice is one of the most potent challenges facing the religious sages, because in a world where interest is an integral element, tools must be created that will bypass the hurdle. Methods of loaning money in which the word "interest" is not mentioned are part of the technical side, but how, in the final analysis, will the Islamic banks make money?
The methods that are conjured up are no different from those that are accepted by Jewish religious sages. According to one method, money can be borrowed for investment purposes if the bank is a full partner of the entrepreneur, and they divide the investment and the profits between them. This dispenses with the need for interest. Another method is for the bank to decide in advance how much it will get from the entrepreneur in return for the loan the latter receives from the bank, with the additional amount being paid for the effort invested by the bank, but not as interest. A third way is for the bank to buy for the entrepreneur the equipment and the materials he needs: The bank makes a profit on the price gap and the entrepreneur pays back only the original value of the loan. Thus, as long as the rule of "fair capitalism" is upheld, homes such as those in Victory Heights can be built with the aid of First Islamic.
Egyptian woes
However, Islamic banking practice has a hard time finding suitable solutions for the lower classes. In contrast to the potential buyers of villas in Dubai, who probably won't need loans from First Islamic, the situation in Egypt is different. The first question that the parents of an Egyptian bride will ask the parents of the groom is whether he has an apartment, because anyone who has an apartment is either rich or capable of meeting mortgage payments. Either way, he will be a good catch.
It's not only the parents who are interested in the ability to buy an apartment outright or via payments. For nearly six years, Egyptian construction companies have been mired in a deep recession that has all but frozen their business. According to unofficial data, more than 16 million Egyptians live in deplorable conditions, in temporary structures, huts or hazardous buildings, and more than 9 million single Egyptians are not marrying because they don't have the wherewithal to buy a home. There are two reasons for this situation: surging unemployment, which the government has been unable to eradicate by its artificial methods of creating jobs; and the obsolete methods by which the Egyptian financial market is conducted.
About 300,000 new people enter the Egyptian job market every year, many of them university graduates who try to find work in government ministries - work that guarantees a pension. In the meantime, they work as waiters, taxi drivers, or brokers for hotels and restaurants who try to recruit clients among passersby on the street. Some of them succeed in leaving Egypt and finding work in the Gulf states, which themselves prefer to nationalize the workforce or at least to accept foreign workers from countries that are not "problematic." By this they mean countries such as Pakistan and India, because expelling workers from them will not generate an immediate quarrel with the former host state.
Those who remain behind, in the homeland, and want to get married will have to pay about 700 Egyptian pounds ($113) to rent an apartment. That is nearly five times the minimum wage in Egypt and twice as much as the average wage in the middle- and lower-level ranks of the bureaucracy. The apartments are large and impressive, even if most of them fail to meet building standards. Until 10 years ago Egypt didn't even have a binding building code, and when an elaborate one was then adopted, very few contractors implemented it (reports from Egypt tell about 112,000 demolition orders for unfit dwellings that are pending, of which only 69 were carried out).
The traveler along the broad new avenues of the rising Egyptian cities - the vast sprawling quarters on the outskirts of Cairo - will be struck by the sense of ghostliness they impart. There are high-rises from which the protective wrapping on many of the windows has yet to be removed, along with the colored markings that attest to their construction plan. Some of the roads are covered by a thick layer of dust. Most telling of all, though: The parking lots are empty. There is no one to buy these fine homes. The cheapest of them costs 50,000 Egyptian pounds, the middle-range ones go for 250,000, and the expensive flats will set the buyer back 500,000 Egyptian pounds.
In 1996, President Hosni Mubarak singled out housing for young couples as a national goal. That is his response whenever an acute problem arises which draws excessively prolonged criticism in the Egyptian media. It was the same with higher education, the same with the health services and the trains, and the same with housing, too. Mubarak declared that a special law was needed to make it possible for young couples to get convenient loans and that the needy, too, would get similar loans, in which the repayment would not exceed 25 percent of their income. Mubarak's directive was bandied about in bureaucratic channels for nearly three years before it became a bill.
Religious obstacle
In addition to making government funds available to young people as aid for housing, the Egyptian mortgages law was supposed to help the contractors unload their vast backlog of homes and lift Egypt out of its recession. But 1.5 million luxury apartments are languishing in the Egyptian real-estate market - at a time when it needs 750,000 apartments a year to supply the middle and lower classes. But when the final version of the bill was circulated it encountered the long-standing obstacle of the important religious institution Al-Azhar, which is the source of religious authority for the government's operations.
The law conflicts with the principles of Islam, declared Sheikh Mohammed Sayid al-Tantawi, the head of Al-Azhar. His main complaint was aimed at the possibility that the banks, under the law, would have to evict buyers who did not repay their loans. But he also objected to the fact that the transaction, which involves interest, would be carried out between the bank and the client, thus creating the possibility of making a profit from interest without expending any effort.
For a year, legal experts and the sages of Al-Azhar toiled to come up with a compromise formula. In 2001 a reasonable way was found, according to which the banks would be able to evict buyers who failed to meet the payments and then put the house up for sale, but under conditions which would make it all but impossible for the banks to implement the clause. For example, before the tenants are evicted the home must be offered in a public tender, which makes it difficult to sell. In addition, the buyers must be given a number of warnings before the house is put up for sale, and the evicted family must be compensated for its investments in the house.
However, the most difficult clause to implement was the one stipulating that the deal be signed between the bank, the buyer and the contractor, with the contractor being the guarantor vis-a-vis the bank for the repayment of the loan. This would prevent the sin of a usurious loan at least in part, because the bank can make loans to the contractor according to the accepted Islamic conditions. However, the contractors do not want to sign off on a law that would make them responsible for the repayment of their clients' loans for 25 years or more, especially with the new law stating that ownership of the home is transferred to the client immediately upon purchase.
Now, four years after the law took effect, the wind continues to blow through the handsome empty homes, some with lovely views, spraying sand and dust through the air in areas that have become domestic tourism sites for young people who come to the neighborhoods to dream. But this is not the main thing. The main thing is whether the residents of Victory Heights in Dubai will hear the sound of the golf club striking the ball during the afternoon siesta. As for the Egyptians - let them solve their problems by themselves.
Robot riders
Sports sometimes creates unusual occupations. A case in point is camel racing in the Arabian Peninsula, which requires a constant supply of riders. To meet this need there are special "professionals" who travel to the neighboring countries in Asia and kidnap children or buy them from their parents. Because this is a sport with special demands. The riders have to be as light as possible and to shout in a loud voice that will spook the camels and make them hurry to reach the finish line.
The prizes in camel races are not as high as they are in horse racing, but a first prize of $190,000 in the central race in Qatar, or prizes of $50,000 in less prestigious races, is temptation enough for owners of racing camels. This is nowhere more apparent than in the United Arab Emirates, where biweekly races are held. It's difficult to estimate the number of camels that are designated for racing, but some idea of the scale can be gleaned from the fact that there are some 40,000 camel riders in the Gulf states. Moreover, these riders tend to have short careers: Once their weight reaches 50 kilograms, they are no longer "fit for use." This means a lifetime occupation for finders of camel riders.
The riders come mostly from Pakistan, India and Bangladesh. Their average age is seven, but some are even younger. In the "best" case they are purchased from their parents for between $2,000 and $3,000; in other cases, they are simply grabbed on the street. "Experience" has proved that children from these countries are the best in the profession, because their weight is very low at the desired age, and even more important, their voices are higher and they are especially good at screaming out of the sheer fright that grips them when they are harnessed to the camel's humps and forced to race.
Reports by human rights organizations say that these children are systematically starved to ensure that they do not gain weight, that they work from morning until late at night and that they are also forced to take care of the camels, feeding and cleaning them - and all this without wages, only in return for food and lodging. Then, when their "period of service" ends, they are simply deported. In the past few years the U.S. State Department has been highly critical of this practice, especially of the kidnapping of children, and has demanded that the Gulf emirates desist from the custom and enact laws to prevent it.
Laws have been enacted. Sharjah, one of the seven emirates of the UAE, does not grant entry visas to children who are intended to be camel riders, unless the request is made by the parents. Sharjah also uses DNA testing to verify the relationship between the child and those who have submitted the request, to prevent cases of fraud. Children below the age of 15 do not get a work visa, and one of the child's parents must accompany him to the place of work. In Qatar only children aged 14 and above are eligible for a visa, and now a new law is in the works that would raise the age to 18 for a riding visa. Another proposal under discussion would set a minimum wage of $400 a month.
Qatar went even further to meet the demands of the human rights groups, and especially to repulse the objections of the State Department. In 2005 a robot rider will apparently come into use, to replace the children. The robot is actually a puppet that will be placed on the hump and will be able to gesticulate rapidly with its hands and also utter sounds to make the camel run faster. The development of the robot has been entrusted to a Swiss company, which has already invested $2 million in the project and will sell the rider robots for $5,500 each.
The camel-riding commission in Qatar will this year purchase 100 of the robots and they will be leased to the camel owners at subsidized rates. In this way Qatar hopes to put a stop to the smuggling of children. Until the robots arrive and are proved to be as good as the children, however, the kidnappers will continue to make a good profit.
Nabil Fayad strikes again
In August of this year Nabil Fayad, a Syrian intellectual and a scholar of comparative religion, wrote the following: "Nationalism for us means four or five people holding a monopoly on Syria's capabilities at all levels ... That the citizen must belong to an ethnic community or to a family in order to be considered a Syrian ... It is shameful that our studies can be found in the universities of Bar-Ilan, Haifa and Jerusalem, yet are completely banned in our homeland. It is even more shameful that after 40 years of being wrapped in something resembling Ba'ath in our hearts, under the title of (threatening) Zionism, we feel that people like Avi Shlaim, Ze'ev Herzog or Israel Finkelstein are incomparably closer to us than self-styled intellectual terrorists such as Ahmed Dargam [the Ba'ath party official in charge of censorship in Syria] and the other members of the wise leadership. It is shameful that we should feel that wonderful women such as Shulamit Aloni or Yael Dayan or Tamar Gozansky are incomparably closer to us than the female sheikhs of thought terrorism who move about like night beetles in all the back alleys of Syria."
The Syrian authorities have forbidden Fayad to publish his major work on the Passover Haggadah and its sources, and on the Talmud and the Mishna in Syria. But Fayad is not only an academic. He is a publicist whose comments appear on an Internet site of his own and can also be found on liberal Arab sites. Amid all this he continues to be a Syrian citizen even when he is in prison.
Last month he was released from prison after being held in custody without being charged for 33 days, and he continues to write on Internet sites. To judge by what he declared in August, he has no intention of stopping: "Someone may comfort us by saying that the domination of the Ba'ath [the ruling party in Syria] and its leadership will end happily in the era of freedoms, and that all this is going to collapse into the historical wax museum, but we see that the duration for which Ahmed Dargam and his ilk imposed spiritual liens on us 10 years ago is being extended unmercifully. Therefore, it is our right, when we see the military, economic and national achievements made by these people, to cooperate with whoever we want without fear or psychological complex. We are now writing to the whole of humanity, not to the Syrians or the Arabs or the Muslims only. They used us as currency in what they called `the campaign' [against Israel] ... The battlefields of this campaign were five-star hotels and the bedrooms. It is our right to liberate ourselves by means of the peace that we all want. It is our right to write wherever we are permitted, to use our computer where we are not supervised, to live in a place without pollution or corruption."
Fayad republished this article on his Internet site, and two weeks ago allowed it to be posted on the liberal Web sites that operate in Europe and are a new platform for the Syrian opposition. Expect him to launch additional red-hot barbs at the regime of Bashar Assad in the near future.
"People like Fayad exist abundantly in Syria," says a Lebanese journalist. "They are only waiting for the moment when some in Israel will finally pick up the gauntlet and start conducting political negotiations with Assad."
Terminal costs
At the beginning of May the new Tehran airport was dedicated during an imposing ceremony. On the day of the Khomeini Terminal's inauguration (it's one of two terminals that have been under construction for more than 30 years), the Revolutionary Guards blocked the landing strips with tanks and other military vehicles, and the first flight, to Isfahan, was escorted by ancient Soviet MiG fighters and by Phantoms. The message was clear: The Revolutionary Guards will not permit the new airport to operate. The reason is their suspicion that the Turkish-Austrian company (Tepe-Afken-Vie, or TAV), which won the tender to manage the airport, maintains commercial ties with Israel - or at least has the potential to maintain such ties. Letting a company like this operate the airport "is a blow to security and to national honor," the deputy commander of the Revolutionary Guards stated.
TAV, which is one of the largest corporations in Turkey, built part of the new terminal in Istanbul. The Revolutionary Guards declared that they would not allow the Tehran terminal to operate unless all TAV staff were expelled. The company will be compensated for its investment ($15 million) in the preparations to operate the terminal, but that is not really the point.
The Revolutionary Guards were outraged that it was not someone close to them that won the tender to build the terminal, but "someone" who was recommended by President Mohammed Khatami. Amid all this melee the government did not find the time to report on the cost of the inaugural ceremony, an issue that was the subject of trenchant criticism in the Iranian media. It was only recently that the Iranian ministry of transportation published the "official and exact" costs. They don't match the cost of the recent dedication of the new terminal at Ben-Gurion International Airport, but they aren't far off. Here are a few of the illuminating numbers:
The highest amount was paid for advertising, $140,800. Then came the expenditures for lunch ($135,000) and salaries to the staff ($118,000). A hefty amount was also paid for flowers to decorate the event (about $50,000). The official film crew got $5,000, the cost of transmitting images and DVD was almost $49,000, signs cost $13,000, chair rentals were $27,000, the symphony orchestra was hired for $12,000, and clothes (it's not clear why or for whom) cost $50,000. The party that evening cost some $30,000, and there is also another item, "formal matters," which totaled about $50,000. By contrast, the flight-safety controllers were paid only $3,500.
The total cost, according to government reports, was $1.8 million. It seems there's no way to launch a terminal cheaply. Not even the Iranians could manage that.
