A Pocket of Prosperity in the Middle East

Bolstered by a constitution and a parliament since 2001, Bahrain continues to push forward with reforms aimed at strengthening social unity. H.E. Dr. Hashim Hasan Albash, former Bahraini Senator and current Ambassador of Bahrain to France, analyzes his country’s democratic movement and efforts to diversify its economy.

The Diplomatic Letter: Mr Ambassador, the Kingdom of Bahrain has been moving steadily forward with the democratization process launched in 2001, revising the constitution and holding local and parliamentary elections in which women were allowed to vote. Could you describe King Hamad bin Isa Al-Khalifa’s aspirations for the country, as he pushes ahead with these reforms?

H.E. Hashim Hasan Albash: I do not want to dwell on the reforms themselves, as they have been widely covered in the national and regional press as well as the international media, which called them a pioneering step in the Gulf region. I would, however, like to emphasize that the democratization process launched in 2001 has enabled us to make considerable strides.

The National Charter, which comprises the preamble to our Constitution, paved the way for striking out in a new political direction in correspondence with our people’s deep-seated aspirations. In the February 2001 referendum, 98,4% of Bahrainis voted in favor of all the proposed changes to the constitution. These reforms are now being gradually implemented.

Your question also touches upon the issue of the participation of women in our political life. Women already play a significant role in Bahrain’s economic life, but it is important for them to also take part in the kingdom’s decision-making bodies. To that end, the 2001 Constitution puts women and men on equal footing. It stipulates, in Article 1 Paragraph 5: “Citizens, both men and women, are entitled to participate in public affairs and may enjoy political rights, including the right to vote and to stand for elections, in accordance with this Constitution and the conditions and principles laid down by law. No citizen can be deprived of the right to vote or to nominate oneself for elections except by law.”

For the second time in our nation’s history, women will be allowed to vote in the parliamentary and municipal elections held at the end of November 2006. They will also be able to exercise their right to stand for election, as guaranteed by the Constitution. Several women have already announced their candidacy and stand a good chance of winning a seat in Parliament or on city councils.

I don’t want to try to predict the election results, but I can tell you that women are better prepared to take on these responsibilities at this time, thanks in part to the evolution of Bahraini society and to heightened public awareness since the 2002 municipal elections, especially among women. How else can we explain that no women won seats in that election, despite the fact that a higher percentage of women voted than men. But I would not call that initial experience a negative one, far from it, since women came out of that election much stronger. In other words, the issue of the status of women shows that if attitudes are to change, then the attitude of women themselves must change. I hope that the women running in the upcoming elections are successful, no matter what the outcome of those elections may be. We must not forget that democracy is still very young in Bahrain, and that the number of people who can hold public office is limited, even in the oldest democracies.

The most important thing to remember is the government’s determination to improve the political, economic, legal, social and cultural status of women in our country. In order to successfully elevate women’s status, the government has laid special focus on initiatives led by the Supreme Council for Women, an institution set up five years ago by an Emiri decree issued on 22 August 2001. Currently chaired by Shaikha Sabeeka, the wife of His Majesty the King, the council is the main body for sharing ideas and recommendations on all issues relating to the status of women. The government and the parliament consult the council on a regular basis. Since its inception, the Supreme Council for Women has been advising women’s associations and supporting the efforts of Bahraini ministries and other organizations working to improve the status of women, most notably through training programs and internships. In order to foster more initiatives that advance women’s rights, in June 2006 Her Majesty announced the creation of a prize rewarding organizations that make significant strides in this arena. A nationwide strategy has been implemented, targeting several different aspects of the problem. This has led to the creation of partnerships and agreements between the Supreme Council for Women and various ministries, with the aim of getting more women involved not only in government activities, but also in the work of the parliament and municipal councils. Seminars and workshops are being held around the kingdom with that same goal in mind, organized in cooperation with various private sector partners and associations. We have thus made great headway in advancing the status of women, thanks to the work of both the political community and civil society.

In the political arena, this drive has led to the appointment of two women to serve in the current government: one as Minister of Health, and the other as Minister of Social Affairs. The Senate now has six women senators, out of a total forty seats. The Dean as well as the President of the University of Bahrain are also women. Let me also remind you that long before the current Constitution was signed, a woman was named to serve as the Ambassador of Bahrain to France. She was none other than Shaikha Haya Rashed Al-Khalifa, who took over as the President of the 61st United Nations General Assembly on 12 September 2006. This goes to show that advancing the status of women is of great concern to both our political and civil institutions. A great deal remains to be done before these reforms are fully implemented. Certain reforms are moving steadily forward, while others are going more slowly. They have been hindered by hurdles and hesitations that will take longer to overcome.

Generally speaking, His Majesty King Shaikh Hamed bin Isa Al-Khalifa’s reform campaign is tied to his strategy of opening up Bahrain. This strategy was inspired, firstly, by the King’s goal of building a modern society able to step up and join the globalization process, and secondly, by his desire to satisfy the demands of the Bahraini people. I, for one, believe that no successful political leader can neglect his citizens’ aspirations. The changes undertaken by His Majesty the King are the result of his determination to listen to the Bahraini people. Bahrainis do not want to lag behind when it comes to development.

A debate has consequently been opened on the direction in which the kingdom’s institutions are moving, in consultation with key civil society representatives. Workshops and seminars have been held to heighten public awareness and make citizens more conscious of their rights, reflecting the new dynamic infused into every level of society. Reforms have even been made in our judiciary, with the creation of a Constitutional Court, a Council of State, and a Judicial Institute. These are all major steps in bolstering democracy in our country.

This determination to implement changes has also led to advances in the social arena, another area of great concern to the Bahraini political community. Numerous social measures have been launched since 2001, by decision of His Majesty the King. These include measures designed to help students unable to pay their university enrollment fees, which have either been reduced or waved. Assistance funds have also been set up to help widows and orphans. Numerous subsidized housing complexes have been built for underprivileged and low-income Bahrainis. These families’ rents as well as their utility bills have consequently been cut in half.

These institutional reforms have led to tangible social advances, infusing a brand-new dynamic into Bahraini society and opening up new horizons for Bahrainis, giving them even greater motivation to play a more active role in our Kingdom’s life.

T.D.L.: As the first legislative session draws to a close, would you say that Bahrain’s new institutions are working well? What steps must be taken next to keep the democratization process moving forward? Have these reforms set new energies into motion in Bahraini society?

H.E.H.H.A.: If I had to assess the work accomplished during the first legislative session, since the Constitution was adopted, I would say that it was packed with fruitful debates. The Parliament examined numerous bills addressing issues of great concern to Bahraini citizens. The Shura Council and the Chamber of Deputies have been of great help in improving the quality of our laws. The creation of these two chambers enriched these debates and enhanced our judicial arsenal.

During this legislative session, every time a law was considered or amended – whether it concerned political, economic, social or cultural affairs, and no matter why type of issue was at stake – the Bahraini citizen was always at the heart of the debate and was the focus of all the actions taken by the government. Several amendments were made to existing laws. Some were dictated by social and political changes that have taken place in our country. Others were made with a desire to bring our national laws in line with international agreements that have been ratified by the Kingdom, such as the Convention on the Rights of the Child, or the Convention on the Elimination of All Forms of Racial Discrimination and the Convention Against Torture, which came into effect in the Kingdom on 26 March 1990 and 18 February 1998.

Changes were also made to the text of various laws passed in 2001 and 2002, such as the Political Rights Law which lowered the voting age from 21 to 20. This reform was made in response to demands from deputies, civil society and youth organizations, with the aim of allowing more of our young people to take part in the political process while making them more aware of its importance.

There are many other examples, such as amendments to our Labor Code, to the law governing the status of government employees (the 1975 law on pensions and retirement funds for retired civil servants), and to the Labor Unions Law.

The great strides made during this first legislative session helped improve the quality of our laws and made the workings of the legislature and government more transparent, thanks in great part to Article 144 of Chapter 3 of the Bahraini Constitution, which instills wide powers in the Parliament and even more so in the Council of Representatives, the elected body which oversees the executive branch and has the right to question the government’s decisions as well as the laws it puts forward.

It should also be said that these supervisory powers are given only to deputies elected by direct universal suffrage, and hence not to Senators. These deputies set up commissions of inquiry to monitor government actions, ask questions, and request clarifications from ministers in their respective areas of responsibility. For instance, the Economic Commission asked the government to give it a list of citizens who would be compensated for the property expropriated from them through state-approved public improvement programs.

This legislative session also saw the development of parliamentary diplomacy. According to the Chairman of the Council of Representatives, Khalifa Bin Ahmed Al-Dahrani, the National Assembly is expressing growing interest in holding conferences, seminars and working meetings to explore the experiences of other parliaments around the globe. In fact, our inter-Parliamentary cooperation with France has been expanded over the past four years, thanks to mutual visits by parliamentary delegations. The latest example came in September 2006, when the Senators in the France-Gulf States Friendship Group visited Bahrain. Well before this visit, in early 2006, Bahraini deputies made their own trip to France.

In addition to their legislative duties, our deputies are being consulted more and more frequently by other governments. They are consulted on a wide array of issues that are not always directly related to Bahraini internal affairs but are international in scope, and can thus have an impact on our national laws. The Bahraini Parliament’s involvement in this examination process, coupled with the transparency of our parliamentary debates, has enabled our citizens to keep abreast of these foreign policy issues. This is all the more true, now that parliamentary sessions are broadcast on our national television channel and are widely covered in our national newspapers.

Finally, I would like to underscore the fact that Bahrain’s new constitution also includes legislation guaranteeing an independent judiciary along with the rights of labor unions and political groups – there are now fifteen different groups in the Kingdom, taking the form of political associations – as well as the rights of other groups working in the social and cultural arenas.

T.D.L.: Four opposition parties that boycotted the October 2002 elections, in the wake of the reform of the Constitution, could field candidates in the general elections scheduled for the end of this year. Are their demands legitimate, most notably as concerns expanding the National Assembly’s powers? Bahrain’s Shiite community, which comprises 70% of the population, is also seeking stronger social and political integration. Is this an important issue, given the current state of affairs in the region?

H.E.H.H.A.: Our current parliament is comprised of several different political groups representing three main leanings: Islamists, liberals, and independents. The 2002 Constitution guarantees these groups’ right to exist. Just to give you an indication, let me mention the Democratic Progressive Tribune, Alwassat Al arabi Al Islami, the National Islamic Tribune, National Democratic Action, Free Thought (which groups together independent currents), and the Islamic League. Whether to take part in the 2002 elections, or whether to boycott them, was a choice faced not just by a single group, but by all of Bahraini society. I believe that the existence of an opposition, of any sort whatsoever, reflects a certain amount of freedom within a society. The very existence of these demands is a symbol of this, as long as they fall within the country’s legislative framework and do not impugn public order or the best interest of the State. Any type of political tendency can be freely expressed in Bahrain. Let me also add that the demands put forward in 2002 did not come from any one community. They were, first and foremost, the demands of Bahraini citizens. Some were indeed legitimate, such as the demands regarding the right to work, to have decent housing, to get an education, to have access to better health care, and to participate in the political process.

What’s more, belonging to a given ethnic group or community is not the common denominator that unites these political associations. They have come together around the ideas and the social agendas championed by these groups. This means that our political parties have both Sunnis and Shiites as members. I believe, to the contrary, that by putting forward such widely diverse demands, these groups have given our democratic process a fresh boost.

We have also made respect for religious diversity an integral part of our institutions, which has brought changes in the political arena. Non-Muslim Senators now sit on the Shura Council (Senate). I say this as someone well acquainted with the situation, since I worked with Christian and Jewish colleagues when I was a Senator, before being named Ambassador to France.

Within the government itself, Bahrain’s ministers are born of all the different groups that make up our Kingdom. Let me end by saying that it is time to put behind any divisions linked to our ethnic origin, identity or community, and move forward together. The National Charter very rightly applies to each and every Bahraini citizen, irrespective of their origin or ideology.

T.D.L.: Bahrain hopes to become a key financial and service pole in the Gulf region, with 350 banks and financial institutions already operating in the country. With the oil industry still supplying the greater part of public revenues, is Bahrain making headway in its drive to diversify the economy? What are some of the main growth sectors, along with financial services and the aluminum industry?

H.E.H.H.A.: Bahrain has long been considered the region’s key financial pole, if only because of its strategic location. Hydrocarbons have supplied the better part of public revenues since the early 1930s. However, given Bahrain’s naturally diminishing oil reserves and the desire to foster new development opportunities on the archipelago, Bahraini officials have been working for more than a decade to diversify our economy and national industries. Numerous measures have been taken with the aim of attracting foreign investors and making it easier for them to do business in Bahrain. They can now operate within a suitable judicial framework that is being constantly realigned to meet global market conditions and regulations, using the appropriate financial tools.

As it began seeking new market outlets, Bahrain initially laid great emphasis on expanding investment income as well as the banking and insurance sectors. It focused next on a variety of industrial sectors, starting with the aluminum industry. Since the late 1990s, local authorities have been paying closer attention to sectors such as agriculture, textiles and handicrafts, and even more so to tourism and communication technologies.

Bahrain’s tourism infrastructures have been greatly augmented (with large-scale projects such as Two Seas, Durrat Al Bahrain, and the Formula One racetrack, and the construction of more hotels and palaces). The International Airport was expanded and can now handle more than 3.5 million passengers annually. Our telecommunications network was opened up to competition and expanded, working through Batelco. As for the southern part of the country, this area is booming right now, as numerous projects are carried out there.

Local authorities are counting heavily on an influx of foreign investors from GCC and other countries, to help drastically cut unemployment. Our country offers investors considerable advantages and opportunities, starting with investment incentives and the launching of large-scale economic and tourism projects.

As for training Bahrain’s young people, special focus has been laid on education, telecommunications, and expanding the use of new technologies. This led to the creation of the Bahrain International Investment Park. In fact, the main objective behind the BIIP is to attract high-tech projects with high added value, which will lead in turn to the creation of new high-quality jobs in Bahrain.

Bahrain’s industrial parks and large-scale projects are indeed free zones, offering foreign companies easier terms and numerous advantages, such as 100% foreign ownership of capital and a guaranteed 0% tax rate for ten years. Appropriate customs services have also been set up, and measures have been taken making it easier to recruit local workers.

The construction and public works sectors have also been booming since the late 1990s, along with all the wide-scale projects tied to them. We are thus seeing the construction of power plants, new cities, subsidized housing complexes, bridges, roads, and ports. Programs to renovate hospitals and other airports will also help to create new jobs.

The oil industry no longer generates an overwhelming percent of Bahraini GDP. It is still our primary source of revenue, but it is being increasingly challenged by other sectors that have become important to the country’s economy, such as financial services, commerce, industry, tourism, and telecommunications.

T.D.L.: King Hamad bin Isa al-Khalifa’s strategy of opening up the economy led to the signing of a free-trade agreement with the United States and has made Bahrain one of the most competitive countries in the Middle East. How will the US-Bahrain accord help spur even greater economic growth? Will new opportunities open up for foreign investors as the privatization process moves into the next stage, with the deregulation of the telecommunications sector?

H.E.H.H.A.: After several negotiation stages, the United States and the Kingdom of Bahrain signed a free-trade agreement at the close of 2004. This is an important accord, in that it will not only enable us to increase the volume of bilateral trade, but will also help Bahrain shore up its economic position on both the regional and global stages. This comes at a time when the Kingdom is in the process of privatizing various public service companies. This chiefly concerns the telecommunications sector at the moment, but the process will eventually be expanded into other areas, such as electricity and transportation services. While there was already a good amount of market freedom in Bahrain, the implementation of the July 2003 privatization law has sparked an economic upswing.

Bolstering free trade will not only enable us to harmonize our trade laws, it should also help us reduce trade barriers and customs taxes.

We have become a strategic partner for the United States in the Middle East. This agreement will further strengthen our two countries’ ties. We currently export aluminum, textiles, fertilizers, organic chemical products, petroleum products, and electrical fittings to the United States. This agreement gives us better access to the US market, while giving American products easier access to ours.

Defined as an international system, a free market economy is characterized primarily by the absence of tariff and non-tariff barriers, and the free flow of goods, services, capital, and workers. This system will no doubt make our companies more competitive and spur an influx of investment. As the privatization process moves forward, and the State pulls out of large public service companies, the impact of this economic boom will start to be felt around the Kingdom, even if the process is carried out gradually. This new dynamic, along with the impact of this agreement, should foster more private initiatives. It can only help, and will certainly generate new jobs. In addition to this new asset, I should also mention Bahrain’s pro-business legal system, with its flexible investment regulations and attractive business climate that makes it easy to create companies. It goes without saying that the privatization of any firm has consequences, especially on workers. And so this program is being carried out in stages, to minimize its social repercussions. The end goal is to create more jobs and to open up more opportunities for Bahrainis.

T.D.L.: Your country is a strong proponent of close regional economic integration working through the Gulf Cooperation Council. How can Gulf States overcome the hurdles that have kept this process from moving forward? What must still be done in order to create a GCC common market by 2007?

H.E.H.H.A.: The Gulf Cooperation Council (GCC) was created on 26 May 1981 – by Saudi Arabia, Bahrain, the United Arab Emirates, Kuwait, Oman and Qatar – as a tool enabling its members to coordinate their economic, political, social, cultural and security policies. According to the wishes of the leaders of all six monarchies, it is turning into a model for integration, with the gradual emergence of a regional common market.

Various obstacles obviously had to be overcome to make this happen. We did this by laying out clear objectives from the very start: creating a common market, standardizing customs tariffs, establishing a monetary union and a single currency, and creating a free-trade zone.

All six countries agreed upon a number of common external tariffs as early as 1983 (most notably on luxury goods). In 1998, they approved plans to create a customs’ union with the aim of establishing total equality in a variety of areas, such as: the free flow and free establishment of people and goods, public and private sector jobs, education, health care, real estate, capital flow, taxation, and the creation of companies. At the December 2001 GCC Summit, the Member States Finance Ministers and Central Bank Governors presented a timetable for setting up a monetary union and single currency, which was approved. The GCC also requested and received precious assistance from the EU, working through the cooperation agreement that has linked the two bodies since 1990.

Our own economic integration process has begun to take concrete shape, primarily in the form of coordinated oil policies. This initiative has even given the GCC greater sway in OPEC, despite the fact that neither the Kingdom of Bahrain nor Oman belong to this organization. We are also seeing a rise in economic exchanges and trade between member countries. In another significant step forward, visas for citizens of GCC Member States have been abolished.

It must be said, however, that things have neither been easy nor perfect, and that there are still imperfections and obstacles to overcome. They reflect a lingering desire in GCC Member States to maintain their own unique advantages, and keep competition to a minimum. In my humble opinion, if we are to get past the problems that have hindered our integration process, we must reconcile our regional aspirations with our national interests, and harmonize our common constitutional framework. As we push forward with the integration process, the specificities and differences that exist throughout the Arab world – in both the political and economic arenas – must also be taken into account.

T.D.L.: At the 26th GCC Summit, held in Abu Dhabi, Member States voiced concern over the way the Iraq war has boiled over into the Arab Peninsula. In light of the rise in terrorist attacks in Saudi Arabia, do you think this conflict threatens to spread to other Gulf countries? Could strong regional cooperation stop this from occurring?

H.E.H.H.A.: The climate of violence that reigns in Iraq, with the increase in attacks, is of great concern to GCC countries and to the international community as a whole. And while we have no desire to interfere in Iraqi internal affairs, we fully support the Iraqi government’s efforts to achieve national entente, rebuild the country, and preserve a united Iraq.

Meetings are continually being held on these issues, such as the conference in Teheran on July 9th of this year. It brought together the foreign affairs ministers of countries neighboring Iraq, and was attended by Bahrain. All the conference participants confirmed their support for the Iraqi government’s efforts to foster reconciliation and national dialogue in Iraq. We also underscored the importance of working together, to bring stability and security to Iraq and to curb the terrorist acts that are cutting down the Iraqi people, places of worship, and foreign diplomats working in this country. In fact, a conference promoting reconciliation, sponsored by the Arab League, was supposed to be held in Iraq in June 2006, but had to be postponed because of the deteriorating security climate. We have expressed our desire to help Iraq over and over again. We also support the United Nation’s and the International Monetary Fund’s efforts to rebuild this country and foster the emergence of a stable and prosperous Iraq.

The media has already shown how the Iraq war has “boiled over”, reporting on the widespread demonstrations held in the Arab world, in Asia, and in various European capitals, where people have taken to the streets to voice their discontent.

I think that the main cause of these tensions is actually recent developments on the regional stage, which is dominated by the Israel-Arab conflict. This situation has been further aggravated by events in Iraq. These tensions nourish terrorism. After the attack on the residential compound in Riyad, Prime Minister Shaikh Khalifa bin Salman Al-Khalifa strongly condemned this attack, declaring that Bahrain supported the steps taken by Saudi Arabia to ensure its security. In December 2004, all the Gulf countries condemned terrorism, in all its forms, in the final declaration of the GCC Summit held in Kuwait. Terrorism has become a problem for the entire planet, to the point where cooperation against this threat is not only necessary, it is vital. In any case, we have always condemned terrorism, no matter what form it takes, and no matter where it strikes.

What’s more, the sharp rise in terrorist attacks over the past few years has called the security policy in this region into question. In 1986, the GCC made establishing a common defense one of its key objectives. The first Gulf war, with the invasion of Kuwait and the emergence of terrorist attacks, prompted us to further strengthen our cooperation and dialogue on security matters. But these events also spurred the countries of the region to start looking for other mechanisms, with the aim of laying out a new defense strategy. And so on 31 December 2000, at the 21st Summit of GCC Heads of State, the foundations for a common defense were laid out in Bahrain. The army remained a defensive army in the service of peace. A defense pact was approved, with the main objective of establishing effective mutual cooperation in the case of an attack from the outside on a GCC country. In another example, the 3rd meeting of the GCC Supreme Defense Council, held in Kuwait in October 2004, focused on the themes of security and the battle against terrorism.

Since the events of 11 September 2001, we have also been working closer with neighboring countries. We have held regular ministerial meetings, and exchanged information to help make our borders even safer. We are also trying to bolster cooperation between our judiciary branches and law enforcement agencies.

T.D.L.: The second Forum for the Future, the key venue for exchanging ideas within the G8 Broader Middle East and North Africa (BMENA) Partnership, was convened in Manama in November 2005. Does your country agree with the United States about the importance of democratizing the Middle East, in order to fight terrorism and foster regional development? What do you think of the election of a Hamas-led government in Palestine?

H.E.H.H.A.: As you know, the Forum for the Future is an outgrowth of the “Partnership for Progress and a Common Future with the Region of the Broader Middle East and North Africa”, or if you prefer, the “Broader Middle East” project. Despite the presence of the leaders of the region’s countries at the Sea Island Summit in June 2004, G-8 Heads of State and Government went ahead and approved this initiative. I think that their main concern was, first and foremost, fighting terrorism in the region and fostering its development.

The Forum for the Future is a vehicle for dialogue with very noble and ambitious objectives. However, the first two meetings, held in Morocco in December 2004 then in Manama in November 2005, did not meet the target objectives.

Democratization is a political process that seeks to set up a mode of government that is necessarily a positive step forward, in any part of the world. In a democracy, sovereignty is supposed to reside in the people, who hold sovereign power and express their will by voting. This requires holding free elections and giving the people the freedom to chose the leaders they desire, rights which have never been contested. Did not the sovereign people of Palestine, in free and transparent elections, democratically elect Hamas to lead them?

T.D.L.: Iran has been brought before the United Nations Security Council over its nuclear program, but the situation remains deadlocked. What is your take on the conflict between Teheran and the international community? Does this brewing crisis represent a serious risk to your country and the rest of the region? As Iran takes on ever greater geopolitical weight in the Gulf, is it time to start looking for a new security structure for the region?

H.E.H.H.A.: Our Kingdom’s foreign policy is, first and foremost, a policy of peace. This is true on both the regional and wider global stages. We are working to ensure the stability and security of this region, whether it concerns the Israeli-Palestinian conflict, or the situation in Iraq and right now in Lebanon. With regard to Iran, it is clear that this country carries great weight and importance in this region, in both the political and economic arenas as well as in terms of security. Our countries border each other. We are just as concerned as the other countries in the region about the nuclear issue.