US Embassy Muscat and Secretary of State Clinton respond to Wikileaks

The wikileaks story rages across the world over the weekend. While the New York times and other reputable international media companies (The Guardian, El Pais, Le Monde...) were given a preview of the whole dataset, we are only able to access them as they are released piecemeal by wikileaks (so far just 290 out of 251,287).

Unfortunately there were no new Muscat cables in the second or third wikileaks installments.

I also was amused that Iranian President Mahmoud Ahmadinejad is as annoyed as the Americans over the first round of leaks, and was forced to call the leaks a hoax & conspiracy by the US that's all directed at Iran, because all neighbouring contries like him and want him to be their bestest friend. Yeah. What a joker he is. Perhaps he read my earlier disclaimer that in this tinker tailor soldier spy vs spy situation, all sorts of things are possible. Is this defector really a defector, or a double agent? Is the information real, or planted disinformation, or a mix of both? Is Iran really funding Shia 5th columnists and developing nuclear weapons?

In this specific case, however, it seems clear that Iran has been pissing off a lot of the Gulf countries for some time, and everybody believes they have a covert programme ongoing to develop nuclear arms and associated delivery systems. Thus the cables show it has been the USA who has been the one holding back from aggressive military action, while Saudi, Bahrain, UAE, Egypt and Kuwait all have had enough of Iran's meddling in their internal affairs and urged the US to act, and act quickly. The Gulf States argument has been that because no amount of UN or US/EU sanctions and arm-twisting will ever divert the Iranians from nuking up, it's the lesser of 2 evils to strike them now rather than wait and let the Iranians stall long enough to get the bomb.

The Gulf Governments and their media have all been totally quiet about this aspect of the leaks so far, not surprisingly. I haven't seen any Oman specific stuff reported in Omani papers either, although Times of Oman did print the Reuters feed highlighting how Saudi Arabia was urging the US to attack.

So, with all this going on (and note this is just from the first 0.1% of cables released to date), Muscat Confidential asked the local US Embassy for their comment on the leaks.

Patricia Attkisson, new Public Affairs Officer at the United States Embassy Muscat, was kind enough to promptly sent me this official statement:

"Dear Dragon,

As a matter of policy the Department of State does not comment on materials, including classified documents, that may have been leaked. However, I can certainly state that our relationship with Oman will continue to be as strong as ever, based on mutual respect and common goals."

Fair enough. Patricia has only recently transferred from a previous stint in Jamaica, so a warm welcome to Oman Pat!

Her boss, America's Secretary of State Hillary Clinton couldn't get away with just that short a response with the press in Washington however, and made a comprehensive statement yesterday, which I thought I'd share. It's the longest 'no comment about something someone won't discuss' that I've seen for a while.


Photo: US Secretary of State Hillary Clinton, not commenting on or confirming what are alleged to be stolen State Department cables.

Secretary Clinton on Wikileaks
By Hillary Clinton

SECRETARY CLINTON: Well, good afternoon. Do we have enough room in here? I want to take a moment to discuss the recent news reports of classified documents that were illegally provided from United States Government computers. In my conversations with counterparts from around the world over the past few days, and in my meeting earlier today with Foreign Minister Davutoglu of Turkey, I have had very productive discussions on this issue.

The United States strongly condemns the illegal disclosure of classified information. It puts people's lives in danger, threatens our national security, and undermines our efforts to work with other countries to solve shared problems. This Administration is advancing a robust foreign policy that is focused on advancing America's national interests and leading the world in solving the most complex challenges of our time, from fixing the global economy, to thwarting international terrorism, to stopping the spread of catastrophic weapons, to advancing human rights and universal values. In every country and in every region of the world, we are working with partners to pursue these aims.

So let's be clear: this disclosure is not just an attack on America's foreign policy interests. It is an attack on the international community - the alliances and partnerships, the conversations and negotiations, that safeguard global security and advance economic prosperity.

I am confident that the partnerships that the Obama Administration has worked so hard to build will withstand this challenge. The President and I have made these partnerships a priority - and we are proud of the progress that they have helped achieve - and they will remain at the center of our efforts.

I will not comment on or confirm what are alleged to be stolen State Department cables. But I can say that the United States deeply regrets the disclosure of any information that was intended to be confidential, including private discussions between counterparts or our diplomats' personal assessments and observations. I want to make clear that our official foreign policy is not set through these messages, but here in Washington. Our policy is a matter of public record, as reflected in our statements and our actions around the world.

I would also add that to the American people and to our friends and partners, I want you to know that we are taking aggressive steps to hold responsible those who stole this information. I have directed that specific actions be taken at the State Department, in addition to new security safeguards at the Department of Defense and elsewhere to protect State Department information so that this kind of breach cannot and does not ever happen again.

Relations between governments aren't the only concern created by the publication of this material. U.S. diplomats meet with local human rights workers, journalists, religious leaders, and others outside of governments who offer their own candid insights. These conversations also depend on trust and confidence. For example, if an anti-corruption activist shares information about official misconduct, or a social worker passes along documentation of sexual violence, revealing that person's identity could have serious repercussions: imprisonment, torture, even death.

So whatever are the motives in disseminating these documents, it is clear that releasing them poses real risks to real people, and often to the very people who have dedicated their own lives to protecting others.

Now, I am aware that some may mistakenly applaud those responsible, so I want to set the record straight: There is nothing laudable about endangering innocent people, and there is nothing brave about sabotaging the peaceful relations between nations on which our common security depends.

There have been examples in history in which official conduct has been made public in the name of exposing wrongdoings or misdeeds. This is not one of those cases. In contrast, what is being put on display in this cache of documents is the fact that American diplomats are doing the work we expect them to do. They are helping identify and prevent conflicts before they start. They are working hard every day to solve serious practical problems - to secure dangerous materials, to fight international crime, to assist human rights defenders, to restore our alliances, to ensure global economic stability. This is the role that America plays in the world. This is the role our diplomats play in serving America. And it should make every one of us proud.

The work of our diplomats doesn't just benefit Americans, but also billions of others around the globe. In addition to endangering particular individuals, disclosures like these tear at the fabric of the proper function of responsible government.

People of good faith understand the need for sensitive diplomatic communications, both to protect the national interest and the global common interest. Every country, including the United States, must be able to have candid conversations about the people and nations with whom they deal. And every country, including the United States, must be able to have honest, private dialogue with other countries about issues of common concern. I know that diplomats around the world share this view - but this is not unique to diplomacy. In almost every profession - whether it's law or journalism, finance or medicine or academia or running a small business - people rely on confidential communications to do their jobs. We count on the space of trust that confidentiality provides. When someone breaches that trust, we are all worse off for it. And so despite some of the rhetoric we've heard these past few days, confidential communications do not run counter to the public interest. They are fundamental to our ability to serve the public interest.

In America, we welcome genuine debates about pressing questions of public policy. We have elections about them. That is one of the greatest strengths of our democracy. It is part of who we are and it is a priority for this Administration. But stealing confidential documents and then releasing them without regard for the consequences does not serve the public good, and it is not the way to engage in a healthy debate.

In the past few days, I have spoken with many of my counterparts around the world, and we have all agreed that we will continue to focus on the issues and tasks at hand. In that spirit, President Obama and I remain committed to productive cooperation with our partners as we seek to build a better, more prosperous world for all.

Thank you, and I'd be glad to take a few questions.

MR. CROWLEY: We'll begin with Charlie Wolfson of CBS in his last week here covering the State Department.

SECRETARY CLINTON: Where are you going, Charlie?

QUESTION: I'll (inaudible) into the sunset, but let me get to a question.

SECRETARY CLINTON: Yes, sir. (Laughter.)

QUESTION: Madam Secretary, are you embarrassed by these leaks personally, professionally? And what harm have the leaks done to the U.S. so far that you can determine from talking to your colleagues?

SECRETARY CLINTON: Well, Charlie, as I said in my statement, and based on the many conversations that I've had with my counterparts, I am confident that the partnerships and relationships that we have built in this Administration will withstand this challenge. The President and I have made these partnerships a priority, a real centerpiece of our foreign policy, and we're proud of the progress that we have made over the last 22 months.

Every single day, U.S. Government representatives from the entire government, not just from the State Department, engage with hundreds if not thousands of government representatives and members of civil society from around the world. They carry out the goals and the interests and the values of the United States. And it is imperative that we have candid reporting from those who are in the field working with their counterparts in order to inform our decision-making back here in Washington.

I can tell you that in my conversations, at least one of my counterparts said to me, "Well, don't worry about it. You should see what we say about you." (Laughter.) So I think that this is well understood in the diplomatic community as part of the give-and-take. And I would hope that we will be able to move beyond this and back to the business of working together on behalf of our common goals.

MR. CROWLEY: Kim Ghattas of BBC.

SECRETARY CLINTON: Kim.

QUESTION: Madam Secretary, I was wondering whether you could tell us what you think your upcoming trip is going to look like. Presumably, a lot of the people who have been mentioned in those alleged cables are going to have conversations with you. Do you think it's going to cause you discomfort over the coming week as you engage in conversations with those leaders?

And I know you don't want to comment on the particulars of the cables, but one issue that has been brought up into the daylight is the debate about Iran. What do you think the impact is going to be of those documents on the debate about Iran in the coming weeks and months?

SECRETARY CLINTON: Well, Kim, you're right. And I don't know if you're going on this trip or not, but we will be seeing dozens of my counterparts in Astana, and then as I go on from Kazakhstan to Kyrgyzstan and Uzbekistan and then ending up in Bahrain for the Manama dialogue. And I will continue the conversations that I have started with some in person and over the phone over the last days, and I will seek out others because I want personally to impress upon them the importance that I place on the kind of open, productive discussions that we have had to date and my intention to continue working closely with them.

Obviously, this is a matter of great concern, because we don't want anyone in any of the countries that could be affected by these alleged leaks here to have any doubts about our intentions and our about commitments. That's why I stressed in my remarks that policy is made in Washington. The President and I have been very clear about our goals and objectives in dealing with the full range of global challenges that we face. And we will continue to be so and we will continue to look for every opportunity to work with our friends and partners and allies around the world and to deal in a very clear-eyed way with those with whom we have differences, which of course brings me to Iran.

I think that it should not be a surprise to anyone that Iran is a source of great concern not only in the United States, that what comes through in every meeting that I have anywhere in the world is a concern about Iranian actions and intentions. So if anything, any of the comments that are being reported on allegedly from the cables confirm the fact that Iran poses a very serious threat in the eyes of many of her neighbors, and a serious concern far beyond her region.

That is why the international community came together to pass the strongest possible sanctions against Iran. It did not happen because the United States went out and said, "Please do this for us." It happened because countries, once they evaluated the evidence concerning Iran's actions and intentions, reached the same conclusion that the United States reached - that we must do whatever we can to muster the international community to take action to prevent Iran from becoming a nuclear weapons state.

So if anyone reading the stories about these alleged cables thinks carefully, what they will conclude is that the concern about Iran is well founded, widely shared, and will continue to be at the source of the policy that we pursue with likeminded nations to try to prevent Iran from acquiring nuclear weapons.

MR. CROWLEY: We've got to let the Secretary get to her airplane and get to her trip. Thank you very much.

SECRETARY CLINTON: I will leave you in P.J.'s very good hands. Thank you.

QUESTION: Madam Secretary, did you talk to anyone in Pakistan or India?

SECRETARY CLINTON: Thank you all.

QUESTION: Thank you, Madam. (Inaudible)

Wikileaks: It begins. Report of an interview with HM.

I guess it's like that old phrase of advice to anyone interacting with the media - "always treat every mike as live". It's now applicable to professional diplomats too - "remember that cable/discussion/meeting may be leaked to the public someday..."

For those living in the proverbial cave these past weeks, infamous internet site Wikileaks has finally started to publish its vast silo of leaked US State Department cables (around 250,000 in total). The largest release of confidential government information EVER. Please google it to get the background.

I'll leave it to others way more talented than I to debate the main issues, as they are indeed historic, earth shaking, world changing, unprecedented, shocking, etc, etc. Although I'd note that I think wikileaks has it wrong when they say:

Wikileaks began on Sunday November 28th publishing 251,287 leaked United States embassy cables, the largest set of confidential documents ever to be released into the public domain. The documents will give people around the world an unprecedented insight into US Government foreign activities.

The cables, which date from 1966 up until the end of February this year, contain confidential communications between 274 embassies in countries throughout the world and the State Department in Washington DC. 15,652 of the cables are classified Secret.

The embassy cables will be released in stages over the next few months. The subject matter of these cables is of such importance, and the geographical spread so broad, that to do otherwise would not do this material justice.

The cables show the extent of US spying on its allies and the UN; turning a blind eye to corruption and human rights abuse in "client states"; backroom deals with supposedly neutral countries; lobbying for US corporations; and the measures US diplomats take to advance those who have access to them.

This document release reveals the contradictions between the US’s public persona and what it says behind closed doors – and shows that if citizens in a democracy want their governments to reflect their wishes, they should ask to see what’s going on behind the scenes.
...

This uber-leak is NOT so much about such details as 'the extent of US spying on its allies and the UN'. All the US's allies already knew the US spies on them, and that in return by spying on the US that the US knew about that too.

The big impact (at least outside the US State Dept) is going to be much more about the leaking of the global international diplomatic equivalent of confidential gossip: i.e. such gems as what KSA's King Abdullah thinks of the Pakistan President*:

President King Abdullah firmly believes that Asif Zardari is the primary obstacle to the government's ability to move unequivocally to end terrorist safe havens there ("when the head is rotten, it affects the whole body").

So, what about Oman? I hear you ask.

Well readers, there will eventually be around 1000 cables from Oman's American Embassy released, but as of today there are just 3: here, here, and here. I'll be super interested on how Omantel and the government treat these wikileaks. Apparently Australia has blocked them already, so let me know if the same happens there!

In all of them Oman comes out of it really well: US assessments of Omani senior Government officials as super competent; Oman urging non-military solutions to Iran; HM encouraging improvement of Oman's Government's responsiveness to its citizenry; HM making explicit efforts to strengthen the role of women in Omani society; Oman supportive of the US in its effective Pax Americana in the Gulf region... and that's just from 3 cables.

This is information overload already readers. (EG IMHO, Sh. Maktoum comes across as a lightweight.)

So here is my pick of the three, fresh of the wire. Having never been honoured with a meeting with HM, much as I would wish for it, this is ... precious to me. A report of a meeting from March 2008 between HM, US Admiral Fallon and the US Ambassador to Oman. Enjoy. Its almost like you're there. There will hopefully be a lot more to come. Please note my disclaimer at the end of this post.

Photo: US Admiral Fallon.

S E C R E T
...
SUBJECT: ADMIRAL WILLIAM J. FALLON'S MEETING WITH SULTAN
QABOOS

Classified By: Ambassador Gary A. Grappo for Reasons 1.4 (b, d)

-------
SUMMARY
-------

¶1. (C) Sultan Qaboos discussed both domestic and regional
issues during his February 19 meeting with Admiral William J.
Fallon, CENTCOM Commander. On the domestic front, the Sultan
described his desire to empower the government to be more
responsive to citizen concerns. Seeking to strengthen the
role of Omani women, the Sultan plans to convene a conference
in 2009 designed to increase the participation and leadership
of women in all aspects of Omani society. Sultan Qaboos also
shared plans for continued infrastructure development in Oman
and described efforts underway to obtain more natural gas.
On Iraq, the Sultan advised against a premature withdrawal of
U.S. forces and stated that more regional assistance would be
forthcoming if Iraqis would "come together" to take charge
of, and invest in, their own country. Sultan Qaboos shared
U.S. concerns about Iranian meddling in Iraq and elsewhere,
but contended that Tehran knew confrontation with the U.S.
was not in its interest. Iran's "charm offensive" in the GCC
had succeeded in lessening suspicions of some officials about
the true intentions of Iranian policies. End Summary.

¶2. (C) CENTCOM Commander Admiral Fallon, accompanied by the
Ambassador, met February 19 with Sultan Qaboos bin Sa'id for
approximately 2 hours at one of the Sultan's castles -- Husn
al Shumugh -- in the interior of Oman. (Note: The Sultan
was outside of Muscat on his annual 4-6 week "meet the people
tour" during which he visits selected sites outside the
capital. End Note.) The Sultan appeared in good health and
was cheerful, although he commented that his role as ruler of
Oman was demanding and did not allow him time to do all the
things he wanted to do, such as reading more books. "My
office is wherever I am," he stated, noting that he
constantly had to attend to paperwork and urgent requests
from his staff, among other tasks. The Sultan added that
despite his busy schedule, he always made time to "watch the
news," though he did not elaborate on his preferred media
outlet.

-------------------
CONCERNS ABOUT IRAQ
-------------------

¶3. (C) The Sultan expressed concern over a premature
withdrawal of U.S. forces from Iraq. Recognizing recent
improvements in the security situation, he counseled that
American troops should only leave "when the time is right."
He stressed that Iraqis had to "take charge" of the fate of
their country, but questioned whether the different factions
would be able to "come together" to accomplish this. He
pointedly asked the Admiral, "Do you really think Prime
Minister Maliki and his government are capable of pulling the
country together?" The Sultan did not directly respond to
Admiral Fallon's comment on the need for assistance and
investment for Iraq from elsewhere in the region. Instead,
he stated that if the Iraqi people helped themselves and
invested in their own country, others would follow suit.

¶4. (C) The Sultan appeared to follow events in Iraq closely.
He commented, for example, that the Kurds had apparently
"come out well" in recent central government talks on budget
issues, and asked about the status of electricity production
in Iraq. The Sultan seemed to take a particular interest in
Admiral Fallon's discussion of Iraqi Shia leader Abdul Aziz
al-Hakim, including the status of Hakim's health and his
possible successors.

--------------------------
INFRASTRUCTURE DEVELOPMENT
--------------------------

¶5. (C) In addition to emphasizing the need for outside
investment in Iraq, Admiral Fallon highlighted the importance
of assistance from regional states for infrastructure
development in Afghanistan and other Central Asian nations.
Again the Sultan sidestepped the issue and shifted the
conversation to the critical role of roads and highways in
economic development. He then mentioned infrastructure
projects for Oman currently under consideration, including
construction of a new dam and a freight rail line from the
northern port of Sohar to the planned port in Duqm. The
Sultan hoped that the southern port of Salalah could be
linked by rail to Muscat and, eventually, to other GCC
states.

--------------
IRANIAN ISSUES
--------------

¶6. (C) The Sultan commented that the Iranians are "not
fools," and claimed that Tehran realized there are "certain
lines it cannot cross" (i.e., direct confrontation with the
U.S.). Regarding GCC relations with the Iranian government,
he stated, "Iran is a big country with muscles and we must
deal with it." He continued that Iran's "charm offensive" in
the region had achieved a degree of success as some GCC
authorities (he did not mention names) were now less
suspicious of Iranian intentions. The Sultan added,
laughing, that "I must say that as long as (the U.S.) is on
the horizon, we have nothing to fear."

¶7. (C) Responding to Admiral Fallon's frustration with
Iranian interference in Iraq, the Sultan remarked that
Iranian meddling abroad was "almost a game" to the regime in
Tehran, and said that Iran's leaders would have to stop this
practice if Iran wanted to "join the world as a noble
country." The Sultan hoped that Iraqi leaders would clearly
tell and convince Iranian President Ahmadinejad during his
upcoming visit to Iraq to cease Iran's unhelpful interference
in their internal affairs. On the possibility that Iran is
waiting out the President's final term before re-assessing
its strategy, the Sultan said that Tehran should realize that
it has to deal with the U.S. as a country, and not just the
current administration.

------------------
THE SEARCH FOR GAS
------------------

¶8. (C) After noting Iranian dependence on imports of refined
fuel, the Sultan described Oman's efforts to obtain more
natural gas to fuel growing domestic power needs and
large-scale industrial projects. Oman had committed too much
of its limited gas production to long-term liquefied natural
gas (LNG) export contracts. As a result, the government was
trying to boost production by taking smaller and less
productive gas fields away from Petroleum Development Oman
(PDO) -- 60% owned by the government and 34% owned by Royal
Dutch Shell -- and awarding them to outside companies such as
British Gas and BP. The Sultan claimed these firms were in a
better position to increase productivity in these fields, and
pointed to the progress of U.S.-based Occidental Petroleum
Company in raising oil production in former PDO concession
areas, such as Mukhaizna.

¶9. (C) Looking offshore, the Sultan said he hoped that new
gas fields would be found in the Gulf of Oman to help ease
the country's natural gas shortage. India's Reliance
Industries was currently exploring a deepwater oil and gas
block in this body of water, but had made no significant
discoveries yet. Qatar would begin supplying gas to Oman by
2013, the Sultan noted, but not in quantities sufficient to
meet outstanding needs. He added that Oman was still
supplying limited gas from Musandam to Ras al-Khaimah in the
UAE due to an agreement he made with its emir -- and which
the Sultan felt he could not break -- well before Oman was
squeezed for this resource.

---------------------------
THE IMPORTANCE OF EDUCATION
---------------------------

¶10. (C) Sultan Qaboos shared that he placed a great deal of
importance on education, and noted that a study of history
provided the context needed to better understand present
trends and events. Regarding claims that some rulers in the
region wanted to keep their people uneducated in order to
more easily control them, the Sultan explained that this
strategy could easily backfire as it also left the populace
more susceptible to influence by extremists, such as the
Muslim Brotherhood. Former Egyptian president and
pan-Arabist leader Gamal Abdal Nasser, the Sultan said, had
"set the region back" by being "anti-everything" and engaging
in vitriolic rhetoric designed to keep the masses ignorant.

-----------------------------------
EMPOWERING THE GOVERNMENT AND WOMEN
-----------------------------------

¶11. (C) On domestic politics, the Sultan announced that he
would hold the first-ever combined meeting of his Cabinet of
Ministers and the Majlis al-Shura (the directly elected lower
house of Oman's bicameral advisory body) on February 26. By
meeting together, the Sultan hoped that the Cabinet and the
Majlis would learn how to cooperate better and jointly focus
on important issues. He commented that both bodies also
needed to "demonstrate more leadership" and avoid past
foot-dragging on promises made to the populace. "People need
to see the results of decisions," the Sultan stated.

¶12. (C) Letting Admiral Fallon and the Ambassador in on a
"secret," the Sultan confided that he planned to call for a
conference of all "notable women" in Oman in 2009 in a bid to
encourage Omani women to expand their participation and
leadership in different aspects of Omani society. Minister
of Social Development, Dr. Sharifa bint Khalfan al-Yahyaiya
(one of Oman's three female cabinet ministers) will chair the
meeting on the Sultan's behalf. Lamenting that no women won
seats in the October 2007 election for the Majlis al-Shura,
Sultan Qaboos observed that Omani women were stuck in
tradition and needed to be empowered to "take more charge"
and to be "less shy." "Some customs (regarding women)," he
added, "shouldn't be kept." Nevertheless, gradual change is
occurring in Oman, the Sultan asserted. His philosophy was
to "let it happen," rather than hold it up to public debate,
as the latter course of action often led to factional
fighting, internal strife, and other ills.

---------------------------------------------
A RECURRENT THEME: MORE RESPONSIVE GOVERNMENT
---------------------------------------------

¶13. (C) In concluding the meeting, Sultan Qaboos returned to
his goal of improving the responsiveness of the Omani
government to citizen concerns. He stated that he would be
pressing "harder" on his ministers to engage in more and
better public relations efforts before the Omani police and
to effectively enforce their decisions so that the people
could see the benefits of announced actions. Giving one
particular example, the Sultan said that rather than simply
announce a new development project, the government should
explain the downstream employment opportunities the project
would generate for Omani citizens. Effective cooperation
between ministries and the Majlis Oman was also needed to
strengthen the civil institutional framework in Oman, the
Sultan added.

-------
COMMENT
-------

¶14. (S/NF) In discussing his desire for operational change
in the senior government ranks, the Sultan twice implied (but
did not directly state) that such change was needed to
prepare the country for his eventual departure from power.
The Sultan's comments indicated that he may feel the
government is too dependent on his authority and should be
empowered to run more effectively without constant direction
from the palace. End Comment.

¶15. (U) This message has been reviewed by Admiral Fallon.
GRAPPO

Wow.

I can't wait for more. HM totally rocks.


DISCLAIMER: * or more accurately "what wikileaks and their anonymous source purports to be what those representatives from the US State department chose to commit formally in writing (and after editing and review) to the US Secretary of State about what King Abdullah was perceived by them via a translator to have probably said, or inferred, to them about what his (King Abdullah's) opinions were on the Pakistani President, in an unstated context, and when knowingly shared by the King with official representatives of the US State Department in a non-121 meeting attended by other persons". Gedit? Caveat Emptor indeed. In this world, some (or most) of these cables may be official unoffical propaganda/black intel, from almost anyone. It's just the internet after all. So readers are advised that all this is for entertainment value only. Treat it as a novel. For god's sake don't go off and do anything real based on these digital bits and bytes. And that advice applies to professionals and amateurs alike!

Omantel continue to lose big money for Omanis on shady WorldCall Pakistan deal

It was always a suspicious deal even before the recent recession appeared to be a convenient fall guy, but Omantel continue to throw good money after bad on the strange company they bought in Pakistan called WorldCall. They now are asking to effectively loan the company $70 million to do things that include 'restructuring debts'.

I blogged about what a loser this company seemed to be way back in 2007 here when the deal was done. I suspect it's no co-incidence that then CEO of Omantel, Mohammed bin Ali Al-Wahaibi, was subsequently replaced by the Government, after he resigned "for personal reasons". The current CEO is a smart young technocrat Dr. Amer bin Awadh Al-Rawas.

Now Omantel are looking for shareholder approval at yet another extraordinary general meeting to effectively loan the apparently useless company a whopping US$70 million: see the story in Reuters. The company was not able to borrow money on its own, never a good sign.

Remember the public company paid a whopping 25PKR per share for the majority stake - strangely enough, to a well connected Omani Businessman, one Sheikh Sulieman Ahmad Said Al-Hoqani, who must be credited with making a very, very cunning sale for close to $200 million - shares of which are now trading at around 2.5PKR per share, about a 95% loss for Omantel shareholders taking exchange rates into account. (Omantel threw more money at the useless company in 2009 too).

As the report read:

Omantel seeking shareholder approval for Worldcall

DUBAI | Wed Nov 10, 2010 3:07am EST
Nov 10 (Reuters) - Oman Telecommunications Co. OTL.OM (Omantel) will seek shareholder approval to serve as a guarantor to obtain funding for struggling Pakistani unit Worldcall (WCTL.KA), the company said on Wednesday.

Worldcall has requested $70 million in funding for capital expenditure and meet liabilities but was unable to independently obtain the required financing, Omantel said in a statement.

Omantel's board of directors will raise the issue of stepping in as a guarantor to obtain the financing at a planned extraordinary general meeting.

Omantel took a 56.8 percent stake in Pakistani diversified telecom operator Worldcall in 2008 as part of its strategy for international expansion. The $193 million deal marks its biggest foreign investment so far.

But the subsidiary came under pressure due to the global financial crisis and price wars that weighed on margins.

In 2009, Omantel sought to inject $50 million into the struggling unit.

Last week, Omantel reported third-quarter profit declined 33 percent, falling short of analysts' estimates, as expenses rose. (Reporting by Shaheen Pasha; Editing by Amran Abocar)

As far as I'm aware, no-one has questioned the board on this strange acquisition or the inflated price paid for it, nor the arrangements of the financing of the cash they've subsequently poured in. And I guess as long as Omantel can continue to exert pseudo-monopoly power over telecoms charges in Oman, the shareholders seem willing to stay for the ride, subsidised by the everyday people and businesses of Oman.

Sheikh Sulieman Ahmad Said Al-Hoqani was also on the Board of Directors for Oman Air, BTW, until he was replaced in 2007.

Photo: Omani businessman Sheikh Sulieman Ahmad Said Al-Hoqani, circa 2004.

Interested readers may wish to see for themselves the intricate network of companies associated with Sh. Al Hoqani and his associates via here, but be warned, it's a bit of a rabbit hole.

Omantel does seem to have an awful lot of extraordinary general meetings...

I wonder if anyone has looked into who WorldCall owes all that debt to?

Problems continue at Zubair's Barr Al Jissah resort villas

Just a quick update on the problems facing buyers of the hyper-expensive villas and town houses at Zubair corperation's Bar Al Jissa development. I posted in detail last year here.

The owners are still furious with the poor state of construction and finishing on their apartments. In fact, one owner has just taken them to court in Oman for breach of contract, and the judge agreed to hear the case. At the second hearing on October 30th, he gave Zubair 6 months to prepare their defence and to get a report from a court appointed expert. It will be very interesting to see how this turns out.

Comments made by various owners:

"...the foolishness and arrogance of one misguided Omani family..."

"...BAJ nightmare."

"...we all expected that the good reputation of the Zubairs was worth something. How wrong we were."

"The growing list of serious construction problems besetting our small settlement is both astonishing and terrifying: terrifying for the level of seriousness and danger; astonishing for the amount of money we have all put forward for something that is completely devoid of construction quality. Lack of water, electrical problems, water pouring from rooftops through townhouses in a not very serious storm, sinkholes, cracking concrete are all serious problems and some are life-threatening."

"...It is obvious that the Zubairs have taken our property investment, spent around 10% of it on our properties, and pocketed the remaining 90%."

Photo: Chairman of Zubair Corp, Rashad M. Al Zubair, the man responsible for the mess at Barr Al Jissah Residences.


So what's the problem?

Well, these town house apartments were very expensive, selling for US$1.2-$1.5 million, and represented by Zubair as top of the range luxury buldings. In fact, to quote Barr Al Jissah residences OTT website blurb:

"Oman presents Barr Al Jissah Residences, the most exclusive and luxurious freehold property's in the Gulf.

Exceptionally designed villas and townhouses, built to the highest standards and specifications to give the most discerning and concientious purchaser, the best lifestyle imaginable."

"Developer: The Zubair Corporation.
The Barr Al Jissah Residences is being undertaken by Barr Al Jissah Resort Company SAOC which is owned by The Zubair Corporation and the Government of the Sultanate of Oman, represented by the Ministry of Finance."

In reality, the buildings were constructed like any other such buildings in Oman - by cheap Indian labour via infamous Zubair contractors Bodge-it and Leggit Larsen & Toubro with, it appears, every effort made by Zubair and their contractors to use the cheapest materials and fittings available. Even so, completion of the buildings was delayed by almost a year.

Here's a recent incident by an unfortunate buyer shared by email to other owners (emphasis is mine):

...Two days ago the socket in the garage where the dryer is connected caught fire. The socket and the dryer plug burned and melted. Puzzlingly the corresponding trip switch on the electric switch board did not trip – which would have prevented the fire.

Today we replaced the dryer plug and used another socket in the garage. About 10 minutes later the same happened: the plug caught fire and both the plug and the socket melted.

This is a very serious issue because it is very obvious that there is a design and/or construction flaw as in a case like this the corresponding switch on the switchboard should trip preventing any fire to take place. Upon asking some of the neighbors they have told me that in several villas these sockets and parts of the electric wiring, switches were replaced due to being below specifications and quality requirement. I am baffled by the fact that if this problem is known, why are all the villas not being notified and why are the necessary repairs not being done in order to prevent a potentially more serious incident???

In another incident about two months ago the second floor main switch tripped without any of the individual switches tripping. At that time I told [xxxx] my non-professional, non-qualified opinion, that there must be a design problem (maybe the total electricity load capacity of the first floor switchboard in not in line with the actual amount of electricity going through that switchboard). Again, about two weeks after I called [xxxx], two Indians came and said that everything is okay…

So, bottom line is that an Omani Government sponsored development is promising 5 star and delivering 1 star. And despite the Zubair Corporation taking everyone's money (both for purchase and very expensive maintenance fees), they are failing to fix serious problems and ignoring the valid complaints of owners that what was promised has in no shape or form been delivered.

The owners are hoping that a direct appeal to HM will help.

Again, why is it that nothing gets done in this country by those actually tasked with doing their jobs? IE The Government officials responsible for standards, the giant companies who are being allowed to take people's money and rip them off? HM has better things to do!

The answer is that too many people in Oman are focused on short-term quick bucks for no effort, rather than thinking about the long term reputational issues or even simply respecting international standards and contracts. Too many Government officials are typically both professionally incompetent and inexperienced, and in fear of annoying some big shot with wasta (like the Zubair family).

And in this case, the Government are also directly involved, providing a veneer of official endorsement for these developers, and also provided the land for Zubair in the first place.

Note, the unanswered complaints, leaks, electrical faults, legal action and damage to Oman's tourism and investment reputation doesn't stop Zubair claiming the following on their corporate website:

The Zubair Corporation is a well-established leader in this sector, having initiated the first travel agency over thirty decades ago, recently establishing hotels throughout the region and building the first major resort in Oman. The Corporation is considered a flagship for private investment in tourism, and its commitment and success have set a precedent for further development, proving that investing in this sector is economically viable.

What a joke.

The new Chairman of Zubair Corp, Rashad M. Al Zubair, as "the next generation of the Zubair family to assume the mantle of leadership", should get off his father's laurels, get a grip on his company, and start placing a higher priority on the impact he is having on this country's international reputation. In his statement on the website he raves on and on about "fulfilling His Majesty’s vision".

His father HE Mohammad Al Zubair didn't build a great company through such underhanded and unprofessional business practices.

Omani Spy-gate: Multiple Omanis arrested for spying for Abu Dhabi??

Yes, talk of the town is the case of the Duqm spy ring.

It seems around 15 (or 17 or 19 or...) Omani nationals were busted a couple of weeks ago, apparently for operating as spies for the Abu Dhabi crown price's outfit.

Why?

Well, Oman's Government, led by the Ministry of Finance, is investing heavily in a new industrial mega-port complex in Duqm, a previously sleepy coastal town in the middle of nowhere between Muscat and Salalah.



This is also where the technocrats wanted to put a huge coal fired power station (there is no coal in Oman to speak of, BTW). The Omanis have (cunningly) secured the partnership of the port of Antwerp, a really really big mega-port in Belgium, who will be able to bring a whole heap of expetise in the port business to Oman.

As part of that complex, the obvious play for Oman was to add a 'free trade port facility', where goods can be shipped in and out without significant duty or paperwork. The goods can be processed too, and 'value added'. It seems the Abu Dhabi crowd were concerned that the strategic location of the port* would impact the outlook for the UAE's planed free trade zone in Abu Dhabi, and indeed were concerned about the impact on the existing Jebal Ali Free Trade port in Dubai [note: now also effectively owned by Abu Dhabi, post Dubai-meltdown].

So it seems the foreign intelligence arm of the Abu Dhabi Royal family had managed to bribe several Omanis to betray their country and provide intel on the goings on in Duqm. They got caught, in a pretty impressive victory for Omani intelligence.



It's not in the papers.

Why all the talk about such a secret situation, you may ask. The word is the UAE, as a demonstration of their petulance, have blockaded all pork shipments from the UAE to Oman. This is why there is a drastic shortage of nice American and other land imported pork product in Oman right now.

Did you notice? No pork folks. The Oscar Myer ship is not trapped at sea, but her cargo is apparently stuck at the border. A Bacon blockade. Swine sanctions.


Porcine Petulance, if you will. Why retaliate with a bacon ban? I have no idea. The UAE has always been insane, so, why not? Maybe it's difficult for Oman to complain about it?

Despite this side effect, Well done ISS.


*The Duqm port is on the Indian Ocean, close to all major E African/Indian trade routes, and OUTSIDE the straights of Hormuz and the confines of Gulf. A free trade zone would attract Indian, Pakistani, and most critically Iranian business, aided and abetted by the Chinese and the Koreans. Closer to the rest of the world, safer and cheaper wrt fuel and labour, this could have a serious impact on the UAE ports.

Oman tops UN list as 'Most Improved Country'

Hey, congrats Oman. The UN just listed The Sultanate as the world's most improved country over the past 40 years. Just in time for the 40 year celebration too.

Oman most-improved nation in last 40 years, UN index says.
The country that has made the most strides in the past 40 years, particularly education, is a small Middle Eastern nation of just three million people: Oman. This is followed by China, Nepal, Indonesia and Saudi Arabia.

This isn't a surprise: 40 years ago, Oman was still effectively in the dark ages, with no infrastructure and a country locked into a life of subsistence fishing and goat herding. Most people were extremely improverished.

Then HM took over, and Oman's renaissance began.

So, well done HM.


Meanwhile, I see we are keeping up our policy of population control via the fatal accident rate.

4 more killed 
in Oman 
road accident

5 November 2010 MUSCAT — It was another day of tragedy on Oman’s roads on Wednesday with four people killed in a terrible accident in the wilayat of Barka.

The mishap, that also seriously injured six others, occurred when the driver of a speeding three-tonne pick-up heading to Muscat from the Batinah region lost control of the vehicle after one of its tyres burst, police said.

It turned over and landed on the other side of the dual carriageway, colliding with four cars coming from the opposite direction. The four deceased were travelling in the cars; two of them died instantly, while the other two victims succumbed to their injuries later.

The incident, which happened around 7pm, held up traffic on the highway for several hours.

On Tuesday, three youngsters riding motorcycles, died in two separate accidents in Amerat in the capital and Sohar in the Batinah region. The victims in Amerat were two teenagers, aged 15 and 19. They were killed when their bike was hit by a vehicle, one of them dying on the spot and the other in hospital.

In the Sohar incident, the victim, a 21-year-old man, was killed when his motorcycle collided with another vehicle.