Saturday, January 31, 2009

Muscat Festival, Fate of Ex-Head Muscat Municipality's Shatti Building

News remains quite quiet.

Muscat Festival rages, with great free fireworks if you have access to a hillside house in Qurm. For those new to Muscat, I'd advise going at least once. It's a true Omani cultural experience.

Lots of nice comments on the Blue City post. (Love the gratuitous plug Muscati, good luck with that!!! Me too!!!)...

I think in the end we are just going to have to wait a few months and see what movement occurs in the many and varied Oman real estate projects.

Common sense dictates that ANY such real estate project must, wherever it can, pause and take a seriously deep breath right now, no matter how healthy the original business model was. If a big or essential contract is underway, of course you'll let it keep running, but give the invoices and payment milestones extra scrutiny!

Look at all your contracts, update business plans, and most especially have another look at those worst case cashflow projections. Security of senior management golden parachute clauses may be considered too. I'm glad I'm not a contractor in this situation. A contractor now is faced with 2 choices: either perform and risk getting stiffed for far more than you are in the hole already, or don't perform and be held in breach and get definitely stiffed for what you are already in the hole for.

Now, everyone will look at a host of considerations for profit maximization, or loss minimisation... and a lot of land, sunk cost, equity, debt, and cashflow is up in the air. You'd want a very understanding and liquid banker right now. Oh, and limited liability.

Keep the rumours and news coming. I'd take a place in Muscat Hills. And a really cheap foreclosure at the Wave. And many of the small, central, apartment projects should be fine longer term, and should progress now, as they get local funding.

Real estate Deals elsewhere...
Update also on the much talked about everywhere but in the press new office building in Shatti, built by ex-head of Muscat Municipality His Excellency Eng. Abbas. Its a building well known for being unusually high compared to the previous surrounding buildings, including the Hyatt, whose view it did rather taint. Oh, and allegedly built on land originally designated as public park.

My good friend in the Diwan told me that. as it happened, the ex-Chairman had an urge of charity not un-coincidentally around the time of his move to his new role as advisor in the Diwan (dept of Royal Court Affairs), and the building has actually been kindly donated to the Ministry of Religious Affairs, tenants included. A wonderful charitable gesture.

Rumours of it's demolition, a-la mode of another building near the airport owned by someone else who recently departed government office, are (obviously) totally unfounded.

Thursday, January 29, 2009

the inevitable happens: Blue City's highest rated bonds downgraded to Junk

News just breaking that, surprise surprise, Blue City's bonds have been downgraded by the Fitch Rating agency.

The commentary seems pretty balanced and, well, true. Blue City have been slow, and that slowness cost them big time as it meant they didn't have stuff to sell in the hey-days of real estate in the GCC. Now, it's a little late.

Plus they have missed by a huge margin the covenants they made on sales. Collections (ie, the cash they've taken in from people via pre-construction sales) at the last interest payment date on 7 November 2008 were just $35 million, versus the original target of $165m. Cash take even failed Blue City management's re-revised target of $49m.

Ratings are deliberately obscure: BBB and above is investment grade, which means pension funds and banks can hold them. As usual, Blue City's borrowing was split into tranches will different claim on the assets and income, thus allowing BC to have a subset (just less than 30% of the $925 million they borrowed) of their bonds classify as investment grade 'BBB' by being entitled to first call on the cash. Even when issued, the remaining 70% of the borrowed money was junk. Now it all is.

More critically, if Blue City fail to raise $455 million in sales by 7 November this year, they are obliged to repay all the debt. Ooops. Sounds like insolvency looming to me.

As a result of this Blue City are desperately trying to renegotiate the terms of the loans. Meanwhile, Bank of New York Mellon - who I think hold the cash in escrow - have (I'm told by my sources within BCC1) not released any money to Blue City for the last 2 months. So no contractors are being paid, Bovis (the project manager) have walked out in disgust (previously reported here), the shareholders are still in court, and no-one in their right mind is buying property off plan in the GCC...

Perhaps a friendly Bulgarian Bank could be convinced to throw a big loan to Blue City's well connected Cyclone shareholders?

At least the construction of the hotel has started. But it won't help the way Omani bonds are seen in the market, especially if they miss payments.

Meanwhile, Al Sawadi Investments and Blue City management continue to be very well paid even though they seem to have a policy of stiffing their contractors.

So that's alright then.

BTW, Fitch's ratings are as follows:
Investment grade
* AAA : the best quality companies, reliable and stable
* AA : quality companies, a bit higher risk than AAA
* A : economic situation can affect finance
* BBB : medium class companies, which are satisfactory at the moment

Non-investment grade (also known as junk bonds)
* BB : more prone to changes in the economy
* B : financial situation varies noticeably
* CCC : currently vulnerable and dependent on favorable economic conditions to meet its commitments
* CC : highly vulnerable, very speculative bonds
* C : highly vulnerable, perhaps in bankruptcy or in arrears but still continuing to pay out on obligations
* D : has defaulted on obligations and Fitch believes that it will generally default on most or all obligations

PRESS RELEASE: Fitch Downgrades Blue City Invest 1 Ltd Notes
Thursday January 29th, 2009 / 13h22
Fitch Ratings-London-29 January 2009:

Fitch Ratings has today downgraded the A3, B1, C and D class notes of Blue City Investments 1 Ltd (BCC1) as detailed below. All the classes remain on Rating Watch Negative (RWN).USD262.5m class A3 (XS0267260346): downgraded to 'B+' from 'BBB-' (BBB minus); RWN USD143m class B1 (XS0259701018): downgraded to 'B-' (B minus) from 'BB'; RWN USD50.5m class C (XS0272445726): downgraded to 'B-' (B minus) from 'BB'; RWN USD70m class D (XS0273296243): downgraded to 'B-' (B minus) from 'BB'; RWN

The transaction is a securitisation of a USD925m financing package for the development of an upmarket residential, hotel and leisure resort on the Indian Ocean coast at Al Sawadi, located 90km to the west of Muscat, the capital of The Sultanate of Oman.
Fitch initially placed the notes on RWN on 4th July 2008 on the basis of poor sales performance and due to concerns relating to a legal dispute between the development's shareholders. While BCC1's new management successfully implemented operational and organisational improvements and introduced a more clearly focused marketing and sales strategy, the transaction continues to under-perform and the shareholder dispute remains unresolved. The project will also be challenged by the highly uncertain near term outlook for Oman's integrated tourism resort (ITR) market because of the global economic slowdown and the recent and rapid softening of the economy within the Gulf Cooperation Council (GCC) region.

The project has failed all of the documentation's Residential Sales Tests tested to date. Collections at the last interest payment date (IPD) on 7 November 2008 stood at USD35.0m versus the Residential Sales Test 1's target collection level of USD165.0m. Collections also fell substantially short of BCC1's revised forecast of USD49.0m.

The shortfall between actual collections and target collections as per the documentation's sales tests is largely attributable to three reasons: first, sales commenced significantly later than initially envisaged, and construction progress also suffered delays, due to changes to the master plan following the transaction's closing in November 2006; second, the actual payment plan for purchase price instalments under the project's residential sales contracts is linked to construction progress milestones, whereas the payment plan structure assumed by the documentation is linked only to a time schedule that was determined at closing and did not anticipate delays in the commencement of sales or construction; third, the Al Murjan section, which was forecast to generate sales of 800 units during 2008, proved unmarketable due to shortcomings in its design concept, forcing BCC1 to redesign this section and leaving it without any new product to sell for most of 2008.

As a result of the delayed launch of units to the market and slow sales progress to date, the project missed out on a period of strong growth in the GCC's real estate sector that the development was intended to take full advantage of. The GCC real estate boom came to an end in late 2008 and while the decline in prices and transaction volumes in Oman's ITR market is, due to its small size, more difficult to assess and quantify compared with the more transparent markets of Dubai and Abu Dhabi, the near-term outlook is negative and uncertain, undermining the confidence of both purchasers and developers. The agency understands that all the ITRs within the greater Muscat area on which construction has not commenced were temporarily put on hold by developers in late 2008.

Even if sales progress over the next two quarters is in line with BCC1's current expectations, the transaction will fail Residential Sales Test 5 on the 7 November 2009 IPD, which calls for USD455.0m of aggregate collections, triggering the immediate acceleration and mandatory repayment of all outstanding debt.

The agency understands that BCC1 is seeking to restructure the transaction via far-reaching amendments to the documents and will shortly be submitting its proposal to the issuer note and security trustee, The Bank of New York Mellon ('AA-'((AA minus))/'F1+'). BCC1 has informed the agency on an informal basis that the proposal will likely include changes to the Residential Sales Tests and Capex Tests, the launch and construction schedule of the project's different sub-sections, the payment schedule under the construction contract and the final legal maturity date of the notes in an attempt to avoid an acceleration of the debt and provide the borrower with a greater level of flexibility to respond to the changed market environment. Fitch intends to resolve its Rating Watch as more information about the proposed restructuring becomes available.

Regardless of the scope and effect of any amendments to the documentation, the agency nonetheless believes that BCC1 may face liquidity constraints and require an equity injection in the future, depending on future sales and collections volumes and the extent to which payments under the construction contract can be further back-loaded.

Following initial delays after the re-design of the masterplan, the laying of foundations of the first hotel began on 20 January 2009 and foundation works are scheduled to begin on the Al Naman apartment section on 15 February. The workers camp, with capacity for 9,000 workers, was completed in November 2008, and further enabling works on the site are ongoing.

Fitch will continue to closely monitor the performance of the transaction. Updated surveillance information and the new issue report can be found on the agency's subscription website,

Sunday, January 25, 2009

Is Oman's Kish gas deal in jeopardy?

Kish Island: Site of an undeveloped 40 Tcf Iranian gas field

A strange little report passed by my Google search yesterday - from IranOilGas news . But its subscription only.

Iran will develop its Kish gas field without Oman (subscription), Iran - Jan 20, 2009
It is not clear against what collateral, and under what terms & conditions, Oman will be financing such a project. PEDEC is in charge of developing Kish gas ...

and on their website:

Managing director of Iranian Offshore Oil Company (IOOC) Mahmoud Zirakchian Zadeh disclosed that developing Iran’s Kish gas field (initially planned to be undertaken jointly by Iran and Oman) ...

It might be that negotiations are getting a bit tense. (for those that don't know, Oman signed several MOUs with Iran to discuss a joint Iranian/Omani development of a part of the field last year. Negotiations have been on-going since). A previous 'indirect Google sample' of the report said the Iranians were proceeding with a Chinese company and without Oman. Hmmm.

Is this just negotiation tactics on the part of the Iranians? Maybe false? Or are the Chinese taking advantage of current low oil prices and diplomatic weight to snatch a deal by offering a better price and execution capability?

Loss of the Iranian gas would be a blow somewhat especially after around 2020 (depends on how screwed they were getting on cost and price though), but might redirect Oman's energies (and a lot less cash) to getting the gas through increased domestic commercial terms, because the Iranian gas was never going to be for less than a few dollars a MBTU. Or perhaps the Qatari's will help? Nope, they're frozen til 2010, and Bahrain is first in the queue. And don't even think of the Saudis, plus they need their gas themselves.

Question is - what would a Chinese company possibly do with a gas field in the Middle East? Either build an LNG plant, or, perhaps sell the gas to the Omani's via pipeline in exchange for liquified cargo ex-Sur(but obviously, for less gas once liquified, so the Omanis get a deal).. That way the Omanis are somewhat protected from dealing directly with the Iranians, and the Chinese pay all the upfront costs.

But, how can Oman sell Chinese/Iranian Gas back to the Chinese?

I'll speculate.

After around 2028 or so, the LNG plants will have lots of spare capacity as their Gas Sales agreements [GSA] expire, and 20% or so capacity is already currently available (as the LNG companies GSAs don't meet the newer and larger capacity at Sur). And the current capacity could be filled almost immediately with Omani gas (by borrowing gas already sold by the Omani Government to someone else in the far future). In that way, Oman could effectively sell the Chinese LNG right now from a gas field that hasn't been developed yet, if the Kish deal is solid enough to pay back the borrowed gas (at a steep premium, obviously).

Now that might be a winning deal...

Plus, because the sweetener would simply be the sale of borrowed gas and not cash, Oman would get cash now by accelerating production and some paper transactions. And the promise of a significant gas stream in the future, with someone else paying the bills.


Saturday, January 24, 2009

A New US President – the start of a new era?

New US President at last
As with most of you I suspect, I watched the inauguration of President Obama, spellbound. As local blogger Suburban pointed out, the Muscat Festival fireworks almost seemed synchronised with the event taking place in Washington! Spooky. Meanwhile work and other commitments, combined with an almost total lack of decent news in Oman of late, have lead to a short posting hiatus. Normal service should resume soon, JD...

The oath was messed up a bit (apparently by the Judge, and later the oath was re-administered properly to ensure no later legal problems). His speech was pretty good. Drawing the connection to the founding US constitution and the need to keep the faith was brilliant. His comments reflecting the need to change back to a firm basis of US policy based on law and constitutional correctness, with ol’ GW sitting there, were right to the point.

Good luck Mr. President. We all expect far too much of you. But after the across the board disaster that was GW Bush and his ineptitude, there is really no way you could be worse.

There are excellent articles on Obama and Bush in last week’s Economist.

Omani Government maintains spending despite oil price drop
Meanwhile, Oman's Government are taking the decision to draw down reserves and increase State borrowing to sustain Government spending in 2009. Effectively they are hoping oil prices will increase to at least $70 by next year sometime. This brings Oman into the swelling ranks of other Keynesian based approaches to the recession.

The Government have also pumped a lot of money into maintaining domestic borrowing as well.

While Government infrastructure projects that have yet to start will be delayed, on-going projects will be continued.

Saturday, January 17, 2009

Oman win Gulf Cup!!!!!!!!!!!!!!!!!!!!!!

We won!

On penalties perhaps, but we won. against Saudi. ha ha ha ha ha !

Very, very nice.

Celebrations continue. (If you see photos, I'm the one in the middle hanging out the roof of the Lambo. The other two are my wife and prospective wife no. 2, your honor.)

Well done Oman. And special kisses to Al Habsi.

Good news to report. In the little local bar I passed by for an ale to see the ending. Locals generally cheered the Minister officiating, and certainly cheered the images of HM that were tagged with the broadcast.

Friday, January 16, 2009

Oman through to a classic final against the old enemy: Saudi

It's the final we all wished for - as long as we win: us vs. RSA.

Tomorrow, at 6pm, Oman play Saudi in the regional Gulf football cup final. Its a big deal. And it'll be a nail biter game.

Oman got through their semi against Qatar thanks to the amazing Al Habsi. The team played pretty well.

Photo: Oman beat Qatar to face Saudi

In the other semi-final, Saudi vs Kuwait, it was a classic 'no lose' game for Oman. One of them was going to lose. And while everyone was cheering for Kuwait (honestly, just try cheering for Saudi.... I always find it just sticks in the throat), really we all wanted Saudi to win!

Why? So we, Oman, can kick their ass in the final. Omanis really can't stand Saudis. What with the war(s), the border disputes, the religious interference, and the 1980s Saudi official fatwa against all Ibadhi; lets say, there's not a lot of love lost between the people of Oman and the brotherly Kingdom to the West. The great thing is, this nationaistic passion will be subsumed in the sport of football. One can only wonder how long before Gaza could play Israel in a peaceful football match.

I really hope we win tomorrow. Getting beaten by the Saudis would totally suck

Enjoy the game folks. Fingers crossed it doesn't go to penalties again... I'll be out with the crowds if they win!

And in other news...
Oh, it rained really hard last week, in case you hadn't heard/don't live here. The wind was IMHO a lot stronger than during Gonu for several minutes. And it hit very fast - a real storm. Mostly the city survived pretty well. Amazingly the pitch was OK for the matches too.

Photo: hail, wind and rain strikes Oman

Rain and hailstorms lash northern parts of Oman

By Sunil K. Vaidya, Bureau Chief
Published: January 14, 2009, 12:58

Muscat: Hailstorms lashed the northern parts of Omani capital for almost 30 minutes on Tuesday night.

"It was like small cubes of ice but not in definite shape," Saeed Masood, an Omani resident of Seeb, 45-km north of central Ruwi, told Gulf News.

He said the streets were covered with ice and traffic came to a halt as visibility reduced drastically.

"Our terrace was filled with solid pieces of ice," said Yogesh Shah, a long-time Oman resident who lives in a terrace flat in Seeb.

After the storm stopped, Shah said children in the area had a gala time. "For sometime children started throwing ice at each other," he said.

There was nothing unusual about hailstorms as it had happened in the past too, said Hamid Al Brashdi of the Meteorological and Air Navigation Department.

He predicted more rains, accompanied by thunderstorms, due to continued trough of low pressure that first brought rains in Musandam and Wusta region and then over Muscat.

The meteorological office advised people to take extra care during rains, especially in low-lying areas.

I do like the last point of advice. Surprised they didn't warn about being in wadis and things too.

Tuesday, January 13, 2009

In other news... HM's old boat refitted; Mr Zawawi buys a piece of a US firm that makes electricity from waste; Paki British Soldier of Omani origin

A couple of interesting news item tit-bits on the web today...

MoT refits HM's old yacht

Press release from Super Yacht Times that a mysteriously un-named 103m super yacht is being refitted in Oman with a state of the art entertainment system.

The yacht in question - as there is only one 103m yacht in the world - is His Majesty's old 1982 yacht, renamed Loaloat al Behar and now owned by the Ministry of Tourism.

(actually, its 103.8m long, according to wikipedia's list of the world's biggest yachts)

A 103 meter superyacht, under Oman ownership, is currently being refitted with Lantic Systems Entertainment Solution. Lantic Systems A/S, based in Aarhus, Denmark, has won a refit project through its esteemed Systems Integrator in the Arabian Gulf, Elcome International LLC.

The 103 meter superyacht is currently undergoing a major refit in Oman. Part of the refit was implementation of an entertainment system and a key criteria for the Entertainment Systems selection, was minimal installation impact as many of the distinguished interior details on the vessel had to be preserved.


The Lantic Systems solution was selected for all 10 Guest Cabins, 5 VVIP Cabins, the Cinema, as well as for Saloons and Outdoor Deck Areas.

Sounds nice. After its refit, I bet it'll be one tasty ride. Wonder how much it'll cost???

Wizard of Oz buys Green electricity company
Reported today, Mr Omar Zawawi, probably Oman's richest and most successful businessman and owner of mega-conglomerate Omzest (as well as advisor to His Majesty), has bought a $20mln share of a US firm that uses high-tech gassification process to produce electricity from municipal waste.

Photo: Workers at Ze-Gen's waste-to-electricty test facility in Bedford, Mass.

Waste-to-energy firm Ze-gen piles up cash

Waste-to-energy firm Ze-Gen said Tuesday that it has raised money to further develop and commercialize its technology for converting municipal solid waste to electricity.

The company announced a series B round of $20 million that was led by a division of the Oman-based conglomerate Omar Zawawi Establishment.

There are a handful of firms developing different processes for converting municipal solid waste into usable energy. There are landfills that capture methane gas, which can be burned for electricity. Energy from incinerated trash can be used, too, but it is considered inefficient and polluting.

Ze-Gen uses presorted construction debris, which is put through a gasification process, where the trash is heated and put under pressure. Unlike burning, gasification yields what's called synthetic gas, which contains methane that can be burned to make electricity.

The company has a demonstration facility in Bedford, Mass., where it intends to supply electricity to the local utility.

Last year, the original developers of the core technology filed suit against Ze-Gen, alleging that the intellectual property was misappropriated. Company executives have said the case has no merit.

Nice to see that the credit crunch has not stopped Mr Zawawi from being able to make canny strategic investments like this one. This is the sort of technology for which there would be a great long term market in the middle east (incl. Oman) as we produce more waste per person than the average US citizen.

Certainly should be able to compete with imported coal!

And finally,
It seems the British muslim soldier Prince Harry's in a bit bother over after calling him a 'Paki' is actually of Omani decent, according to the UK's Guardian newspaper!

Racist slur or army banter? What the soldiers say
The Guardian, Tuesday 13 January 2009

In mess halls and parade squares across the country, Prince Harry's comments were being chewed over yesterday. As they pondered the media furore, some insisted his comments pointed to a wider problem of racism in the armed forces, but others were quick to come to his defence, claiming his critics had little or no understanding of army life.

However, no one with first-hand experience of the British military seemed remotely surprised that the 24-year-old, who is third in line to the throne, had chosen the term Paki to describe a fellow soldier.

Nabs, who spent 11 years in the British army, described the interest in Prince Harry's comments as "pure nonsense".

"When I joined the army my first nickname was 'Private foreign bollocks', and it was a relief when people started calling me that because I knew that it meant I had been accepted," said the 38-year-old British Muslim, whose family originate from Oman.

"It is the sort of thing that is said with good humour among friends and in that context it is something that we can all take it. What counts in the army is that you are good at your job. If you are then you will get a bit of banter but you will also get respect. If you are not any good people will pick on whatever they can, whether that is that you are ginger or Irish or a woman."...

He seems to have a pretty good attitude about it all.

Rumour that Ministry of Tourism is under investigation

Super hush-hush word in the corridors of power is that the Ministry of Tourism is under some pretty serious investigation for alleged suspected corruption, possibly reaching "very high levels" within the Ministry, according to my sources in the super-straight, and very much respected & feared, Oman Government State Audit.

From what I gather, the investigation may be centered on some activities within OMRAN, the land development subsidiary of the MoT; and is, in part, related to contracting irregularities not yet fully explained.

It will almost certainly all be quite OK. But there is apparently enough concern to prompt an investigation, which may of course deservedly lead nowhere.

Monday, January 12, 2009

Oman sees potential victory in ball game

busy still.

Big story about to break, but tomorrow on that one.

Meanwhile, Oman face Qatar (well, I believe they have Qatari nationality) in the semis. This Wed. The nation will be consumed. and if we win that a cliff hanger against the Saudis.

Drive anywhere you want 6:00-8:00, Drive no-where near Shatti/MQ/Qurm until 4:30am if we win. Same advice if we loose. But I think Al Habsi will make the difference. Fingers crossed.

And it might rain in the next few days. Certainly wind and clouds. Cool.

Saturday, January 10, 2009

The Dragon's Belated Xmas Cracker & 2009

Hey guys,

Sorry I've been so lax these past couple of weeks, but I needed a break.

Work pretty intense, what with the oilprice crisis, GCC, end of year, credit crisis, ....

Plus staff reviews, invoices, visiting families, massive parties to organise, pay for and participate of; relatives to escort to and from airports, beaches to be sat on, books to be read, taxes to be filed, lawyers and bankers to be consulted, presents to select and receive, teenagers to be controlled,...

all topped by the consumption of a hedonistic display of food, ethyl alcohol,
and all the other good things in life

(such as spending time with your kids, your wife, and your parents, naturally)

The Dragon works to live, not lives to work, if you hadn't guessed.

You know. You too I bet.

This pic sort of sums up many parts of my Xmas break. Like the local bootleg guy delivering my stash of Champagne and caviar for the holidays, or the stuff for under the tree.

So, wow, 2009.

Hey, just like to point out that Obama is soon the new President. That is soooo totally great. I still like that joke from last year:

One sunny day in 2009 an old man approaches the White House from across Pennsylvania Avenue where he’s been sitting on a park bench. He speaks to the U.S. Marine standing guard: “I would like to go in and meet with President Bush.” The Marine looks at the man: “Sir, Mr. Bush no longer is president, and no longer resides here.” The old man says, “Okay,” and walks away.

The following day, the same man approaches the White House, says to the same Marine, “I would like to go in and meet with President Bush.” The Marine again tells the man, “Sir, as I said yesterday, Mr. Bush is no longer president and no longer resides here.” The man thanks him and, again, just walks away.

The third day, the same man approaches the White House and speaks to the very same U. S. Marine saying “I would like to go in and meet with President Bush.” The Marine, somewhat irritated at this point, looks hard at the man and says, “Sir, this is the third day in a row you have been here asking to speak to Mr. Bush. I’ve already told you that Mr. Bush is no longer President and no longer resides here. Don’t you understand?”

The old man looks at the Marine: “Oh, I understand, all right. I just love hearing you say it.”

The Marine snaps to attention, salutes, and says, “See you tomorrow, sir.”

And a lot happened over the break.

The GCC. (BTW, not a story I've seen anywhere yet but ....)
Well Fcukin done to Oman Military Intelligence, ROP Internal Security, ROP Coast Guard, ROP Important Installations Security, and, those who can't be named. Oh, yeah, and Saudi/UAE, etc etc security and their associated mercs, who tended to get in the way.

As far as I'm aware, all the principals got out OK, and no-one noticed a single security incident. Nope, not even a thrown shoe. (LOL)

I'm sorry, but in the current security environment, when it's hard to even stop Afgani refugees swimming onto HM's beach at night thinking its Dubai, that is a hell of an achievement, and its one that didn't happen without a lot of work, IT and money. Thank you guys and gals. I doubt anyone else will be able to thank you in the Omani media. But I can. Well done.

Hey, and now you can unleash all that training and simulation stuff on the throngs of hooligans during the Football cup!!! Please?

Israel bombing the crap out of Gazan children. Hamas launching Iranian pop-rockets back. Everyone else [and I'm afraid that includes Barack Obama for now, but he doesn't actually run anything yet, remember] neither willing and/or able to do anything.

And some nice editorials and comments from that ol' faithful of Omani Fourth Estate, Times of Oman. (I think the comments are still running on that one).

So, thanks to all, especially Muscati (who I know is sort-of-shy, but his comments are often a recommended side bar note to the unreliable ramblings on Muscat Confidential); thanks for the reading and the comments. Especially the comments - engage in civil debate, and try to bring externally sourced facts where possible, and (I'm afraid to say this kids, but it's true) do a bit of bloody reading of some essential history a little bit before mouthing off. Try to read back your comments before hitting post, even though I often can't manage that with my own posts.

Please, please for christ-almighty's sake, pick a totally anonomous nickname like even Ahmed can do.

And lets have a great 2009 in Oman.

There is no better place on the planet for 18 months, IMHO.

Just wait till we win the football cup!!!!!!

May 2009 bring you and us all peace, prosperity, health and happiness,

The Dragon

Colonel Smiley, ex-Commander of Oman's Armed Forces, and the man who defeated the Nizwa rebellion, dies age 92

One of Oman's most famous military commanders, Colonel David Smiley, British Soldier and Spy, died age 92. His life story is pretty amazing.

He was responsible for helping the previous Sultan of Oman, Said bin Taimur Al Bu Said(the current Sultan's father), defeat the Saudi-backed armed rebellion of Ghalib bin Ali, the former Imam of Nizwa, and Talib bin Ali, Ghalib's brother, in the late 1950s centred in Nizwa and Jebel Akhdar.

Col. Smiley played a key role in making Oman the modern unified and peaceful nation state that it remains today. If it wsn't for him, Oman would likely be a very different place today.

He published an account of his experiences in Oman and Yemen in his book, ‘Arabian Assignment’ in 1975. You can also read an interesting short account of the Jebel Akhdar war here.

A wonderfully detailed warts-and-all account of the 'Green Mountain' war can be found here. This report also provides a fascinating overview of Omani political and cultural background. I encourage my younger Omani readers to look at it. (I'm not sure how much of this stuff is actually taught in the schools here. I suspect not at all).

Here is a key quote from the latter review of the rebellion that highlights how crucial Smiley's leadership and victory was to making Oman what it is today:
... Oman later faced a much more serious threat in the late
1960's and early 70's than the minor tribal rebellion of the
1950's. In the 1960's the Dhofar Rebellion, heavily
supported by the Soviet Union and the Peoples' Republic of
China, came close to toppling the regime. Had the Dhofar
rebels been successful, a peoples' democracy would have been
established within Oman. A Yemeni style peoples' republic in
control of the Strait of Hormuz would be an incalculable
complication on the international scene today.

The victorious resolution of the Jebel Akhdar War
insured that the Sultan of Oman could concentrate his forces
and efforts against the enemy in the Dhofar Province without
concern for a rebellion in central Oman. The necessity of
actively prosecuting a war in Dhofar while being required to
isolate rebels in central Oman would have seriously
jeopardized the successful resolution of the more serious
threat in Dhofar. Therefore, Oman's victory in the Jebel
Akhdar was an important ingredient in the successful
conclusion of the Dhofar Rebellion and a stable, progressive
government remains firmly in place in this important
strategic area.

At ease, Colonel Smiley. Rest in peace.

Thank you.

Photo: Colonel David Smiley in Yemen, 1963 (front, 3rd from right)

Daily Telegraph Obituary

Colonel David Smiley
Special forces and intelligence officer renowned for cloak-and-dagger operations behind enemy lines on many fronts.

09 Jan 2009

Colonel David Smiley, who died on Thursday aged 92, was one of the most celebrated cloak-and-dagger agents of the Second World War, serving behind enemy lines in Albania, Greece, Abyssinia and Japanese-controlled eastern Thailand.

After the war he organised secret operations against the Russians and their allies in Albania and Poland, among other places. Later, as Britain's era of domination in the Arabian peninsula drew to a close, he commanded the Sultan of Oman's armed forces in a highly successful counter-insurgency. After his assignment in Oman, he organised – with the British intelligence service, MI6 – royalist guerrilla resistance against a Soviet-backed Nasserite regime in Yemen. Smiley's efforts helped force the eventual withdrawal of the Egyptians and their Soviet mentors, paved the way for the emergence of a less anti-Western Yemeni government, and confirmed his reputation as one of Britain's leading post-war military Arabists.

...But the pinnacle of Smiley's post-war career was his three-year tenure as commander of the Sultan of Muscat and Oman's armed forces during a civil war which threatened to bring down one of Britain's more reactionary allies in the Gulf.

By now in his early forties, Smiley ran a gruelling counter-insurgency which gradually drove the guerrillas back from the scorching plains into their mountain retreat, the 10,000ft high Jebel Akhdar, which had never been successfully assaulted. With two squadrons of the SAS under his command, Smiley planned and led a classic dawn attack on the mountain fastness, finally crushing the enemy.


Thursday, January 8, 2009

Oman Oil Company executives live the royal life

Oman Oil Company is a 100% Government owned investment arm of the Ministries of Commerce and Oil & Gas.

So it was interesting to learn from a Luxury Vietnamese Tour Company that their super-top class tours have been taken by Presidents, Royals, Russian Billionaires and .... Oman Oil Company executives!


Joined on the list were also Omani Royal Ministers, apparently.

Photo: Some of Oman's Senior Civil Servants snapped in Vietnam

Its a tough job, spending other peoples money, isn't it?

Where do I sign up?

Obviously, the execs and Ministers were on personally funded trips, and certainly weren't being paid to go on luxury cruises at the State's expense. Surely?

Luxury Travel Vietnam Launch First Travel Blog in English in Vietnam

The Luxury Travel Company has launched the first travel blog in English in Vietnam providing the latest in trends, new, advice and travel stories from across of its Asian destinations.

Various travel advisors can share with bloggers and internet surfers their local know-how about travelling in the region.

“ The amazing thing about a blog is instant presence online,” said Pham Ha, CEO and founder of luxury Travel Company.

The blog will allow clientele to benefit from the advice and experiences of its luxury travel advisors, as well as other customers, on travel to Vietnam, Cambodia, Laos, Myanmar, Thailand and other destinations in Asia.

Luxury Travel Company's main business activities - luxury inbound/outbound operator, luxury adventures, custom tours, romance, wellness and spa, MICE, family travel and private travel arrangements for VIP stars, celebrities, Royal and Government clientele, private jet and yacht cruises...nothing is impossible in the whole luxury meaning.

The company's depth of experience and large infrastructure enable it to create unique itineraries with the operational confidence to fulfill client expectations.

Last year, the company served 10,000 satisfied customers. Among Luxury Travel’s clients are ambassadors, senators, Russian millionaires, CEOs and presidents of Oman Oil Company, royalty and Oman Royal Government ministers, French ministers, Deputy Prime Minister of Canada…and others.

Anyone interested can blog on to

Debate on Essa Al Zedjali's Times of Oman editorial on Jews continues

The debate is continuing on the recent post referring to our local Hitler sympathist and holocaust apologist, Essa Al Zedjali,

and his front-page published observations and opinions on the on-going conflict in Gaza, religion, culture, race and ... err... Jews and genocide.

What do you think? Tell us at Muscat Confidential Comments.

I wonder if this editorial made the international media?

While OPEC cuts, Oman boosts oil production

I realised the Government were saying that oil production would creep up a bit this year.

But I hadn't thought about that comment very much. But it is quite interesting that while OPEC struggle to cut production, Oman is upping it.

This shows why Oman isn't a member of OPEC (as well as avoiding having to pay a share of the significant costs to run OPEC day-to-day). A 5-8% growth in production is good news for Oman if the oil price holds. It's taken the Government 8 years to turn around the country's production decline, and it looks like they've done it.

Its very hard, once a country's oil production peaks, to reverse the decline. Oman should feel pretty proud that the steep production decline of the past few years has been arrested or even reversed.

Oman Oil Production - 2007 from Crude Production blogspot

At $45 a bbl, Oman should net about $7 billion this year from liquids export, after taking out the big investment costs for ongoing oil and gas projects (about $5 billion in 2009). At $70, that net cashflow almost doubles to $13bln.

So you can see oil price is going to be far more important than volume to Oman's coffers this year. Everyone in Oman should be praying for a nice high price!

Oman oil output to rise in 2009

ONA reported that while OPEC members are formally cutting crude outputs, Oman’s oil production in 2009 could rise to about 810,000 barrels per day.

It quoted Mr Mohammad bin Hamad Al Rumhy, the Sultanate’s oil minister as saying that the non OPEC oil exporter sees USD 70 a barrel as a fair price for oil which is suitable for both consumers and producers. He added that “There are new discoveries in oil and gas and the sultanate's oil production will reach between 805,000 and 810,000 barrels per day.”

In November 2008, Mr Rumhy said that he expected Oman’s oil production to rise to 800,000 barrels per day in 2009 from 750,000 to 760,000 barrels per day in 2008.

(Sourced from: Oman News Agency)

Tuesday, January 6, 2009

Oman diversifies investment into Vietnam. Omani youth probably think they can party forever

In what I think is an excellent move, Oman's investment fund is getting into Vietnam (above), as reported in vovnews. $100 million big ones.


It should be a good investment.

I only wish many Omani youth, currently out partying over a regional football game, would realise the incredible competition they have in the real world to pay their way. People in other nations, like Vietnam, with sure, a few natural resources, but a need to work due to population pyramid effects. These guys WORK.

And that is what Oman is up against long term. Countres that save, rather than borrow; and work - sun up to sunset, often as families, doing business. Making money the hard way .... by working their asses off.

Photo: Vietnamese people, working their asses off.

Oman is nice, I admit. Hey, that's why I'm here.

But it is sleepy here. Omani's do not generally have much of that SE Asian zest.

Here it's more 'Inshallah, man'. And the terrible inefficiency of low paid, unskilled/low skilled Indian labour doing almost everything. Which I can handle mostly, perhaps because I'm not really a business man trying to make a buck I guess. It has in parts that Caribbean feel sometimes.

So, good luck Oman in the football. Al Habsi is a total star player, and with him you have a great chance.

But the other 100,000 of you, who won't be playing in the premiership, err, better start working. Notice how few 'Go Oman!!!!' tricked up cars are a part of the morning commute?

'Cos oil income is not going to be enough. And your Dad can't do too much more borrowing against his ex-rising house/lands/stock market to keep supporting you in the lifestyle to which you have become accustomed, ...

Vietnam hails Omani investment
Deputy Prime Minister Nguyen Sinh Hung affirmed Vietnam’s commitment to strengthening economic ties with Oman while receiving leaders from an Omani-invested company on January 5.

At the meeting, Warith Mubarak Said Al Kharusi, Chief Executive Officer of the Vietnam-Oman Investment Company (VOIC), briefed the deputy PM on the company’s activities and its plan to expand investment and cooperation.

Mr Kharusi, who also heads the Oman State Reserve Fund, said the joint venture intends to raise its registered capital to US$5 million from the initial amount of US$1.5 million. He told the Deputy PM that the Omani partners pledge to invest US$100 million in Vietnam through VOIC, which will be developed strongly to attract other investors.

For his part, Mr Hung welcomed the partnership between Vietnam’s State Capital Investment Corporation (SCIC) and Omani partners and emphasized that the Vietnamese Government always encourage Omani expansion of investment and cooperation in Vietnam.

The state leader said Vietnam strives to grow at 6.5 percent in 2009 and VOIC should prepare comprehensively before investing in the Southeast Asian markets, which have potential consumer demands.

“The Vietnamese Government is accelerating reforms to perfect the investment climate,” said Nguyen Sinh Hung, adding that cooperative investment will help enhance Vietnam-Oman relations and boost their bilateral cultural cooperation.
VOIC came into being after the Deputy PM’s official visit to the Kingdom of Oman in December 2007, during which the two sides’ leaders agreed to set up a joint investment fund for strategic projects in Vietnam.

Monday, January 5, 2009

HM sends emergency aid flight to Gaza

As the Israeli armed forces continue their violent invasion of Gaza, and escalate the war with Hamas and their rocketeers into a messy urban warfare of an army vs guerrillas, it seems His Majesty Sultan Qaboos has directed the Oman Charitable Organization (OCO) to send some aid to Gaza. Xin Hua news

Excellent move. Its something. And it will be real to those few it can help at least.

Oman to operate flights of emergency aid to Gaza 2009-01-04 15:25:33  

ABU DHABI, Jan. 4 (Xinhua) -- Oman Charitable Organization (OCO) will start operating flights of emergency aid to Palestinians who have been suffering from Israeli military strikes, the English newspaper Oman Daily Observer reported on Sunday.

OCO's move on Sunday is in line with the directive of Oman's Sultan Qaboos bin Said to send relief aid to Palestinians in Gaza, according to the report.

The relief aid, which includes medicines, foodstuff, power generators for hospitals and other requirements, will be airlifted from Omani capital of Muscat to Egypt's Al Areesh Airport and will then be transported by land to Gaza.

If the Egyptians and the Israelis let it across I guess...

But it is very much a candle in the wind at this stage. Unlike when Israel invaded Lebanon and drew against Hezbollah, they seem to have a huge intel advantage in Gaza, and now the troops are moving in force, with total air support, I think Hamas will get a beating, and unfortunately a significant % and number of non-associated ordinary people too.

A big defeat for Hamas in a short intense war, along with a change of Israeli and US Governments, new conferences, retreats, accords, reconciliation, blah blah blah, could offer a real opportunity for a breakthrough quite quickly in 2009, with a revitalised Fatah obtaining actual progress towards semi-statehood in the aftermath, and Israel on a much tighter leash under Obama. Especially if it can be shown Hamas did indeed (as rumoured) deliberately put weapons and bases in and around Mosques, schools and hospitals; and perhaps used ambulances to carry war materiel.

We might even see real UN troops deployed as peacekeepers in Palestine.

This is one reason why not very much of import is being done by pretty much anyone to actually stop the war. Not many countries want Hamas to win this one.

Monetary Union for GCC - except Oman - but agreement on VAT

Nice to see some actual progress at the AGCC conference, because it seems the old story on a GCC wide, including Oman, Value Added Tax [VAT] continues to rumble along, and as the only viable effective income tax the Governments can introduce at this stage in the GCC economic development. This according to HE Mr. Macki quoted in the Gulf News. A VAT will also force the Government to have significantly more information and control over the internal economy especially, with the need to apply VAT credits for VAT paid on a business' purchases, and payment of taxes on ts sales. There is a lot of paper involved in VAT, so more jobs for civil servants too.

In addition, as long as average oil prices stay over $45 this year, the budget will be subsidised by the State reserve fund, and there's a reasonably good chance of that if OPEC implement their cuts. Good to see Oman's production up too.

Photo www.daylife.com2 months ago: Saudi Finance Minister Ibrahim al-Assaf (L) and Minister of National Economy and Deputy Chairman for Financial Affairs of Oman Ahmed bin Abdul Nabi Macki talk upon their arrival for a meeting in Riyadh October 25, 2008

He makes the fair point that the tourism sector is growing at a good clip it would seem, but then again, it's coming from a very low baseline and still only accounts for less than 3% of GDP. Given the huge investments being made, I'm not sure I find 23% growth very good. If any sector, Construction must have boomed in 2008.

Expenditure will grow and salaries are safe, he said. All in all, I agree with Minister Macki that 2009 will be relatively benign for Oman, especially in contrast to many other parts of the world. The rapid reduction in growth will catch a few businesses with inventory problems, and the market price for construction equipment should drop. Together with the soon to feed through drops in global prices for almost everything, especially cement, shipping, steel and food, construction should continue to do well.

The only big exposures for Oman will be the oil price, naturally, and the continued plan to remain fixed to the dollar. The dollar looks like it will face a big correction sometime in 2009, and is already down 10% or so of late, [but after the big recovery of the dollar rate in 2008 that we are all enjoying right now when we repatriate funds!]

The big question for me: I wonder if in his original speech he actually said 'Cyclone Gonu', or did he say 'unusual weather conditions'...?

Omani reserves will cover deficits

By Sunil K.Vaidya, Bureau Chief
Published: January 03, 2009, 23:19

Muscat: Ahmad Bin Abdul Nabi Macki, minister of National Economy and Supervisor of the ministry of Finance, yesterday said that any deficit caused by oil prices dropping below $45 a barrel would be covered by emergency reserve funds as well as restructuring the project plans.

"We will not touch salaries as we look for cuts if the oil price drops below $45," he said during a press conference after announcing the state's general budget for 2009 prepared with the oil price estimated at $45. He said that Oman has in the recent past targeted tourism as one of the main sector in governments bid for economic diversification.

"The tourism sector continues to grow and is expected to realise a growth rate of 22.3 per cent by virtue of the increase in lodging capacities in the country and efforts exerted to market Oman as a tourism destination," he said.


He also announced that people affected by tropical cyclone Gonu in 2007, especially along the Batinah coast, would get 2,200 housing units as part of the first phase, expected to cost of 339 million Omani riyals (Dh3.39 billion).

The total expenditure for the financial year 2009, he revealed, was estimated at about 6.4 billion Omani riyals against 5.8 billion riyals in 2008.

GCC endorses VAT
Ahmad Bin Abdul Nabi Macki, Oman's minister of National Economy and supervisor of the Finance ministry, deputy chairman in the Financial Affairs and Energy Resources Council, has said that the introduction of Value Added Tax (VAT) was a joint GCC decision.

He also added that the study to introduce VAT in the GCC countries was underway to compensate for the loss of revenue following the Customs Union and Common market introduction.

In reply to a question he said: "There are no plans to introduce any other taxes."

Sunday, January 4, 2009

Times of Oman editor Essa Al Zedjali says Hitler justified in his actions against the Jews

I figured Essa Al Zedjali, Editor in Chief of Times of Oman, would launch an opinion piece raging against Israel today, but this time he's really out-done himself.

He basically says the actions of the Nazi Party and Hitler against the Jews were justified, excusing the mass murder of millions of civilians. This gem is proceeded by a summary that could be Cliff notes for the infamous forgery The Protocols of the Elders of Zion.

In fact, it's so 'out there' that it may well be illegal under Oman's famously pro-free press laws...

I would say its covered under several clear injunctions:
1/ that newspapers not publish anything that is politically, culturally, or sexually offensive;
2/ not to publish anything that ... creates hatred toward ... any ethnicity or religion;
3/ not to publish anything that ... promotes religious extremism;
4/ not to publish anything that ... insults other states.

It's perhaps the most disgusting, bigoted, conspiracy theory crap ever to grace the front page of an Omani newspaper (no, really, these days he modestly puts his weekly opinion piece on the front page, above the fold). Its quite unbelievable.

It would seem Mr Al Zedjali is now acting as a defacto-national spokesman for the wacko Iranian President's point of view of such things. Great!

Viewpoint this week

How Israel became a terrorist state
Essa bin Mohammed Al Zedjali
Sunday, January 04, 2009 12:37:52 AM Oman Time

It is illustrative to browse through the relevant pages of history to know the real history of the Jews in Germany. You would then come to know why Hitler had taken harsh measures against them. The entire economy of Germany, including banks, publishing houses, jewellery stores, light and heavy industries and almost all economic organisations of consequence, was under the total control of the Jews.

They muddied every aspect of the economy by perpetrating fraud after fraud on common people. This unprepossessing situation annoyed the German citizens no end and impelled Hitler to punish the Jews for their bad deeds.

He then goes on to say how the press in the USA are totally controlled by 'The Jews'...

Viewpoint (cont.)

...The United States today finds itself in the same predicament as Germany back then. Now in the US, the Jews wield enormous control over all important decisions, whether they relate to politics, economy or media. No American citizen is free today to utter a single word about international or even national issues. This is the reason the American views on various issues being relayed to the world through the media are in fact the views of the Jews.

Perhaps his reading hasn't covered such US publications as the controversial book published in 2007 by two US academics, John Mearsheimer of the University of Chicago and Stephen Walt of Harvard University,'The Israel Lobby and US Foreign Policy'. See the wiki link for an extensive example of freedom of debate in action in the USA, even over a topic as supposedly controlled as the role of the Jewish lobby in the USA.

In fact, in my opinion the best place to get top flight intellectual criticism of the USA is ... from within the USA.

It's ironic that Essa, editor of a newspaper in a country where the publication of almost anything - from photos of traffic accidents to any criticism of a Government Minister - is illegal, has the gall to accuse the USA of not having a free press.

A great Omani intellectual? LMAOFOFL.

Oman, you deserve so much better than this drivel. By publishing such idiocy, he helps make real and deserved criticism of the bombing of Gaza by Israel seem synonymous with antisemitism. This is of great assistance to those who do accuse any critique of Israel as being racist.

Meanwhile, Israel has commenced its invasion of Gaza using tanks and troops. Its going to get pretty messy.

Saturday, January 3, 2009

Happy New Year, and GCC Conference tells off Israel

OK – it’s a new year. People are generally back at work today, and life in the Sultanate proceeds to return to normal now the AGCC conference is over and we have our roads, coast, and hotels (and their associated bars and restaurants!!) back. The weather is, if anything, a little on the cool side, and that bloody red tide is still stopping decent swimming in the sea. If this period of red tide (must be 2 months now?) is going to be the norm, Oman can forget about coastal resort tourism as a growth business!

And I’m back to the blog after a short break, much enjoyed.

The big issue of late – dominating the GCC publicity machine, and in the country at large – is the continued and rapidly escalating war between Hamas and Israel in the Gaza strip.

Hamas keeps sending rockets into Israel, Israel responds with aerial bombardment and border closures, Hamas sends more rockets, … (repeat endlessly). All the signs now are that Israel is bombing the crap out of north Gaza in preparation for a ground attack with troops and tanks. Meanwhile, Hamas are hunkered down in their bunkers, relatively safe from most of the bombing, and busy trying to beef up their stockpiles of ammunition and heavy armaments ahead of the anticipated ground invasion, with materiel smuggled through their tunnels connecting Gaza and Egypt, tunnels which Israel keeps trying to bomb too.

So, the GCC naturally discussed the Israel/Gaza issue and issued their totally weak communiqué, packed full of 'deep concern', lofty ‘calls’ and ‘urges’, while lacking any actual unilateral action. Expect more of the same from the Arab League.

Photo: GCC Leaders agreeing to give Israel a very big telling off, and to ask it to please stand in the naughty corner (but only if that wouldn't be too much trouble).

Wow, the Israelis must be quaking in their boots after this missive…

Gulf leaders ask Israel to end Gaza massacre
By Sunil K. Vaidya, Bureau Chief
Published: December 30, 2008, 23:46

Muscat: Leader of the Gulf Cooperation Council (GCC) strongly condemned the barbaric Israeli aggression on the Palestinian people in Gaza and held Israel responsible for taking the situation to a dangerous level.

In the final communique of the 29th GCC Summit concluded in Muscat yesterday, the council voiced deep concern over the flagrant Israeli offensive, which led to a large number of deaths and injuries, destruction of properties and terrorising civilians with no consideration for ethics, humanity or international legitimacy resolutions.

The council called on Israel to stop its brutal aggression against the unarmed Palestinian people and end the unfair siege imposed on all Palestinian territories, including Gaza.

It urged the international community to take immediate action to stop massacres and tyrannical practices by the Israeli military machinery. The council also called on the international community to provide the necessary protection for the Palestinian people who endure all forms of atrocities and oppression due to Israel's stubborn policies and inhuman practices.

The council called on all Palestinian factions to unite their ranks, as national unity is the shield and the sole means to protect the Palestinian people and regain their legitimate rights, including the establishment of an independent state with (occupied) Jerusalem as its capital.

The GCC leaders held Israel responsible for the deterioration of the peace process due to its tight siege on the Palestinians, especially in Gaza, confiscation of lands and construction of colonies, the building of apartheid wall and its ongoing excavations under the Al Aqsa mosque.

The GCC also called on the international community to provide necessary protection for the Palestinian people.

What a joke.

The problem is that the GCC States only ever give lip-service to their declared total support for the Palestinians. Are they providing significant funding to Fatah or Hamas or the Palestinian authority? No, and certainly not Hamas. Perhaps they could provide easy access to the safe GCC countries so that lots of ordinary Palestinians could live here and work? Er, No.

Are they providing military support to the Palestinians? Or sending their Airforces and Navies to provide humanitarian aid? No, of course not!

Do they back these statements up with boycotts, sanctions, or other actual actions with teeth, rather than just talk and posturing? No. Are they perhaps taking action to pressure Egypt to provide support for Gaza? No. Are they pressuring the USA to act more strongly? No.

Just a telling-off (aka ‘strong condemnation’) to Israel and more whining to the UN Security Council. Sure, they allow their tightly controlled press to bitch about Israel/USA, and also allow (limited) street protests in support of Gaza. Oh, and the King of Bahrain cancelled his country’s New Year celebrations in support of the Palestinians. Wow, that’ll really make them feel better in Gaza with the bombs falling.

Why such hypocrisy?

Because it is in the best interests of the Gulf States that chaos reigns in Israel/Palestine. It keeps the GCC populace focused on the issue of Israel/Palestine, instead of having the time and energy to address more difficult and uncomfortable domestic issues (such as unemployment, how to meld increased democratic representation and secularism with Islam, improving the distribution of wealth and opportunity, women’s rights, unionisation, expatriate labour, etc etc etc).

While everyone hates to see bombings with civilians being killed and injured, to be frank the last thing the GCC leaders would like to see is a strong Hamas and/or Hezbollah. Hamas and Hezbollah are Islamofascists, dominated by theological ideologues rather than pragmatists. Hamas actively opposes the legitimacy of the GCC’s set of monarchs to rule their countries, and both Hamas and Hezbollah are effectively supported by Iran with money, arms and training. And remember that the brotherly state of Iran is the real enemy of the GCC - with their continued support for Shia extremists, counter claims on islands claimed by the UAE, counter-productive sabre rattling with the Americans and Israelis, periodic threats to blockade the strait of Hormuz, a regime representative of a successful Islamic revolution over a ruling Monarch, etc etc.

This general revulsion of most Arab countries to Hamas and what it stands for is why Egypt are so willing to provide the anvil against which Israel pounds Hamas in Gaza. Hamas are effectively an offshoot of the hated and illegal Muslim Brotherhood, and the last thing the rulers of Egypt (or the GCC) would do is support such an outfit. Thus, if you read the communique from the GCC you'll find lots of condemnation of Israel, but no support for Hamas. In fact, Hamas are not refered to at all except as a 'faction' who are urged to get back in line with Fatah and Abbas. LOL.

One should note that all GCC members continue to host numerous and significant American military bases:
Oman: US Airforce use RAFO bases in Thumrait, Masna’ah and Masirah, have radar and intelligence gathering stations in Musandam, plus a large strategic War Reserve Materiel (WRM) storage facility in Seeb,
Qatar:Home of the regional US Central Command base, plus a big US Airforce base at Al Udeid,
Bahrain: US 5th Fleet HQ, plus Shaikh Isa Airbase,
Kuwait: Ali Al Salem and Ahmed Al Jaber Airbases, plus 2 big US Army bases,
and of course,
Saudi: Eskan Village Airbase and several other bases.

Oh, and Jan 1st 2009 finally marks the start of the Oman/USA Free Trade agreement. And Oman certainly is not going to do anything to either impact that agreement, nor to get off on the wrong foot with the new US Administration.

Hence, a very strongly worded telling off for the Zionist Fascists, and otherwise carry on with business as usual chaps!

I expect an especially incisive Times of Oman 'Viewpoint' opinion piece from Essa tomorrow that will say how totally and unbelievably fantastic the GCC Conference was, how much great stuff was achieved (more from me on that issue tomorrow), and how evil the Israeli/US actions in Gaza are. I'll be amazed if he mentions Hamas or their rockets though...

Happy New Year everyone. Nothing's changed.

So, that’s alright then.