Saudi Arabia’s ‘Programme HQ’: Can Riyadh rival Dubai as a business hub?

 Plans to make access to mega-project contracts conditional on companies establishing regional headquarters in the kingdom are ambitious but ambiguous

 

Middle East Eye: In the pre-pandemic days of globalisation, countries competing in emerging markets were often engaged in a "race to the bottom" to attract multinational companies, which typically involved offering them incentives such as tax breaks and favourable labour laws.

More recently, governments with large enough economies have opted for the stick-over-the-carrot approach in allowing companies to set up shop, often for political objectives.

Last year, for instance, Turkey passed a law requiring any social media platform based abroad with over one million daily Turkish users to set up a representative office in the country.

Saudi Arabia is taking a leaf from the same playbook as it grapples with the economic fallout of the Covid-19 pandemic and embarks on its ambitious Vision 2030 plans.

In mid-February, Minister of Investment Khalid al-Falih announced that any company seeking contracts with the government, state-owned firms and the Public Investment Fund (PIF, the sovereign wealth fund) will have to base its regional headquarters in the kingdom by 2024.

Saudi Arabia is hoping that the allure of being the Middle East’s biggest economy, with hundreds of billions of dollars earmarked for mega-projects over the coming decades, will force companies to comply.

“There was surprise at the announcement, and there are some merchant families that will not be happy,” said Theodore Karasik, a senior adviser to Gulf State Analytics, a Washington-based consultancy.

“But at the same time, others will see the benefit of such a regulation, and in how the city states of the Arabian peninsula interact with each other for recovery purposes. Because of Covid-19, they are rebooting and restructuring their economies."

The requirement, called “Programme HQ”, is still at the discussion phase, with “as many questions as answers. It is a reminder of the intense competition for investment within the Gulf Cooperation Council,” said Rachel Ziemba, a non-resident fellow at the Gulf International Forum, a Washington-based institute.

To read the rest go to: https://www.middleeasteye.net/news/saudi-arabia-uae-dubai-programme-hq-rival-business-hub

 

Red Sea cables: How UK and US spy agencies listen to the Middle East

 An expanding network of undersea fibre optic cables from the Mediterranean to the Gulf has made surveillance of regional communications easier than ever

 

The Mediterranean viewed from the Troodos Mountains, Cyprus (Paul Cochrane)

Middle East Eye: The growth of Middle Eastern fibre optic cable networks has given Western signals intelligence agencies unprecedented access to the region’s data and communications traffic.

“There is no question that, in the broadest sense, from Port Said [in Egypt] to Oman is one of the greatest areas for telecommunications traffic and therefore surveillance. Everything about the Middle East goes through that region except for the odd link through Turkey,” said Duncan Campbell, an investigative journalist specialising in surveillance since 1975.

The Five Eyes, a signals intelligence (SIGINT) alliance of the US, the UK, Canada, Australia and New Zealand, has been snooping on the Middle East since the network was formed during the Second World War.

The key players are the US’s National Security Agency (NSA), and the UK’s Government Communications Headquarters (GCHQ), utilising both known and secret facilities in the region to collect data.

The Middle East is a hotbed of surveillance for obvious reasons: its strategic political-economic importance, the Arab-Israeli conflict, and political divisions between the allies of the Five Eyes and their adversaries, from militant groups to countries such as Iran and Syria.

While all conventional forms of surveillance are carried out, from airspace surveillance to tapping phone lines, the region is a strategic asset for mass surveillance due to the current routes of fibre optic cables.

“The importance of cables is still largely unknown by the average person. They think smartphones are wireless and it goes through the air but they don’t realise it is through cables,” said Alan Mauldin, research director at telecommunications research firm TeleGeography in Washington.

Spy agencies have tapped into fibre optic cables to intercept vast volumes of data, from phone calls to the content of emails, to web browsing history and metadata. Financial, military and government data also passes through cables.

To read the rest go to: https://www.middleeasteye.net/news/red-sea-cables-how-us-uk-spy-agencies-listen-middle-east

 

'Digital Suez': How the internet flows through Egypt - and why Google could change the Middle East

Most web traffic between Europe and Asia passes through fibre optic cables crossing Egypt. Could a proposed new route through Israel and Saudi Arabia break the 'Red Sea bottleneck'?

 

Most internet traffic between Europe, the Middle East and Asia passes through Egypt (MEE/Illustration by Mohamad Elaasar)

 

Middle East Eye: There are only a few historically strategic transit points around the Mediterranean Sea: the Strait of Gibraltar, the Bosphorus, and the Suez Canal.

While the Suez Canal has been a jewel in Egypt’s crown since 1869, netting the country some $5.6bn in revenues in 2020, it accounts for just eight percent of world cargo shipments.

But Egypt’s location as a fibre optic cable hub, linking Europe, Africa, the Middle East and Asia, means up to 30 percent of the global population’s internet connectivity transits through the country.

“If you want to route cables between Europe and the Middle East to India, where’s the easiest way to go? It is via Egypt, as there’s the least amount of land to cross,” says Alan Mauldin, research director at telecommunications research firm TeleGeography in Washington DC.

Egypt, through its state-owned monopoly Telecom Egypt (TE), has successfully capitalised on its position to entice cable operators to transit the country.

“It is one of Egypt’s trump cards, like the Pyramids, which never goes out of fashion. They are used to making business out of transit and tourism, but now they’re doing it with data. It is a digital Suez canal, which trades on its geopolitical position,” Hugh Miles, founder of Arab Digest, in Cairo, told Middle East Eye.

There are 10 cable landing stations on Egypt’s Mediterranean and Red Sea coastlines, and some 15 terrestrial crossing routes across the country, of which 10 are operated by the Egyptian telecom giant, spanning a region stretching from the Mediterranean as far as Singapore, according to TE.

 

To read the rest go to:  https://www.middleeasteye.net/news/google-egypt-suez-digital-internet-flow-change-middle-east