World Bank President Paul Wolfowitz, German and Arab officials and business leaders are meeting this week to help refocus attention on improving Germany's ties with the Middle East.
The Hamas victory poses a particular problem for German-Arab relations
It has been a tense year in Arab-European relations. The war in Iraq is still raging. Fury over Danish caricatures of the Prophet Mohammed led to rioting and boycotts of western products. A democratic election brought militant group Hamas to power in Palestine. And Iran continues to resist appeals to cease its nuclear activities.
As a result, the eighth annual German World Bank Forum, on Thursday and Friday, is bringing together representatives of the political, business and academic communities to refocus attention on ties between Germany and the region and identify opportunities for enhanced political and economic cooperation.
The forum, titled, "Germany and the Middle East: Change and Opportunities," won't focus on the boycott of Hamas or even Iran's nuclear activities. Instead, topping the agenda is how to increase technical, educational, political and especially economic cooperation and social contact.
"The region has important business potential, particularly for Germans," said Alexander Neunzig of the Hamburg Chamber of Commerce, a partner in the forum. "And increased business relationships are a prerequisite for improved political ties, better economic development in the region and peace."
Billions in trade
German trade with the region amounts to billions annually. With countries such as Iran or Saudi Arabia, annual trade is 4.9 billion euros ($6 billion) and 5.4 billion euros respectively, according to the Hamburg Chamber of Commerce. The main areas of trade are chemical and industrial products and machinery.
World Bank President Paul Wolfowitz is expected to urge more German development help
As a result, some fear that German business could suffer if political relations between Arab nations and the West deteriorate. Germany, who opposed the Iraq war, has been in the forefront regarding Iran and Palestine, leading some in the German business community to become nervous.
"We need to examine where the Middle East is heading," said Peter Goepfrich, executive director of the German-Arab Chamber of Commerce. "We also need to take a look at the widening gap in relations. On the one hand, there is an economic boom in the region; on the other, there is an escalation of political tensions."
Germany has a good reputation in the region, built over many years. Much of that is due to the prestige of its products as much as personal interaction and trust-building in business relationships. This will help insulate German business from politics, experts say.
"Even if the political situation gets tenser, our business relationships are strong and much more stable and should be fine," said Neunzig. "We even have businessmen coming from Iran and Iraq to the forum."
A slow renaissance
There is also an increasing interest in Germany in enhancing political ties since the September 11 attacks in New York.
"A policy shift is too strong a description," said Katja Niethammer, a Middle East expert at the German Institute for International and Security Affairs. "But the past Social Democratic-Green party government gave a new accentuation to the region and Germany became more visible."
The war in Iraq and Germany's opposition to it also enhanced the country's standing in the region, say experts. Although it has also led to some misunderstandings as Arab countries expect Germany to side with them against the US in other issues.
Germany's standing in the Arab world increased after it opposed the Iraq war
Other forms of cooperation have been expanding in the past decade, such as efforts to promote good governance, rebuild infrastructure and in education. A particular emphasis is on reaching young people: 60 percent of the population in the Arab world is between the ages of 15 and 30.
As a result, German-style universities have opened in Syria, Cairo and Jordan in the past five years and one is planned for Oman. The Goethe Institute and German Academic Exchange Service (DAAD) are also expanding into the Gulf region, with new branches in Abu Dhabi in the United Arab Emirates.
"The Gulf region has only recently come into focus for Germany very recently," said Germany's ambassador to the UAE, Jürgen Steltzer. "Before we were not too politically active, but mostly our relationship was one as a supplier of consumer goods. But as we want to make our relationship stronger, that also has to include the softer fields, such as cultural and educational exchanges."