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Business

Investing in the Future of the Middle East

Business between the West and the Arab world has suffered since September 11, largely because Westerners feel insecure in the region. But staying away could cause more harm in the long run, politically and financially.

Business is driven by profits, by the hard facts of supply and demand. But it is also sensitive to social and political conditions. A key example of this is the struggling stock market in the wake of the terrorist attacks on New York and Washington.

The financial world took a major hit when the World Trade Center was attacked, and has still not entirely recovered. Fear of renewed attacks and a general feeling of insecurity hinder the spirit of investments, especially where financial risks may be involved. And one of the most volatile markets right now is the Middle East.

Few western companies are conducting business in the region at the moment. Many fear that the markets are too unstable to invest in. When the political situation is so uncertain, no one can guarantee that an investment will pay off. However, many more companies are pulling out of the region on the basis of something more fundamental - a clash of cultures between the West and the Arab world.

In the wake of the terrorist attacks many Americans and Europeans feel unsafe in the Middle East. Part of this is due to the concentrated media attention -largely negative - streaming out of the region. Everywhere one looks, bombs seem to be exploding. The evening news is filled with the latest reports on attacks in Israel and Afghanistan.

But the Middle East comprises more than just religious and ethnic conflicts. It is rapidly modernizing and becoming one of the fastest growing economic regions. The Gulf states and Emirates, for example, have an average per capita income of $17,000. However, without trading partners in the West to help inject foreign revenue and stabilize the economy, the regional conflicts will become more pronounced.