Obama’s SOS to Gulf emirs: Invest in US and global economies
A secret American delegation was sent by US President Barack Obama this week to solicit Saudi Arabian and other Gulf rulers for hundreds of billions of petro-dollars for investment in US and global economic stimulus plans, debkafile‘s exclusive Gulf sources report. They came away empty-handed.
The chilly welcome received by the delegation, which met finance ministers and the heads of banks in Riyadh and the five emirates, was generated by wide disapproval of the US president’s policy of engagement with Iran. Two other US missions had just been and gone, headed by defense secretary Robert Gates and special adviser to the US secretary of state for South Asia and Gulf affairs, Dennis Ross. Both failed to allay Gulf anger and trepidation over this policy.
Our Gulf sources report that the third delegation, which unlike the first two was unannounced, argued that since US economic recovery was not expected to turn the corner before 2011, Gulf investors still had a unique opportunity to partner the US in helping the world economy out of its doldrums. The general message was that if they Gulf rulers fail to invest in US and international markets at this point, they would miss out on the rewards of the recovery.
Not all the data presented to the Gulf officials matched the figures published in Washington and other western countries. They were informed on the quiet that Federal Reserve Governor Ben Benanke had been “premature” in his optimistic forecast of “slightly positive” growth in the second half of this year, particularly in the fields of banking and construction, and a recovery that will “strengthen” next year – even though US Treasury Secretary Timothy Geithner said Wednesday, May 6, it was “a good, independent, credible forecast.”
The Gulf states were urged to help the global economic back on its feet because, according to US data, the Gulf Cooperation Council (GCC) would by the year 2018 rank as the world’s fifth-largest economy after the US, China, Japan and the EU. “As major players in the world economy, you cannot stand on the sidelines,” they were told.
President Obama’s discreet approach figured in general terms at the GCC meeting of heads of state and finance ministers meeting in Riyadh Wednesday, May 6, which was convened to establish a regional central bank. But no decisions were taken.
According to our sources, the negative vibes between the Gulf and Washington over the Obama administration’s policy of favoring Tehran have made these Arab rulers doubly wary of responding to the US president’s appeal for a Gulf stake in US and global economic recovery