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1 - Summers of discontent: business–state politics in the Middle East

Published online by Cambridge University Press:  22 September 2009

Pete W. Moore
Affiliation:
University of Miami
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Summary

August is not a pleasant month in Kuwait City. In the noonday heat, a cigarette lighter left in a car can burst into flames. Sandstorms arrive without warning, making immediate shelter vital. Understandably, August is a time many Kuwaitis choose not to remain in the country, giving the impression that politics is almost suspended during the summer months. How ironic, then, that two of Kuwait's most damaging political events, a massive fiscal collapse and invasion by Iraq's army, occurred in the month of August. These events were not unrelated. The crash of an extra-legal stock market, the Souq al-Manakh, in 1982 initiated a string of economic difficulties that would contribute to the Iraqi invasion nearly a decade later. To cope with the fiscal and political fallout from each, the Kuwaiti state turned to its private sector. The public–private struggle to respond to these events would require enduring many more Augusts.

Kuwait, however, was not alone. Across the Middle East, declines in external sources of capital were testing state capacities to respond. Of all the Arab states, no other was tied to Kuwait's travails quite like the Hashemite Kingdom of Jordan. In addition to foreign aid from the West, Jordan was a major recipient of development aid from Kuwait. Hundreds of thousands of Jordanian professionals have worked in the public and private sectors in Kuwait since the 1950s.

Type
Chapter
Information
Doing Business in the Middle East
Politics and Economic Crisis in Jordan and Kuwait
, pp. 1 - 29
Publisher: Cambridge University Press
Print publication year: 2004

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