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Chaos seems to reign from the waters of the Nile to the Fertile Crescent and onwards to the seat of the old Ottoman Empire. If we believe the old adage about investing things are at their worst it may be time for Middle East investment. Civil war continues to rage in Syria. Iran still seems to be pursuing nuclear ambitions. Protesters are on the verge of getting the Egyptian military to unseat a disastrous presidency in Egypt and are demanding changes in Istanbul as well. Some time back we suggested that it might be time to invest in peace in Syria. We were not ignoring the monumental problems of that country and the fact that it has become a battle ground involving the powers and would be powers of the region and the world. Rather we offered a vision based on more rationality that is currently being applied to the situation. Our comparison had to do with the civil wars and unrest in Central America a generation ago and how many leaders in the region woke up to the realization that they were being left behind. Our suggestion that it may be time for Middle East investment follows the same line of thought.
Democracy, Fair Governance, and Investment
Egypt has had a democratically elected president for just over a year. He was elected by a very small margin. However, he has governed as though he had received a huge mandate from the Egyptian people. What Mr. Morsi, the president of Egypt, has missed is the understanding that a true democracy is not just based on who gets the most votes. It is based on democratic and fair governance. The US system of checks and balances has served that nation well in keeping headstrong politicians from going too far either left or right over the course of more than two centuries. It is to be hoped that when the military steps back into Egyptian politics that it insists on a broader concept of democracy than that of Mr. Morsi’s Islamic Brotherhood who seem to believe that a small majority at the polls entitles them to enact laws that they believe are the mandate of the Almighty. If the Egyptian military can govern briefly and with a light touch they may be able to put Egyptian politics and the economy back on a sound footing. If so it will be time for Middle East investment, at least in Egypt. Fundamental analysis tells us the obvious which is that the tourism sector will bloom again if the social situation stabilizes. Egypt has a large manpower pool and many skilled individuals. All that it needs is a stable economy and political scene in order to succeed.