Page 429 - Arabia the Gulf and the West

426 Arabia, the Gulf and the West

July 1979, is equivalent to 19,500 per cent. It is hard to think off-hand of any
Western manufacture which is priced comparably.
The inflation of which the OPEC governments complain has to a large
extent been generated in their own countries. The thousands of millions of
dollars that have flowed into the oil states of the Gulf since 1970-71 have
pushed up the prices of goods and the cost of skilled labour to giddy heights.
This was inevitable, given the huge sums of money involved, the carelessness
with which they were spent, and the determination of all sections of the
populations of these states to profit from the vast windfall. It did not require a
rise in the cost of imports from the industrial countries to create inflation in
these states: it was a home-grown product, brought about by an impatience to
possess in profusion, and in the shortest possible time, not just the manufac­
tures of the West but also, if possible, the entire infrastructure and superstruc­
ture of a modern Western economy. Skilled labour was scarce, so that con­
struction costs soared. Foreign firms were forced to take on local partners who
contributed nothing of value to any enterprise but added greatly to its cost. A
reckless multiplicity of orders and contracts for every imaginable artefact and
service generated follies by the score, as epitomized by the importation of a
shipment of sand from England to equip a swimming resort in Saudi Arabia. So
great were the quantities of goods and materials purchased that the rudimen­
tary port facilities of the Gulf states were overwhelmed by them. The charges
for their transport soared, as ships waited off-shore for weeks, or even months,
on end to discharge their cargoes, the intrinsic value of which was, in many
cases, a mere fraction of the cost of their shipment. When to these countless
mercantile follies and the administrative blunders which accompanied them
are added the millions upon millions of dollars, dirhams, riyals and dinars­
how many millions no one will ever know, though the total must be enormous-
absorbed by the swarm of middlemen, commission agents, influence pedlars,
courtiers, placemen, touts and pimps of every hue and description frantically
engaged in the soliciting and obtaining of contracts, the charge that inflation
has been exported to the Gulf oil states from the West may be seen for the
canard it is.
The argument based upon past exploitation by the oil companies and the
compensation due in consequence is equally false. One could argue with as
much validity that the oil industry in the Middle East is virtually a gift from the
West, that before the coming of the oil companies the Arabs and Persians knew
neither what they possessed nor what to do with it if they had known, and that
the discovery and exploitation of their oil amounted to a charitable enterprise
on the part of Western philanthropists. Whatever flavour of moral lollipop one
elects to suck upon when contemplating the development of the oil industry in
the Middle East, the fundamental truth cannot be avoided that since the end of
the Second World War the governments of the Middle-Eastern oil states have,
without contributing a scintilla of effort, capital or skill of their own, acquired