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Gulf Cooperation Council

Persian Gulf Rent-a-Sheiks

(Excerpted from Chapter Five: Persian Gulf Rent-a-Sheik: Big Oil & Their Bankers…)

Recent destabilization campaigns against the Qaddafi government in Libya and now targeted at the Assad government in Syria, have been spearheaded by Persian Gulf monarchies whose interests have always been more aligned with those of Western bankers and multinationals than with the aspirations of the Arab people.

 

Gulf Cooperation Council

Gulf Cooperation Council

The elite single families who rule the six Gulf Cooperation Council (GCC) nations – Saudi Arabia, Kuwait, Qatar, Bahrain, United Arab Emirates and Oman – are heavily invested in Western economies.  High volume crude oil production keeps this investment capital flowing to Wall Street while allowing the GCC elites to live opulent lifestyles.

In this way the volume of oil production is much more important than the price received for the oil for Western bankers and the GCC monarchs alike.  In addition, the GCC nations have been following the Four Horsemen – Exxon Mobil, Chevron Texaco, BP Amoco and Royal Dutch/Shell – downstream and now control refineries, petrochemical operations, etc.  In this capacity they desire cheap crude oil stocks to fuel these endeavors.  Hisham Nazer, the current Saudi Oil Minister put it this way, “We now have a mutual bond of self-interest and reciprocal security interests.”

As Western dependence on Third World resources has increased, it has become increasingly necessary for the international bankers and their corporations to include local elite cliques in their capital accumulation schemes, making a small group of local people extremely wealthy so that this group will cooperate in selling local resources cheaply to the West.

An example of this utilization of local elites as surrogates can be seen through the case of the richest man in the world.  He is Sultan Hassanal Bolkiah, Sultan of Brunei, a tiny oil enclave on the island of Borneo, where Royal Dutch/Shell holds a virtual monopoly over the oil industry and has paid the Sultan well to keep it that way.  The Sultan of Brunei is reported to be worth over $60 billion and lives in a 1,778-room palace.

These local elite will, in turn, hand over their wealth to Western bankers for protection from devaluation and bank failure.  This robs the home country of much-needed capital and often precipitates devaluation and debt crises.  The US has itself become a debtor nation and owes its debts, in part, to these same Third World elites, who own over $1 trillion on deposit at large US banks, while their fellow countrymen live in abject poverty.  Egyptian elites, for example, hold $60 billion in deposits in foreign banks, while the average Egyptian earns $650/year. [1]

In the case of the GCC, the amount of recycled petrodollars flowing back into Western investments is truly staggering.

The Saudis alone now have over $600 billion invested abroad.  Citigroup owns 33% of the Saudi American Bank but is itself now controlled by members of the House of Saud.  In 1993 Saudi Prince al-Waleed bin Talal, owner of Saudi Commercial Bank, plunged $590 million into Citibank.  Bin Talal now owns 17.34% of Citigroup, while Crown Prince Abdullah owns a 5.4% share, making them the bank’s two largest shareholders. [2]

The Saudi Citigroup share purchases were facilitated by the Washington-based Carlyle Group, which is 20%-owned by the Mellon family that owned Gulf Oil and now owns a large chunk of Chevron Texaco.  Carlyle is led by former Reagan and Bush Defense Secretary and Reagan NSC Chairman Frank Carlucci.  George Bush Sr., James Baker III and former British Prime Minister John Major are senior advisers and board members at Carlyle.  In 1995 Prince bin Talal teamed up with Canadian developer Paul Reichmann, Loews chairman Larry Tisch and Lebanese financier Edmund J. Safra to buy London’s Canary Wharf complex for $1.04 billion. [3]

UAE ruling Sheik Zayed runs the Abu Dhabi Investment Authority.  Much of its money is handled by private investment and equity firms like Carlyle Group and Donaldson, Lufkin & Jenrette, which is 18% owned by the Saudi Olayan Group.  Olayan also owns big chunks of JP Morgan Chase and CS First Boston.  The director of the Abu Dhabi Investment Authority serves as Carlyle Group’s Asian adviser.  Bahrain plays a role in this petrodollar shuffle, serving as the key unregulated offshore banking center for both the GCC sheiks and their international mega-bank partners.

Lebanon had been the premier banking center of the Middle East in earlier days, but with Beirut reduced to rubble by Israeli shelling, merchant banking has moved to the duty-free port of Dubai in the UAE.   Investment banking is centered in Kuwait.  But it is Bahrain which is home to the vast multi-billion dollar pool of money market funds which emanates from GCC Four Horsemen-derived petrodollar revenues.  Most banks in Bahrain are foreign-owned and all US mega-banks have operations there.  Many of Bahrain’s banks are owned by GCC elite and serve as a major conduit in the petrodollar recycling process.  The Kuwait Burgan Bank, for example, owns a 28% stake in one of Bahrain’s largest banks, the Middle Eastern Bank.

The most powerful firm in Bahrain is Investcorp, which took big stakes in Saks Fifth Avenue, BAT, Tiffany, Gucci, Color Tile, Carvel Ice Cream, Dellwood Foods, New York Department Store of Puerto Rico, Circle K and Chaumet.  Investcorp was co-founded in 1983 by Bahrain ruling family scion Sheik Khalifa bin Sulman al-Khalifa, who owned a big chunk of BCCI.  A recent Investcorp prospectus lists the Bahrain Minister of Finance as an owner.

Investcorp’s chairman is Abdul-Rahman Al-Ateeqi, former Oil and Finance Minister of Kuwait.  Its Vice-President is Ahmed Ali Kanoo of the wealthy Saudi Kanoo family, which is worth an estimated $1.5 billion.  Former Saudi Oil Minister Sheik Yamani was one of Investcorp’s founding shareholders, along with seven members of the Saudi royal family.  Investcorp has its eight-story headquarters in Bahrain, along with a Park Avenue New York office and a Mayfair district office in London.  Sheik al-Khalifa’s partner in launching Investcorp was Nemir Kirdar, the bank’s current president who was in charge of Chase Manhattan’s Persian Gulf operations.  Numerous Investcorp senior executives are Chase alumni as well. [4]

Many Investcorp purchases turned out to be flops and there is a shady side to the bank.  French jeweler Chaumet executive Charles Lefevre said Investcorp fudged Chaumet numbers to entice shareholders while trying to pawn its shares off at a higher price to other Persian Gulf investors.  Another complaint alleged that Investcorp attempted to loot the Saudi European Bank in Paris.  Investcorp board member Abdullah Taha Bakhsh, a reclusive Saudi billionaire, invested heavily in George W. Bush’s Harken Energy, along with Bahrain’s ruling Sheik al-Khalifa.  Bakhsh was accused of looting the Al Saudi Banque of Paris when it collapsed in 1988 just ahead of the strikingly similar collapse of BCCI.  Bakhsh is a shareholder in First Commercial Financial Group, a Chicago-based commodity futures trading firm which was sanctioned by US regulators for check-kiting and fraud.  Just before the Gulf War broke out, Investcorp sold a 25.8% share to an Iraqi company, despite a Bahrain law prohibiting such transactions. [5]

The Saudis and Kuwaitis are the clear leaders in GCC overseas investments.  The Kuwaiti Investment Authority has over $250 billion invested abroad and is the biggest foreign investor in Japan and Spain.  Citigroup and JP Morgan Chase handle Kuwaiti investments in the US, where the al-Sabah clan owns stock in each of the 70 largest firms listed on the New York Stock Exchange.  Their US holdings include 100% of Occidental Geothermal, 29.8% of Great Western Resources, 100% of the Atlanta Hilton Hotel, 45% of the Phoenician Hotel and 11% of Hogg Robinson.

In Germany they own 14% of Daimler-Chrysler, 25% of Hoechst (the Nazi IG Farben spin-off and the world’s 2nd largest pharmaceutical company), 20% of Metallgesellschaft and part of German retailer Asko.  In Italy they own 6.7% of Afil, the Agnelli family holding company which owns Fiat and several other endeavors.  In the UK Kuwait owns St. Martin’s Properties and 5.4% of Sime Darby.  In Malaysia their K-10 company owns the biggest newspaper, the New Straits Times Press.  In neighboring Singapore, the Kuwaitis own 10.6% of Singapore Petroleum, 37% of Dao Heng Holdings and 49% of the securities firm J. M. Sassoon.

Kuwait Oil Company (KOC), was technically nationalized in the early 1980’s, but remains close to its former parents, Chevron Texaco and BP Amoco, selling the two Horsemen oil at a discount.  KOC made wealthy the al-Sabah emirs and the al-Ghanim family, who acted as the company’s agent for decades.  By 1966 KOC bought a Danish subsidiary and became the first Middle Eastern oil company to retail gasoline in Europe.  KOC has been the most aggressive GCC firm in its overseas downstream investments.  In 1982 it bought hundreds of Q8 gas stations across Europe.  By 1987 it owned over 5,000 gasoline retailers in Europe and South Asia. [6]

The Kuwaitis even bought into one of the Four Horsemen- BP Amoco.  As of 1988 they owned a 22% share.  They have since reduced their share to 9.85%, still a controlling interest. [7]  They purchased the Naples, Italy refining operations of Mobil, own nearly 4% of ARCO (recently bought by BP Amoco), and own 2.39% of Phillips Petroleum (recently merged with Conoco).  In Spain the Kuwaitis operate the Torras Hostench chemical firm.  In Japan they operate Arabian Oil.  There was talk in oil industry circles that Kuwait was about to become the “Eighth Sister”.

All told GCC investments in Western banks and corporations total over $1 trillion.  The bulk of this is invested in long-term US and Japanese government bonds.  The GCC sheiks are crucial to floating the entire house of cards that is the global economy.  Their guaranteed purchases of US debt, which has largely been accrued through defense spending in the Persian Gulf region, keep the US dollar strong and prevent the international financial architecture from crumbling.  The emirs and their elite friends also bankroll CIA covert operations, while re-balancing their trade surpluses with the West through the purchase of US weaponry to protect their oil fiefdoms.

Kuwait’s investments abroad have not been without scandal.  They owned two California hotels with S&L crook Charles Keating. [8]  Kuwait is part-owner of the HSBC-controlled Midland Bank, a major player in the Silver Triangle drug money shuffle and clearing agent for the government of Panama, whose board is loaded with ex-Pentagon officials.  In 1981, the same year that the GCC was created, KOC bought Sante Fe International, a US firm with close ties to the CIA.  The company had developed a horizontal drilling technology which the Kuwaitis employed in stealing Iraqi oil.

[1] “Nightmare Victory”. Eqbal Ahmad. Mother Jones. March/April 1991. p.7
[2] “Saudi Prince Becomes Citicorp’s Top Stockholder”. Michael Quint. New York Times. 2-22-91. p.A-1
[3] “Saudi Prince Joins Reichmann Bid to Reaquire London Complex”. Larry M. Greenberg. Wall Street Journal. 8-4-95. p.A-4
[4] “All That Glitters”. Larry Gurwin and Adam Zagorin. Time. 11-6-95. p.52
[5] Ibid. p.52
[6] Oil Politics in the Gulf: Rulers and Merchants in Kuwait and Qatar. Jill Crystal. Cambridge Press. New York. 1990.
[7] “US Hungry for Kuwait Petrodollars, Not Just Oil”. Peter Dale Scott. Pacifica News Service. 12-24-90
[8] “Meet the New World Order”. Christine Bratton & Doug Henwood. Left Business Observer. 1-26-91. p.2

Dean Henderson is the author of four books: Big Oil & Their Bankers in the Persian Gulf: Four Horsemen, Eight Families & Their Global Intelligence, Narcotics & Terror Network, The Grateful Unrich: Revolution in 50 Countries, Das Kartell der Federal Reserve & Stickin’ it to the Matrix.  You can subscribe free to his weekly Left Hook column @ www.deanhenderson.wordpress.com

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28 Responses to Persian Gulf Rent-a-Sheiks

  1. happeh July 16, 2012 at 5:00 pm #

    The Sheikdoms are full of idiots.

    The minute they are no longer useful, all of those assets will be confiscated just like Iranian assets have been confiscated.

    The Israelis controlling all that Arab Oil Money must laugh pretty hard about that.

  2. Ariadna Theokopoulos July 16, 2012 at 5:08 pm #

    “The US has itself become a debtor nation and owes its debts, in part, to these same Third World elites”

    Curious. The biggest creditor to which the US owes trillions is the Federal Reserve Bank. I had no idea that the bankers who control it are in fact third-world Arabs hiding behind jewish names, the rascals!

    • Deadbeat July 17, 2012 at 2:11 am #

      The biggest creditor to which the US owes trillions is the Federal Reserve Bank

      Booyah!!! That’s the real truth.

  3. botafogo July 16, 2012 at 6:24 pm #

    You see now, Ariadna, why Laura and Khalid are so keen on on toppling the Syrian government? because after and IF they succeed there will remain only this thin line of jewish front names between the salafis like themselves(and these sheiks of course, “third world Arabs” so to speak) on one hand and total domination of the whole world on the other!
    btw, Syria is one of the few countries(and certainly the ONLY arab country) that does NOT owe a cent to foreign banks, what a nuissance for Khalid, Laura and the sheiks!

    • Laura Stuart July 16, 2012 at 6:35 pm #

      You are a liar. Show me where I ever supported any of these corrupt people.

      • botafogo July 16, 2012 at 9:41 pm #

        You silly zio-salafi shill are calling me a liar? What do i have to show you? Just go and reread you own rantings against the government of Syria and you will see that they correspond word for word with the anti-syrian rantings of “these corrupt people” with whom you’re sitting in the same boat, don’t you? Don’t try to deny it, it’s a fact.
        Do you keep writing against the Nejdi family of dictators who consider the whole of Arabia their property and even gave the country their family name, do not allow any elections, any meetings, nothing at all? NO, you DON’T!
        Do you keep writing about the horrible atrocities committed against the people of Bahrain by the usurping ruling family with the help of Nejdi occupiers? NO, you DON’T!
        So it’s you who are a liar, hypocritical zio-salafi stooge.

        • Laura Stuart July 16, 2012 at 9:46 pm #

          yes yes my rantings against Assad make me a Jew a Zionist an Abd al Saud – anything else you care to lie about?

          Show me where I ever supported Al Saud or the Gulf rulers.

    • Ariadna Theokopoulos July 16, 2012 at 6:46 pm #

      Yes, I see.
      “Syria is one of the few countries (and certainly the ONLY arab country) that does NOT owe a cent to foreign banks, what a nuissance for Khalid, Laura and the sheiks!”
      There was Libya too but those heretics, deviationists and pornographers have been pushed aside so that the Libyan people can enjoy the freedom to borrow money to their hearts’ content..

      • who_me July 16, 2012 at 8:21 pm #

        syria isn’t paying israeli oligarchs loan interest? isn’t that anti-semitism? no wonder laura and khalid (and that new guy, with the suitably arab sounding name, which i’ve forgetten now) are so upset with assad. the nerve of a mere muslim to withhold funds from jewish banksters. it’s simply unheard of in civilized circles. assad should be rogered with a knife and then shot, like qaddafi, for such impertinence!

        • botafogo July 16, 2012 at 9:50 pm #

          “syria isn’t paying israeli oligarchs loan interest? isn’t that anti-semitism? no wonder laura and khalid (and that new guy, with the suitably arab sounding name, which i’ve forgetten now) are so upset with assad.”

          exactly!!!

  4. Laura Stuart July 16, 2012 at 6:32 pm #

    Personally I want rid of all of them including Assad. It is very wrong to judge a whole nation of Muslims by the self imposed so called leaders, least of all those who stole the wealth of the Ummah.

    • botafogo July 16, 2012 at 9:46 pm #

      “Personally I want rid of all of them including Assad.”

      You miserable zio-salafi liar, “all of them including Assad”, so why do you speak exclusively about Assad and not about the salafi tyrants with whom you’re sitting in the same boat fighting against the Syrian government? Don’t you worry about Syria, they’ve had their elections, they voted in a referendum for a new constitution and soon they will have their presidential elections in which they will elect a president they like. And in the meanwhile they are eliminating quite a number of salafi terrorists paied and armed by the Persian Gulf salafi dictators
      Try not to peddle here a kind of rechauffee of the qatari Al-Khanzeera and better start writing against the nejdi, bahraini and “all of them”, i mean the salafi dictators, then maybe you will have some credence from readers of this site.

      • Laura Stuart July 16, 2012 at 9:54 pm #

        Yes I say it again I want rid of all of them not just the bahraini and saud ones but ALL OF THEM.

  5. who_me July 16, 2012 at 8:31 pm #

    an interesting thing which the article shows is how integrated the leadership of those gcc nations is with the western capitalist polygarchy. one of the canards of the “america controls israel” crowd is that america uses israel as their colony controlling the me. and needs it for that reason. but as the connections spelled out in this article show, the western capitalists don’t need israel to control the leadership of me countries at all. they do quite well without israel. the leaders of these countries are as or more integrated into the western capitalist establishment as any of their other colonies are.

    • who_me July 17, 2012 at 12:00 am #

      Laura Stuart

      July 16, 2012 at 9:59 pm

      typical jewish slander propaganda from typical jewish slander propaganda sources. as usual from you.

  6. Ariadna Theokopoulos July 16, 2012 at 10:39 pm #

    Penetrating economic insight…..
    Neah, twaddle

  7. who_me July 17, 2012 at 1:22 am #

    http://news.antiwar.com/2012/07/16/us-navy-fires-on-fishing-boat-in-persian-gulf-killing-one/

    “US Navy Fires on Fishing Boat in Persian Gulf, Killing One”

    the zionazis send massive forces to ramp up the tension and then when the inevitable happens, say: “oops, but it’s not our fault, they provoked us into it”. sick. and this is also sick:

    “The Obama administration has significantly increased its military and naval presence in the Persian Gulf region as of late. The build up, planned for at least a year, comes mainly in the form of Navy warships and minesweepers patrolling the waterway to the south of Iran. Stealthy F-22 and F-15C warplanes have also been placed into two separate bases in the Persian Gulf.”

    the inclusion of f-22s, if true, represents a serious intent by the zionazis to go to war against iran. the f-22 is a surprise first strike weapon. they will be sent in early to try and knock out iranian air defenses. these aircraft have been held back from overseas deployments until now. as far as i know, they were not used in iraq, nor any of the other american criminal aggressions. this is their first aggressive deployment.

    • Barb Weir July 19, 2012 at 12:44 am #

      Obviously, the first wave of the allied attack on Iran has already been accomplished. Do you think they have completed their mission or that more Indian fishermen will die?

      • who_me July 19, 2012 at 1:04 am #

        “Do you think they have completed their mission or that more Indian fishermen will die?”

        i think their “mission” has just begun. what do you think?

  8. who_me July 17, 2012 at 1:32 am #

    http://www.ipsnews.net/2012/07/human-rights-worse-after-gaddafi/

    Human Rights Worse After Gaddafi

    • Ariadna Theokopoulos July 17, 2012 at 2:36 am #

      That cannot be. I know someone who has friends over there who say it’s all copacetic. He was a tyrant, you know, killing his own people and worst of all he was a heretic and a deviationist.

      • who_me July 17, 2012 at 3:12 am #

        yes, i agree, it’s amazing what refusal to be a jp pawn does to a leader. leaders resort to all sorts of debauchery, heresies and barbarity once they cross that line. but i had to post that vile article to show how the shiites were such liars.

        • who_me July 17, 2012 at 3:14 am #

          and evil. did i mention how evil the shiites are?

          • Ariadna Theokopoulos July 17, 2012 at 3:38 am #

            No, you didn’t but I already had it from a trustworthy source. Or two

          • who_me July 17, 2012 at 3:46 am #

            ah…

  9. who_me July 18, 2012 at 8:04 pm #

    http://original.antiwar.com/justin/2012/07/17/the-lies-we-tell/

    “The assumption is that Obama and the Democrats will have to pay a political price for intervening in Syria’s civil war — but to whom will the price be paid? Republican hawks, led by John McCain and Lindsay Graham, are harrying the administration for not intervening more strenuously and openly, while Mitt Romney — while not yet calling for airstrikes, per McCain and Graham — criticizes the White House’s “paralysis” and calls for openly arming the rebels, rather than doing it under the table.

    As for the prospect of Obama alienating some of his supporters on the left-wing of the Democratic party: this didn’t happen when it came to Libya, and I doubt intervening in Syria would deflate the President’s enormous credibility in those quarters, where identity politics long ago displaced anti-imperialism as an ideological priority. “Humanitarian” interventionism is today the default foreign policy agenda of the liberal-left, with only old-fashioned Marxists dissenting.”

    the last line quoted is interesting. the old fashioned marxists are the people on the left who still have not been corrupted by zionist jews pretending to be leftwing – commonly now known as the psuedo-left or cyrpto-zionist left. if rightwinger raimondo is savvy enough to know of this distinction of the real left from the pretenders who get credited for being “the left”, then maybe it’s a sign that there is hope for the real left yet.

  10. who_me July 20, 2012 at 1:56 am #

    http://www.rnw.nl/english/bulletin/syria-rebels-control-all-iraq-syria-border-points-iraq-official-0

    “The top official said Iraqi border guards had witnessed the Free Syrian Army take control of a border outpost, detain a Syrian army lieutenant colonel, and then cut off his arms and legs.

    “Then they executed 22 Syrian soldiers in front of the eyes of Iraqi soldiers.”

    grotesque death squads in full dress zionazi regalia. from the description of the number of soldiers, it’s likely the zionist terrorists captured 1 border outpost only, not the border.

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