Tuesday, 14th February 2017
Michael Thomas reflects on challenges and opportunities and how to connect with the MENA region in an exciting new market situation.
Forty years ago I started my career of business development with the Middle East, the first oil boom had begun and I wanted to be part of it. I originally started in the Lebanon as a young man in the early seventies, it was not long before I was invited to join the Kuwait Shipping Company and I lived in Kuwait. This we built up to become UASC, the major flag carrier operating to the Gulf. It was the start of what was to become a great business development adventure, which enabled me to rub shoulders with some of the great and the good of the Middle East – both with Arab and International business people.
These were very exciting times and none of us involved had ever had it so good, nor are those days likely to return. The leaders of the Middle East, whoever they were, were in control. Money was in plentiful supply and there was a real ‘can do’ attitude in the region that was common amongst the Arabs and expatriates; in fact, this was the start of the real Arab Spring. The only festering sore at the time was the occupation of Palestine, which sadly still continues.
I was involved in many of the major projects of the day, British exports were booming and British companies were and still are highly regarded in the region. The fall of the Shah of Iran came surprisingly as quite a shock to those in the West, we were not ready for it and a new regional power was emerging. These were exciting days.
In the late 1980’s I was invited to join The Committee for Middle East Trade, known as COMET, which was at that time the British Government’s Private Sector Advisory group on trade with the Middle East. The oil boom was in its second phase and the Thatcher Government had developed a close, export driven working relationship with the private sector. There was tremendous support from Ministers and the DTI Country Market Desks, which in my opinion it was a mistake to recently close. As UK companies excelled in the export market, Government was totally supportive. Those joining a trade mission to the Gulf could claim a £450 subvention from Government. British Embassies willingly gave their time at no charge and commercial attachés somehow had much more time to assist exporters. Change was in the wind. Politics and instability started to take their toll.
The Iran relationship became fragile with a breakdown of political trust, but there was business to be done, constructive engagement became the new commercial diplomacy and it worked. The Iranians I soon realised were not all religious fanatics but a very intelligent highly civilised and a hard-working race. The Iraq-Iran war was the beginning of Saddam Hussein’s unwise adventures on the battle fields, culminating in his eventual fall, a glimmer of hope at the time, but the flame soon died. Perhaps the liberation and development of Kurdistan one of the few positive outcomes. I was proud to lead the first trade delegation to Kurdistan following the downfall of Saddam, with Lord Tim Clement-Jones backed up by a full complement of armed soldiers to look after us. We met with Prime Minister Barzani and much business was done.
I well remember taking my first trade mission to the region over 20 years ago, long before commercial trade missions had got going. We did the Levant: starting in Beirut, driving to Damascus and then on to Jordan for nearly three weeks – far too long for a trade mission, but a really interesting and enjoyable experience. This whetted my appetite even more for the region and its people. Later I met President Assad at a dinner hosted by the British Government at Lancaster House and I remember well one of his aides telling me “Mr Thomas for too long Syria has been on the losing side and now we are going to join the winning side.” I wonder if he really thinks he has won in Syria.
The current disintegration of Syria is a real tragedy and will take some time to overcome and the rebuilding of Syria, a poor country, is going to be a major challenge. Other North African Countries are now suffering with the regional economic downturn and a worrying new political dimension has appeared with Russia meddling in the Eastern Med and the Middle East.
The complete chaos of Libya is another tragedy. Many of you may remember some years ago I produced Libya Opportunity and Challenge at the Corinthia Hotel in Tripoli, this was a major undertaking and a bit of a gamble, but it paid off. I was ably assisted at the time by Susan Sandouka, who was then working with me. Saif Gaddafi and 13 of his Ministers and over 350 delegates attended the conference, many from the UK. The conference ended with an amazing dinner in one of Gaddafi’s huge tents. It was a real achievement and we all thought that things in Libya were about to change, but not in the way they did! This was followed with Egypt’s Government suffering a hiatus with the Muslim Brotherhood. We all saw that coming when George Bush demanded democracy for Egypt at the World Economic Forum, which I attended.
The result of this instability coupled with the reduction of oil prices means that the UK has lost a substantial part of its export markets in some regional countries. I feel very sad about the Yemen Civil War, Yemen is a country which I know well and have successfully carried out millions of pounds of business, not a rich country but its people are very able and intelligent businessmen. The implications for instability in the region created by the current Yemen War are great. This is another lost opportunity, Yemen, or at least the strategic Port of Aden should be the centre of all shipping, but this was not to be and it now looks as if Oman will pick up this challenge.
Perhaps one of my biggest disappointments of my time has been that the UK seems to be no further forward with Iran, in fact we have lost considerable ground over the last ten years. When I was running the Middle East Association I was invited by the UK government to be their trade specialist on Iran to focus on developing commercial not political relationships visiting Iran four or five times a year. I had great success and met many wonderful people, British exports reached nearly £600 million a year I set up and ran the British Pavilion of the Tehran Oil and Gas Show and developed this to its peak of 120 UK companies exhibiting. Relationships between the British and Iranians were much more relaxed then and UK businessmen were being welcomed and many did excellent business.
Today Iran relationships with the UK are an enigma. The UK has much to offer Iran and strangely even with the current politics businessmen do get on well with each other, but unfortunately there has developed a complete lack of trust and political paranoia in the regime with the UK and sadly this has impacted on our business relationships, not helped of course by American sanctions and their mutual mistrust. Iran continues to be a lost opportunity for the UK and frankly it will take a long time for our relationships to get back to the point where we were ten years ago.
Michael Thomas, Executive Chairman & CEO