Foreign AffairsWritten evidence from Douglas Hansen-Luke and Rosamund de Sybel

1. Abstract

This report outlines the personal views of the authors based on their knowledge, relationships and combined experience of 10 years living and working in Bahrain.

Its primary purpose is to provide as objectively as possible an outline of Bahrain, its political situation, recommendations to resolve the current crisis and the likely outcome if the Bahraini Government pursues no new policy initiatives. Comments and suggestions are also made on the British Government’s policy towards Bahrain.

Throughout the document the authors’ maintain a positive view on all the inhabitants of Bahrain and, other than their obvious presence as British expatriates, have no strong affiliation with any particular group of Bahraini society. Any comments on Saudi Arabia are made as observers from without and from the standpoint of how the authors feel that country is perceived in Bahrain.

2. About the Authors

2.1 Douglas Hansen-Luke

Douglas Hansen-Luke lived and worked in Bahrain from 2007 to 2012. He was employed there as the regional CEO of an international asset manager. He represented the firm’s business and managed its relationships with public institutions and sovereign funds. In 2011 in response to the disturbances in Bahrain he managed the relocation of his firm’s office to Dubai. During his time in Bahrain, Douglas wrote and provided investment commentary to amongst others the BBC, CNBC, the Financial Times and the The Gulf magazine. He is now the Managing Partner of HLD Partners, a consultancy focused on responsible investing and an approved Parliamentary candidate for the Conservatives.

2.2 Rosamund de Sybel

Rosamund de Sybel lived in Bahrain from April 2007 to May 1st 2012. She worked first as a reporter and then editor of The Gulf magazine. This publication covered current affairs, economics and business across the Gulf and MENA region. In her last year in Bahrain, Rosamund worked as a Research Associate for the International Institute of Strategic Studies (IISS).

3. Key Points

There are positives

1. Day-to-day life continues almost as normal in Bahrain. In spite of continuing low-level violence:

(a)The Kingdom has a mixed and historically well-integrated society, the largest group of whom are foreigners who stay by choice

(b)Bahraini nationals, of whatever social group, pay no taxes have access to free health care, education and housing

(c)Violence is present from both sides but is by no means universal

(d)Moderate Government members and opposition leaders are closer to each other than is often realised

2. British Government policy, as opposed to media and public opinion, has generally reflected these facts.

But

3. Current policy will not end discrimination nor lead to reconciliation:

(a)There are significant inequalities between Sunni and Shia

(b)Police and protester brutality has occurred and continues to occur

(c)Moderate leaders have lost the initiative in managing this crisis

(d)Polarization and radicalization between communities is accelerating. Many Shia regard the security forces as tools of repression. Large numbers of Sunni view Shia protesters as violent, sectarian and pro-Iranian

The authors recommend that:

The British Government either explicitly state a policy of non-interference and non-involvement or actively play the role of a critical friend and offer a comprehensive dispute-resolution plan. For both the Bahraini and British Governments a successful resolution requires a higher level of engagement, moral courage and determination and an acceptance that even with this commitment, success will not be easily achieved

4. A Society Divided

4.1 Demographics

The defenders of the Bahraini regime, including many expatriates, believe that the Kingdom is not only one of the most pleasant places to live in the Gulf, but also in the world. The largest population group in the country are foreigners who have moved there voluntarily. There is no income tax. Fuel and food are subsidised for all. Bahrain has the sixth cheapest petrol prices in the world at 13p per litre.

For nationals there is free provision of education and health, free or subsidised housing and unemployment benefit. The Government pays for half of the training costs of Bahrainis and provides generous incentives for those starting new businesses. Bahrain has the best-educated local workforce in the Gulf. Per capita gross domestic product is relatively high, at $23,000. Women have equal rights, are educated, can drive, vote and wear what they like.

Bahrain allows freedom of religion and is open and welcoming to foreigners of all genders, race and cultures. In HSBC’s annual expatriate survey of 2010, Bahrain was ranked one of the world’s top destinations to live and work. Economic growth, although slowed, is still positive, and Bahrain has built has one of the most diversified economies in the region. This year the World Heritage Foundation ranked Bahrain as the world’s 12th freest economy—two steps ahead of Britain.

Despite these positive indicators, the country’s recent history has been punctuated by political disturbances, culminating in the anti-government protests and the civil unrest of the past 21 months.

The country’s Shia majority, (believed to make up more than 60% of the Bahraini population and around 40% of all residents) have long complained of political and economic marginalisation by the Sunni ruling Al-Khalifa family. Bahraini Shia have been shut out of jobs in the security forces and in many government offices. There is a high level of youth unemployment among the Shia community. A concentration of capital has found its way into the hands of government supporters.

4.2 Not a civil war

More than 55 people have been killed since unrest began in February 2011, though opposition groups claim the number is far higher. This figure includes protesters, onlookers, and security forces, in addition to a handful of protesters who died in police custody.

In a country as peaceful as Bahrain had been in the run-up to 2011, this figure is both shocking and tragic. Within the context of the region however, the abuses that have been perpetrated are of a comparatively small scale and the overall casualty figure is low. Since March last year, although the level of general protest has remained high, the mortality rate has dropped.

To put the situation within a British context, in Northern Ireland, which has a population size similar to Bahrain’s, nearly 500 died in 1972 the first year of the troubles. This comparison is made not to minimize the suffering that has occurred in Bahrain but to disprove that there is either a general civil war or unfettered brutality on the part of the security forces. People go about their daily business, the majority of expatriates have remained in the country and life, on the whole, continues as normal.

It is this normalcy, which is probably most difficult for residents and onlookers to understand. Though violence has increased and there are skirmishes between protesters and police on an almost daily basis, they are limited to pockets of the country. For the vast majority of people living in Bahrain they have little impact on day-to-day life. On a TV screen broadcast in the UK it may appear that the whole country is in flames, but the reality is that it is only small areas of the country are affected at any one time.

In those areas the police and protesters play a sometimes fatal game of cat and mouse. Security forces have faced stones, Molotov cocktails, fire extinguishers firing metal bolts as well as improvised explosive devices. The security forces’ use of birdshot and what is seen as an excessive use of tear gas, to control unrest has been condemned by rights groups who remain silent on the use of force by protesters.

One of the authors has witnessed three of these riots at close hand. On each occasion he can warrant that the police responded to the crowds and Molotov Cocktail throwing protesters with more leniency then he would have expected. Bahrain’s Police have spent 21 months facing protests, riots and low-level violence. When deployed in full riot-gear to densely-packed, Shia villages they stand in 30–40 degree Celsius heat for hours on end whilst pelted with abuse and stones. When they charge, the crowds melt away and re-form one or two blocks away.

In such an environment the surprising fact is that there are not more breaches of discipline. An example of one such breach was experienced by the author but is described separately to protect his Bahraini companion and family from possible negative consequences.

The fact that Bahrain’s paramilitary National Guard was recently deployed into new areas of the country could be seen as a sign that authorities are now introducing a tougher strategy to handle unrest.

4.3 Politics

The political and economic inequalities, which sparked the initial wave of demonstrations that began on February 14, 2011, have yet to be addressed. Conciliatory talk from the Government has not been backed by action, and neither has it dampened calls for reform.

Though Bahrain’s largest opposition group, Al Wefaq, and five other opposition societies have condemned the use of violence, they have warned that they cannot control youth groups. Many Bahrainis increasingly identify with the demands of the leaderless ‘February 14’ group, which calls for the overthrow of the monarchy and advocates violence against security forces as ‘self defence.’

Though it still enjoys a broad support base, the calls from Al Wefaq, for a constitutional monarchy, an elected parliament and government, an end to gerrymandering and a transparent judiciary, to many Bahrainis now ring hollow.

The political situation in Bahrain has reached a stalemate. Progress in reaching a meaningful resolution to the crisis in the near term appears unlikely. Hard-line elements within the regime have been in the ascendancy since the failure of a dialogue last year between Bahrain’s Crown Prince and Al Wefaq. These security-focused members of the government continue to prioritise repression of the situation over reform.

With reformists within the Royal family unable to consolidate their position, talks with opposition groups have stalled. Bahrain’s leaders insist that they are ready to talk and to come to an agreement but established opposition groups claim that the Government has yet to embark on a serious initiative to enter into dialogue or reach a negotiated settlement.

The recent stripping of citizenship of 31 Shia activists, has served to further undermine prospects for conciliation.

4.4 Reforms

Though the government has implemented a number of the reforms recommended by an “Independent Commission of Inquiry” (BICI) ordered by King Hamad in 2011, the commission’s recommendations were not carried out in full.

This report, published in November 2011, found that the security services were guilty of torture and excessive use of force. It also criticised the opposition’s response to early offers of dialogue. Accepting the report’s findings, the authorities worked to implement a number of recommendations, including the referral of all cases of security personnel who committed major abuses to the Public Prosecutor, the abolition of the military court system, new procedures to record interrogations of detainees, the creation of a commission to address reinstating fired workers and a compensation fund for the victims of torture, among others.

However, verdicts handed down by military courts that sentenced a number of activists to life imprisonment have not been overturned despite the commission’s recommendations. In addition, no senior official has been prosecuted for abuses, though low-ranking officers have been charged.

The BICI report was unprecedented in the Arab world, and opened a significant window of opportunity to reach a resolution, drawing a line under the abuses and mistakes carried out by both sides. One year on, this window has closed.

5. Bringing the Parties Together: A Plan for the Future

It is the contrast between words and actions, which most truly represents the tragedy that is Bahrain today.

Part of the problem is a perceived lack of urgency on the part of the government. The authorities have been spared the economic pressures that an on-going political crisis would normally exert. Almost 80% of Bahrain’s government income comes from oil, the majority of which is produced by the Abu Saifa field, which is gifted to Bahrain by Saudi Arabia.

Complicating Bahrain’s internal politics and further polarizing the population along sectarian lines has been the fact that Bahrain has been caught in the struggle between two regional powers, Saudi Arabia, the largest Sunni country in the region, and Iran, a Shiite theocracy. Saudi policy has clearly shown that majority-rule in Bahrain would be unacceptable at present. At the same time, Bahraini officials insist that Iran and its proxies are working to destabilize Bahrain.

Some efforts to address socio-economic grievances have been made. In particular, the Government has committed to accelerating the provision of public housing, one of the biggest grievances among poorer sections of Bahraini society.

Saudi Arabia and other Gulf Cooperation Council states have also approved a ‘Marshall Aid’ plan for Bahrain, that would deliver $1bn a year to the country for the next 10 years. This and the $7bn that the Bahraini government and companies plan to raise for the expansion of the aluminium and refining business mean that growth and employment will resume.

The Government has also stated it is committed to reform, and has stated its willingness to negotiate reforms for political representation.

Al Wefaq’s demands build on what already exists in Bahrain. There is an elected parliament (albeit one which is circumscribed), relatively free speech and broadly-speaking, clear rule of law. Back in February 2011, the Crown Prince also accepted that constituency boundaries and what appeared to be obvious Sunni-favouring gerrymandering would be reviewed.

However, a key difference in principle between the moderates on both sides is whether or not Parliament should be able to select the Prime Minister and hence the Government. The Prime Minister, the King’s Uncle, has been in power for almost 40 years. There are many amongst the Sunni, and even Shia population, who view him as an on-going source of stability. If Parliament were to become majority Shia, which it would do, given equal constituencies, and if it also had the power to select a Prime Minister or Government then it is likely that a member of the Al Khalifa family would not be tolerated.

This then is the key choice facing the people and rulers of Bahrain. Other points of difference are essentially about speed and consistency of implementation. Who selects the Government, however, remains a substantive difference. Is day-to-day Government to be taken from the Al-Khalifa family and is there a viable group ready and able to assume that role?

6. What Role for Britain? More than an Honest Friend?

To date British Government policy has been highly effective in maintaining a positive relationship with both the Bahraini establishment and with the main opposition group, Al Wafeq. Alistair Burt and other British government ministers have successfully positioned the UK in the role of an old and honest friend. We have shown support to the Khalifa’s on their reform programme but we have also stated clearly, especially privately, that we cannot support their regime if it resorts to violence or torture.

Britain has multiple interests in Bahrain but the authors perceive four issues that need to be addressed consistently and simultaneously:

1.Maintaining Bahrain as a strategic centre for British action in the Gulf and as a staging post for Central Asia.

2.Favourably positioning British companies to bid for forthcoming investment and export contracts.

3.Protecting the life and property of the substantial British community in Bahrain and the Gulf.

4.Maintaining Britain’s long-term and over-arching commitment to human rights, the rule of law and the right to self-determination.

Britain’s first two interests could easily be addressed by privately and publicly supporting the Al Khalifa government without qualification or pressure for reform. Such an approach, however, cannot be squared with the third and fourth objectives. Public support for the Al Khalifa’s would at some point make British expatriates targets of the protesters. And, in the long-run, Britain’s interests, stature and soft-power rely on a genuine moral commitment to our democratic values both at home and abroad.

Can Britain make meet all of these four objectives and promote a positive outcome in Bahrain?

The authors believe that a win-win outcome for the Bahraini Government, the moderate opposition and Britain would be for announced reforms to be implemented in full with a sense of urgency, for political constituencies to be reformed and for Parliament to have a veto on the choice of Prime Minister.

This last point would be the most difficult agree. The reality, however, is that the opposition could not yet put together a credible government strong enough to deal with extreme Sunni and Shia groups, or the pressure that would be exerted by Saudi Arabia.

Bahrain currently has “No taxation” allied with “no representation.” An open and immediate change of Government would risk the Saudi oil subsidy and require the new people’s representatives to either tax or redistribute wealth to fund growth and free housing.

If Britain were to successfully push for and offer to facilitate a dialogue that aimed for a five-year transition to fully and fairly elected Government then Bahrain would benefit, our influence in the region would rise and, provided there was stability in Bahrain, then Saudi Arabia would also be content.

Such a programme would require significant capacity building in Bahrain, constitutional reform, civic and political education and a commitment to protect Bahrain from extremists from either Iran or Saudi Arabia attempting to influence the outcome. Success would be by no means guaranteed and such an approach would require a political courage from all sides. The default alternative, however, is far less likely to allow a resumption of normal life and has grave risks for both Bahrain, surrounding countries and British interests in the Gulf.

7. Keep Calm and Carry On

Buoyed by military support from the GCC and Saudi Arabia in particular, it is unlikely the Al Khalifa regime would be removed without their consent. Protesters and the opposition understand this. Unfortunately if discrimination, unequal representation and a two-tier process of economic success continue then the Government will ensure that large parts of the Shia population become permanently embittered and disengaged.

Recently public protests have been banned. More and more of the opposition will consider themselves forced underground. Moderates will continue to lose ground and extremists benefit. Looking forward to a life of disenfranchisement, large numbers of male Shia youth will embrace the authority and position that they receive by joining radicalised groups.

On the other-side there is a strong risk that ultra-national Sunni’s will disengage with the political process and become increasingly more violent. Some are already calling for the end of the Al Khalifa regime and direct rule from Saudi Arabia.

A Gulf-equivalent of Northern Island is in no-one’s interests but as things stand then unrest in Bahrain will intensify and, in turn, promote instability in other areas with large Shia-populations—Kuwait, eastern Saudi Arabia and even Oman.

8. Conclusion

There are many truths in Bahrain. It is the view of the authors that the situation in Bahrain at present is not as bad as the one portrayed by most mainstream media. It is also their view that there is not such a great separation between moderates on both sides. Unfortunately if things continue as they currently stand then the eventual outcome will truly reflect the worst that is said of Bahrain now. Strong and courageous action from the Bahraini Government and opposition, supported by Britain, may not entirely succeed but it has a far greater chance of good then of the Bahraini Government doing nothing and Britain abandoning an old friend.

20 November 2012

—— END ——