May 30, 2006
Media Savior Secularism: Ruthless Business Empires & Making Liberalism in the Arab World
It is not often I have the occasion to combine three of my negative obsessions: secularist posing, corruption and Egypt into one comment. But uniqely an FT article from 21 May by Roula Khalaf and William Wallis allows me to do just that, covering Orascom, the Egyptian telecoms & everything else giant's plans to launch a Sat TV news channel.
Orascom, whose...non-virginal business practices in region (including some fine accusations of bribery in the context of Iraqi and North African cell tenders) do not immediately lead me to think of its owner as a secular savior - rather as part of the business as usual sorts.
The story discusses Sawiris - Orascom's "heavy" and owner - and his aim to build a media empire to complement his telecoms (and everything else). I don't quite buy the promoting "liberal society" line he spouts to Khalaf and Wallis. This is about money - but I am sure he's smart enough to play something of the secular card with the US and specifically with the Bolshy Right audiences that love such things (and Andrew Sullivan, who generally laps up this sort of thing with the critical thinking capacity of a melon).
Naguib Sawiris, Egypt’s billionaire businessman, hopes to become a new independent satellite television mogul in the Middle East, replicating his regional success in telecommunications.
The head of the Cairo-based Orascom Telecom Holdings ..... is already majority-owner in two satellite television stations, Melody music and Melody films. He is now starting a third entertainment channel dedicated to young audiences and has applied for a licence to launch a 24-hour satellite news channel for Egypt’s domestic market.
Mr Sawiris is also expecting gradually to turn an Iraqi terrestrial general channel he owns into a broader regional satellite news channel to one day compete with the popular Qatar-based al-Jazeera and Saudi-owned al-Arabiya.
The foray into satellite media, a field that, outside al-Jazeera, has been largely dominated by Saudis.....appears to be driven by business as much as political motives.
An outspoken secular businessman..... Mr Sawiris wants to win the hearts of Arab youth by promoting a more liberal Arab society.
Why Khalaf and Wallis (particularly Khalaf, Wallis as I already pointed out needs to get more savvy) would write something like "appears to be driven by business as much as political motives" escapes me.
Perhaps I am too cynical about Sawiris.
“When I started Orascom I started a regional activity, and I believe I can replicate the story in media,” he said, on the sidelines of a World Economic Forum conference in the Egyptian Red Sea resort of Sharm el-Sheikh. “Here [in the Middle East], most stations are family-owned, royal-owned or government-owned.”
The only hope for the region, he said, was a change in education to combat religious fundamentalism and extremism: “There is terrorism because they [young people] have nothing to look forward to.”
Now on the last line, I have to largely agree. Still, it's a bit rich for someone like Sawiris to be banging on about "family owned" groups with the underlying implication that they're clotting up the market, given Orascom's Corporate Governance.
Mr Sawiris, best-known in Europe for last year’s purchase of a controlling stake in Italian mobile and fixed line phone operator Wind Telecommunications, said his biggest challenge was to persuade the Egyptian government to allow him to start an independent Cairo-based news channel.
The powerful Christian businessman said he was most concerned by the rise of the Muslim Brotherhood, the banned Islamist group that forms Egypt’s largest opposition movement and which won about 20 per cent of seats in last year’s legislative elections. But he also criticised the government crackdown on demonstrators.
Oh. Somehow I think getting a license to open a news channel is not going to be so hard.
“Governments by nature are inefficient and security oriented,” said Mr Sawiris. “This machine has to reach out to artists, thinkers, businessmen, professors and secular judges and gain their support in the fight against terrorism and fundamentalism. They’re not doing that.”
The criticism that is not quite.
Fair enough on a level, the statement, but frankly in reading this, I don't hear someone who's really truly critiquing Mubarek and the Vampire Regime, I hear Mr Hand in Glove angling to spin some street cred for a new biz.
Now, on some level I don't blame the man, but on another given the spin in the re liberalism and the like, I have to say the "reform" spin here is more marketing than real
Repressing peaceful activists was futile, he said, in the age of satellite television: “If you don’t want people to see something don’t do it and, if you do it, don’t try to hide it.”
True enough, but mate, I still don't buy your spin.
Well, it's decent initial marketing and you may get some dumb American money, so what the fuck....
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I am an econ-idiot. How is the Saweris group not a family business? Is it traded publicly? How many percent of the stock is owned by Sawaris himself?
Also I like how he is marketing the fact that he is Christian as part of the whole point. It's beyond weird. I mean, he's not like religious or anything. Or that his being Christian means anything as opposed to another powerful magnate being Muslim.
Once I read this book about various important players in Egypt in the period following Sadat (called "After Sadat") - Christopher Hitchens gave it to my husband as a Christmas present - how's taht for a great anecdote... anyhow one of those power players was the family that owns the Arab contractors - Osman Ahmed Osman - and it is just funny how people treat these big powerful and very corrupt families as somehow being the force for democracy in the region. I mean, just surreal.
Posted by: Anna_in_Cairo at May 30, 2006 05:23 AM
Parts of the empire are publicly listed, so in his mind he no doubt feels it is different than the purely closely held family groups.
However, given my knowledge of the group's corporate governance, the family retains effective control. The minority shareholders are along for the ride.
This was precisely why I found the spin so entertaining. It's great marketing to the West, though. I am sure he was laying the groundwork for future efforts (and backstopping against blowback from his Iraqi endeavours).
Posted by: The Lounsbury at May 30, 2006 12:30 PM
I once read about corruption in the Republic of South Vietnam, it was...breathtaking. Taking money for providing artillery support, for example. The graft was systematized, since everybody were obliged to bribe their superiors with the bribes from their inferiors. The really corrupt, however, took more than needed.
Though slightly irrelevant to the topic, the question is: Is there such a system in place in MENA? Or are bribes in connection to doing business not that systematized or frequent, or even necessary?
Posted by: Klaus at May 31, 2006 05:07 AM
A typical character in our business in middle income companies - the Big Guy. (See Shinawatra in Thailand, Li Ka-Shing in HK)
Posted by: Alex at May 31, 2006 07:31 AM
I find it hard not to share your cynicism.
On the other hand, it's all relative when it comes to emerging markets tycoons. In Latin America there's been a real change in the character of a number of the big family groups as a new generation takes the helm with a much broader vision of being players in a regional/global market rather than just the local market they already dominate. They're far more open to product and market innovations. And to outside funding and accepting a few of the constraints that entails.
They're also more sensitive to long-run "reputation as an asset" that has to be regularly renewed, and that's only partly accomplished with spin. In contrast, the old family-capital approach to reputation is paternalistic -- "we're wonderful because we're rich and powerful, and any criticisms are lese majeste."
You see a similar distinction in the FSU -- the best of the new businesses compete -- in part -- on reputation. They don't have the old Soviet mentality that "just because I'm big and have all the right connections I deserve to be successful and free of criticism." Even among Russia's oligarchs -- the more successful were the ones who took the long view of building a reputable business and not just grabbing all the assets they could strip and run with them -- that is, they grabbed but also invested and paid a lot of attention to building relationships that involve a modicum of trust. One of my worries with the asset grab currently underway by the state bureaucrats under Putin is that some of the old Soviet mentality is rearing its ugly head again. A shame, that, if we start seeing the old "red managers" sort of behavior.
In LatAm, are the new generation still family-dominated businesses? Yep, but with a bit more transparency and accountability. Are they still inveterate rent-seekers? Of course - but they now are less likely to be focused on just sewing up the local market. Are they likely to engage in some sharp practices? You betcha. But in emerging markets the "new mentality" family types are probably less corrupt than most "self-made" nouveau tycoons or (the few) corporate managers who succeed in turning their CEO position into a legacy.
So back to Sawiris -- I tend to see guys like him as representing some potential positive factors, and I'd rather hear them openly advocating a new value set even if it's mostly puffery. But of course take their spin with the proverbial grain (especially if they're Venezuelan elites who talk a great game but...).
Posted by: nadezhda at May 31, 2006 10:41 AM
Naguib Sawiris has been touting this idea since 2004. The Egyptian government, for now, doesn't like it.
Judging how bland the Orascom-sponsored "Inside the Middle East" on CNN is, I doubt his TV station would be that different. But then again even TV stations owned by business moguls close to the regime, like Ahmed Bahgat's Dream or Emad Adib's Orbit (which is mostly Saudi-funded, though), have had interesting shows that push the limits. Al Qahira Al Youm or Orbit is a very popular political talk show, while Hala Sarhan's show on Dream (and before that, radical anti-regime Al Destour editor Ibrahim Eissa's show, which was dropped under pressure) did raise a lot of critical issues. (Sarhan famously did shows about homosexuality and masturbation.) Any business mogul worthy of the name will want to attract a large viewership and have provocative shows, since that's what bring the masses. It's much better than state TV, even if it's not Kifaya TV (and how boring would that be?) After all, I don't expect CBS, NBC or ABC in the US to do anything very politically transgressive. So why expect an Arab channel to do so?
Posted by: issandr El Amrani at June 8, 2006 09:45 AM