from Pressure Points and Middle East Program

Can Bahrain Save Itself, Part II

June 13, 2011

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Middle East and North Africa

Human Rights

Politics and Government

Bahrain

On June 3 I wrote here about some good news from Bahrain. The king had lifted the state of emergency and called for dialogue, the main opposition group Al Wefaq had accepted the request, and the foreign minister (and soon after, the crown prince) had visited Washington to talk about compromise and negotiation.

And yet. Today’s news does make one wonder if this is all window dressing. The crown prince had been expected to lead this dialogue. Today the government announced that it would instead be led by Speaker of Parliament Khalifa al Dhahrani, who unlike the crown prince is regarded as a hard-liner. Perhaps even more significantly, he is not a member of the royal family and has little decision-making power. Whether Al Wefaq can enter into negotiations with him is uncertain, and the group will surely wonder why the crown prince has backed—or been pushed—out.

Watching events in Libya, Syria, Egypt, and Tunisia, the king should come to grips with reality: things cannot go back to the way they were in Bahrain last year. The sooner he enters a serious negotiation over constitutional reform with Al Wefaq and others, the sooner Bahrain can address and perhaps solve its problems.

These are primarily political but the economic impact is direct.

The Wall Street Journal reported on May 26 that “Ratings agency Moody’s cut Bahrain’s Thursday sovereign bond rating by one notch to Baa1, from A3, with a negative outlook, citing a significant deterioration in Arab country’s political environment. Moody’s said the rating cut was driven by the possible effects of ‘the recent political turmoil on the country’s growth prospects and its public finances.’ Moody’s added that ‘political tensions in the country remain high and there seems little prospect of the underlying causes of the unrest being peaceably resolved, at least over the short term.’ According to the rating agency, these events are likely to have damaged economic growth significantly, especially in service sectors such as tourism, trade and financial services.”

Bahrain’s future is very much in doubt. One can only hope that the argument made by the crown prince and foreign minister in their Washington visit is more than a line put out to reassure anxious Westerners. If the hard-liners in the royal court win out, their victory will boomerang against the king and destroy the chances for Bahrain to resolve this crisis.

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