Middle east development

The international affiliate of SBG, bin Laden Group International (BGI), based in Jeddah, is equally directed by Bakr Bin Laden (CEO), Yahia Bin Laden (General Director), Omar Bin Laden (President) and Hasan Bin Laden (Vice President), and present in Egypt, Jordan, Lebanon, Malaysia and the United Arab Emirates.

Bemco for energy.

Mohammed Bin Laden Organization for infrastructure.

Project Management and Development Co. Real Estate for real estate.

Al Salem Group for industrial manufacturing of steel and metal products; engineering, maintenance

Mimar Industrial Group for textile, present in Lebanon, Great Britain and Spain.

Casareen Contract Manufacturing for clothing distribution in Great Britain.

Palwa Beleuchtungs GmbH and Palwa Iberica for crystal production in Germany and Spain.

Hazar Media Group for newspapers in Lebanon, France, Great Britain, Egypt and the United Arab Emirates.

United Saudi Maintenance & Services Co. for maintenance services.

GFC and Casareen Retail International for distribution in Great Britain, Malaysia, Singapore, Egypt, Lebanon, France and the United States.

Forship Ltd. for the transport of freight in Great Britain, France, Egypt and Canada.

Baud Telecommunications and the Middle East International Group in Switzerland for public relations.

The international affiliate of SBG, Bin Laden Group International (BGI), based in Jeddah, is equally directed by Bakr Bin Laden (CEO)[didn’t we mention BGI in the first bullet point?]


Business Ventures

In Saudi culture, family groups stay together, including family business groups. Some family members may branch out on their own ventures, but only when they receive a consensus of support from the entire family. Since Tarek bin Laden has pursued his own business ventures separate from the SBG group, Tarek is viewed as a maverick, having an erratic personality. In fact, despite his respect in the Middle East business community, Stratfor sources indicate that Tarek is not highly thought of by his family members, which is very unusual in Saudi culture. [Is this what you mean here? Tarek bin Laden has pursued his own business ventures separate from the SBG group, which is not typical of Saudi family practice. Thus he is viewed by many of his family members as a maverick with something of an erratic personality. Despite his relatively good reputation in Middle East business circles, according to Stratfor sources, Tarek is not highly thought of within the bin Laden family.]

Cannot verify t his claim anywhere, best to remove? In [when?], Tarek bin Laden reportedly started a textile business with Swedish actor Kjell Bergqvist in [Egypt?]. It is thought that the two planned to sell clothing to the West, making use of the large state-owned textile mills in Egypt. However, [they discovered that the mills were poorly designed and were busy producing textiles for the Soviet Union. Their textile business never got off the ground?]. Tarek also was affiliated with the Tarek bin Ladin Hospital & Clinic in Jeddah, Saudi Arabia. [can you elaborate here? this seems sort of out of the blue.] Even today, MED is considered to be a relatively small player in the Saudi business arena. Notwithstanding the publicity surrounding the Yemen-Djibouti bridge project, Tarek himself is not that well known amongst the general public outside of those individuals that have done business with him.[this seems somewhat inconsistent with what we say elsewhere in the report] His bridge project illustrates the uniqueness of his case compared to other influential and successful Saudi businessmen and highlights the scope of Tarek’s maverick personality and business goals, going far beyond the conventional construction projects pursued by other companies in the region.[how so? this is unclear]
Regarding the construction of the bridge, MED CEO Oussama Al-Dimashki, Al Noor City Holding [Co.?] is also controlled by Tarek bin Laden.[why is this here? I believe this is the first mention of this entity. can you elaborate? did Al-Dimashki tell us this?] Regarding the bridge development plan, Al-Dimashki said MED wishes to emulate Dubai’s success and implement the MED development model in other countries, beginning with Yemen and Djibouti. Noor City Development Corp. (NCDC)[is there a connection to Al Noor City Holding?], a San Francisco-based information technology, planning, development and management company, was hired by MED to handle planning, development, construction and management of the Yemen-Djibouti bridge. Tariq Ayyad, an American of Kuwaiti origin and a civil engineer, construction manager and a former bridge engineer with the California Dept. of Transportation, is the company’s chairman. MED is also planning to build giant free-trade zones and expanded ports on both sides of the crossing, which includes plans to build the “City of Light”, also called “Al-Noor City” on the Yemeni side of the bridge with the purpose of providing economic opportunities, infrastructure and housing.-moved to different section.
Tariq Ayyad also is the founder of Digital Equity Exchange (DEE) and ShareChive LLC.

According to NCDC the NCDC Web site, Spokesman? News release?], DEE [is a brokerage firm?] that has secured additional funding to support development of the Al-Noor cities and is currently preparing shares, establishing trading requirements and [calculating?] gains and benefit for all shareholders and beneficiaries of the developments. DEE will monitor, facilitate and record these[all stock?] transactions. ShareChive is a company that provides construction management of large government infrastructure projects. Using ruggedized tablet PCs, ShareChive clients can view their plans and reference material, record project data, and communicate wirelessly.[is this relevant? Why are we even mentioning ShareChive? Is it involved in Al-Noor City developments?]

In May 2006, Tariq Ayyad tried to obtain a court order in the Northern District of California to prevent the inspector general of the Department of Housing and Urban Development (HUD) from accessing his financial records. According to court records, Ayyad was a landlord who participated in HUD’s Section 8 subsidized-housing program. He rented a property to tenants at a reduced price and, in return, received payments from the Housing Authority of the City of Napa. The payments were transferred electronically into his bank account. In November 2003, Ayyad allegedly transferred ownership of the property to a different person but continued to receive the government payments until April 2004, as if he were still the landlord. HUD investigated whether Ayyad had received payments to which he was not entitled and subpoenaed the records of the bank where he had the account. Ayyad attempted to quash the subpoena but the motion was denied because he failed to support his motion with a required sworn statement. Available records show that this case is now closed.
Links to Terrorism and Criminal Activity

In 1979, when SBG was renovating Mecca, the company had the exclusive contract to make repairs in the city’s “Holy Places.” SBG trucks entered and left Mecca at all hours without being inspected, and it is believed that a group of anti-al-Saud militant Wahhabis led by Juhaiman al-Utaibi [jihadists?] used the company’s trucks to smuggle weapons into the city and briefly took over the mosque at Mecca. Tarek’s brother, Mahrous bin Laden, [who helped supervise the Mecca project?], had studied in England, where he became acquainted with Fadhi[full name?], the son of the ex-sultan of Yemen’s southern Abdin region who had been radicalized by Syrian members of the Muslim Brotherhood. Familiar with a group of Syrian Muslim Brothers in exile in Saudi Arabia, intelligence investigations revealed that the group had taken advantage of Tarek’s brother, using the bin Laden trucks unbeknownst to Mahrous. This case demonstrates the ties between the royal family and the bin Laden Group for if it had been another group, those involved in the incident would most likely have been jailed and barred from further economic activity in Saudi Arabia.[Is this what you mean to say here? It is believed that Mahrous provided assistance to the militants, enabling them to seize the mosque. Saudi intelligence later found that a group of Syrian exiles who belonged to the Muslim Brotherhood had taken advantage of Mahrous and had used the SBG trucks to transport weapons into Mecca, unbeknownst to Mahrous, who was arrested but later released. The case demonstrates the loyal ties between the Saudi royal family and the bin Laden family for Mahrous was the only person not beheaded out of the 63 who took part in the incident.

Yeslam bin Laden, Tarek’s brother who heads the Saudi Investment Company (SICO), also has ties to persons thought to be involved in terrorist activity. During the 1980s, SICO’s board of directors included members of the Shakarshi family, which is linked to criminal activity, including money-laundering and drug trafficking in Zurich. [that is suspected of being linked to al Qaeda? Some other terrorist group?] As of 2001, Yeslam was still thought to maintain relations with the Shakarshi family.

Yehia bin Laden, Tarek’s brother who represents SBG in Lebanon, has links to the bin Mahfouz Group, a Saudi conglomerate founded by Khalid bin Mahfouz. Khalid bin Mahfouz, who is also founder of the National Commercial Bank of Saudi Arabia, the first bank in the country, and once personal banker for the Saudi royal family, has been accused of providing financial support to Osama bin Laden. Bin Hahfouz was also a close friend of another of Tarek’s brothers, Salem bin Laden.

According to the book “House of Bush, House of Saud”, by the American writer Craig Unger, [do you mean ‘according to’ this book? what do you mean ‘cancelled’? do you mean this published book (available from Amazon) was banned in Great Britain? The report I referenced said the book did not go to print but looks like it has] bin Hahfouz responded to the accusations, claiming he donated $270,000, upon Salem’s request, to Osama’s cause to assist the U.S.-sponsored resistance to Soviet forces in Afghanistan. Bin Hahfouz said the money was never intended to be used to fund future terrorist activities of Osama bin Laden.
Of course, Tarek bin Laden’s most obvious potential link to terrorism is through his half brother Osama, who orchestrated the events of Sept. 11, 2001. Osama bin Laden is one of Mohammed’s bin Laden’s youngest sons and the only to be born to a Saudi mother-other reports incidate she was of Syrian decent, delete. [Can we say something like this here? But the bin Laden family is a big one, and links between Osama’s terrorist activities and his siblings -- including Tarek -- have long been alleged but never proved. This has not kept those affected by Osama’s terrorist acts from trying to establish links to his family members in law suits and investigations related to 9/11]. Stratfor came across a total of 11 suits, including those filed by surviving victims and relatives of those killed in the 9/11 attacks, have been filed [naming Tarek a defendant yes ?]. Continental Casualty Company v. al Qaeda Islamic Army dismissed the charges against Tarek in January 2006. Many of the other cases are still open.
In July 2003, in a New York District Court, plaintiffs Euro Brokers Inc., Maxcor Financial Group Inc., Maxcor Financial Inc., Maxcor Financial Asset Management Inc., Tradesoft Technologies, Inc., Maxcor Information Inc., Euro Brokers Ltd., Euro Brokers Financial Services Limited, Euro Brokers Mexico, S.A. de C.V. and Euro Brokers (Switzerland) S.A. listed Tarek bin Laden as a defendant in an action to recover property damage sustained as a result of the hijacking and crash of United Airlines Flight 175 into the South Tower of the World Trade Center on Sept. 11, 2001. The plaintiffs alleged that the defendants knowingly provided money and other aid to terrorists, which enabled the 9/11 attacks and other attacks to occur.
In a similar case filed in September 2004 in a U.S. District Court for the Southern District of New York, plaintiffs World Trade Center Properties L.L.C., World Trade Center L.C.C., 2 World Trade Center L.L.C., 5 World Trade Center L.L.C., Silverstein WTC Management Co. L.C.C. and 7 World Trade Center L.P. alleged that on Sept. 11, 2001, they suffered massive damages to their properties as a result of intentional damage inflicted upon them by the crashes of two hijacked aircraft into two buildings, the North and South Towers of the World Trade Center. According to their plaintiffs, the financial resources and support network of the defendants -- charities, banks, front organizations and financiers -- are what allowed the attacks of Sept. 11, 2001 to occur. In addition to Osama bin Laden, individual members of the bin Laden family, including Bakr bin Laden, Tarek bin Laden, Omar bin Laden, Abdullah Awad bin Laden and Yeslam bin Ladin, were listed as defendants in the law suit.
According to the [September? yes] 2004 civil complaint[this is the same law suit described above? yes], Tarek served as general supervisor of the International Islamic Relief Organization (IIRO) in the early 1990s. The IIRO, which was established to provide resources to and assist orphans and immigrants in the Islamic world, grew as an organization because of support provided by the Saudi royal family. The IIRO also was alleged to be a supporter of al Qaeda, used to transfer funds and personnel to the terrorist group. On Aug. 3, 2006, the U.S. Treasury Department included the IIRO’s Indonesia and Philippines branch offices on a list of individuals and groups belonging to or associated with the Taliban. According to the department, Mohammad Jamal Khalifa, Osama bin Laden's brother-in-law and a senior al Qaeda member, was at one point the director of the IIRO’s Philippine branch.
The U.S. Treasury Department designated the Philippine and Indonesian IIRO branches as terrorist financiers for funneling money to al Qaeda and other radical groups, including six militant camps in Afghanistan in the 1990s. Specifically, the department listed the IIRO Philippine branch as a source of funding for the al Qaida-affiliated Abu Sayyaf Group (ASG) and noted that the IIRO Indonesia director channeled money to two Indonesia-based Jemaah Islamiah (JI)-affiliated foundations. The IIRO Indonesia branch allegedly supported JI by providing assistance with recruitment, transportation, logistics, and safe havens. In 2002, IIRO Indonesia allegedly financed the establishment of training facilities [where? Indonesia? yes] for use by al Qaida associates.
The U.S. Treasury Department also designated Abd Al Hamid Sulaiman al-Mujil, an IIRO official in Saudi Arabia who channeled money to the Philippine and Indonesian branches, as a terrorist financier, stating that Mujil specifically provided funds directly to al Qaeda. According to a declassified memo by Matthew Levitt, a former deputy assistant secretary in the Treasury Department’s the Office of Intelligence and Analysis, the IIRO supported terrorists from the early 1990s through the first half of 2006. Investigators have also found an IIRO[-Saudi Arabia?] report showing that members of the royal family play a supervisory role in connection with some of the local IIRO offices in Saudi Arabia. The US government has been reluctant to prosecute it due to its direct links to the Saudi government as members of royal family allegedly play a supervisory role in connection with some of the local IIRO offices
Despite the organization’s suspected links to terrorist activity, the IIRO still carries out charitable operations through legitimate channels. For example, on June 9, 2008, the United Nations Children’s Fund (UNICEF) signed a memorandum of understanding with IIRO Saudi Arabia at its headquarters in Jeddah. Present at the signing was Dr. Adnan bin Khalil Basha, secretary general of the IIRO, and Dr. Ayman Abu Laban, UNICEF representative in the [Persian?] Gulf.
Tarek bin Laden is a well-established [and relatively well-regarded?] businessman in the Middle East with many political and business connections. Despite suspicions regarding his alleged links to terrorist activity, there is no hard proof of such links, and doing business with MED should pose no major business risks. However, companies considering any involvement with MED may have shareholders who would object to dealing with a half brother of Osama bin Laden who may or may not have been involved in funneling money to al Qaeda. These companies should be prepared to answer shareholders’ inquiries and to make prudent decisions based on the known risks of the business venture.
Business/Security Assessment
Apart from the bin Laden connection, there are indeed significant business and security risks on the ground in Yemen and Djibouti, including corruption, terrorism, crime, war, insurgency and political instability. Clearly, such threats could impact the construction of a proposed 18-mile-long bridge between the two countries that would include the longest suspended span in the world (3.1 miles). Bureaucracies on both sides of the Red Sea would be sorely tested by the project, and the temptation for poorly paid civil servants to ask for bribe money to expedite licensing and project approvals would be very high. Construction could also be delayed, employees could be threatened and the structure itself could be damaged or destroyed.
However, both countries are eager to attract foreign investment, and a project like this would help induce the flow of money. With enough attention and focus on the part of the host governments -- and on the part of foreign participants -- such a major construction project could help create a more disciplined bureaucratic and security apparatus and maximize the economic benefits of successful project completion.
The following assessment addresses the specific business and security risks any foreign business should be aware of when operating in these two countries.
Business Environment: Yemen

Since the end of Yemen’s civil war in 1990, the government of President Ali Abdullah Saleh has tried to boost the country’s economy. The International Monetary Fund (IMF) is working to improve the financial management of the country’s assets and the World Bank is currently involved in 19 projects there. Yemen also is a member of the World Trade organization, although it is the only country on the Arabian Peninsula that has yet to join the Gulf Cooperation Council (its membership is pending). Yemen’s economic health depends largely on its oil and natural gas deposits and several foreign oil companies operate there in cooperation with the government.

Since 1990, property expropriation from foreigners has been rare in Yemen, but establishing legal land ownership is a complex process. Yemen only recently adopted a system of property registration and land titles. For much of the country’s history, land rights were hereditary and informally administered by regional tribes. The increase in foreign presence in Yemen has pressured the government to put a system in place that guarantees property ownership. Before operating in Yemen, foreign companies are encouraged to communicate and negotiate with regional and tribal leaders in addition to the government. Land disputes are often messy and can involve violence.
As in most other countries on the Arabian Peninsula, foreign companies in Yemen are required to act through Yemeni agents. Not only does this ensure that Yemenis benefit directly from foreign investment, it also opens up avenues for corruption. Yemen is a Muslim country that follows a form of Sharia law, and foreigners should be aware that claims on accumulated interest are difficult to recover. Foreigners should also be aware that cultural and religious differences in Yemen result in varying business practices and customs. [For example? Can we have just a few specifics? Seems rather vague otherwise].

In terms of economic freedom and [government?] transparency, Yemen is ranked very low worldwide and below average for the region. This is largely because of burdensome corporate taxes, corruption and political intervention[what is this, exactly? intervention into what?]. While the government has tried to streamline the process of registering a new company (creating a single agency to handle foreign investors), red tape is still a barrier.

Corruption in Yemen consists mainly of bribery, blackmail, nepotism and backroom negotiating. Special commercial courts set up to handle business disputes are corrupt and inefficient, and the regular court system is slow and subject to political pressure. As a result, business disputes are more commonly settled by informal arbitration that relies on bargaining and negotiating and does not necessarily adhere to the laws of the country. Bargaining and negotiating is required in almost every business transaction, including those with government officials.
The level of risk in Yemen’s business environment is high.¹
Business Environment: Djibouti

Djibouti’s economy is based on its proximity to a major shipping thoroughfare (the Strait of Bab el Mandeb), its position as a sea-access point for Ethiopia and its relative stability in a fairly unstable region. The Djiboutian government supports foreign investment and is seeking to increase transparency. The port of Djibouti has undergone a $800 million expansion paid for by its new manager, Dubai Ports World. The investment is aimed at making Djibouti the next Dubai -- a small, poor country that became enormously wealthy very quickly [because of its oil and gas resources?]. While Djibouti does not have the oil reserves that [Dubai?] or the United Arab Emirates (UAE) have, it is touting its updated port facilities and 60 percent unemployment rate[a country will typically tout its high unemployment rate? I would think it would tout the quality of its workforce.] to lure investors.

In an effort to attract foreign capital, Djibouti has privatized transportation sectors (such as port and rail), but the country’s commercial[delete? is it just the laws related to commerce or the entire legal code?] legal code is outdated, based on laws established during French colonial rule, and this causes bureaucratic slowdowns for businesses seeking to set up operations. Several free trade zones have been established near the port of Djibouti (the capital city), and most businesses operate from there. There is very little financial activity outside of the capital city and port area.

Although there are anti-corruption laws on the books, they are rarely enforced. Politicians and civil-service employees require bribes and favors in return for cooperation. Sometimes politicians will require that foreign investors use a specific contractor (a company owned by a relative, an important supporter or perhaps the politician himself) before a project can be approved. Also, especially outside the capital city, the line blurs between formal and informal economic activity. Tax collection and essential services are administered based on bargaining, relations and bribery.

The level of risk in Djibouti’s business environment is medium.¹

Terrorism: Yemen
There are currently two terrorist threats in Yemen: the al Qaeda node in Yemen (known as the Yemen Soldiers Brigade, or YSB) and tribal violence in the hard-to-patrol areas outside of the Sada’a, Sana’a and Aden population centers. These threats are exacerbated by the large supply of weapons in Yemen’s desert bazaars, where vendors sell assault rifles, hand grenades and rocket-propelled grenade launchers.
Al Qaeda has been in Yemen for some time -- at least since 2000, when al Qaeda operatives bombed the USS Cole in the Port of Aden. Osama bin Laden’s ancestral home is Yemen, where the government is sympathetic to Islamic militants. The government’s military and intelligence institutions are largely made up of ultra-conservative Salafists, who form an important supporting pillar for President Saleh. In addition, Yemen is at the heart of an Islamic region struggling with jihad -- Somalia, Saudi Arabia, Iraq, Pakistan and Afghanistan -- and it attracts jihadists from these neighboring countries as they are squeezed out by military operations and police crackdowns.
Since January, al Qaeda or al Qaeda-inspired groups have been increasing their activity in Yemen. The deadliest attack so far has been the gunning down of two Belgian tourists and two of their Yemeni guides on January 18. Since then, nearly all al Qaeda-inspired attacks in Yemen have been [improvised explosive device (IED) or?] mortar attacks against energy targets. A French pipeline in Saah district was attacked with a timed explosive[IED?] and a Chinese oil field in the eastern Hadramout district was shelled [hit by mortar fire?]. In Yemen’s capital, Sana’a, terrorists have attacked the Italian embassy and a housing compound for Westerners. None of the attacks against energy targets this year have resulted in deaths, and they appear to have been carried out by poorly trained operatives; often the mortar attacks involved firing two or three rounds from the back of a pickup truck and then driving away.
A much more common form of violence is the tribal activity in Yemen’s hinterlands. The central government has control over the populated areas of Sa’dah, Sana’a and Aden, but tribal law dominates outside of these cities. The most common tribal bargaining chip in dealing with the government is kidnapping -- especially the kidnapping of foreign tourists. This will typically bring diplomatic pressure of a country like Germany, Japan or France upon the Yemeni government. In September 2006, two German and two French tourists were kidnapped by tribal elements in an effort to negotiate the release of fellow tribal members from jail. In May 2008, two Japanese women were kidnapped near Marib, a popular tourist area approximately 100 miles east of Sana’a. Some 200 foreigners have been kidnapped in Yemen since the brief civil war there in 1994. All but four have been returned unharmed.
The internal threats Yemen faces reflect its fractured political landscape. Yemen is hardly a country ruled by consensus, and many factions do not believe the Saleh government represents their interests. The central government has enough problems remaining cohesive and is hardly in a position to prevent al Qaeda strikes against energy interests or rein in the tribal factions. While there have been no significant attacks in areas near the site of the proposed bridge project, such a project could well match the target set that al Qaeda typically uses when preparing attacks.[would likely be part of the al Qaeda target set?]

The threat of terrorism in Yemen is high.²