Friday, November 30, 2007

Citi of Arabia

from The Wall Street Journal (US: New York)

No one should be under any illusions that Abu Dhabi's $7.5 billion investment in Citigroup is a normal commercial transaction. It comes from a sovereign wealth fund controlled by a foreign government, which has political as much as business interests; from an Arab government that has a troubling history with American banking laws; and it offers a Middle Eastern entree into the U.S. financial system that since 9/11 plays a pivotal role in the war on terror ... Everyone should also admit that this investment means that Arab interests will now have inordinate sway over America's largest bank. Abu Dhabi's 4.9% stake combined with the 3.9% stake of Saudi Prince Alwaleed bin Talal makes them the bank's dominant shareholders, and who knows how many other smaller holdings are in Middle Eastern hands. The small Gulf states may be governed separately from Saudi Arabia, but they are closely linked by geography, family ties, and national interests. For purposes of political influence, they often behave as part of the same tribe.

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