US embassy cable - 92KUWAIT4025

C O N F I D E N T I A L SECTION 01 OF 04 KUWAIT 04025 
 
LONDON FOR NANCY JOHNSON 
NSC FOR BRUCE RIEDEL 
CENTCOM FOR POLAD 
 
E.O.12356 DECL: OADR 
TAGS:  PGOV, KPRP, EFIN, PINR, PREL, KU 
 
SUBJECT:  KUWAIT'S SUNNI MERCHANTS:  UNHAPPY 
OPPOSITION ARISTOCRATS 
 
1.  CONFIDENTIAL -- ENTIRE TEXT. 
 
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SUMMARY 
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2.  THE TRADITIONAL POLITICAL PREEMINENCE OF KUWAIT'S 
LARGE ARISTOCRATIC SUNNI MERCHANT FAMILIES IS THREATENED 
BY THE PACE AND DIRECTION OF POLITICAL CHANGE IN THE 
EMIRATE.  ALREADY EMBATTLED BY A DECADE OF FINANCIAL AND 
POLITICAL SETBACKS, THE SUNNI MERCHANTS HAVE FAILED TO 
SUCCESSFULLY NEGOTIATE ROADBLOCKS CREATED IN PART BY THE 
RULING SABAH FAMILY, HAVE REFUSED TO ALLOW YOUNGER 
MEMBERS OR NEW BLOOD INTO THEIR TIGHTLY CONTROLLED 
LEADERSHIP STRUCTURE, AND MORE RECENTLY, APPEAR RAGGED 
IN THEIR ORGANIZATION FOR SCHEDULED OCTOBER 
PARLIAMENTARY ELECTIONS.  BARRING ANY BOLD MOVE ON THE 
PART OF THE AL-SABAH TO REINTRODUCE THE MERCHANT 
FAMILIES INTO THE POLITICAL PROCESS, WE BELIEVE 
TRADITIONAL MERCHANT POLITICAL AUTHORITY WILL CONTINUE 
TO DECLINE AS THE PACE OF CHANGE INCREASES.  END SUMMARY. 
 
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THE POWER OF THE SUNNI ARISTOCRATS 
----------------------------------- 
 
3.  THE EMPOWERING MYTH (HISTORICALLY UNVERIFIABLE BUT 
NOT NECESSARILY ILL-FOUNDED) OF KUWAITI SOCIETY HAS A 
HANDFUL OF SEA-FARING FAMILIES FROM THE NOBLE AL-ANAIZA 
TRIBAL CONFEDERATION ESTABLISHING A SETTLEMENT ON THE 
OINT OF LAND JUTTING INTO THE BAY OF KUWAIT SOMETIME IN 
THE EARLY TO MID-EIGHTEENTH CENTURY.  ONE OF THE DOZEN 
OR SO ORIGINAL FAMILIES, THE AL-SABAH, SOON EMERGED AS 
PRIMUS INTER PARES, MEDIATING DISPUTES THAT AROSE AS THE 
OTHER FAMILIES AVIDLY PURSUED BUSINESS INTERESTS. 
TRADITION SAYS THIS DIVISION OF RESPONSIBILITY WAS A 
PACT BETWEEN THE SABAHS AND THOSE WHO BECAME MERCHANTS. 
THE REASONS FOR ALLOCATING THAT ROLE TO THE AL-SABAH ARE 
LOST IN THE MISTS OF TIME, BUT THE FUNDAMENTAL 
RELATIONSHIP REMAINS REMARKABLY THE SAME TODAY. 
SOCIALLY, THE AL-SABAH STILL MANEUVER ON AN ESSENTIALLY 
EQUAL BASIS WITH THOSE FAMILIES WHO, BASED ON THEIR ROLE 
IN FOUNDING THE COUNTRY AND ESTABLISHING THE RULE OF THE 
AL-SABAH, FORM THE CORE OF THE KUWAITI MERCHANT 
ARISTOCRACY. 
 
4.  ELITE AND ECONOMICALLY POWERFUL, THE SUNNI MERCHANTS 
HAVE SPREAD THEIR INFLUENCE THROUGHOUT THE SOCIETY AND 
HAVE HISTORICALLY ACTED AS AN EFFECTIVE CHECK AGAINST 
THE POLITICAL POWER OF THE AL-SABAH.  THE CONSIDERABLE 
EXECUTIVE TALENT OF THE MERCHANT CLANS, OFTEN THE 
PRODUCT OF LEADING UNIVERSITIES IN THE WEST, HAS BEEN 
PUT TO USE IN THE SERVICE OF THE STATE AS OFTEN AS IN 
THE SERVICE OF THE FAMILY LEDGERBOOK.  SCIONS OF THE 
SUNNI PATRIARCHS HAVE LED KEY MINISTRIES AND MANAGED THE 
INVESTMENT PORTFOLIOS AND OIL WEALTH OF KUWAIT WHILE 
THEIR ELDERS HAVE BEEN KEY ADVISERS (AND PRIVATE 
BANKERS) TO VARIOUS AMIRS.  IN GENERAL, HOWEVER, 
MERCHANT FAMILY INTEREST IN POLITICAL AFFAIRS HAS BEEN 
TO MAINTAIN A BUSINESS AND INVESTMENT CLIMATE CONDUCIVE 
TO PROFIT-MAKING.  THIS FOCUS HAS LED THE MERCHANT 
FAMILIES AT TIMES TO TAKE POSITIONS AMAZINGLY "LIBERAL" 
IN REGIONAL TERMS ON SOME ISSUES.  HOWEVER, WHEN IT HAS 
SERVED THEIR INTERESTS, THE MERCHANT FAMILIES HAVE 
OPPOSED LIBERALIZATION TO STAND FIRMLY ALONGSIDE THE 
RULING AL-SABAH FAMILY.  AT THE TIME, FOR EXAMPLE, MANY 
IN THE MERCHANT FAMILIES ACQUIESCED IN THE 1976 AND 1986 
GOVERNMENT DISSOLUTIONS OF THE NATIONAL ASSEMBLY SINCE 
IN THEIR VIEW, PARLIAMENTARY MACHINATIONS APPEARED TO 
THREATEN COMMERCIAL TRANQUILITY. 
 
5.  THE CORE FAMILIES OF THE SUNNI MERCHANT ELITE REMAIN 
THE OLD FOUNDING FAMILIES:  THE AL-BAHAR, AL-NISIF, 
AL-SAGER, AL-GHANIM, AL-ABDELRAZZAQ, AL-RASHED, 
AL-ROUMI, AL-NOURI, AL-HAMAD, AL-ABDULHADI, 
AL-ABDULGHAFOUR AND OTHERS WHO RECALL THE DISTINCT AREAS 
OF THE OLD WALLED CITY OF KUWAIT WHERE THEIR ANCESTORS 
SETTLED.  HOWEVER, STATUS AMONG THE SUNNI ELITE IS BY NO 
MEANS STATIC.  OTHER SUNNI FAMILIES WITH ANAIZA ROOTS OR 
FROM THE NAJD REGION OF SAUDI ARABIA MIGRATED TO KUWAIT 
OVER THE PAST 150 YEARS AND BY VIRTUE OF THEIR NOBLE 
ARAB STOCK, HARD WORK, AND BUSINESS ACUMEN, WERE READILY 
INTEGRATED INTO THE RANKS OF THE MERCHANT ELITE.  AMONG 
THESE FAMILIES ARE THE AL-DUAIJ, AL-SHAYA, AL-GHANNAM, 
AL-KHORAFI, AL-OTHMAN, AL-GHARABALLY, AL-MARZOUK, 
AL-WAZZAN (SUNNI), AL-FAWZAN, AND AL-BABTAIN.  MANY OF 
THE GRANDEST DIWANIYA HALLS OF KUWAIT TODAY FEATURE A 
PORTRAIT OF A FATHER OR GRANDFATHER WHO WORKED AS A 
DECKHAND, WATER SELLER IN THE SOUQ, OR DITCHDIGGER 
BEFORE ACCUMULATING THE FAMILY FORTUNE. 
 
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THE EIGHTIES:  A DECADE OF DISAPPOINTMENT 
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6.  SINCE KUWAIT'S INDEPENDENCE IN 1961, RAPID 
POPULATION GROWTH, THE ACCESS OF ALL KUWAITIS TO A GOOD 
EDUCATION, AND THE SPREAD OF OIL WEALTH LED TO A NATURAL 
DECLINE IN THE TRADITIONAL POWER OF THE WEALTHY MERCHANT 
ELITE.  GENERALLY, IN MODERN KUWAIT, INFLUENCE LOST BY 
THE MERCHANT FAMILIES DEVOLVED TO THE GOVERNMENT I.E. 
THE AL-SABAH.  (MERCHANT POWER FIRST BEGAN TO DECLINE 
WHEN THE GOVERNMENT GAINED ACCESS TO AN INDEPENDENT 
SOURCE OF INCOME VIA OIL REVENUES.  NO LONGER WERE THE 
IMPOVERISHED AMIRS DEPENDENT ON THE WEALTHY BUSINESS 
FAMILIES.  IN FACT, AS OIL WEALTH CAME TO DOMINATE THE 
ECONOMY, THE GOVERNMENT COULD INFLUENCE WHICH FAMILIES 
PROSPERED FINANCIALLY AND WHICH DID NOT.)  ACCORDING TO 
LOCAL OBSERVERS, THE DECLINE OF MERCHANT POWER 
ACCELERATED CONSIDERABLY DURING THE LAST DECADE.  A 
IMPORTANT FACTOR WAS THE SABAH FAMILIES ENTRY INTO THE 
COMMERCIAL FIELD WHICH GREATLY ANTAGONIZED THE SUNNI 
MERCHANTS AND CALLED INTO QUESTION THE PACT BETWEEN THE 
TWO PARTIES.  THERE WERE, HOWEVER, OTHER CONTRIBUTING 
FACTORS INCLUDING THE LOSS OF TRADITIONAL MERCHANT 
TRADING PARTNERS DUE TO THE IRAN-IRAQ WAR, ECONOMIC 
STAGNATION SPILLING OVER FROM THE COLLAPSE OF THE SUQ 
AL-MANAKH STOCK MARKET, AND GROWING AUTHORITARIANISM 
FROM A GOVERNMENT IN CONTROL OF SEEMINGLY UNLIMITED 
PETRO-DOLLARS. 
 
7.  NOT SURPRISINGLY, DURING THE EIGHTIES EVERY GROUP IN 
KUWAIT BECAME MORE AND MORE RELIANT ON GOVERNMENT 
LARGESS; THE TRADITIONALLY INDEPENDENT SUNNI MERCHANTS 
SUFFERED THE MOST AS A RESULT.  AS THE MERCHANT FAMILIES 
LOST TRADITIONAL POLITICAL POWER AND INDEPENDENCE, SOME 
INCREASINGLY ADOPTED AN "OPPOSITION" STANCE TOWARDS THE 
AL-SABAH, AFFECTING PERFORCE THEIR BEHIND THE SCENES 
EXERCISE OF INFLUENCE.  OTHERS HAVE TRIED TO CONTINUE 
THEIR OLD POLICIES BUT FROM A MUCH WEAKENED POSITION. 
UNLIKE MOST OF KUWAIT'S OTHER "OPPOSITION" GROUPS, THE 
MERCHANT FAMILIES DO NOT NECESSARILY SUPPORT INCREASED 
DEMOCRATIZATION, EXPANDED SUFFRAGE, OR OTHER POLITICAL 
REFORM (INCLUDING IMPLEMENTATION OF ISLAMIC LAW). 
INSTEAD, THEY EMPHASIZE THE NEED TO GIVE INCREASED 
POLITICAL POWER TO KUWAITIS WITH PROVEN LEADERSHIP AND 
MANAGEMENT SKILLS (THEMSELVES) SO KUWAIT'S OIL WEALTH 
WILL BE USED WISELY WHILE A MONETARY AND REGULATORY 
CLIMATE FAVORABLE TO THE PRIVATE SECTOR IS ENSURED. 
 
----------------------------------- 
THE NINETIES -- POLITICAL FREEFALL? 
----------------------------------- 
 
8.  EXTREMELY ACTIVE AND PROMINENT IN PAST GOVERNMENTS 
AND POLITICAL CAMPAIGNS, THE SUNNI MERCHANT FAMILIES NOW 
APPEAR TO BE FAILING TO ORGANIZE EFFECTIVELY FOR THE 
COUNTRY'S SCHEDULED OCTOBER PARLIAMENTARY ELECTIONS. 
THE MERCHANT FAMILIES ATTRACTED SOME ATTENTION IN THE 
RECENT HIGHLY POLITICIZED ELECTIONS FOR THE BOARD OF THE 
CHAMBER OF COMMERCE.  HOWEVER, THE OUTCOME OF THAT 
ELECTION ILLUSTRATED THE POLITICAL INERTIA OF THE 
MERCHANT ARISTOCRATS.  SOME OBSERVERS CHARACTERIZED THE 
CHAMBER OF COMMERCE ELECTION AS A DRY RUN FOR OCTOBER 
ELECTIONS PITTING A DEMOCRATIC OPPOSITION AGAINST A 
SLATE OF CANDIDATES BACKED BY THE AL-SABAH.  IN FACT, 
THE FACE-OFF WAS MORE OF A POLITICAL PRIMARY WITH A 
CHOICE BETWEEN THE BIG-NAME SUNNI MERCHANTS WHO HAVE 
ALWAYS CONTROLLED THE CHAMBER OF COMMERCE AND A GROUP OF 
NEWCOMERS TRYING TO UNSEAT THE TRADITIONALISTS BY 
RUNNING A SLATE FROM THE "ORDINARY FAMILIES" INCLUDING 
SOME SHIA, BEDOUIN, AND NON-ARISTOCRATIC BUSINESSMEN. 
THIS KUWAITI "RAINBOW COALITION" FAILED CONVINCINGLY IN 
ITS ATTEMPT TO UNSEAT THE ELITE FAMILIES FROM THEIR 
POWER BASE IN THE CHAMBER OF COMMERCE. 
 
9.  SEEMINGLY CONTENT TO HAVE PROVED THAT THEY RETAIN 
THEIR GRIP ON THE BASTION OF SUNNI MERCHANT POWER, THE 
LEADING MEMBERS OF THE FAMILIES APPARENTLY ARE NOT 
TAKING EFFECTIVE ACTIONS TO COMPETE IN THE OCTOBER 
ELECTIONS FOR THE NATIONAL ASSEMBLY.  WHILE THE MERCHANT 
FAMILIES HAVE A "PROTO-PARTY" REPRESENTED IN THE 
OPPOSITION ALLIANCE, THEIR GROUP, THE CONSTITUTIONAL 
FRONT, HAS DONE LITTLE IF ANYTHING TO ORGANIZE 
EFFECTIVELY IN ANTICIPATION OF ELECTIONS.  THE ONLY 
PROMINENT SUNNI MERCHANT WHO HAS DECLARED HIS CANDIDACY 
TO DATE IS FORMER FINANCE MINISTER AND PARLIAMENTARIAN 
JASIM AL-KHORAFI.  OVERALL, THE MERCHANT FAMILIES -- 
BOTH INDIVIDUALLY AND COLLECTIVELY -- HAVE FOR THE FIRST 
TIME IN THE HISTORY OF KUWAITI ELECTIONS FAILED TO AGREE 
ON A SLATE OF CANDIDATES.  WITH THIS LACK OF AGREEMENT 
MANY OF THE MOST POPULAR, ABLE, AND 
POLITICALLY-CONNECTED MERCHANT LEADERS HAVE APPARENTLY 
REFUSED TO RUN. 
 
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MERCHANT LEADERSHIP CRISIS 
-------------------------- 
 
10.  ONE OF THE MOST IMPORTANT -- AND DAMAGING -- 
PROBLEMS FOR THE MERCHANTS' POLITICAL FUTURE IS 
SELF-IMPOSED.  THERE IS AN ALMOST CRIPPLING ABSENCE OF A 
FORMAL STRUCTURE THAT WOULD ALLOW FOR THE DEVELOPMENT OF 
NEW LEADERSHIP.  THE MERCHANTS AFTER ALL REPRESENT 
EXTENDED TRADITIONAL CLANS THAT CANNOT EASILY ADOPT THE 
INSTITUTIONAL TRAPPINGS OF A PARTY OR POLITICAL INTEREST 
GROUP.  NEWLY REELECTED CHAIRMAN OF THE CHAMBER OF 
COMMERCE ABD AL-AZIZ AL-SAGER, A FORMER NATIONAL 
ASSEMBLY SPEAKER AND MINISTER OF HEALTH, IS NOW 79 YEARS 
OLD.  WHILE STILL ALERT, HIS HEALTH IS POOR AND HE 
REFUSES TO RELINQUISH ANY PERSONAL POWER.  SAGER ALSO 
RESISTS THE CREATION OF ANY STRUCTURE TO ALLOW YOUNGER 
MERCHANTS TO ASSUME ANY INTER-FAMILY LEADERSHIP 
AUTHORITY. 
 
11.  ANOTHER INTERNAL PROBLEM THE MERCHANTS FACE IS THAT 
MANY OF THE MOST IMPRESSIVE MEMBERS OF THE FAMILIES ARE 
MORE COMFORTABLE PURSUING BUSINESS RATHER THAN POLITICAL 
INTERESTS.  UNWILLING TO CHALLENGE ABD AL-AZIZ AL-SAGER 
AND HIS SEPTUAGENARIAN CRONIES, THE MIDDLE GENERATION 
MERCHANTS WHO COULD NATURALLY PROVIDE LEADERSHIP TO 
THEIR FAMILIES ARE TOO OFTEN MORE ABSORBED WITH 
HAPPENINGS IN NEW YORK, LONDON, PARIS, OR GENEVA THAN IN 
KUWAIT.  WHILE REGARDING THEMSELVES AS THE "TRUE 
KUWAITIS", THEY HAVE LITTLE INTEREST IN DIRTYING THEIR 
HANDS WITH THE QUOTIDIAN PROBLEMS OF THEIR MORE 
CONSERVATIVE AND MIDDLE-CLASS COUNTRYMEN.  THE 
ARISTOCRATIC MERCHANTS HAVE ALWAYS DESPAIRED OF THE 
"IGNORANT" LOYALTY OF KUWAIT'S BEDOUIN TO THE AL-SABAH, 
IGNORING THE FACT THAT THE LEGITIMACY OF THE AL-SABAH 
AMONG AVERAGE KUWAITIS STEMS FROM SEVERAL DECADES OF 
AL-SABAH INVOLVEMENT IN PROVIDING VALUED GOVERNMENT 
SERVICES. 
 
12.  SOME YOUNGER MEMBERS OF THE MERCHANT FAMILIES HAVE 
BECOME MORE AND MORE IDENTIFIED WITH OTHER GROUPS IN THE 
OPPOSITION ALLIANCE.  MUHAMMAD JASIM AL-SAGER, EDITOR OF 
"AL-QABAS" NEWSPAPER AND NEPHEW OF THE SUNNI MERCHANT 
PATRIARCH ABDELAZIZ AL-SAGER, IS A SPOKESMAN FOR A MUCH 
BROADER OPPOSITION POINT OF VIEW THAN JUST THAT OF THE 
SUNNI MERCHANTS.  TWO SONS OF ONE OF KUWAIT'S WEALTHIEST 
MERCHANTS, ABDEL AZIZ AL-GHANNAM, ARE MEMBERS OF THE 
MOSLEM FUNDAMENTALIST MOVEMENT - MUCH TO THE CHAGRIN OF 
THE OLDER FAMILY MEMBERS.  YET EVEN THOUGH THESE YOUNGER 
GENERATION MERCHANTS HAVE ADOPTED AN INCREASINGLY 
IDEOLOGICAL BASE FOR THEIR OPPOSITION POSITION, IT 
APPEARS UP TO THIS POINT THAT THEIR PRIMARY TIES REMAIN 
ULTIMATELY WITH THEIR FAMILIES. 
 
13.  THE HOPE OF SOME OF OUR MERCHANT CONTACTS IS THAT 
AFTER THE ELECTIONS, THE AL-SABAH WILL ASK LEADING 
MERCHANT FAMILY LEADERS TO JOIN THE GOVERNMENT IN KEY 
CABINET POSITIONS.  THEY ARGUE THAT ONLY THE BIG-NAME 
MERCHANTS CAN PROVIDE THE LEADERSHIP AND EXPERTISE 
NEEDED TO GUIDE KUWAIT THROUGH THE MULTIPLE CHALLENGES 
IT FACES OVER THE NEXT SEVERAL YEARS.  THE MERCHANTS 
CLAIM (WITH A GREAT WEIGHT OF EVIDENCE) THAT ONLY WHEN 
THE AL-SABAH HAVE GOVERNED WITH THE GUIDANCE AND UNDER 
THE INFLUENCE OF THE SUNNI MERCHANTS HAS THE COUNTRY 
PROSPERED.  THEY AGREE, HOWEVER, THAT THE RULING FAMILY, 
ACCUSTOMED TO UNCHECKED EXERCISE OF POWER AND 
EXPENDITURE OF PUBLIC FUNDS, WILL NEVER WILLINGLY INVITE 
STRONG, INDEPENDENT MINISTERS INTO THE GOVERNMENT. 
WHILE THE MERCHANTS MAY LONG FOR THE DAYS WHEN THEY 
COULD SHARE POWER WITH THE AL-SABAH, CONSTITUTIONAL RULE 
IN POST-WAR KUWAIT IS LIKELY TO SEE OTHER MORE ACTIVE 
AND AMBITIOUS BLOCS CONTESTING FOR THAT PRIVILEGE. 
 
GNEHM 
 
 
 
                       CONFIDENTIAL