The Middle East conflict – opportunities for Sri Lanka? While the global economy crumbles opportunities abound for Sri Lanka – By Aubrey Joachim
As the Middle East crisis deepens and threatens the global order as we know it adjustments and realignments will occur which will result in strategic opportunities arising for those that can and are willing to exploit them. What the whole world is witnessing right now is almost a David and Goliath battle being played out. The end game in that Biblical story is familiar to all. Despite what that end game will be the underlying uncertainty and risk in the Middle East will linger. It may be time for corporate re-think and global re-set.
Wars have been fought for as long as mankind evolved from the jungle to societal living. Most wars have begun and been fought over the desire of one party to dominate the other or gain some tangible benefit such as land or wealth. Both of these aspects can be at play in the current Middle East crisis.
Irrespective of the outcome wars have taken a severe toll in terms of lives as well as destruction of assets. However, the nature of modern ‘warfare’ seems to be changing in keeping with the shifts in other areas of human endeavour dictated to by the advent of AI and the exploiting of knowledge. And, in the case of the current conflict it is patently clear that the Iranians are using brain rather than brawn. After all it was the 9th century Persian mathematician Muhammad ibn Musa al Khwarizmi who invented algebra and is credited with pioneering algorithms – an uncanny fact in today’s age of AI.
Interestingly the Iranians are exploiting mathematics to the hilt. When one of their 40 Thousand USD drones takes two or three 4 to 10 Million USD interceptor missiles to mitigate the damage the maths speaks for itself. As is being reported the war has to date cost the US around USD 12 Billion!
Mathematics aside, the Iranians are also using their geographic position as a weapon as well. They are using the Straits of Hormuz as a strategic weapon to once again play a numbers game with the global economy. A smart move which is frustrating the Goliath. And so too are they playing with strategic aviation hubs with occasionally fired drones that create fear and doubt in the minds of airlines and passengers creating huge disruption and economic losses.
Besides the above, while the US – as they boast – are using the most expensive and sophisticated weapons ever invented, the Iranians are using a simple weapon that costs nothing – mere words. Iran has merely threatened Western-linked economic interests in the Gulf. It only took mere threats to have Dubai’s financial and knowledge hubs scramble and close their offices. Global finance institutions and software and technology giants are assessing their situations in light of the current instability. How long will all this last? Will the uncertainly ever dissipate? Will the once peaceful and prosperous Gulf States ever be the same again? Is it time for global corporate giants to re-think their positions on locations?
The entire Middle East situation is opening up a number of opportunities for Sri Lanka. Once again geography and intangibles such as knowledge and intellectual capital come into play. Sri Lanka has much to offer in both respects. The country is well positioned geographically on the global map to easily replicate a Dubai or a Doha as an aviation hub. In fact, it is already a major shipping hub with one of the best deep water ports in the region and an efficient transhipment point. It is a key location on China’s Silk route. Couple the two – aviation hub and maritime hub – the ideal combination.
However, while the aviation and shipping opportunities will play a significant part in global supply chains, an even more important and exciting prospect is Colombo’s Port City Development which can certainly play host to the global corporate giants that must surely be evaluating their situations in the context of the current conflict in the Middle East. As a location to position a corporate office it is ideal. What better place than being in the Indian Ocean with a pleasing climate and Lonely Planet’s best kept secrets at one’s doorstep. As a Financial Hub it would excel with access to the African, Indian and South East Asian markets – given the increasing shift of power from the West to the East.
While the Middle Eastern corporate centers must necessarily ‘import’ almost all of their human capital from outside the country, Sri Lanka boasts a well-educated but under-employed workforce. In fact, a number of Sri Lankans would certainly even now be working for the global corporates. Sri Lanka has always had some of best finance and accounting talent in the world and more recently its IT talent is in high demand. It may not be a surprise that high level Sri Lankan finance professionals were involved in setting up the financial centers in the Middle East. With Sri Lankan diaspora engaged by a number of global organisations overseas, they may see the benefits of getting back home and also add value to corporates that move to Sri Lanka.
Also the opportunity to attract those that wish to invest in real estate and live the ‘high life’ in a peaceful idyllic location without ever the fear of missiles or drone fragments infringing one’s balcony. The world’s wealthy are yearning for peace quiet and a beautiful sunset!
The opportunities are many and they must be grabbed urgently. Hopefully the government and those that are in positions that can exert influence will see the strategic opportunities that are crying out for a home.
The current war – even though not reaching a finite end – may reach a stalemate with some sort of fragile peace being negotiated but the underlying fear, threat and risk will remain for decades to come. It is therefore time for Sri Lanka to act now as the window of opportunity is here.
The author – former Global President of CIMA is an Australian citizen of Sri Lankan descent and spent 10 years in the Middle East with an US Oil & Gas multinational
