Saudi Investment

looksee · 21-03-2017 11:58pm #1

This is not really a religious question so much as a cultural one. Saudi investors have said they are proposing to invest €300m in Waterford. Good for Waterford, though one would wonder how two huge shopping centres in a city the size of Waterford are going to make any lasting impression on the local economy.

However, while investment is needed in the city, it niggles a bit that it is coming from a culture that would not allow its own women to visit unless fully covered and with a chaperone, and would not allow them to drive there if it were in Saudi Arabia. And that is before we get to suggestions of slave labour.

I am not sure what I think. If any other investors came along, would I be examining their motives and culture? What is the pay back for them? It is hard to imagine any other investors wanting to invest in Waterford on that scale, especially since there is a large, empty shopping center very close to where the new one is proposed.

Hotblack Desiato · 22-03-2017 2:50am

Will off licences and bacon butchers be allowed in this shopping centre?

Peregrinus · 22-03-2017 5:19am

looksee wrote: »

What is the pay back for them?

Rent.

There's nothing surprising or necessarily sinister about Saudi Arabians making investments abroad. Saudi Arabia earns unimaginable amounts of foreign currency from the export of oil. The only thing you can do with foreign currency is buy things in foreign-land. There's a limit to the amount of smoked salmon and Mercedes-Benzes that even the Saudis can consume, so it's inevitable that the Saudis will acquire foreign assets. In other words, invest in foreign countries. It's that, or keep all their spare dollar bills in a shoebox under the bed.

This is true for any country with a large balance of payments surplus; China, for example. But it's especially true for Saudi Arabia and some of the Gulf States, because the other traditional way of investing your unwanted dollars - lend them to the United States government to finance its colossal budget deficits - is not open to people who will not enter into transactions of usury. The Saudis don't like to lend money at interest (which is what you're doing when you buy government bonds) so they invest by buying assets/enterprises, or taking shares in them, instead of financing them through mortgages, bonds and the like.

Will there be off-licences and pork butchers? Yes, there certainly will. The Saudis have no objection to non-Muslims drinking or eating pork; nothing in Islam forbids this. They wouldn't run a pork butchers themselves, since that would involve them handling pork which they don't like to do, but they have no difficulty in letting property to non-Muslims who handle pork.

topmanamillion · 22-03-2017 6:11am

It involves a fair bit more than shopping centres.
"The proposed development would include 30,000 square feet of retail space, 15,000 square feet of hotel accommodation, 30,000 square feet of apartments, as well as 10,000 square feet of office space"

Also they would need to rebuild a rail station in the area.

This isn't a development, its the redevelopment of a significant portion of Waterford city.
Considering they`ll probably get the land for next to nothing from NAMA, there is significant scope for them to make a killing here.

Peregrinus · 22-03-2017 6:25am

Or to lose a bundle. Still, I suppose they know what they're doing.

silverharp · 22-03-2017 12:35pm

I don't see that it matters, Saudi money is tied up in all sort of things and if you are prepared to buy their oil you cant pick and choose where you want random sanctions

Peregrinus · 22-03-2017 12:59pm

Silverharp has it. You can't hand squillions of dollars over to the Saudis and then complain when they try to spend it.

smacl · 22-03-2017 1:29pm

looksee wrote: »

I am not sure what I think

You have to ask whether they are any better or worse than the other venture capitalists that NAMA have been flogging our property en masse, while also denying us the right to buy it ourselves? As an organisation tasked to sell publicly owned property in the best interests of the public, they've made a lot of questionable decisions. On the scale of things, this one seems no worse than most.

recedite · 23-03-2017 2:14pm

Great to see Saudis investing in this country. As already mentioned, they have to spend abroad, and they know the oil will run out eventually, so they have a moral obligation to have at least some tangible assets to bequeath to future generations of arabs, when the oil wells run dry and all the money has been spent.
It will be interesting to see whether they can resist the temptation to specify some sort of small cultural centre/mosque as part of the planning permission, or whether they will take a completely hands-off approach to the investment.

looksee · 23-03-2017 3:50pm

When you recall the fuss that was made in Dunnes Stores because of South African fruit being sold there, linked to the the apartheid situation - small gestures like that did eventually remove, to a large extent the apartheid system.

But here we have a country that is engaged in human trafficking, slave labour and subjugation of women, but they have money so they are welcome, please come and invest in our country! The scale of investment may not even be appropriate to Waterford, but we can forgive anything if there is money coming in, sure we will worry about all the empty shops and offices in the town later.

smacl · 23-03-2017 4:12pm

looksee wrote: »

When you recall the fuss that was made in Dunnes Stores because of South African fruit being sold there, linked to the the apartheid situation - small gestures like that did eventually remove, to a large extent the apartheid system.

Its a fair point, but the analogy to South Africa would be for us to stop buying their oil, not refusing to sell bits of land to them. It would be rather hypocritical on the one hand to say we weren't going to let them make this investment while on the other driving around and heating our houses with fuel bought from them. Perhaps we should put some of the money earned towards energy security, because as things stand we're pretty much beholden to the gulf states regardless of their horrific human rights record. Oranges we can live without if needs be, oil not so much.

looksee · 23-03-2017 4:22pm

Ok so, I have been totally flattened in the Waterford forum as a negative moaner (which would be really funny if people knew what I had spent the morning doing

) - you want to 'give us money'? That's great we are not picky, thanks very much. Now the subject is being skirted round here too. We will just have to wait and see what comes of it.

smacl · 23-03-2017 4:35pm

looksee wrote: »

Ok so, I have been totally flattened in the Waterford forum as a negative moaner (which would be really funny if people knew what I had spent the morning doing ) - you want to 'give us money'? That's great we are not picky, thanks very much. Now the subject is being skirted round here too. We will just have to wait and see what comes of it.

Not skirting around it at all, the wealth the Saudis enjoy comes from other countries spending money for their oil. If we don't want to deal with the Saudis, and I personally would much rather not, we need a viable alternative energy source to imported oil. While we're slowly getting better at renewables, we're still a long way off not being dependant on oil.

AlmightyCushion · 23-03-2017 4:48pm

smacl wrote: »

Not skirting around it at all, the wealth the Saudis enjoy comes from other countries spending money for their oil. If we don't want to deal with the Saudis, and I personally would much rather not, we need a viable alternative energy source to imported oil. While we're slowly getting better at renewables, we're still a long way off not being dependant on oil.

Would Ireland buy a lot of Saudi oil? I'm imagine we'd be more like to buy North Sea oil from Britain or Norway. I've no idea, I'm assuming based on their relative closeness to us that it makes more sense to buy from them.

Edit: After a quick google I found this. Looks like we get most of our oil from Norway, Denmark and Britain. We also get a pretty large amount from Libya.

http://cdn.thejournal.ie/media/2013/03/oil-infographic.jpg

smacl · 23-03-2017 6:08pm

AlmightyCushion wrote: »

Would Ireland buy a lot of Saudi oil? I'm imagine we'd be more like to buy North Sea oil from Britain or Norway. I've no idea, I'm assuming based on their relative closeness to us that it makes more sense to buy from them.

Edit: After a quick google I found this. Looks like we get most of our oil from Norway, Denmark and Britain. We also get a pretty large amount from Libya.

http://cdn.thejournal.ie/media/2013/03/oil-infographic.jpg

Interesting, from that we get the largest part of our oil from UK refineries (~75%), though at this point the UK is a net importer of oil as well and also gets a fair amount from OPEC, which leaves our reliance on OPEC sourced oil at roughly 25%. Not nearly as much as I'd though but still a fair wedge of cash.

the_syco · 23-03-2017 7:27pm

looksee wrote: »

But here we have a country that is engaged in human trafficking, slave labour and subjugation of women

I think if you check, you'll find that the last Magdalene Laundry was shut in 1997 :pac:

Oh, wait, you mean the Saudis? Long term, once the oil runs out, they're fecked. Which is why they're investing now, when they have the money, and it means something.

Have they looked into a golf course to go with the hotel?

Hotblack Desiato · 24-03-2017 2:02am

I wouldn't worry about oil so much, we can get it from lots of places and have a strategic reserve, but we've become very dependent on gas for electricity generation and heating and that means cosying up to Vladimir whether we like it or not.

Ferrari3600 · 24-03-2017 2:11am

Paddy getting on his high horse about moral values is always amusing.

http://www.irishtimes.com/business/financial-services/libya-considered-investing-1-5bn-in-bank-of-ireland-1.2285742

Peregrinus · 24-03-2017 3:48am

AlmightyCushion wrote: »

Would Ireland buy a lot of Saudi oil? I'm imagine we'd be more like to buy North Sea oil from Britain or Norway. I've no idea, I'm assuming based on their relative closeness to us that it makes more sense to buy from them.

Oil is oil; it doesn't matter where it comes from. If we buy oil at all we drive up the price of oil and so increase the Saudis income from selling oil to someone else. The only way to stop the Saudis earning dollars from selling oil is to stop them from selling oil through sanctions or similar.

robindch · 24-03-2017 10:41am

Peregrinus wrote: »

The only way to stop the Saudis earning dollars from selling oil is to stop them from selling oil through sanctions or similar.

The only way to stop the Saudis earning cash from oil is for people to stop buying it.

Until that happens, our options on the consume-side are to create an EU-wide common energy purchase policy - this will stop predatory pricing policies from energy-powerful countries, especially Russia which has a history of using energy supplies as a foreign policy weapon.

On the reduce-side, the EU can make significant progress with renewable energy sources - here in Ireland, wind energy produces an average of over 3GW, approximately 30% of the country's electricity needs, which themselves are perhaps 45% of the country's total energy requirement.

silverharp · 24-03-2017 10:58am

robindch wrote: »

The only way to stop the Saudis earning cash from oil is for people to stop buying it.

Until that happens, our options on the consume-side are to create an EU-wide common energy purchase policy - this will stop predatory pricing policies from energy-powerful countries, especially Russia which has a history of using energy supplies as a foreign policy weapon.

On the reduce-side, the EU can make significant progress with renewable energy sources - here in Ireland, wind energy produces an average of over 3GW, approximately 30% of the country's electricity needs, which themselves are perhaps 45% of the country's total energy requirement.

70% of oil is used in Transportation whereas with electricity gas is the main traded commodity

smacl · 24-03-2017 11:25am

robindch wrote: »

On the reduce-side, the EU can make significant progress with renewable energy sources - here in Ireland, wind energy produces an average of over 3GW, approximately 30% of the country's electricity needs, which themselves are perhaps 45% of the country's total energy requirement.

Wind power is also intermittent and requires huge investment on the storage side to become a viable primary power source, with pumped hydroelectric storage probably the best viable option for this country.

robindch · 24-03-2017 11:48am

smacl wrote: »

Wind power is also intermittent and requires huge investment on the storage side to become a viable primary power source, with pumped hydroelectric storage probably the best viable option for this country.

I'm not denying any of that - but given the country's enormous dependence on foreign energy supplies, I think it behooves the country to develop and use what we do have as best we can.

Hotblack Desiato · 29-03-2017 1:50am

robindch wrote: »

On the reduce-side, the EU can make significant progress with renewable energy sources - here in Ireland, wind energy produces an average of over 3GW, approximately 30% of the country's electricity needs, which themselves are perhaps 45% of the country's total energy requirement.

3GW of installed wind capacity is very far from being 3GW of despatchable power you can call upon as desired. The "approximately 30% of the country's electricity needs" is impossible in practice.

smacl · 29-03-2017 7:51am

Hotblack Desiato wrote: »

3GW of installed wind capacity is very far from being 3GW of despatchable power you can call upon as desired. The "approximately 30% of the country's electricity needs" is impossible in practice.

This comes down largely to storage and interconnection. Theoretically, we could be getting about 80% of our energy from renewable sources, but the infrastructural costs would be prohibitive. See the Store Project from more details. A scenario involving buying and selling surplus to the UK in addition to local storage would be more realistic and provide about 40%. I was involved in a research project with UL a few years back looking at the potential feasibility for pumped hydro based storage in various locations around the country and results were positive. The costs are high however, and the political will isn't there yet.

magicbastarder · 29-03-2017 7:59am

you've seen the rail equivalent to pumped storage being used in the state? buy old rolling stock and roll them up and down hills; *way* less investment required than hydro pumped storage, and can be dismantled leaving a far less intrusive footprint. or so the sales pitch goes, anyway.

smacl · 29-03-2017 9:22am

magicbastarder wrote: »

you've seen the rail equivalent to pumped storage being used in the state? buy old rolling stock and roll them up and down hills; *way* less investment required than hydro pumped storage, and can be dismantled leaving a far less intrusive footprint. or so the sales pitch goes, anyway.

Sisyphuss railway? AFAIK more expensive per stored and returned MWh than pumped hydro, and from my understanding only a solution where the topography is not suitable for pumped hydro (e.g. the Nevada desert).

freshprince · 29-03-2017 9:29am

looksee wrote: »

When you recall the fuss that was made in Dunnes Stores because of South African fruit being sold there, linked to the the apartheid situation - small gestures like that did eventually remove, to a large extent the apartheid system.

But here we have a country that is engaged in human trafficking, slave labour and subjugation of women, but they have money so they are welcome, please come and invest in our country! The scale of investment may not even be appropriate to Waterford, but we can forgive anything if there is money coming in, sure we will worry about all the empty shops and offices in the town later.

Yes but this is a Muslim majority country doing it so we're not meant to talk about it just brush it under the rug and pretend it's nothing bad!

magicbastarder · 29-03-2017 9:38am

smacl wrote: »

Sisyphuss railway? AFAIK more expensive per stored and returned MWh than pumped hydro, and from my understanding only a solution where the topography is not suitable for pumped hydro (e.g. the Nevada desert).

yeah, i was wondering if the costs assumed near zero rolling stock costs, on the assumption that what was being used was EOL, which could have quite an impact.

looksee · 29-03-2017 9:57am

We seem to be edging away from the topic and onto renewable energy. I am a little surprised at the lack of concern about accepting investment from a regime that is so casual about human rights. I don't see the arguments of 'well we buy their oil' and 'other governments are just as bad' are all that relevant.

Peregrinus · 29-03-2017 10:02am

looksee wrote: »

We seem to be edging away from the topic and onto renewable energy. I am a little surprised at the lack of concern about accepting investment from a regime that is so casual about human rights. I don't see the arguments of 'well we buy their oil' and 'other governments are just as bad' are all that relevant.

I don't think we're accepting investment from the regime, here, are we? W're accepting investment from individuals who live in a country governed by this regime. I think that's a material difference.

Saudi Investment

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