Kuwait as a Sub-National Entity of the Ottoman Empire - Coursework Example

HISTORY OF KUWAIT The State of Kuwait is a constitutional monarchy with a parliamentary system of government. It is situated on the coast of the Persian Gulf, bounded by Saudi Arabia to the south, while Iraq lies on its northern and western borders; the Arabia Sea stretches along its eastern border.1 I) EARLY HISTORY (1613 – 1913) Historical records in the British Archives prove that Kuwait emerged on the global scene as an independent political entity in 1613. The Archives contain a letter written by Kuwaiti ruler Sheikh Mubarak Al-Sabah in 1913 to the British Political Resident in which the Sheikh describes Kuwait as “a land of the poor in which our grandfather Al-Sabah dwelled in 1613.”2 The Bani Khalid tribe ruled as overlords of East Arabia during the 17th century over 1: Kuwait: Wikipedia.org. 2: History of Kuwait: Kuwait-info.com. an area extending between what is presently Kuwait and Qatar. Barrak Bin Ghuraif, the Amir of the Bani Khalid, constructed his kout (a house near a water body shaped as a fortress) in a small fishing society near Qurain. Qurain today exists as Wattiya in present Kuwait City. The Utub, an alliance of Arab families who fled the drought conditions in Central Arabia, arrived in Kuwait during the beginning of the 18th century. The hospitable Bani Khalid allowed them to settle in Kuwait as long as they were subject to the former’s rule. The Bani Khalid experienced instability as family disputes erupted first in 1722 and then in 1752. The destabilising effects of these disputes were exacerbated by the rising power of the Wahhabis, enemies of the Bani Khalid located in Central Arabia. The Utub used this situation to claim for more independence. The Wahhabis supported the Utub and helped them gain de facto independence. The Utub celebrated the event by electing Sabah I Bin Jaber as the first Amir of Kuwait in 1756.3 Their election of the first Amir of Kuwait marked the total and successful transformation of the Utub from nomadic people to settlers. While the influence of the Bani Khalid began waning more and more, the influence of the Utub of Kuwait grew correspondingly stronger. Sheikh Abdullah I Al-Sabah, who succeeded as Second Amir in 1762, was responsible for bringing about the radical change of Kuwait into a flourishing and influential independency. Kuwait began steadily gaining international prominence and became an important port of call in global trading routes during the 18th and early 19th centuries. Taking full advantage of its only natural resource, Kuwait developed a flourishing pearl trade. Hundreds of sambuks (small pearling ships) sailed to the rich pearling grounds each year and returned by the end of summer. Shipbuilding and 3: History of Kuwait: Kuwait-info.com. trading emerged as the other major occupations in Kuwait. Trading was carried out in winter when dhows (wooden trading ships) sailed to India and returned with goods that were transported to the Mediterranean by desert caravans. Caravans from East and South Arabia also moved via Kuwait to Syria. Kuwait’s own markets were thronged with Bedouins marketing their goods and services, or purchasing imported goods to be resold in the Kuwaiti interior.4 Sheikh Jaber I Al-Sabah, the Third Amir of Kuwait (1812 – 1859) was a shrewd and astute ruler who heeded the advice of Kuwaiti merchants while ruling the country, and who took care to keep in existence good relations with all the major countries of that time. However, as Kuwait thrived through the remainder of the 19th century under the Fourth Amir, Sheikh Sabah II (1859 – 1866), the Fifth Amir, Sheikh Abdullah II (1866 – 1892), and the Sixth Amir, Sheikh Mohammad I (1892 – 1896), its independence was increasingly coveted by countries in the Arabian Peninsula as well as Europe.5 II) KUWAIT AS A SUB-NATIONAL ENTITY OF THE OTTOMAN EMPIRE (1913 – 1918) Kuwait’s Seventh and last Amir of the 19th century, Sheikh Mubarak Al-Sabah (1896 – 1915) perceived the Turkish Ottoman Empire as the greatest threat to Kuwait’s independence.6 He negotiated with the British and Turks to grant Kuwait the status of a caza (sub-national entity) of the Ottoman Empire. This officially came about when the Anglo-Ottoman Convention was signed in 1913 whereby the Turks and British both recognized Sheikh Mubarak Al-Sabah as the undisputed ruler of the caza of Kuwait.7 4: History of Kuwait: Kuwait-info.com. 5: Ibid. 6: Ibid. 7: Kuwait: Wikipedia.org. Sheikh Mubarak countered the Turkish influence by entering into many treaties with the international powers of those times. His tactic was successful, and the nation flourished during his rule. Hundreds of immigrants, lured by the country’s well-organised administration and rising commercial trade, came to settle in Kuwait. This trend continued during the rule of the Eighth Amir, Sheikh Jaber II (1915 – 1917).8 The rule of the Ninth Amir, Sheikh Salem Al-Mubarak (1917 – 1921), witnessed three important events. The first was the end of Kuwait’s status as a caza of the Ottoman Empire. When World War I ended in 1918, the Ottoman Empire was financially devastated, and the victorious British had no difficulty in scrapping the 1913 Anglo-Ottoman Convention and formally pronouncing Kuwait as ‘an independent sheikhdom under British protectorate.’9 III) WORLDWIDE RECESSION (1920) & THE TREATY OF UQUAIR (1922) The second important event during the rule of the Ninth Amir was the Worldwide Recession in 1920. It caused international trade to reduce drastically. Kuwait’s importance as a major port of call was adversely affected. The third important event was the beginning of hostilities with the Ifhwan tribe of the interior of Arabia (the hostilities went on for nearly 8 years before Kuwait finally defeated the Ifhwan comprehensively in 1930).10 Sheikh Ahmad Al-Jaber Al-Sabah ruled as the Tenth Amir of Kuwait from 1921 to 1950.11 Three important events took place during his reign. The first was the signing of the Treaty of Uquair in 1922 between Kuwait and Saudi Arabia under which they both 8: History of Kuwait: Kuwait-info.com. 9: Kuwait: Wikipedia.org. 10: History of Kuwait: Kuwait-info.com. 11: Ibid. recognised the border between them, and designated an area of 5,180 square kilometres (off Kuwait’s south border) as the Saudi-Kuwait Neutral Zone.12 IV) THE WALL STREET CRASH (1929) The second important event during the rule of the Tenth Amir was the Wall Street Crash in 1929. It caused a sharp fall in the global demand for luxury goods. International demand for newly introduced Japanese cultured pearls replaced the traditional demand for real pearls. This development was a huge body blow to the pearling industry in Kuwait, causing the activities of nearly 800 of its pearling ships to ground to a near halt.13 V) THE OIL BOOM (1930s) The third important event during the rule of the Tenth Amir saved the country from its stalled pearl industry and catapulted it into unimaginable riches and prosperity - Oil was discovered in Kuwait for the first time. As a result of the first geophysical oil exploration conducted during the 1930s, oil was discovered in the Burgan area of Kuwait. The first oil well was drilled in Bahrah in 1938. The next eight years witnessed a swift development of the new oil industry in Kuwait as oil was discovered in more areas of the country. By the time World War II ended in 1945, Kuwait was primed to begin exporting oil. Kuwait first started exporting oil in 1946. As oil exports continued to increase tremendously in the years that followed, Kuwait created a town called Ahmadi (named in honour of the Tenth Amir) close to the oilfields to accommodate the employees of the oil companies.14 The tremendous growth of its oil industry propelled Kuwait into becoming one of the wealthiest nations of the Arab Peninsula.15 12: Kuwait: Wikipedia.org. 13: History of Kuwait: Kuwait-info.com. 14: Ibid. 15: Kuwait: Wikipedia.org.. By the time the rule of the Tenth Amir ended and the Eleventh Amir, Sheikh Abdullah Al-Salem Al-Sabah succeeded him (1950 – 1965), 16 Kuwait was well on the way to massive prosperity. It achieved the rank of the biggest oil exporter in the Persian Gulf region in 1952. This caused a huge influx of manpower from a large number of countries, especially India and Egypt.17 VI) GLOBALLY RECOGNIZED INDEPENDENCE OF KUWAIT (1961) Although Kuwait existed as an independent political nation since 1613, June 19, 1963 is an auspicious date in Kuwaiti history as it marks the day the country gained global recognition as a sovereign nation.18 This came about after a formal exchange of notes between Britain and the Eleventh Amir of Kuwait.19 The Kuwaiti Constitution was formally approved on November 11, 1962 and its National Assembly gathered for its first formal meeting on January 19, 1963. Kuwait became an official member of the Arab League in 1961 and of the United Nations in 1963.20 The Eleventh Amir moved swiftly to settle boundary disputes with neighboring countries. Kuwait and Saudi Arabia agreed on a boundary demarcation and signed a pact to equally share the oil reserves in the Saudi-Kuwait Neutral Zone. In 1963, after lengthy discussions, Iraq finally recognised Kuwait’s border with it as well as Kuwait’s entity as an independent nation.21 Fuelled by its booming oil industry, the country continued to prosper greatly. The Kuwait Oil Company, a partnership between Gulf Oil and British Petroleum, was nationalised by Kuwait in 1970.22 16: History of Kuwait: Kuwait-info.com. 17: Kuwait: Wikipedia.org. 18: History of Kuwait: Kuwait-info.com. 19: Kuwait: Wikipedia.org. 20: History of Kuwait: Kuwait-info.com. 21: Kuwait: Wikipedia.org. 22: History of Kuwait: Kuwait-info.com. VII) THE OIL EMBARGO (1973) The world experienced its first Oil Embargo in 1973. It caused a great increase in oil prices. The Twelfth Amir of Kuwait, Sheikh Sabah Al-Salem Al-Sabah (1965 – 1977) decreed total national control over the nation’s oil industry, thereby gaining full control of the huge income from oil sales. Oil money was used to fund several national infrastructure projects (like roads, ports, factories, power plants and water desalination plants) as well as for improving the people’s standard of living.23 VIII) THE OFFICIAL STOCK MARKET CRASH (1977) The increase in oil prices brought huge riches to several private persons who responded by speculating heavily in Kuwait’s legal stock market in the mid-1970s. This caused the legal stock market to crash in 1977. It was a minor crash. The government reacted by bailing out the investors who suffered losses and setting up more stringent rules. This governmental reaction led to unforeseen results, as the least risk-opposed investors began channeling their investments into the country’s unofficial stock market called the Souk Al-Manakh.24 IX) THE UNOFFICIAL STOCK MARKET CRASH (1982) The Souk Al-Manakh was controlled by many rich Kuwaiti families who indulged in trading in huge amounts of stock mostly between themselves. The Market began rapidly luring new investors looking to invest in an area other than the official stock market.25 The crash of the Souk Al-Manakh was precipitated by the widespread use of postdated cheques. This led to the creation of a massive, unregulated expansion of credit. When the 23: History of Kuwait: Kuwait-info.com. 24: Kuwait: Wikipedia.org. 25: History of Kuwait: Kuwait-info.com. Crash finally occurred in 1982 (a postdated cheque presented by a stock dealer bounced), it triggered off a huge collapse. Government investigators discovered that an amount equal to U.S. $ 94 billion was contained in outstanding cheques given by 6,000 investors. The country’s financial sector, as well as its total economy, was severely shocked. The crash spawned a recession that swept through the Kuwaiti community as families were badly affected by the investment follies made by some family members based on the family’s credit. Kuwaiti banks were badly hit. With the exception of its biggest commercial bank, the National Bank of Kuwait (that was saved only due to support by the Kuwaiti Central Bank), all other commercial banks became technically insolvent. The government hurriedly intervened and set up a complex se of policies contained in the Difficult Credit Facilities Resettlement Program. The Program soon began to slowly but effectively rectify the huge problem during the years that followed.26 X) THE IRAQI INVASION (1990) & THE GULF WAR (1991) The Difficult Credit Facilities Resettlement Program was still going on in 1990 when Kuwait suffered the most crippling blow in its entire history – the Iraqi invasion.27 Kuwait had heavily sided with Iraq during the Iran-Iraq War (1980 – 1988). Iraq, under President Saddam Hussein however turned on Kuwait after 1988 claiming that it do three things: forgive Iraq’s $ 65 billion war debt, stop its 40% increase in oil production, and stop alleged slant drilling from its portion of the Rumaila oilfield that it shared with Iraq. After several months of increasingly vociferous accusations and denials, Iraq suddenly invaded its small neighbour on August 2, 1990. After easily capturing Kuwait, Saddam Hussein declared that the Thirteenth Amir of Kuwait, Sheikh Jaber 26: Kuwait: Wikipedia.org. 27: Ibid. Al-Ahmad Al-Jaber Al-Sabah was no longer its official ruler, and appointed Ali Hassan Al-Majid as Governor of Kuwait.28 The Iraqi occupation of Kuwait lasted 7 months. When a large number of peaceful diplomatic negotiations failed to make Iraq withdraw from Kuwait, a huge force from 34 countries led by the United States comprehensively defeated the Iraqi forces in little over a month (January 17 to February 26, 1991) in the Gulf War. As the Iraqi soldiers retreated from Kuwait, they set fire to 600 oil wells in Kuwait causing around 6 million barrels to go up in smoke everyday. The total Persian Gulf region was heavily polluted. The Persian Gulf Sea was not spared – around 11 million barrels of oil spilled into it.29 XI) KUWAIT AFTER THE GULF WAR (1991 TO PRESENT) It took a consortium of national and international firefighters nine months to completely extinguish the burning oil wells of Kuwait. It took another two years for proper repair and reconstruction works to be carried out at a cost of $ 50 billion.30 Since then Kuwait has successfully put the bad memory of the Iraqi invasion out of its mind and resumed its role as one of the largest exporters of oil in the world. Today, Kuwait is the sixth richest nation in the world. Kuwait’s proven oil reserves (104 billion barrels), is ranked as the fifth largest global oil reserve. Oil continues to be the mainstay of its economy, comprising 95% of its exports and generating 80% of governmental revenue. Kuwait’s prosperity is reflected in its high GDP ($ 138.6 billion), its high per capital income ($ 55,300), and the fact that its currency (the Kuwaiti Dinar) maintains, and has long maintained, its position as the highest valued currency in the 28: Kuwait: Wikipedia.org. 29: Ibid. 30: Ibid. world.31 As on April 10, 2008 the Kuwaiti Dinar was equal to 1.89469 British Pounds, 2.38347 Euros, 3.75206 U.S. Dollars, 3.83310 Canadian Dollars and 4.02409 Australian Dollars.32 Sheikh Jaber Al-Ahmad Al-Jaber Al-Sabah ruled from 1977 until his death in 2006. He is succeeded by the present ruler of Kuwait, the Fourteenth Amir Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah.33 31: Kuwait: Wikipedia.org. 32: Kuwaiti Dinar Exchange Rates: Exchange-rates.org. 33: History of Kuwait: Embassy of Kuwait, Canada. XII) REFERENCES USED ANON. 2008. History of Kuwait: Embassy of Kuwait, Canada. [Online]. Available: http://www.embassyofkuwait.ca/Kwt/history/Rulers_of_Kuwait.htm [12 Apr. 2008] ANON. (N.d). History of Kuwait: Kuwait-info.com. [Online]. Available: http://www.kuwait-info.com/sidepages/nat_history.asp [12 Apr. 2008] ANON. 2008. Kuwait: Wikipedia.org. [Online]. Available: http://en.wikipedia.org/wiki/Kuwait [12 Apr. 2008] ANON. 2008. Kuwaiti Dinar Exchange Rates: Exchange-rates.org. [Online]. Available: http://www.exchange-rates.org/currentRates/M/KWD [12 Apr. 2008] Read More