The Money's Worth

In the past ten years, the West has poured $3.8 billion in public and private investments into the Middle East--the largest single chunk of cash the region had ever seen.* What has it bought for the area?

"Very little general benefit," concludes Hedley V. Cooke, a veteran of the U.S. consular service in Turkey and Palestine, writing in the current Middle Eastern A/fairs. "Large foreign investments have not yet stimulated any cooperative economic planning for the good of the entire region.

The main international river systems . . . are still controlled on a piecemeal basis. Proposals for more integration . . . have not been well received." Country by country, however, "some of the results appear considerably more auspicious."

TURKEY got about 45% of all foreign governmental aid to the Middle East. Result: "The economic strength to put up a long-sustained stand against Communism . . . Economic development is now keeping well ahead of population growth. The democratic form of government seems to be well established. Military strength has increased greatly . . ."

ISRAEL got about 20% of foreign-government (mostly American) grants to the Middle East. Result: Israel"has been enabled to realize several major goals":a doubling in population, economic progress rapid enough to ensure political stability and to cause rightist and leftist extremists to lose ground, an army adequate to safeguard independence.

SAUDI ARABIA now gets the bulk of its national revenue from oil royalties. Unfortunately, at present the money goes largely to subsidize royal relatives and tribal chieftains,"a relatively small group lacking in civic conscience."

IRAQ is spending 70% of its oil royalties on long-term development, but"no spectacular results can be expected for at least several years," and in the meantime, public impatience may lead to oil nationalization.

JORDAN "would long ago have ceased to exist as an independent state" but for the $200 million it got from Britain, U.N., aid to Palestine refugees and Point Four. One benefit: Jordan's Arab Legion is "the best-trained combat force in any of the Arab states."

What have the foreign investors, chiefly the U.S. (66% of the total) and Great Britain, reaped in return? "Immense oil resources for strategic purposes," says Cooke, and "the firm establishment of Turkey as a strong and friendly vanguard of defense against Communism." Also, "Israel's support of the West, [which] is dependable, no matter whether or not that state is admitted into the Western alliance system." Gains "in Saudi Arabia have been considerable. Apart from the oil . . . they include an American air base at Dhahran."

In the Middle East in general, says Cooke, ". . . the pace of social and economic development is much too slow, even when judged by charitable standards . . . In most of the countries, the will and ability . . . wholeheartedly . . . to struggle against Communism is substantially lacking." His conclusion is qualified: "Bad as the present conditions are, it is a virtual certainty that the total situation, both in the Middle East and in the world as a whole, would be considerably worse today but for the large investment made in the Middle East."

* Of which $2.5 billion came from the U.S. Direct business investment (90% of it by the U.S., British, Dutch and French oil companies) totals $1.5 billion. U.S. Government grants and credits, including military aid, total more than $1 billion. The rest of the $3.8 billion consists of grants and credits from other foreign governments and about $600 million in gifts and loans to Israel by American Jewry.

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