Editor's Note:
Today we offer for your consideration part 2 of the three part interview with United States Ambassador to Saudi Arabia Ford M. Fraker. Part 1 provided his insights on the current state of the relationship between America and the Kingdom. In this part he addresses the business component of the relationship, the security environment in the Kingdom and the challenge of sorting out the visa policy. On Monday, part 3 of this series will include
Ambassador Fraker's discussion of regional security issues, reform initiatives and the counter terrorism partnership.
SUSRIS
EXCLUSIVE
The Diplomacy of Business
A Conversation with Ambassador Ford Fraker
Part 2
BUSINESS TO BUSINESS
SUSRIS:
The business component, as you said earlier, leads diplomacy in the relationship with Saudi Arabia. What do you tell Americans about the business environment in the Kingdom?
AMBASSADOR FORD M. FRAKER: As I said this morning at the conference, if you�re in a U.S. business with international aspirations and you�re not looking at the Saudi market, than you�re missing the opportunity of a decade if not the next three decades.
SUSRIS: Any specific sectors you would suggest or is it the boom of all booms and the opportunities are wide open?
FRAKER: It�s the boom of all booms. It really runs the gamut from professional services, construction and manufacturing. It is all sectors.
SUSRIS: Many Saudi business people feel Americans are not getting onboard with the economic opportunities, the boom, to the extent they should be.
FRAKER: I agree with that. It�s gradually changing but not fast enough. It�s a big frustration for me because it�s a big part of what we try to do � to get this message out to U.S. companies. It�s a hard one, simply because the public perception of the Middle East in general and Saudi Arabia specifically has been so negative for so long. 9/11 is still in people�s minds. So to move beyond that tragic event will require more time and attention and education.
Then it comes down to who actually is going to do that job � to get the message out? Should it be the Saudis? One of my complaints with my Saudi friends is that I�ve been running around this part of the world for 30 years and for 30 years they have been ineffective putting their own case across to the American public despite the money spent.
On the other side, should it be the State Department? Should it be the Commerce Department? Certainly the Commerce Department should be promoting the opportunities in the Kingdom. The Embassy has a Commercial Attach�, and I am constantly stressing the need to increase the number of business delegations to the Kingdom and to identify ways we can increase the people to people connection. At the end of the day, that�s what it�s all about. If we can get people on airplanes to visit Saudi Arabia, they will see for themselves the opportunities for partnerships.
After 30 years of doing business in the region, I have seen that every time someone comes to the Kingdom they leave more positive than when they arrived, every single time. So half the battle is getting them on an airplane.
SUSRIS: What about competition? Are the Chinese and Europeans taking up what Americans are leaving on the table?
FRAKER: The United States is still the largest trading partner but we�re losing market share to Asian and European companies for several reasons. Their proximity to the Kingdom and, frankly, more of their companies are coming to the Kingdom so they are getting more of the pie. Plus they are benefiting from the overhang of a neutral to a negative reaction to America as a holdover of the 9/11.
Again, I see that corner being turned. Fundamentally the Saudis would prefer to do business with us and the five-year visa is making that easier.
TRAVEL SECURITY
SUSRIS: Before we talk about visas let�s talk about a different impediment for Americans going to the Kingdom, the State Department warnings about travel in Saudi Arabia. Are you satisfied that the security conditions in the Kingdom are compatible with Americans visiting, living and working in Saudi Arabia?
FRAKER: Yes. In fact we�re in stage three of a return of families program. In September 2007, I got approval for stage one - adult family visitation for two week visits. This was followed by stage two - approval for all family members to visit for two weeks.
We�re now pursuing a program of return of families. The first step will be the return of adult family members and a move to a two-year posting. This is an important signal to companies.
SUSRIS: Do you see any change in attitudes about living and working in the Kingdom when you talk to people in the business community?
FRAKER: Yes, a little bit. I�ve rewritten the travel advisory warning four times. When I first arrived the wording was such that life insurance policies would not cover senior executives traveling to the Kingdom.
That was a very real impediment. An executive would say that he was going on a business development trip to Saudi Arabia and his corporate lawyer would say no you�re not because you are not covered. With the approval of two-week visitations for family members, the travel warning has been rewritten so there are no legal impediments now, as far as corporate insurance to prevent executives from traveling to the Kingdom.
You can argue whether or not the language is too extreme or too alarming, but we hope the message that we are in a return of families program means that we are sufficiently satisfied that the internal security environment is good enough for us to start this program.
That whole story is moving positively in the right direction. It is based on an improved security environment in the country. It�s not that the threat stream necessarily has diminished. It�s that the local security forces have proven able to confront and deal with the risks that exist and have demonstrated efficiency in heading off threats. So that�s a big part of why I feel comfortable we can move forward.
VISAS
SUSRIS: Visas and port of entry procedures for Saudis � business people, students, tourists � traveling to the United States. A lot of business is not getting done because of the travel constraints. What�s your take on the situation?
FRAKER: It probably took me about 27 seconds to figure out the visa issue was the single biggest impediment to the bilateral relationship moving forward. I was warned about it before I arrived in Riyadh and it was instantly crystal clear and it moved right to the top of the list.
The visa issue had become sort of a litmus test for the overall relationship and the commitment of the United States to Saudi Arabia. Every time I went to see senior Saudi officials they did not want to talk about Iran or Iraq. They wanted to talk about visas. It was overwhelming the relationship.
I was pleased to get the President engaged on this issue on his first trip to the Kingdom, in January, sufficiently such that he committed to the King that he was going to fix the problem. Which meant that we all had something to work for knowing he was coming back in May. I kept saying to everyone the King won�t see the President unless he�s fixed this problem because he promised to fix this problem. And he�s coming out in May so that�s our time frame.
It proved to be an effective cudgel both back in Washington as well as in Riyadh to make sure it happened. It wouldn�t have happened if it hadn�t been for the President�s trips and his engagement from the top down.
We had such a position in the Kingdom, which is why it just drove me nuts � as a banker � that we were not capitalizing on the opportunities as we should have. When I spoke with the President, I talked about the billions of dollars of contracts that we had lost simply because our competitors could say to customers, well you can�t award this contract to the Americans because 20 percent of it is a training component and you�ll never get the visas to go to the United States to train.
In specific cases Americans were losing contracts for that reason. And when they were winning contracts, it might be specified in the contract that the training component would happen in the UK or Europe. So we were missing all the soft benefits from this business as well. The President is a businessman and he got it.
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The change in the visa policy would not have happened if he had not heard it first hand. On his first visit in January we arranged a roundtable of young Saudi entrepreneurs, all U.S. educated business owners. I met with them the night before the discussion and said this is your opportunity to talk about your businesses. Talk about the challenges you�re facing vis a vis doing business with the United States. That�s what he wants to hear about.
The press was present. I made a statement. The President made a statement. Then the press left. The President said, okay tell me about your businesses. All twelve of them went after him on the visa front with countless stories about business they�ve lost. The frustrations they�ve had. The fact they are not traveling to the United States any more. They�re not sending their kids to the United States for vacation or to attend universities. At the end of it he walked out and said I gotta fix this. |
President
George W. Bush participates in a roundtable discussion
with Saudi entrepreneurs Tuesday, Jan. 15, 2008, at the
United States Embassy in Riyadh. White House photo by
Chris Greenberg |
When the President came back in May, the provisions of the five-year visa had been agreed to. We went into the King�s office for the meeting, and the first thing the President said to him, �Your Majesty.. I�m so pleased we could sort out this visa problem, because now we�re going to educate the next generation of Saudis. I met with some of your young entrepreneurs and when I heard their stories I was committed to make this happen.�
It�s five years, reciprocal. This means that Americans should be getting five year multiple entry visas for business. Saudi tourists are receiving five-year visas and students get up to five years depending on their term of study. So a student on a King Abdullah scholarship, which includes one year of English and four years at a university will receive a five year visa. A student enrolled in a two-year graduate business program will be issued a two-year visa.
This is to prevent the situation we still have where students come back to the Kingdom after their sophomore year to renew their visas and they get held up and don�t make it back for junior year. As a parent can you imagine the ill will and upset that that creates.
So at the moment we are riding a positive crest on visas.
Another cause of ill will and angst has been the secondary screening process Saudis between the age of 16 and 45 are automatically subject to upon arrival in the United States. As a result of the President�s visit in January, Homeland Security Secretary Chertoff came to the Kingdom in February to discuss the issue. We are now implementing a system to exchange airline passenger information. That means before flights arrive at the port of entry the security checks will have been done. It will be like the program for flights from Europe to the United States.
SUSRIS: So now we have five-year visas. Is the issuance still Riyadh only?
FRAKER: No, we�ve gone to full issuance in Dhahran. We did that in June.
SUSRIS: The Jeddah Consulate is moving?
FRAKER: A new consulate is under construction now northeast of Jeddah and is projected to open in 2010. It will be a much more secure facility than we have now.
Next:
On Monday in the final part of our three part conversation with America's Ambassador to Saudi Arabia Ford M. Fraker, we talk about the the partnership in counter terrorism, reforms in the Kingdom and regional security issues. Look for that SUSRIS Exclusive on December 1st.
Part 1 of our conversation with Ambassador Ford
Fraker
About Ambassador Ford M. Fraker
Ford M. Fraker was sworn in on April 11, 2007 as U.S. Ambassador to the Kingdom of Saudi Arabia. At the time of his nomination by President George W. Bush, Ambassador Fraker was serving as Chairman of the Trinity Group Limited, a private investment banking firm in the United Kingdom and as consultant for Intercontinental Real Estate Corporation in Boston, MA.
Ambassador Fraker graduated cum laude from Harvard University in 1971 with a Bachelor of Arts degree. He has served as a banker in the Middle East for more than 30 years. He began his career with Chemical Bank where he worked from 1972 to 1979. He worked in Lebanon, the
UAE, and Bahrain, ending as a Vice President and Regional Manager for the bank�s Bahrain office. He joined the Saudi International Bank in 1979 and worked for SIB until 1991, holding positions of increasing management responsibility in the bank�s General Banking, Credit and Client Development units. When he left SIB in 1991, Ambassador Fraker was serving on the bank�s Management Committee.
Ambassador Fraker founded Fraker & Co. in 1991, and in 1993, he joined MeesPierson Investment Finance (UK) Limited, where he was the Managing Director responsible for placing U.S. and European investment products with European and Middle Eastern institutional and private investors. In 1997, he co-founded Trinity Group Limited and continued to serve as Managing Director and Chairman until his nomination by President Bush.
Ambassador Fraker was born in Princeton, NJ and speaks French and Arabic.
Source: U.S. State Dept.
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