Islamophobia Is Bad for Business

A few years ago, nearly 1,600 Chinese laborers moved to Saudi Arabia to build a railroad in Mecca. But first these employees of the China Railway Construction Corporation—owned by the officially secular Chinese government—spoke the one-sentence shahada, a declaration of faith in one God and Mohammed as his prophet.

The city is barred to non-Muslims, so the mass conversion meant the workers could get down to business on the Mecca Metro, designed to shuttle passengers between Islamic holy sites in the city and surrounding area. The Metro was completed in 2010, and now the world’s 1.6 billion Muslims, including a few more from the People’s Republic, can perform their pilgrimage with every modern convenience.

In that same year, 2010, China surpassed the United States as the leading export market for Middle Eastern oil. China also beat out the United States as the top overall exporter to the Middle East, thanks to a 90 percent increase in Chinese exports to the region from 2005 to 2009. This followed China’s 2001 establishment of the Chinese-Arab Friendship Association, which promotes economic cooperation between Beijing and 22 Arab states. And last year the Algerian government granted another Chinese state-owned company a contract to build the Grand Mosque of Algiers, slated to be the world’s third largest Muslim house of worship.

While Beijing is buying and selling throughout the Middle East and North Africa, and, indeed, building Islam for Muslims, in the United States, Islamophobia is becoming an acceptable position. It is hurting American business prospects just when the country, wracked by the economic downturn, can least afford it.

The evidence of increasingly legitimized Islamophobia is everywhere. Representative Peter King’s 2011 hearings on “radicalization” of Americans Muslims were widely perceived as a witch-hunt. In the run-up to the presidential elections, Republican hopeful Herman Cain infamously promised supporters he would make American Muslims take a loyalty oath and that an American Muslim would never serve in his cabinet. Conspiracy theories about a Muslim takeover of the U.S. judicial system are rampant, and some twenty state legislatures have considered, and in some cases passed, bills banning the use of sharia, the Muslim legal code. That such bans are a solution in search of a problem could hardly be more obvious; the same goes for the ill will toward Muslims that the bans represent.

Islamophobia is alarmingly present outside official circles as well. Hate crimes against Arab Americans are down from their immediate post-9/11 peak, but incidence remains higher now than before that sad day. And more than one in three conservative Republicans responding to a Pew poll last summer said Barack Obama is a Muslim. It is telling that suspicion about Obama’s faith is greatest among his most strident opponents.

American Islamophobia is no secret in the Muslim world, according to James Zogby, who runs the Washington-based Arab American Institute (AAI). “America is suffering not only from the problem of the treatment of American Muslims, which sullies our image, but also our foreign policy sullies our image in the Arab world.”

AAI has been measuring Arab opinions of the United States throughout the past decade, and the numbers are grim. In the midst of a post-9/11 backlash against American Muslims, with uncharged prisoners languishing in Guantánamo and American wars spreading across the Muslim world, U.S. popularity took a tumble across the Middle East and North Africa.

A 2004 survey of 3,300 Arabs living in Morocco, Saudi Arabia, Jordan, Lebanon, the United Arab Emirates, and Egypt showed that approval ratings dropped by an average of more than 11 percentage points since 2002. Another survey comparing 2011 figures with 2008 figures showed that approval ratings of the United States had fallen by as much as half in all of those countries except Lebanon and Saudi Arabia, traditionally staunch U.S. allies, where approval ratings increased.

A 2011 poll found Egyptians were eleven times more “favorable” toward China than toward the United States; Morocco, Jordan, and the United Arab Emirates were five times more favorable toward China; and Lebanon was three times more favorable.

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“Anti-Arab and anti-Muslim sentiment has cost the United States and the West a number of business opportunities,” Haroon Moghul, Fellow at the New America Foundation and Fordham Law School’s Center on National Security, explains.

A concrete example came in 2006 when a Dubai enterprise, Dubai Ports World, dropped out of a deal to manage six U.S. ports after members of Congress attacked the plan on national security grounds. U.S. authorities would have been in charge of security at the ports.

“The Dubai Ports World fiasco,” Moghul says, harmed U.S. interests by “denying necessary investment for no reason other than a baseless and prejudicial mistrust of Arabs.”

Tourism is another case “of the potential and loss of business opportunity” resulting from Islamophobia, according to Rafi-uddin Shikoh, who directs DinarStandard, a research group specializing in Muslim-world markets.

In 2011 the Muslim tourism market was worth $126.1 billion, 12.3 percent of the global total, Shikoh says. The top travel destinations were Malaysia, Turkey, the UAE, Singapore, Russia, and China.

“I’m sure the mere discomfort of traveling to America as a Muslim or an Arab has . . . encouraged alternate tourist destinations,” Moghul says. “This lack of exposure will also cost us, as fewer Muslims and Arabs get the chance to study, travel, and experience America and gain an appreciation for our country.”

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China’s advantage in the Muslim world is not set in stone. If, for instance, Muslims in the Middle East and North Africa gave more weight to the Chinese government’s oppression of Muslim Uighurs, wider Muslim attitudes might change.

For now, though, America is the land of the phantom “creeping sharia” threat and of the most obvious forms of Islamophobia, and it continues to execute a foreign policy that alienates the Muslim world. The United States provides military aid in the Middle East and North Africa, but this doesn’t always play well among populations that don’t trust U.S. interference in the region. When Washington announced it would continue military aid to Egypt’s post-revolutionary military government after three decades of propping up Hosni Mubarak’s armed forces, Bahey el-din Hassan, director of the Cairo Institute for Human Rights Studies, told Al-Masry Al-Youm, the nation’s leading independent paper, “The United States doesn’t care about human rights. This was the attitude under Mubarak, they changed a little after revolution, and now the U.S. has come back again to its original position.”

“Rather than focus narrowly on defense and security, let’s prioritize economic growth, education, and cultural exchange,” Moghul suggests. “It costs far less, and the long-term payoff is significantly higher.”

Tunisia is one place where the United States can do some good. “They have had the most successful revolution so far, but that revolution is not going to develop deep democratic roots if Tunisia cannot provide jobs for its youth,” Moghul warns.

Sami Ben-Romdhane, a Tunisian-American eBay executive, believes that Tunisia could be a new Silicon Valley if technology businesses are able tap into the generation that conducted a revolution in part with tweets and Facebook groups.

But when Ben-Romdhane recently spoke to an audience of young Tunisians at a State Department function, he had to foot his own bill to Tunis.

“My objective wasn’t to save on hotels,” he says, but, given that American military assistance to Tunisia has nearly doubled since the revolution, one has to wonder if the U.S. government has its priorities right. We can debate whether these priorities make us safer, but they’re definitely not making us richer.