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C O N F I D E N T I A L SECTION 01 OF 02 JEDDAH 000102 
 
SIPDIS 
 
SIPDIS 
 
RIYADH, PLEASE PASS TO DHAHRAN; DEPARTMENT FOR NEA/ARPI; 
PARIS FOR ZEYA; LONDON FOR TSOU 
 
E.O. 12958: DECL: 01/31/2015 
TAGS: PREL KISL SA
SUBJECT: JEDDAH JOURNAL 4:  PRESERVING THE ARAB FAMILY 
BUSINESS, HAJJIS' TRAVEL WOES,  CALLS FOR BOYCOTT GROWING, 
AND THE OLD ORDER PASSES. 
 
 
Classified By: Consul General Tatiana Gfoeller for reasons 1.4 (b) 
and (d). 
 
ARAB FAMILY BUSINESS MODEL:  WILL PROGRESSIVE JEDDAH 
MERCHANTS CHANGE THEIR PRACTICE? 
¶1.  (U) On January 23 at the French Consulate General, local 
consultant and business adviser to the elite, Mr. Zaher S. Al 
Munajjed, gave a lecture titled "Saudi Family Companies, 
challenges of the future," describing a theoretical model for 
the long term stability of a family business.  Al Munajjed 
noted that a common strategy many, but not all, major Saudi 
family businesses adopt when the death of a business founder 
prompts a generational succession in the business hierarchy, 
is for the surviving male heirs forcibly to buy out female 
inheritants, even though this is contrary to Shari'a.  It 
will be instructive to see if, in the future, this practice 
continues to dominate Jeddah family business behavior. 
Today, a significant portion of the women among the Jeddah 
elite families are highly educated and experienced and can 
not be dismissed as incapable of contributing to a business. 
Additionally, supporting women's progress has become a 
hallmark issue by which Jeddah has symbolically claimed to 
lead the country, in contrast to the more backwards segments 
of Saudi society.  Consequently, it will be difficult for 
progressive young Jeddah tycoons to exclude sisters, wives 
and daughters from the family business. 
 
WILL THE RICHEST ARAB FAMILY BUSINESS SURVIVE 
"CONSTITUTIONAL" CONFLICT? 
 
¶2.  (C) Mr. Munajjed's model indicates that one key factor in 
preserving a family enterprise over many generations was 
development of a "constitution" which regulates management, 
participation, and succession.  The willingness of all 
factions to accept the principles of this agreement is 
critical to the stability and survival of the enterprise. 
One member of the audience asked how this model would apply 
to the richest of all Arab family enterprises--Kuwait. 
Munajjed agreed that Kuwait faces a test, since two 
principles of the constitution are in conflict: the principle 
of succession and the principle of fitness for management. 
The question within the Al-Sabah family is will the faction 
that ascended to the emir's position in accordance with the 
established principle of succession also accept the almost 
immediate removal of their candidate in conformance with the 
principle of fitness or will the family consensus underlying 
the Kuwaiti Constitution fracture? 
 
AMERICAN MUSLIMS DISSATISFIED WITH TRAVEL AGENCY 
 
¶3.  (U) In late January, the Consulate General received a 
letter signed by 38 American Muslims who had come on 
pilgrimage to Saudi Arabia as "5-star" clients of an Islamic 
Hajj Association of North America (IHNA) tour, complaining 
that the accommodations and service provided by that agency 
were well below what was advertised.  The letter asked Saudi 
and US authorities to revoke the license of IHNA to provide 
Hajj travel in the future. 
 
HAJJ TOURS ARE A MAJOR INDUSTRY 
 
¶4.  (C) This complaint demonstrates that even the relatively 
small American Hajj tour market can involve significant sums 
and attract incompetent and/or unscrupulous service 
providers.  For their pilgrimage, the 38 signatories each 
paid $3,850 plus an additional, unadvertised, last-minute fee 
increase of $625, representing a collective outlay of over 
$150,000.  Additionally, the letter alluded to similar 
displeasure among other, less exalted, travelers among the 
100 people on the tour conducted by IHNA.  This one small 
concern, in the course of a few weeks operation involved one 
hundred U.S. residents investing $250,000 to $300,000 for a 
once-in-a-lifetime event, with a disappointing outcome. 
 
SAUDI BOYCOTT OF DANES SPREADING 
 
¶5.  (U) The Jeddah Political Assistant reports that the 
boycott against Denmark in response to a Danish newspaper 
publishing offensive cartoons depicting the Prophet is 
spreading quickly.  It is becoming a national campaign.  Tens 
of text messages are received on cell phones every day 
 
JEDDAH 00000102  002 OF 002 
 
 
supporting the boycott.  Al Sahat (Note:  Al Sahat is an Abu 
Dhabi-based, but Saudi-financed web site where Arabic 
speakers may comment on issues of importance to them.  End 
Note.) has been promoting the campaign for several weeks.  It 
has reached the point were people are blindly advocating a 
boycott of anyone or anything remotely connected to Denmark. 
On January 28, two participants on Al Sahat advocated banning 
the Danish speaker at the upcoming Jeddah Economic Forum 
06(JEF).  Others have appealed to Walid Juffali, a prominent 
businessman and Honorary Consul of Denmark in Jeddah, to 
address this issue on his weekly television program, the 
Arabic version of the Apprentice.  On the 29th, a series of 
text messages called for a boycott of JEF for hosting 
"Danish" businessman Enan Al Galaly.  Galaly is an 
Egyptian-born Muslim who was granted honorary (?) Danish 
citizenship for his contributions to the Danish tourist 
industry. 
 
SOME INSIST THAT U.S. SHOULD BE BOYCOTTED FOR KILLING MUSLIMS 
 
¶6.  (U) The enthusiasm for boycotts is spreading to other 
issues in Saudi Arabia.  On January 30, a respondent on Al 
Sahat insisted a "boycott (of) US products is more essential 
than boycotting Danish products."  The writer suggested that 
the Muslim public should consider "whether or not killing 
Muslims is more sinful than drawing anti Islam sarcastic 
cartoons." 
 
¶7.  (C) COMMENT:  In the furor inspired by the Danish 
cartoons, none in the Islamic world seem to have expressed 
concern that in the non-Islamic world, Muslims are now 
identified in the public's mind as terrorists, and that the 
Muslim reaction to the cartoons is far more wide-spread and 
intense than has been the Muslim reaction against the 
terrorists who have killed and maimed thousands of Muslims 
and non-Muslims alike.  As a coda, news reports state that on 
January 31, the offices of the offending Danish newspaper 
were evacuated due to a bomb threat.  END COMMENT 
 
PASSING OF AN ERA 
 
¶8. ((U) Following the passing of King Fahd last August, most 
government offices and many private establishments, including 
hotels, banks, and malls, kept portraits of the late King 
hanging on their walls.  The portraits of the late King were 
usually displayed alongside images of King Abdullah and 
either King Abdulaziz, the founder of modern Saudi Arabia, or 
Crown Prince Sultan.  Consulate contacts told Poloff the 
portraits of the late King would probably come down with the 
beginning of the Islamic New Year in order to provide an 
appropriate time of respect for King Fahd. 
 
¶9. (U) With the recent coming of the Islamic New Year, 1427, 
King Fahd's portraits are beginning to come down in Jeddah. 
At the Intercontinental Hotel in Jeddah, workers have 
replaced a portrait of the late King which hung prominently 
in the lobby, and which featured a golden band across the top 
right side out of respect for the King's memory.  A portrait 
of King Abdullah hangs in its place.  A worker at the hotel 
told Poloff on February 1 the image of King Fahd was removed 
at the Islamic New Year.  Some Consulate contacts have told 
Poloff that some establishments will keep portraits of King 
Fahd displayed on their walls until the one year anniversary 
of his death.  However, other establishments in Jeddah are 
now displaying a combination of the portraits, generally 
featuring King Abdullah in the center, flanked by his father 
King Abdulaziz and his half brother Crown Prince Sultan. 
Gfoeller