Crown and thorn: Jordan’s royal ruckus

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Hello and welcome to the Intelligence on Economist Radio. I'm your host, Jason Palmer. Every weekday we provide a fresh perspective on the events shaping your world. The list of billionaires in India is getting longer, faster than ever before. A close look at who's on it and who's fallen off of it shows how the country's economy is changing. And Vancouver is one of the world's most expensive property markets, in part because high rises are frowned on in its poshest corners. We look into why a First nations indigenous group can build the skyscrapers the city needs, but that few want. First up though.

I'm making this recording today to try to explain what's happened over the last few hours.

Prince Hamzah Bin Hussein of Jordan released a video on Saturday in which he claimed he'd been placed under house arrest. His phone and Internet were cut off and his security removed.

This is my last form of communication, satellite Internet that I have and I've been informed by the company that they are instructed to cut it. So it's maybe the last time I'm able to communicate.

Prince Hamza is the half brother of Jordan's ruler, King Abdullah. He's become a well known critic of the King who's been in power since 1999. And now the prince is accused of conspiring against the Crown.

I am not the person responsible for the breakdown in governance, for the corruption and for the incompetence that has been prevalent in our governing structure for the last 15 to 20 years and has been getting worse by the year.

First, he claimed he would defy orders to keep quiet. Then yesterday he released a statement affirming his commitment to the constitution, saying he placed himself in the hands of the King. The standoff isn't over. It's a rare rift in a famously stable Arab monarchy.

This was an extraordinary allegation to make against a senior member of the royal family to accuse him of essentially plotting against the crown.

Greg Karlstrom is a Middle east correspondent.

For the Economist the Hashemites in Jordan, like royal families everywhere, have their disputes, but they've usually been very disciplined about keeping those disputes private and presenting a united front in public. And so to have this sort of a public dispute involving senior royals is quite remarkable.

And tell me about Prince Hamza, against whom these allegations are being made.

Prince Hamzah is a child of King Hussein, who ruled Jordan for almost 50 years in the 20th century, who remains a beloved figure to this day. And the King's fourth wife, an American born woman who took the name Queen Noor when she became Queen. He was once a Crown Prince. From 1999, when King Abdullah ascended the throne, Prince Hamzah was his designated successor, but he was removed from that post in 2004 in favor of the King's son, which is not unusual in Jordan. King Hussein himself went through four different crown princes before he eventually settled on Abdullah.

And so what exactly has he been accused of?

At this stage, the details are still somewhat vague, but up to 20 people have been arrested. They were rounded up in a series of raids on Saturday night. They include a former finance minister who's also been an advisor to the royal court. The government has said that they were plotting against the security and the stability of the country. And they've also suggested that a foreign power was backing this plot, although they've been reluctant to identify which foreign country that was.

And as for the accusations against Prince Hamza, what do you make of those?

The accusations are very thin. So far the government has not presented much in the way of evidence to prove that there was a serious plot afoot here. And there's been no circumstantial evidence of one either. There haven't been any reported arrests from within the military or the security services, which I think undermines the narrative that there was a coup in the offing because you generally need men with guns to organize a coup, particularly in a country like Jordan where the military is known to be quite loyal to the King. It's also a country where the secret police are well known for their reach and for their ruthlessness. It's very difficult in Jordan to hatch a plot against the King. It's a very well coup proofed country, if you will.

And what about the statements that have been coming from Prince Hamza? What do you make of those?

As for the prince, he's come down quite hard on the government. In a series of messages, he's accused the government of turning a blind eye to corruption and nepotism. He said all he was doing was essentially engaging in politics, meeting with tribal leaders, listening to complaints from Jordanians. And he's accused the government of being intolerant to criticism and not allowing anyone to raise their voice. He did on Monday night issue a somewhat conciliatory statement in which he professed his loyalty to the king and his loyalty to the institution of the monarchy. But on Tuesday morning, a rather confrontational audio recording was leaked in which the prince is talking with the army chief, the army chief who had come to warn him not to speak out in public, not to engage in any more political meetings. And the prince is quite confrontational and quite defiant in this recording. So despite this conciliatory statement on Monday night, I don't think we've seen the last of this dispute.

But what's really behind it, do you.

Think this seems less like an attempted coup and more like a dramatic family feud? To give you the backstory here, this is a country where the public is increasingly frustrated with the government. You have an economy that's been stagnant for a number of years. Even before the coronavirus pandemic last year, the economy is thought to have contracted by about 5%. Unemployment has hit 25% and much higher for young people. There is widespread corruption that is rarely punished or prosecuted. And there is a general frustration with incompetence and neglect. And members of the royal family, including Prince Hamza, have become more vocal in their criticism of the government in recent years. He's spoken out about corruption, about mismanagement of the economy. He meets often with tribal leaders who are the main power base for the monarchy, but also tend to be impoverished and live in towns and villages that have poor basic services. So he has tapped into all of this public discontent and that has obviously made people nervous within the king's inner circle.

So in that sense, the Jordanian people will be on Prince Hamza's side in all this.

Some of them are. If you look at the chatter on social media over the past few days, there are plenty of Jordanians who agree with the prince's complaints and appreciate the fact that he is giving voice to those complaints, which they also share. There are also people who've come out defending the king who think that the prince was out of line in his criticism that a. This isn't a role that a member of the royal family should be playing. So the country has somewhat split into camps here. Nobody is really giving much credence to the idea that this was a serious plot. People see it as a family feud and they're taking sides in that feud. But the one thing that is shared, it seems, by many Jordanians, is a sense that this will have a chilling effect on free speech and on dissent in Jordan. Jordanians are saying if a prominent member of the royal family came, can be detained for raising his voice, then there is no space for ordinary citizens to complain or to criticize the government.

So does that make it just a fundamentally domestic dispute, or is there an international angle to this, especially if there are allegations that a shady foreign government was involved?

There have been leaks coming out that are clearly trying to implicate Saudi Arabia. Saudi Arabia, a longtime ally in a neighboring country of Jordan, would be unusual for Saudi Arabia to want to destabilize a country on its borders, a country that it views as vital to its stability. What we've seen in the past few days is sort of blanket statements of support from Jordan's allies, from the United States, from Gulf states, including Saudi Arabia, the United Arab Emirates, other Arab countries. Jordan occupies a strategic position in the region. It borders Israel, Syria, Iraq, Saudi Arabia, and it has traded on that for a long time. As a country that has a somewhat pro Western foreign policy and is very close to the Arab Gulf states, it's been able to use that strategic position to secure aid and support and generally goodwill from the international community. And so we've seen these countries come out very strongly in support of the king over the past few days.

So where do you see this going? Then? You say we haven't heard the last of this story?

We haven't. I think in the short term, none of this seems a real threat to the king. The monarchy as an institution remains quite popular in Jordan and Jordanians. When they look around the region after the Arab Spring, they're very nervous about the prospect of radical political change because they worry about where it could lead in the long run. Though the complaints, the grievances that gave rise to this family dispute, those issues will not go away. Those issues are getting worse. And so if the king ultimately wants to silence his critics, the best way to do that, the only way to do that is, is to respond to their criticisms.

Greg, thanks very much for your time.

Thank you.

For more analysis like this from our international network of correspondence, take out a subscription to the Economist. Get a great introductory deal@Equality.com IntelligenceOffer the link is in. The show notes the names Elon Musk, Bill Gates and Warren Buffet might ring a Bell. They're just three of the more than 700 billionaires in America, which is still the country that proportionally has the most of them, but that number is climbing. Also in India, more tycoons entered the country's billionaires list last year than ever before.

There are now 177 billionaires in the list, with another 30 if you count what is now being referred to as the Indian diaspora, which are billionaires overseas.

Tom Easton is the Economist's Mumbai bureau chief.

And the 177 reflects 50 new billionaires this year alone. There's been a dramatic growth over the past five years.

And what can you learn from picking through this list?

In some places, billionaires may just reflect the fortunes of very, very fortunate people. But actually in India, the emergence of billionaires reflects the success of a lot of industries. And you can separate them into two broad groups. One is kind of traditional sources, but the second, which is far more important and which really constitutes one, most of the new billionaires are from new sources of wealth, namely pharma and software. And these are extraordinarily important industries, not only to India, but actually for the world.

Okay, well, let's start with the top of the list. Who's on there?

In a sense, the most misleading part of the rich list are the people at the very, very top. The two leading participants are Mukesh Ambani and the family of Gautam Adani. These are Mumbai Gujarati families that have made money in many ways through industries that are highly, highly tied to the government. So the source of the Mombani fortune was energy. Adani has huge holdings in energy as well. Adani also has ports. Ambani moved into a new industry very strongly, which is geo, which is telecom. But that too heavily depends on government permissions. That in some ways is a reflection of the complex bureaucracy of India. It's just very, very difficult place to deal with the government and the courts. And these two have been just better than everybody else in actually doing that sort of thing. So they dominate the list, but they're not really a reflection in some ways of the new India.

Right, and you were saying the new India is a country that does particularly well in terms of pharmaceuticals and software. I mean, who are the billionaires in that category?

At the top of the list is the family that is a controlling shareholder of a firm called hcl. It's a computer consultancy. And in fact, the big computer consultancies are extraordinarily important for how the world works. If you have a bank account, if you get a credit card, if you go shopping at a major department store, it's very possible that the companies you're buying from have outsourced all their technology to India. And one of the most important participants in it is this company, HCL. And the newest entry in the top 10 are the people behind a company called Sun Pharmaceutical. They have been on the list many years ago. They've done an extraordinary job in, most prominently generics. Half of their sales else goes to the United States. If you get a pharmaceutical prescription in the United States, the chances are not really that bad that it comes from Sun Pharmaceutical. So again, an incredibly important company on top of an incredibly important industry that everybody in the world is actually using in increasing amounts. But nobody in the world really knows that that's true.

And so the list represents a number of different industries, but it is a list ultimately of people. Are those people the founders of all of these firms?

Generally, the way it works in India is the founding family. They're known as promoters. Keeps a controlling stake in the company, a very, very high stock shareholding. And even if they diversify, they often borrow against the stakes that they have in that core operation. So most of the billionaires, that is the constituency of where their money comes from. But you have other sources of wealth coming to that are kind of interesting. You have people who are either at or near billionaire status who are now chief executives of companies that are based overseas. So chief executive now of mastercard is an Indian man who had previously worked for Citibank. And he has been on the cusp of the list for a while. And right now he is at the billion dollar level. And there are a number of other people who are just below him, like the chief executive of Alphabet and the chief executive of Microsoft. These represent incredible fortunes made by really incredibly talented people who have become in charge of the most important companies in many ways in the entire world.

And if new talent is rising onto that list, some people are surely falling off it. What do the people who used to be on the list tell you about a changing India?

On one level, India has become the source for just extraordinarily capable managers. And that's what you saw in those operating people who are now running companies. On another, simultaneously, it's been the source of an ending series of scams on its major companies. In fact, there have been enough that Netflix had a series of bad boy billionaires. And these were people who all were engaged in something that was later to be suggestive of fraud or something else that are quite damaging and whose lives are very colorful and often are now confined to jail cells. Families are very, very important in India. They constitute, in many ways, the billionaire holdings, but they also internally, there's friction between many of them and litigation and endless fights. And if you go into almost any Indian family, you'll see some sort of skirmish and then you just have some drop offs on people who traditional industries. And you've seen a decline in fortunes from areas like textiles.

And what about the international picture, the degree to which India is more likely than other countries to actually generate billionaires?

I did a statistical spreadsheet on this and you know, there are a lot of people in India, 1.3 billion. And so the chances of becoming a billionaire in any country are very low. And in India they're particularly low. India trails China and it trails America. Statistically less likely chance of becoming a billionaire if you come from India than if you come from those two countries. Yet it is the third largest producer of billionaires in the world. And even though it remains an incredibly poor country, it is an incredibly fertile place for the most important technologies for the world that lies ahead. So it would not be surprising if you had many, many more billionaires in the next decade from India.

Tom, thanks very much for joining us.

Jason, thank you very much for having me.

Vancouver is well located if you like skiing in the mountains and swimming in the sea. But those same natural features have constrained the city's housing market, which is the second most expensive in the world after Hong Kong's. Added to the housing problem are tough zoning rules that constrain the supply of new homes. And then there's the residents themselves. Not in my backyard or nimby. Campaigners have resisted the construction of high rise affordable apartments in the city. But one Canadian indigenous group seems to have found a way through this impasse.

The Squamish First Nation are an Indigenous group in British Columbia.

Elise Burr writes about foreign affairs for the Economist.

They have reserves, one patch of which is in Kitilano, which is a really ritzy part of Vancouver near the city center. The Squamish Nation only gained back this land legally in the early 2000s. They had to have a big court battle for it. And by building on a reserve, they're able to build in a way that is bigger, faster and cheaper than a typical landowner could.

How so? What's different about their buildings?

So they're not subject to municipal regulations. That means they're allowed to build without providing details to the public or holding panhole meetings. I spoke to this Guamish nation spokesman known as Khalsalem, and he told me why the process is much quicker for indigenous groups building on reserve land because.

The Lands are outside of the jurisdiction of the municipal government, the City of Vancouver government. They don't have any control over the density or the zoning for those lands. My council decides what the zoning rules would be.

And so what are their plans in this ritzy part of Vancouver then?

Well, they're planning to build 12 skyscrapers, some reaching up to 59 stories, for about a total of 6,000 rental homes.

We estimate that the project will bring in about 20 billion in Canadian dollars over the lifetime of the project over 99 years. A lot of the revenue generated will go directly to our people to support all kinds of social programs like education, from elementary to post secondary, to affordable housing projects that we can offer subsidies for our members so that they can afford to have a shelter and a home, to health care and to elder care.

And so for the Squamish First Nation, that's the main reason to do this then, to raise funds?

Well, yes, but also homes are sorely needed in Vancouver. The Squamish are able to control the density of housing in the development, so they can build a really large stock of purpose built rental apartments. Khalsalem also pointed out that historically the Squamish people have been at an economic disadvantage.

We aren't at the same level of quality of life that we see by the average Canadian. Our life expectancy of our people tends to be lower than the Canadian average. Our graduation rates tend to be lower than the Canadian average. Our median income of our community members is in poverty levels.

So the money from the project will help correct those imbalances.

And what about the other side of the equation, the residents, these NIMBYs, what's their response to this?

Well, NIMBYs have been pretty successful in Kitsilano, keeping the neighborhood very low density. It's mostly single family homes and duplexes, which is why this development by the Squamish Nation is so stark. Because the Squamish can build a 59 story building and they don't have to put out public information that the NIMBYs can rally against. So basically the NIMBYs are powerless in this instance.

And this is a general feature of Indigenous Peoples rights. Does it seem to you that other groups will follow in this lead?

The project could set a precedent, but urban reserve land is really rare. Indigenous people were pushed out of desirable areas by settlers long ago. However, a lot in 2019 makes it easier to expand or create new reserves. So that could lead to similar development opportunities for other First Nations.

The Additional Land to Reserve and Reserve Creation act can create new opportunities for First Nations. It's a new tool that I think allows for the repatriation of lands back to first nations communities so that they can build their economies for themselves.

Elise, thanks very much for your time.

Thank you so much, Jason.

That's all for this episode of the Intelligence. If you like us, leave us a rating and a review and we'll see you back here tomorrow.