Monday, January 31, 2011

Diplomatic Hemorrhage: US administration’s need for forward-looking policy

    Monday, January 31, 2011   No comments

It was a mistake for President Obama to call Husni Mubarak on the fourth day of the Egyptian revolt, after nearly 100 people have died, to advise him for anything else but to step down and let a transitional leadership prepare for fair, transparent, and pluralistic elections. Instead, his reaching out to Mubarak to push him to reform was seen by many Egyptians as an act of support of a dictator. To ask Mubarak for reform now is to give him a second lease on political life. Mubarak has had 28 years to reform. He has not. In fact the last sham elections he held consolidated his party’s rule and produced a parliament less pluralistic than the previous one.
Every day that passes with Mubarak being president, the US administration loses its goodwill capital with the Egyptian and Arab peoples. US administrations have sided with authoritarians for the sake of predictability and short term stability. These authoritarians have fed US policy makers the idea that US interests are necessarily tied to their regimes remaining in power. These regimes have contended that if they were to go, Islamists will turn their countries into another post 1979 Iran. What was left out, however, was the fact that the Iranian people were not and are not inherently anti-American; they were turned to anti-Americanism when the US administrations sided with the Shah and ignored the demands of the Iranian people. This and future US administrations should not repeat the same mistake.
The US support of Mubarak’s regime is well established. Now, the US administration has a chance to show that its commitment to peoples’ rights to freedom and self-determination are not and cannot be compromised. One way of doing this is to take the side of the people now, not when Mubarak falls.
According to Secretary Clinton, who spoke on CNN’s State of the Union today, the people she "want to see stay in power are Mubarak and his newly appointed Vice President." She hinted that she prefers that the current timeline is preserved: wait until this autumn's presidential elections to make change. This position is misguided and clearly rejected by the Egyptian people. The Egyptian people want constitutional reform, judicial reform, economic reform, and political reform; not merely changing the president. This parliament is not legitimate in the eyes of many Egyptians.
The question is no longer whether or not Mubarak and his regime will stays in power. As far as the Egyptian people are concerned, Mubarak is history. Today, opposition leaders, including the Muslim Brethren, which had 88 members in the outgoing parliament have agreed to designate Mohammed ElBaradei spokesperson and authorized him to put together a coalition government that will oversee the transition into democratic rule. The Obama administration could and should support this initiative in order to mitigate previous missteps.
* Professor Souaiaia, teaches classes in the department of Religious Studies, International Programs, and College of Law at the University of Iowa. Opinions expressed herein are the author’s, speaking as a citizen on matters of public interest; not speaking for the University or any other organization with which he is affiliated.

Monday, January 24, 2011

Oil and Infrastructure Expenditures in Saudi Arabia

    Monday, January 24, 2011   No comments
by Ahmad M. Khatib

The country of Saudi Arabia has been generating increasingly more revenue from sales of crude oil in recent years. The researcher tried to study the impact greater oil revenue has been having on the development of the country’s economy through measuring the impact of oil revenue on infrastructure as one of the most important sectors of the economy. The study explored the relationship between oil revenue and government expenditures on infrastructure during the period of 1983-2007.

The study tried, on one hand, to find out if the increase in oil revenue had been associated with a similar increase in government expenditures on infrastructure. On the other hand, the study tried to measure the improvements these expenditures made by testing the relationship between infrastructure expenditures and some of the improvements resulted from these expenditures during the same period of 1983 to 2007.

The findings of this study suggested that the increase in oil revenue caused only a limited increase in government expenditures on infrastructure and the improvements resulted from these expenditures had also been limited.


Saudi Arabia as the largest oil exporter in the world has been collecting massive amounts of cash from oil revenue as prices of crude oil has been rapidly going up in the last few years. Many wonder how this oil revenue is helping the country of Saudi Arabia achieving economic development and prosperity. One way to answer this question is to measure the impact that oil revenue is having on the development of infrastructure. This study tests the correlation or the relationship between oil revenue and infrastructure development in Saudi Arabia during the period of 1983-2007 to see whether greater oil revenue was associated with a similar increase in these expenditures.

The study also looks at the relationship between these expenditures and some improvements achieved from these expenditures during the same time period. The importance of the study stems from the fact that no study had focused on the specific relationship between oil revenue and the Saudi government main budget expenditures in total or individually or on the effects of these expenditures on their related sectors of the Saudi economy. So, the importance of the study comes from the lack of a documented quantitative study on this topic.


Infrastructure is a broad term used by economists to refer to a group of capital assets in a certain country or locality. There is no clear definition of what is included under infrastructure. Nevertheless, Pollin (2009) divided infrastructure into three areas: transportation, energy, and water management. He further divided those areas into sub areas which includes, roads and bridges, airports, railroads, public transportation systems, drinking water, dams, electric grids, and pipelines moving oil and natural gas.

Other researchers like Similarly, Torrance (2009) divided infrastructure into three categories: transport infrastructure, regulated infrastructure such as water, electricity and gas distribution, and social infrastructure such as schools and hospitals.

No matter what the definition of infrastructure is or its components are, the fact is that infrastructure investment stimulates the economy by improving performance and productivity which, in turn, helps bring about economic growth. Smit and Trigeorgis
(2009) believed that infrastructure investment builds a platform and creates a base for the growth strategy and it is the starting point for any investment to follow.

            The largely recognized positive impact infrastructure investments have on the economy as a direct cause for economic growth encourages different governments around the world to allocate sizable portions of their budgets to infrastructure to stimulate the economy, provide jobs, and of course improve their infrastructure.
Infrastructure in Saudi Arabia

Ever since oil was discovered in Saudi Arabia, the government has been spending enormous resources on building the country’s infrastructure almost from scratch. The country has achieved significant improvements in building its highways, airports, power generating plants, refineries, desalination plants, shopping centers, schools, and hospitals.
Most of this happened in the last half century as Clarke (2007) commented “Saudi Arabia has gone from a country of fractured tribes living in sand-swept villages, to a thriving, industrial nation dotted with skyscrapers, superhighways, airports and factories.” (Clarke,
2007, p. 32)

            The huge growth in infrastructure was a direct result of the growing petroleum industry. Kronemer (1997) indicated that during this growth that took place in less than 50 years, more than 80,000 miles of paved roads were built, 4000 hospitals and health centers, hundreds of schools and several universities.

Despite the considerable spending on infrastructure development in Saudi Arabia some researchers still see a severe need for more infrastructure investment. “Investments in infrastructure, mainly water supply networks, power plants, telecommunications capacity, housing and transport systems, is highly needed because of a growing population.” (Quilliam and Kamel, 2003 p. 49)

            Other researchers also stressed on the badly needed investment in the water supply sector. Mohorjy and Grigg (1995) noticed that despite the huge amounts Saudi Arabia has spent on water desalination, the country still faces severe water problems and doesn’t have the necessary comprehensive water management system.

            This conflict of researchers’ opinions on the evaluation of the effect of expenditures on the different sectors of the economy and what kind of improvements result from these expenditures in relation to Saudi Arabia is one more reason behind this study.

Research Methodology

To determine if relationships do exist between oil revenue, expenditures, and improvements; and if they do, what kind of relationships they are, the researcher ran simple linear regression analyses of two folds. First, between oil revenue and government expenditures on infrastructure during the period of 1983-2007.  Second, between expenditures on infrastructure and quantitative improvements achieved from these expenditures for the same time period. Also to discover any trend, same analyses were done after splitting the period of the study into three equal intervals of times: 1983-1991,
1992-1999, and 2000-2007.

Data Sources and Data Collection

To conduct this study the researcher used secondary data that he has access to from several sources including existing databases and websites. Data needed for this study consists of three types of data. First, Saudi oil revenue amounts for the period of the study 1983-2007. Second, Saudi main budget expenditure amounts on infrastructure and for the period of the study. Third, quantitative expenditure improvements resulting from the expenditures also for the same period of the study.

Annual oil revenue data for Saudi Arabia for the period 1983-2007 were collected from OPEC Annual Statistical Bulletins for the year 1983 and the year 2007.
Data about the Saudi budget expenditures for the period 1983-2007 were gathered from the Europe World Yearbooks 1983-2007; the Saudi Ministry of Finance website; and the International Monetary Fund (IMF) website.
Data on the population of Saudi Arabia for the period 1983-2007 were collected from the website of Population Division of the Department of Economics and Social Affairs of the United Nations Secretariat and from
Data on the Saudi infrastructure for the period 1983-2007 were collected from the Saudi Ministry of Economy and Planning; International Telecommunication Union Website, and also from the World Development Indicators (World Bank).

            All data collected were then analyzed, sorted, and organized in tables using Microsoft Excel spreadsheets.

Limitation of the Study

            Data for this study would have a few limitations that should be indicated. First, data for this study were collected from several sources rather than one source and this may cause inconsistency in the way different numbers have been calculated. Another limitation is the timeline of the study from 1983-2007 may not represent the real relationship between the different variables. Furthermore, there is a chance of bias with those numbers collected from the Saudi government official websites as governments sometimes tend to tweak numbers to fit their own purposes.


Oil Revenue and Infrastructure Expenditures

Findings of the study revealed that the increase in oil revenue had not resulted in a similar increase in infrastructure expenditures during the period of 1983-2007. Moreover, findings showed that this relationship is not getting any stronger over time. While between 1983 and 1990, each increase of one dollar in oil revenue was associated with a decrease of two cents (-.0216) in infrastructure expenditures, a one dollar increase in oil revenue between 1991 and 1998 was associated with less than one cent decrease (-.0069) in infrastructure expenditures. Moreover, between 1999 and 2007 the increase of one dollar in oil revenue was associated with almost less than one cent (.0047) increase in infrastructure expenditures. At the same time the findings of the study also showed that amount of expenditures allocated to infrastructure regardless of the increase in oil revenue was dropping sharply over time. This amount decreased from an average of $2,583.1 million per year in the period of (1983-1990) to an average of $796.98 million per year in the period of (1991-1998) and to an average of $287.49 million per year in the period of (1999-2007).

The findings of the study didn’t reveal any positive relationship between oil revenue and government expenditures on infrastructure in the country of Saudi Arabia during the period of 1983-2007 and the increase in oil revenue had not resulted in similar increases to infrastructure expenditures.

It is very hard to pinpoint the exact reason or reasons why the Saudi government expenditures on infrastructure didn’t increase with the increase in oil revenue. However, one important reason is that the Saudi government has already spent very large sums on building a new and advanced infrastructure in the last few decades since the oil was discovered and money started flowing into the country. This created less need for new large investments on infrastructure and more spending on maintenance and smaller projects. Other reasons may be traced to the general socio-economic and internal situation in the country and may include the following:
a)      Bureaucratic government administration which controls the public expenditures.
b)     Many expenditures occur off- budget such as military expenditures and others.
c)     Large sums of oil money went to pay off government debt and obligations incurred by the Saudi Government from the Gulf War of 1991.

Expenditures and Improvements: Conclusion

As far as the relationships between infrastructure expenditures and the improvements resulted from these expenditures, the study concluded that there are no strong positive relationships between expenditures and improvements measured. The findings also didn’t reveal any relationship between infrastructure expenditures or transport and communications expenditures to improvements measured like road development or number of telephone lines per 1000 people between 1983 and 2007. Improvements in
Saudi infrastructures are considered very modest comparing with other countries around the world.
Dr. Ahmad M. Khatib teaches at Argosy University, Chicago.


Al-Yousif, Y. (2008). Do government expenditures inhibit or promote economic
growth: Some empirical evidence from Saudi-Arabia. The Indian Journal,
48(2), 92-96.

Clarke, K. (2007). A modernization paradox. Harvard International Review.

Foreign Affairs Magazine (2007), The Kingdom of Saudi Arabia.

Kronemer, A. (1997). Inventing a working class in Saudi Arabia. Monthly Labor Review,
120(5), 29.

International Telecommunication Union (2009). World Telecommunication Indicators
2009 Retrieved March 27, 2009 from

Mohorjy, A. M., & Grigg, N. S. (1995). Water-resources management system for Saudi
Arabia. Journal of Water Resources Planning & Management, 121(2), 205.

Organization of Oil Exporting Countries (1985), Annual statistical bulletin.

Organization of Petroleum Exporting Countries (2002), Annual statistical bulletin,
Retrieved May 28, 2009 from:

Organization of Petroleum Exporting Countries (2007), Annual statistical bulletin,
Retrieved May 28, 2009 from:

Pollin, R. (2009). ECONOMIC PROSPECTS: Infrastructure investments and the Obama
recovery plan. New Labor Forum (Murphy Institute), 18(2), 96-99.

Quilliam, N., & Kamel, M. (2003). Modernising legitimacy: Saudi strategies.
Alternatives: Turkish Journal of International Relations, 2(2), 26-65.

Saudi Ministry of Economy and Planning (2009). Development indicators. Retrieved
June 5, 2009 from:

Saudi Ministry of Finance (2008). Government budget data. Retrieved June 2, 2009,


Smit, H. T. J., & Trigeorgis, L. (2009). Valuing infrastructure investment: AN OPTION
GAMES APPROACH. California Management Review, 51(2), 79-100.

The Europa World Year Book, Country of Saudi Arabia (1975-2007).

World Bank (2009). World Development Indicators. Retrieved June 15 from: http://ddp-

Tuesday, January 11, 2011

Delusions of Grandeur: Tunisian leaders and the loss of civil society institutions

    Tuesday, January 11, 2011   No comments


On cold winter days, Mohamed al-Bouazizi, a resident of Sidi Bouzid, loads his cart with fruits and vegetables and pushes it along the dusty streets of the town hoping to make enough money for himself and his family. One day, like many other days, town officials harassed him and then confiscated his produce: he did not have the proper licenses to do business.

Many Tunisians his age graduate high school, earn a college education, and then sit in cafés playing cards and waiting for a job. Officially, about 15% of Tunisians are out of work. Unofficially, many economists put that figure at 40%. When the underemployed, the temporary workers, and homemakers are factored in, nearly 60% of Tunisians become affected by the global economic slowdown and the absence of sustainable economic development. Moreover, the uneven distribution of national resources and development programs created two Tunisias. The first Tunisia consists of the coastal cities whose economy thrives on tourism and government services, and the second Tunisia is made out of the interior states that rely on agriculture. The average citizen of the first Tunisia makes nearly $700.00 a month while the average inhabitant of the second Tunisia sustains himself on no more than $100.00 per month.

Al-Bouazizi is from the second Tunisia. He applied for work without success, and when he applied for government grants to start his own business his application was denied. That is very common, too. Government grants and business opportunities are given to individuals associated with the ruling party and those opportunities are generally found in the first Tunisia.

Like many Tunisians, al-Bouazizi wanted a job--any job that would preserve his dignity and that of his family. He figured that selling fruits would help him and that the government should be pleased with his efforts since he is relying on himself, not on it. He was sadly mistaken.

A government like Ben Ali’s does not like people taking initiative or doing anything without its permission. Al-Bouazizi’s entrepreneurship was deemed unauthorized and he was humiliated by the police. He decided to plead his case before the governor, and traveled to see him. When he announced his intention to meet with the governor he was laughed at, humiliated—again, beaten, and thrown out of the building. With the last door closing before him, al-Bouazizi poured gasoline over his body and set himself on fire. People rushed to save him, and he was taken to the hospital. The event triggered angry protests across the state which later spread to most interior states. At least four more youths attempted to burn themselves in protest as well. After two weeks of riots that were met by harsh police measures, President Ben Ali made a TV appearance to threaten rioters and to promise that he will do all it takes to restore order. He sacked several ministers and governors, visited the burn victims, and attacked foreign media (primarily Aljazeera) for inciting disorder.

As I write this piece, protesters continue to demonstrate in every major interior city, journalists and lawyers are arrested, and reportedly 50 people have been killed (officials claim only 14 had died). The government insists that the incident was merely a family, isolated dispute. Protesters, however, are threatening a revolution to overthrow a regime that is corrupt, brutal, and without legitimacy.

Despite the bloodshed, the resilience of protesters, and the brutality of the security forces, Western governments and media hardly reacted. In the U.S., major newspapers, such as the New York Time and the Washington Post, did not run any major story covering these events. It took the State Department nearly two weeks before issuing a statement of concern. The European Union and its major news outlets essentially ignored Tunisian unrest. Now, it seems that all of North Africa may experience violent riots to protest the same issues. This week alone, a number of people were killed and many more wounded and arrested in Algeria. Moroccan authorities seem to have launched a pre-emptive strike and arrested an indeterminate number of young people under the epithet “terrorist.” Is the U.S. ill informed about the state of affairs in Tunisia (and the Maghreb) or are there other reasons explaining this lax attitude?

The short answer is this: the US and the E.U. are well informed about the Maghreb because the regimes there, especially Tunisia’s, are Western-made and Western-approved. The silence is complicity not ignorance. In the end, complicity will only threaten the interests of governments that stand with regimes instead of democracy-yearning peoples, especially when such complicity is made obvious by the selective condemnations of certain regimes and implicit support of others. The public ought to know the facts about Tunisia in order to contextualize the recent and other uprisings.

On November 7, 1987, Zine el-Abidine Ben Ali overthrew the first Tunisian president, Habib Bourguiba, under the pretext that the latter was no longer fit to govern because of his old age. Bourguiba was a self-declared mujahih akbar (the Great Struggler) whose work helped Tunisia earn its independence. In recognition of his achievements, he was anointed president for life; by whom, we don’t know.

In nearly one quarter of a century, instead of becoming an advanced nation as Ben Ali promised, Tunisia was on a path to social and economic collapse. In the first half of the 1980s, bread riots, labor strikes, and students’ protests brought the country to the brink of collapse. But instead of addressing the real issues, Bourguiba adopted the band-aid approach: he fired and hired one prime minister after another and imprisoned and executed opposition figures while holding sham elections that did very little to build strong civil society institutions. After all, the ruling party has been in charge since the country’s independence.

When Bourguiba appointed Ben Ali as Prime Minister and Interior Minister, he had made his last appointment. On an early Saturday morning in November 1987, the national radio announced the rise of Ben Ali to power. The new president refused to take the “mujahid akbar” label that the national media was willing to offer him. Instead he gave people the illusion that he would be different from his predecessor: he promised openness, democracy, development, and term-limited presidency. Tunisians thought that they would be able to see a new face in Carthage Palace by the end of the second term of any president; that is what the new constitution Ben Ali amended promised then.

Twenty-three years later, Ben Ali is still president. His supporters started a campaign to amend the constitution, for the second time, to allow him to run again. For many, this is a déjà-vu: another irreplaceable “leader” for whom the rules must be bent so that he continues to govern over subjects treated as immature and helpless. For the West, Ben Ali is a known quantity who can be trusted to keep his people in check; after all, his relations with CIA were well documented.

Through constitutional amendments, new election laws, and a strict code governing the press and the media, the regime reneged on all its promises: the term limit was effectively abolished, opposition figures were silenced, business leaders were co-opted, and civil society institutions were uprooted. This time, he did it all systematically and with the West’s tacit approval.

Illusions of Political Pluralism

Although Ben Ali allowed several political parties to contest elections, such parties lacked the social depth and the ideological platform to be able to compete. The real opposition remained banned under numerous pretexts. The performance of political parties in regional and national elections was so pathetic that the regime instituted in election law a kind of “affirmative action” when it reserved a set number of seats in the parliament for opposition parties. This was thought necessary because the authorized political parties failed repeatedly to win any significant votes. By doing so, the regime gave observers the illusion of political pluralism without opening the door to real opposition movements. Ben Ali learned from his predecessor that opening the door to groups such as al-Nahdah Movement could bring about the end of his party’s rule through democratic means. The regime, therefore, opted for political charity with the “affirmative action” election laws instead of open democratic contestation of elections.

Marginalization and Co-opting

In the 1970s and 1980s, the challenge to the single party rule came from labor movements, students, and members of professional associations. Almost every year students in high schools and universities launched paralyzing demonstrations, labor unions went on strikes, and leaders of professional associations provided support for protest movements.

Today, Ben Ali’s ruling party has absorbed many business leaders. Party activists took over student organizations, and universities were relocated to rural areas in order to isolate students from the rest of the populations. Even the large high schools were split into smaller ones to facilitate monitoring and crushing activists.

Regulation of Free Press and Freedom of Expression

The state of the press today is worse than it was during Bourguiba’s reign. Although a large number of news outlets are run by non-government entities, the rules governing the editorial practices are fine-tuned so that any newspaper veering from the official line of interpretation of event would risk being shut down. The only free voice to which Tunisians have access is Aljazeera Satellite channel and website and those are subjected to repeated de-authorization and shutdowns.

Uneven Development

For many visiting foreigners, Tunisia is safe, clean, and affluent especially when compared to other African nations with similar resources. Indeed, the capital Tunis (or part of it at least) and other coastal cities are built for Western tourists: luxurious hotels, clean beaches, and security forces in every intersection. The conditions of the people living in the interior cities, however, are wretched. It must be noted that the uneven development in Tunisia is not new, as it has been known as jihawiyyah since the reign of Bourguiba. However, the elite have excelled at marginalizing regions and peoples in the interior lands. Specifically, Ben Ali’s in-laws (the Traboulsi family) are seen by many Tunisians as a new mafia, not only controlling the means of production and resources, but using the government institutions to establish monopolies and crush competitors. In fact, the French authorities are believed to have pursued charges against one of Ben Ali’s relatives for illegal business activities.

Education and Religious Freedom

Ben Ali’s regime main threat is the youth and religious groups. He marginalized the youth by offering them a placebo. Before 1987, only 12-15% of high school students graduated. The low percentage was not due to students’ laziness, rather, due to government’s measured control of the job market: since most college graduates expected the government to place them in jobs, the government elevated the level of difficulty of the final comprehensive examinations to regulate the job market.

Ben Ali’s regime altered that practice: now, nearly 80% of high school students graduate and move on to college. The result is an increased number of college graduates being unemployed or underemployed, which frustrated the youth of the country.

In order to control the role of religion in the public sphere, the government “nationalized” religious institutions. In other words, individuals are not allowed to form associations, clubs, or attend religious events unless authorized and run by the government. The only orthodoxy is that identified as such by the regime and the only recognized religion is that of the state.

Global Implications

Tunisia is demographically and economically too small to have an impact on world affairs. It is important, however, given its location and memberships.

Geographically, Tunisia is just minutes away from Europe. From the Tunisian coastline, one could cross to Italy using a makeshift raft or inflated tube. In fact, dozens of African immigrants die every year trying to make the journey to Italy, and the European Union has developed strategies to help these “buffer states” keep African immigrants away. One such strategy is paying off North African leaders to act on their behalf. Another more ambitious strategy to combat illegal immigration is the creation of the so-called Union for the Mediterranean, an intergovernmental organization linking 43 countries. The French president, Nicolas Sarkozy, promoted this idea not only to deal with immigration but also to offer Turkey an alternative association given his opposition to Turkey’s bid for joining the EU.

Additionally, Tunisia is a member of the United Nations, the Organization of Islamic Conference, the Arab League, and the Union of Maghrebi States. In other words, Western concern with Tunisian politics is not premised on oil or military matters, but rather on influence. In this way, the West’s alliance with the Tunisian regime differs significantly from Western interest in countries such as Saudi Arabia, Iraq, Iran, Bahrain, Qatar, or even Egypt.

Consequently, Tunisia, despite its relatively average demographic and economic weight within the Islamic world, remains central given its location and its memberships. The ten million citizens of Tunisia want to be respected as human beings, to be given the rights of human beings, and to be treated with dignity. When their government does not afford them these rights, and the West supports the regime and offers lip service to the people, their plight becomes another example of Western double standard and Europe’s willingness to sacrifice its commitment to the promotion of human rights to preserve “friendly” regimes.

For example, the West categorizes a number of Arab and Muslim countries as “moderate,” which is a euphemism for pro-Western. These countries include Saudi Arabia, Jordan, Egypt, Tunisia, and Morocco. It is a known fact that all these countries have a terrible record when it comes to human rights: They hold laughable elections, they incarcerate large number of political prisoners, they torture their citizens, they treat minorities with disdain, and they have no concept of peaceful transfer of power.

The credibility of the West is at stake because of this double standard, which diminishes its standing among the Muslim people when it goes after countries such as Iran, Syria and Sudan for violating human rights, but looks the other way when the rulers of whom it approves continue to abuse the rights of their citizens with impunity. This account is meant to make the public in Western societies aware of reality in places such as Tunisia since the media is effectively practicing self-censorship. It is not an invitation for the US and its allies to interfere in the affairs of sovereign nations, but it is an appeal for their leaders to stop dealing with tyrants, giving despots favored status, and/or shielding dictators from legal actions in international systems. It is a wake up call for the media to live up to its professional role as a neutral institution whose main mission is to inform objectively and without prejudice or favoritism.

• A.E. SOUAIAIA is an associate professor teaching for International Programs, Religious Studies, and College of Law at the University of Iowa.




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