Trump seeks investments from Arab countries

A special feature of United States President Donald Trump’s visit to Saudi Arabia, Qatar and the United Arab Emirates this week has been that of seeking foreign investment for America. This is something new. America set store in selling its goods, whether planes or cars, missiles or guns. President Trump tried to do that as well on this trip to the Middle East, but that was a small part of what he really wanted.

He wanted investment. Now talk of investment for many years has been the monopoly of emerging markets like India, Brazil and developing countries in Africa. It looks like that America is reduced to the level of a middle income or a lower middle income economy, though it remains the largest economy in the world. So, how much investment for America did Trump manage to generate from the three countries? It amounts to $600 billion from Saudi Arabia, $200 billion from Qatar and $1.4 trillion from the United Arab Emirates.

There was a time when foreign countries and foreign tycoons invested in America without asking. Japan ended up by buying huge industries in America. There was a fear that the foreigners are buying everything that Americans could not buy.

A similar thing is happening in Britain too, where Indian, Arab and Russian billionaires are buying the best properties in London. Trump seems to be seeking investments from a weaker ground. There are no industries and no industrial manufacturing in America. The tech giants like Apple, Google, Microsoft, Open AI remain in American hands because it is these companies that are providing a technological edge to America in the era of AI and Internet.

It is unlikely that Americans would allow foreign investors to become majority shareholders in these companies. It is interesting that till recently the American government under outgoing President Joe Biden had stopped Japanese steel giant Nippon from buying American Steel.

So, America seems to be in a dilemma. It wants to preserve its industrial heritage though it has lost its industrial superiority. Somewhere at the back of his mind, President Trump seems to be aware of the sad truth about the decline of America. His slogan of Make America Great Again (MAGA) is a weak attempt to revive America’s lost superiority in the economic sphere.

Today America is a consumer society rather than a global manufacturing hub. Some of America’s experts see this as a natural economic revolution where America remains at the technological frontier while the rest of the world makes and sell things that Americans use. America has become the Great Consumer Society. And Trump seems to perceive the change as a fall and not as a change for the positive.

So what will Trump do with the $2 trillion Arab investment? it is to be noted that UAE’s $1.4 trillion is to be spread over 10 years – in America. Will he use them to invest in the decaying American infrastructure – from highways to airports – or will he use it to set up new industries or revive old ones?

The most important thing of course is that Trump feels that America needs investment and that Americans themselves are not in a position to invest and reinvest in their own country, though America has the largest number of billionaires living in the country.

Trump has given tax cuts to the rich hoping that they would invest in America. But Trump does not seem to be sure that American investments will be sufficient for the investment needs of the country. Hence his hunt for more investments in other countries which are far smaller than the American economy.