AUGUST 22, 2020
HOW CENTRAL IS SHIPPING to contemporary capitalism and trade? The introduction to Laleh Khalili’s new book, Sinews of War and Trade: Shipping and Capitalism in the Arabian Peninsula, makes clear why focusing on maritime trade is no mere niche pursuit: 90 percent of the world’s goods travel by ship. Also, at the very outset, Khalili shows that, on the map of global trade today, it is China that takes center-stage as the factory of the world — and the oil that fuels China’s manufacturing derives primarily from the Arabian Peninsula.
Khalili focuses on the huge maritime infrastructures that have evolved in response to the internationalization of capital and the commodification of oil, with a specific focus on the Arabian Peninsula. The central thesis of her book is that “maritime transportation is not simply an enabling adjunct of trade but is central to the very fabric of global capitalism.” As she powerfully argues:
Maritime trade, logistics, and hydrocarbon transport are the clearest distillation of how global capitalism operates today. The maritime transport enterprise displays this tendency through its engineering of the lived environment: transforming “natural” features of the world into juridical ones, creating new spaces, structures and infrastructures that aim at (though rarely achieve) frictionless accumulation and circulation of capital; creating fictive commodities, financial fetishes, and ever more innovative forms of speculation; and creating racialised hierarchies of labour.
Reading the book certainly feels like an adventure at times. Khalili draws on sources as diverse as the India Office Records, the UK Maritime Museum archives, and the British Petroleum archives, among others, as well as newspapers, trade magazines, memoirs, and novels. She has visited most of the main cargo points of the Arabian Peninsula and has traveled on two different container ships. The book does drag at times — such as when Khalili describes the technical aspects of ship routes or procedures — but even those occasional dull passages are enlivened by Khalili’s sharp, clear prose.
The book is filled with interesting insights. Consider, for example, Khalili’s concise exposition of the fraught history of the Suez Canal, which was constructed by Egyptian peasants pressed into corvée labor, and which allowed Britain to consolidate power over its Asian colonies. The canal became the preferred route for Europeans regularly traveling to India, among them British colonial officials and military officers. Moreover, the Suez Canal also gave Britain the upper hand when it came to Egypt. For example, when the loans borrowed to finance the construction of the canal came due, “the British used the Egyptian debt along with the ‘threat’ of [a] Urabi revolt to occupy the country militarily. In so doing, Britain secured its hold over the entirety of the route to India.”
Khalili highlights the widespread incursion of financial imperatives. Alongside the possibility of speculating on agricultural or energy commodities, traders also speculate on the future price of sea routes, using an index that tracks the specific costs of freight on a given route. Another fascinating discussion deals with the weaponization of “legal apparatuses, doctrines, and rules” and the associated strategic maneuvering involved in the protection of alien property overseas — a discussion that serves as a backdrop for an analysis of maritime arbitration cases. As Khalili argues:
The expropriations of foreign property that followed the Bolshevik Revolution of 1917 and the Mexican nationalization of foreign petroleum companies in 1938 provided the impetus in Western Europe and North America to develop complex legal apparatuses, doctrines and rules to protect the alien property of North American and European investors and firms.
The postwar wave of decolonization intensified this imperative, as newly decolonized states staked claims to their usurped national possessions. A lesson was clearly learned from Mexico’s nationalization of oil, since many of the attempts to alter the terms of existing contracts were obstructed by “stabilization clauses,” which were designed precisely to prevent future modifications.
An excellent and eye-opening discussion has to do with the calculated use of flags on ships, which confer what Khalili calls a “quantum of sovereignty.” Flying the flag of a particular country, however, is by no means a guarantee that the ship actually comes from that country. Using particular flags has often been motivated by strategic or economic considerations, some of them more profoundly dishonorable than others. For example, in the Indian Ocean in the 18th and 19th centuries, vessels of the British East India Company, in order to avoid confrontation with French privateers, flew the red Arab flag. In return, the Company allowed local merchants to sail under its own flag to lend them prestige and power. In another example, during the late 19th and early 20th centuries, slaving ships from the Arabian Peninsula sometimes flew French flags in order to circumvent British maritime inspections.
Yet another shrewd discussion, unfortunately far too short, considers the effect of regional wars on maritime commerce in the Arabian Peninsula. Khalili shows, for example, how the Lebanese Civil War (1975–1990) effected a spatial transformation after the Beirut docks were burned down by the Phalange militia in 1975. Following this event, “each warlord set up his own port along the coast,” and the Beirut docks were replaced with “fifteen or so private ports.” This new arrangement had detrimental knock-on effects for the war-torn country, with shipping moving to ports in Syria, Greece, Cyprus, and the Arabian Peninsula.
Sinews of War and Trade offers an accessible yet sophisticated introduction to the historical, sociopolitical, and economic context of maritime trade in the Arabian Peninsula. Though the book is rather brief — just under 300 pages, excluding references — it nonetheless packs a powerful punch. It will be of value to readers and scholars interested in the field of maritime trade, the Arabian Peninsula, capitalism, labor relations, the interplay of war and commerce, and colonialism, among other topics.