Arab help for blighted suburbs meets French hostility

When the emir of Qatar pledged to invest $65 million in blighted French suburbs, it seemed like a dream come true, but that was before the plan hit a wall of French hostility.

PARIS — When the blighted housing projects ringing major French cities exploded in nationwide riots, France pledged quick action to fix them. Seven years on, the suburban projects remain islands of despair, lofty promises of rebirth largely forgotten. So a new plan to spend millions to help residents turn their neighborhoods around seemed cause for celebration.

Instead, it met a wall of resistance and outright hostility. The reason: the benefactor was the wealthy Arab emirate of Qatar.

The oil-rich state less than the size of Connecticut has exerted an outsized influence as a global bankroller, putting it at the cutting edge of an accelerating power shift between traditional Western powers and emerging economies. As Europe is engulfed in crisis, Qatar has been on a global spending spree, buying stakes in luxury brands, acquiring soccer club Paris St. Germain and financing London's "Shard" — the EU's tallest building. Now, to the consternation of the French, the emirate wants to make a major humanitarian investment in the West.

It all started a year ago when 10 enterprising local officials from the heavily immigrant suburbs bypassed France's sleek diplomatic machine and knocked on the door of Qatar's emir with a request for help to fund the dreams of budding entrepreneurs without means.

In fairytale fashion, their wish was fulfilled beyond their expectations: The emir pledged a $65 million investment fund.

But the offer met a storm of protests by politicians back home, horrified that an outsider would leave its footprint in France's restive neighborhoods. Wounded pride may have played a role. Many found it hard to accept that a small Arab country might succeed where France itself had fallen short.

"France failed in its mission," said Leila Leghmara, one of the officials who made the trip to Qatar. "And now Qatar looks like the savior ... We touched where it hurt."

Permeating the hostile response was suspicion that the tiny Muslim state may have a special agenda at a time when fears of terrorism by Islamist extremists and a perceived infiltration of Muslim culture in French life have been on the rise. Was Qatar using its deep pockets to buy the sympathies of the many Muslims in the housing projects — and ultimately become a power broker within France itself?

Far-right leader Marine Le Pen called the Qatari investment an "Islamist Trojan horse" while independent politician Nicolas Dupont-Aignan, who champions national sovereignty, said France would be "prostituting itself" by accepting the money. Even some members of mainstream parties balked at the Arab largesse.

The saga came to a head last month when the French government effectively hijacked the initiative, pledging matching funds but spreading the butter over all of France's disadvantaged regions — and eliminating the focus on the disadvantaged suburbs. Far worse for the project's originators, the government put the funds under the control of a state bank, kicking the founders out of the driver's seat.

Now, a year after their visit to the palaces of Doha, the 10 who bucked a system that has failed the suburbs worry the money may never reach those they hope to help — ordinary people from their neighborhoods with big ideas bereft of any hope of backing. The rioting that raged for weeks in 2005 was fueled by pent-up frustration about the dead-end futures of immigrants and their descendants in the forgotten suburbs.

The project's original champions dismiss fears of sinister forces at play in Qatar's offer.

"Qatar isn't going to buy France," said Leghmara. "This delirious thinking has to stop." Defenders of the plan note that nobody saw anything pernicious when Qatar raised its stake last year in France's media and defense group Lagardere to 10 percent, making it the largest single shareholder — even though that investment goes to the heart of France's security apparatus.

Investing in the poor neighborhoods that ring French cities does represent a rare example of Qatar using its soft power to directly influence lives, as it is doing elsewhere. Last month, Qatar's emir, Sheik Hamad bin Khalifa Al Thani, visited the Gaza Strip, the Palestinian territory controlled by the Islamist militant Hamas — branded as terrorists by the West. He launched $400 million worth of projects, including housing, a hospital and roads.

The no-strings-attached humanitarian investment in the West by an emerging economy is rare, perhaps unique.

However, Qatar insists that its fund for France is not charity.

"Qatar does business, not philanthropy," Ambassador Mohamed Al-Kuwari told Metro, the free daily, in his country's only reaction to the noisy controversy. "We have no political mission."

Whatever Qatar's motives, experts say the emirate's helping hand for the suburbs simply touches on France's sensitivities about its place in the world as it struggles with its economic downturn and strives to remain a diplomatic power.

"The symbol is very powerful," said Karim Bitar, senior fellow at the Paris-based Institute for International and Strategic Relations. "Qatar has become the conjunction of all French fears."

Two French presidents tried to figure out how to deal with the Qatari offer, first conservative Nicolas Sarkozy and now socialist Francois Hollande — who last month confirmed the compromise of spreading the funds across all neglected regions.

"Each time a nation wants to invest, we say very good, we'll do it together because we can tell you what is strategic, and what is not," Hollande said in explaining his decision on France 24 TV.

The 10 officials looked to Qatar because of the glass ceiling that keeps most residents of the suburbs — stigmatized by their often Arabic names or even their addresses — from getting decent jobs let alone the financial backing for business ventures. French benefactors in the private sector simply aren't there.

"There are lots of people who want to succeed," said Leghmara. "But they find themselves standing in front of closed doors."

Aneld has received pitches for hundreds of projects in need of funding, from high-tech enterprises to a literary cafe. Salim Benradhia's plan for an affordable gourmet restaurant on a barge on the Seine is among them.

"In the suburbs, we don't always have access to Paris restaurants," said Benradhia, a father of two in Clichy-Sous-Bois, where the 2005 riots ignited. "This would make a beautiful night out."

But the banks refused him a loan. Now Benradhia, like others, fears that if the state bank in charge of the project makes all the calls on funding, "we will once again be left on the sidelines."

Now, the local officials who traveled to Qatar fear they will be erased from the picture — along with their plan.

"After all the work we did, we can talk about a hijacking" if the money doesn't help the projects, said Aneld president Kamel Hamza. "It should (help) those who don't necessarily come from the right families or don't have anyone to guarantee a bank loan."

Figures representing France's minorities say accepting Qatar's generosity is just common sense.

"Better money from Qatar than no money at all," said Patrick Lozes, who helped found the Representative Council of Black Associations.

(Brian Murphy contributed to this report.)