MANAMA, BAHRAIN, AUG. 13 -- Still jittery 11 days after Iraq's invasion of Kuwait, the residents and governments of oil-rich kingdoms up and down the Persian Gulf are preparing for the worst while insisting publicly that they have no reason to panic.
Hoarders and nervous shoppers in some of the gulf states have pushed up the volume of food sales in recent days, local airlines report a surge in bookings for flights abroad, and businessmen have moved to convert their previously solid local currencies into U.S. dollars.
Swift action by central bankers and the authoritarian governments in the gulf to bolster public confidence has helped to prevent a serious breakdown of civil institutions or public order. And many gulf residents, knowing that miles of desert and thousands of troops stand between them and the Iraqi tanks, express hope that the worst of the crisis has passed.
But the shock of Kuwait's annexation, which locked up billions of dollars in Kuwaiti assets, has unnerved the princes, traders, oil magnates and financiers who manage and control the gulf's huge economy. Despite the thundering arrival of U.S. and allied warplanes and the much publicized deployment of naval vessels to defend Saudi Arabia and the gulf against an Iraqi attack, some residents of the desert sheikdoms still worry that what happened to the Kuwaitis might happen to them. They worry, too, about the dislocations that would follow any clash between Iraq and the U.S.-led multinational forces now taking up positions in Saudi Arabia.
Here in the island nation of Bahrain, residents search for news of the crisis hour by hour, gathering around radios, scanning news services in hotel lobbies and continually asking one another about the latest developments. Three days ago the Bahrain government ordered local hotels to stop showing satellite broadcasts of the Atlanta-based Cable News Network in their lobbies, telling hotel managers that they were worried about large crowds panicking after watching the news.
In the United Arab Emirates -- the richest gulf state after Kuwait -- authorities today ordered a halt in food exports and warned traders not to raise prices following a spate of panic buying by wholesalers and by shoppers in local supermarkets.
Urging calm, the UAE Commerce Ministry said in a statement that the country had enough food on hand to last eight months. The UAE's seven autonomous states import about $1 billion in food each year, but re-export much of that to Iran.
After a shortage of U.S. cash in the gulf's freewheeling currency markets generated panic and rumors of imminent bank failures late last week, central bankers have flooded the market with dollars and European currencies, attempting to assure wary local investors that they can conduct business as usual.
"Things are certainly not normal," said one Bahraini executive. "There's a lot of stress. You can feel that these places are quite fragile. But everybody's hoping that the situation will stabilize."
The royal governments of the gulf countries, while implementing plans for civil defense, appear uncertain about how much information they should impart to their citizens. In Bahrain, hospitals have hung black curtains on their windows so that operating-room lights could remain lit under blackout conditions. But there have been no public air raid drills and no instructions about how people should respond in an aerial attack.
Bahraini journalists say the island's government hesitated for several days about whether to publicize information about how individuals could protect themselves against chemical weapons, which Iraq possesses and has used in the past. The government eventually endorsed publication of the information, the journalists said. Bahraini officials say their only concern has been to prevent unnecessary panic.
Beyond the immediate prospects for war or peace, the crisis has forced the gulf sheikdoms to confront an underlying fragility in their oil-dependent economies and in the transience of their eclectic societies, which are held together by large numbers of laborers, soldiers, policemen and businessmen from other countries.
"What happened in Kuwait has made people think about the fear of just disappearing," said an Arab expatriate in Bahrain. "Look what happened to the Kuwaitis. You wake up one morning and your money is worth nothing. Your passport is invalid. You have nothing."