stratEGIC Monthly (June 2022):
Building Back Better:
The Drive for Consensus in the Gulf
By Veronica Stigliani, Ashleigh White and Nikola Zukalová
The fifth issue of the stratEGIC Monthly, featuring three analyses of key issues that defined the Euro-Gulf space in June 2022, focuses on:
Mohammed bin Salman’s Regional Tour;
Potential Saudi Arabia-Iran Reconciliation amid the Russia-Ukraine War.
Recalibrating Saudi Arabia’s Regional Role
Between 20 and 22 June, Saudi Arabia’s Crown Prince, Mohammed bin Salman bin Abdulaziz Al-Saud (MBS), traveled to Egypt, Jordan, and Turkey—his first trip beyond the Arab Gulf in three years timed to refresh Riyadh’s regional relations ahead of the US President Joe Biden’s visit to the region and the US-GCC+3 Summit (the six Gulf Cooperation Council countries, Egypt, Jordan and Iraq), scheduled for 13 July. With a string of outstanding issues that require redress, MBS sought to strengthen Saudi Arabia’s partnership with Cairo and mend relations with Amman and Ankara to present a more unified bloc that share strategic interests particularly on the Yemen conflict and the Iran Nuclear Deal. MBS’ diplomatic mission also occurred against the backdrop of the ongoing conflict in Ukraine which is generating economic consequences in the region—for better or worse. Saudi Arabia is also centre stage in terms of energy security as Europe found itself deeply vulnerable due to unwanted dependence on Russian fossil fuels and has begun, in earnest, to search for alternative energy sources. With the outbreak of the Ukraine war, Saudi Arabia became the reference point not only for those countries needing oil and gas, but also for those experiencing acute food crisis, especially those that depended on wheat imports from Ukraine, such as Egypt. In Cairo, MBS met President El-Sisi and inked $7.7 billion (USD) in 14 separate trade deals, to help fight inflation and currency devaluation. The war is also hitting Jordan, which was already struggling to recover from the COVID-19 pandemic: the chance to receive financial assistance from Saudi Arabia was very welcome. This provided the opportunity for Riyadh to repair relations with Jordan which had been stressed by tensions over the custody of the holy sites in Jerusalem and the attempted coup against King Abdullah II in April 2021. Similarly, the devaluation of the Turkish lira and the related declining popularity of President Erdogan’s party led Ankara to reset relations with Riyadh and launch ‘a new era’ of bilateral relations. The new international context thus offered MBS a conjunction of advantageous variables that he was able to exploit in order to recalibrate Riyadh's role in the region.
A Step Forward in Qatari-Egyptian Rapprochement
On 25 June, the Qatari Emir, Tamim bin Hamad Al Thani, visited Cairo for the first time since 2015 and held bilateral cooperation talks with Egyptian President, Abdel Fattah El-Sisi. It signalled that the Qatar-Egypt rapprochement process is very advanced and on the mend after relations soured as a result of Qatar’s backing of the Muslim Brotherhood’s Mohamed Morsi and the 2017 crisis that saw Egypt join Bahrain, Saudi Arabia and the UAE sever relations with Qatar. Following the January 2021 Al-Ula Declaration to normalise relations with Qatar, there has been a significant push from both countries to promote bilateral cooperation. However, if Qatar and Egypt are to sustain lasting diplomatic relations the Muslim Brotherhood needs to be addressed. Qatar’s steps away from the Brotherhood over the last months, including asking leaders of the movement to leave the country in February, signal a continued goal of strengthening ties with the Gulf states and Egypt. While Qatar still provides political and economic support to Hamas and other groups affiliated with the Brotherhood, it is likely that Doha will try and strike a balance to ease tensions and return to the fold. In addition to political normalisation, rapprochement will likely lead to an increase of investment and private sector cooperation. Qatar’s March announcement of a $5 billion investment in Egypt’s economy is a good example. Moving forward it can be expected to see increased bilateral cooperation between Qatar and Egypt along with improved regional relations and, hopefully, a wider de-escalation in the region.
A Tenuous Balance: Is Saudi-Iranian Reconciliation in the Air?
The Russia-Ukraine war also spurred momentum in Saudi Arabia-Iran relations and US engagement. After several rounds of talks between security personnel, reports of possible Baghdad-hosted, diplomatic-level discussions between Saudi Arabia and Iran emerged at the end of June, while Iran’s Foreign Minister Amirabdollahian welcomed the restoration of relations with Saudi Arabia, the reopening of embassies and the launch of political dialogue. This came on the heels of Iraqi Prime Minister Al-Kadhimi’s visits to Tehran and Riyadh as he assumed a leading role in easing tensions between Iraq’s two neighbours in a bid to enhance regional stability and ensure a conducive environment in anticipation of major economic projects. Any rapprochement would require concessions from both sides. Riyadh would need assurances, particularly regarding Yemen, where Iran and its proxy Hezbollah arm and support Ansar Allah (Houthis) and act as spoilers in the UN-led peace talks, as well as other points of contention, such as Iran’s support for terrorist groups working to destabilise the Gulf countries, including Bahrain, Kuwait, the UAE and Saudi Arabia, and involvement in cross-border drug and arms smuggling. In exchange, some limited action could be allowed for Tehran to export oil to the international market in order to alleviate the global energy crisis amid surging prices in the wake of the Russian war in Ukraine, which increase domestic pressures in the US, Europe and elsewhere, and potentially release some seized Iranian assets. A degree of reconciliation with Riyadh, and other regional Arab states, could offer Iran crucial breathing space and help ease its domestic economic crisis by allowing it on board of some planned regional projects. The move could be also significant for the US as it seeks to reinforce its regional standing in the face of increasingly competitive external actors, such as Russia and China. Within the context of the Russian war in Ukraine, Biden’s upcoming visit to Jeddah should also include concrete steps to publicly showcase the strategic importance of the relationship with the GCC for the US, as other actors like the EU, the United Kingdom and China have done recently. Regardless of the level of urgency, any lasting Saudi-Iranian reconciliation will represent a tenuous balance and requires an immense level of trust and confidence-building given that 2016 was just one of many episodes when Riyadh and Tehran severed their diplomatic relations and the main points of contention remain unresolved. One positive example was the recent Saudi-Iranian agreement to raise the quota of Iranian nationals during the 2022 Hajj season and Tehran’s application to join the BRICS+, where Saudi Arabia and UAE weigh their membership. Most importantly, while Saudi Arabia’s foreign policy is a national decision, Riyadh would not proceed with reconciliation with Iran without consulting its closes allies, namely the GCC countries and Egypt.