Gulf and Red Sea Regions

On Friday (10 March), it was announced in Beijing that with the mediation of China, Iran and Saudi Arabia had agreed to end decades of hostility, re-establish diplomatic relations that had been broken in 2016, re-open embassies in their respective capitals within two months, and work towards resolving all disputes between them through dialogue. The diplomatic world appeared taken by surprise, both by the Iranian-Saudi reconciliation, as well as by China’s involvement. The sight of a Sunni Kingdom, a Shia revolutionary republic, and a Communist state cosying together was somewhat unsettling for some. Many rushed to welcome the deal, others, especially among the chattering classes in Washington, rushed to criticise it. Diplomatic contacts have been ongoing between Tehran and Riyadh for some time, held mainly in Baghdad and Muscat with Iraqi and Omani facilitation. After the UAE normalised relations with Iran some months ago, it was assumed that sooner or later Saudi Arabia will follow. But the timing and context of the deal announced in Beijing last week remains a very significant development, with wide-ranging consequences. It also appears to herald a new age of pragmatism in international relations, with considerable implications.

Following a meeting in Beijing, on Friday (10 March), Saudi Arabia and Iran have agreed to reestablish diplomatic relations and reopen their embassies within two months following years of tensions between the two countries. A joint statement released by the Saudi state news agency SPA read: “In response to the noble initiative of His Excellency President Xi Jinping, President of the People’s Republic of China, of China’s support for developing good neighborly relations between the Kingdom of Saudi Arabia and the Islamic Republic of Iran...the three countries announce that an agreement has been reached between the Kingdom of Saudi Arabia and the Islamic Republic of Iran." "That includes an agreement to resume diplomatic relations between them and re-open their embassies and missions within a period not exceeding two months, and the agreement includes their affirmation of the respect for the sovereignty of states and the non-interference in internal affairs of states,” the statement said.

When Russia launched its full-scale invasion of Ukraine one year ago the prevalent feeling among the Arab Gulf states was that they did not want to get involved.  Some thought the best policy was to ignore it, others that they should at the very least dodge it, and some even saw in it some opportunity to extend relations with Russia and China.  There were a number of reasons for this. The region was frustrated with how the west dealt with it. It expected a more equal relationship that never properly materialised. There was fatigue at western attempts – some clearly ill-judged – at interfering in the Arab region, and conversely, disappointment at western failure to stand up to Iran. The unsightly US departure from Afghanistan, and talk of American strategic re-positioning, convinced some that the American moment in the Gulf had passed.

The process of opening-up Saudi Arabia to the world is going on in earnest. As a part of the Vision 2030 blueprint, masterminded by Crown Prince Mohammed bin Salman, the Saudi government is implementing a plan, which, amongst many other things, aims to turn the Kingdom into a popular tourist destination by the end of the decade. Other GCC countries, but particularly UAE, Qatar and Oman, also seek a growth in tourism, and see the industry as one of the potential pillars for their post oil economies. In many countries, tourism is a major economic activity that contributes to economic prosperity. It is also an industry which generates revenues that quickly seep downwards to the very grassroots of society, and so everyone benefits from it. But apart from the economic and financial gains, tourism can also be an instrument of change within societies, opening up conservative, inward looking communities to the outside world. Several Arab Gulf countries have the ambition of turning themselves into major tourist destinations, and some have already considerable success. The potential is great, but there are also some risks.