The maybe greater GCC

The Arab Spring has brought a newfound sense of purpose to the Gulf Co-operation Council (GCC), a six-member club of mostly Sunni oil-exporting Arab monarchies. Despite regular declarations of brotherly love at expensive summits, the GCC’s plans for further integration have been hampered for years by political tensions between the member states. As recently as January, tensions flared between Oman and the UAE after the discovery of an alleged Emirati spy ring infiltrating the Omani government. Despite a shared fear of Iranian power, the GCC rarely seemed an effective or cohesive foreign policy player.

Now, however, the GCC is making a marked display of unity and is seeking to project itself as a regional actor in four very different initiatives. A GCC mediation effort in Yemen seeks to bring about an orderly transition from the challenged Presidency of Ali Abdullah Saleh.  GCC backing for the NATO-led intervention in Libya has offered an unprecedented Arab cover to Western intervention in the internal affairs of an Arab state. The deployment of "Peninsula Shield" forces in Bahrain, where the government has used force to put down a major uprising, activates a mutual security pact in the GCC’s charter, although questions have been raised about whether this was ever supposed to cover internal uprisings. Finally, the GCC is also taking a newly expansionary stance, announcing that it would accept membership bids from Jordan and Morocco, a move that would take it beyond a sub regional bloc into an international alliance of like-minded regimes resisting the regional moves towards greater democracy. Can the GCC sustain this newfound activism and invent a new regional role?

The GCC is 30-years-old this year — a relatively lengthy history given that most of the Gulf states have been independent for just 40 years. It is an alliance that has always been shaped by shared threat perceptions. Although initial efforts to promote intra-Gulf co-operation in the 1970s had little effect, the GCC came together as a bloc in 1981, after the 1979 revolution in Iran, the Soviet invasion of Afghanistan in the same year, and the outbreak of war between Iran and Iraq in 1980, all of which created shared security challenges for the Gulf. The GCC’s founding first charter largely focused on economic and cultural co-operation, but in 1984, it moved to set up a joint defence force, the Peninsula Shield. In reality the GCC countries have always remained dependent on U.S. security guarantees, as was highlighted in the 1990-91 Gulf war, and the institution has been as busy with internal squabbling as with cooperation.

In recent years, the GCC project has focused mainly on economic integration. It makes sense: the combined GDP of the six countries would be close to $1 trillion, one-fifth the size of China, a far more attractive market than any of the individual economies would be on their own. The six members — Saudi Arabia, the UAE, Bahrain, Kuwait, Oman and Qatar — are all relatively wealthy, oil-dependent monarchies with similar economic development priorities and could benefit from greater economic co-operation and co-ordination. The six set up a customs union in 2002. A common market was declared in 2007 but is yet to become a reality. The bloc has been negotiating a free-trade deal with the EU for more than a decade. And there have been longstanding talks about launching a single currency. 

The latter should be economically straightforward — five of the member states already peg their currencies to the dollar, while Kuwait uses a currency basket that is dominated by the dollar — but has proven politically difficult. This is partly because the smaller GCC states have traditionally been wary of the potential for Saudi Arabia, by far the largest of the six, to dominate their joint efforts. Indeed, the UAE pulled out of the single-currency project in 2009 after Abu Dhabi’s bid to host a Gulf monetary council was rebuffed in favour of Riyadh. Such experiences have led to a general cynicism about GCC integration plans.

Three factors have prompted this year’s apparently renewed sense of unity in the face of common threat perceptions. One is the unrest across the Arab world, which has emboldened oppositionists and prompted protests in the Gulf too, most dramatically in Bahrain. (The GCC has announced a $20 billion fund for economic assistance to Bahrain and Oman over the next 10 years.) Another is the belief among some Gulf policymakers that Iran is meddling in Bahrain, although this seems to be stoked more by loud voices in the Iranian media than by hard evidence. The third is an underlying concern, in some quarters at least, about the long-term future of Western alliances with the Gulf, given the West’s withdrawal of support from former Egyptian president, Hosni Mubarak, once the strength of popular opposition in Egypt had become clear. Mr Mubarak was a regular visitor to the Gulf, where personal relationships are profoundly important in politics, and the prospect of him being tried and possibly even executed has outraged his friends in the Gulf, even if many young Gulf nationals watched the Egyptian and Tunisian uprisings with enthusiasm. There is also a marked difference of opinion between Western countries and the Gulf states over Bahrain; while Bahrain has blamed this year’s uprising on a foreign plot, the U.S. and UK believe it is driven by domestic factors, and have said as much.

Given all this, it is likely that over the long term, the GCC states will be looking to gradually reduce their dependence on the U.S. security umbrella in the Gulf, both by building new alliances and by trying to strengthen their own security forces. Recent signs of this include this year’s deployment of 130 South Korean special forces to train their Emirati counterparts, as well as the news that the crown prince of Abu Dhabi has hired Erik Prince* — the former owner of Blackwater, the private U.S. security firm that changed its name to Xe Services after some of its staff were prosecuted for shooting Iraqi civilians — to establish a 800-strong contingent of foreign fighters.

That said, recent differences between the Gulf and the West shouldn’t be exaggerated, and it is likely that the U.S. will remain the Gulf’s main external security backer for the foreseeable future, given its interest in ensuring the free flow of oil. Indeed, Bahrain’s brutal repression of a largely peaceful opposition movements appears to have had little effect on the strong diplomatic, financial, economic, military and security relations between the U.S. and UK on one hand and the Gulf on the other. This partly reflects the strength of GCC backing — led by Saudi Arabia — for Bahrain’s rulers, which sends the West the message that taking on the government of Bahrain would also mean taking on the world’s largest oil exporter, as the GCC is presenting a united front.

But how real is this apparent unity? Each of the GCC countries has responded differently to the Arab uprisings — and each has a different relationship with Iran. Qatar is perhaps the most confident that domestic unrest is unlikely to be a factor, as its tiny population has benefitted from dramatic economic growth and state welfare initiatives since the current emir came to power. It has thus been happy to allow the broadcaster it finances, Al Jazeera, to take a positive view of the uprisings in most of the rest of the region, with the glaring exception of Bahrain. Qatar has gone further than any of the other five countries in supporting the Libyan opposition, with news emerging that Qatari military advisors are training opposition fighters on the ground in Libya, while the country is also facilitating oil exports and fuel imports for the opposition (prompting Libya’s state oil company to complain to OPEC). And it was the first GCC state to pull out of the Yemen mediation effort in frustration.

The UAE would also seem to have little to fear in terms of domestic protests, as its citizenry is only a little larger and a little less rich than Qatar’s. Yet it clearly feels jumpy; four citizens have recently been arrested after calling for a democratic parliament. Its recent mending of fences with Saudi Arabia — after tensions over borders and customs issues in the past few years — is a key driving force behind this more united GCC. Saudi Arabia is probably the most concerned about Iranian expansionism, closely followed by the UAE, which has to strike a balance between Abu Dhabi’s hawkish attitude to a country that occupies three islands claimed by the UAE and Dubai’s strong trading relationship with Iran. By contrast, Oman and Qatar have sought to balance their Arab alliances with relatively good relations with Iran.

It is clear that the GCC deployment in Bahrain is a Saudi-led initiative, with the UAE and later Qatar joining in to provide a degree of GCC legitimacy. Kuwait’s stance has been affected by its uniquely strong parliament and its desire to maintain harmonious relations between its Sunni majority and its relatively well-integrated Shia minority, reckoned at around a third of the population. It has therefore opted only to send naval vessels, in line with the Peninsula Shield’s stated commitment to protect GCC members against external threats, after (mostly Shia) Kuwaiti MPs objected to sending troops to assist a government suppressing an internal uprising. For its part, Oman is not directly involved in the deployment; it has been busy working out a very different response to its own protests, by changing many key ministers and promising political reforms.

Finally, the discussion about including Jordan and Morocco is likely to upset the GCC’s Arab Gulf neighbours, Yemen and Iraq, who are natural economic partners for the GCC states given their need for capital and their abundance of labour, but don’t fall into the Sunni monarchy camp. Others may be more enthusiastic; the Palestinian ambassador to the UAE has already volunteered Palestinian membership. The talk of expansion should be treated with scepticism given the history of progress on GCC initiatives. It may just be a symbolic message. Moreover, the EU experience shows that expansion makes for a more attractive economic bloc — but an even harder time coming up with a coherent foreign policy. Over the next few years, the GCC countries are likely to respond quite differently to internal pressures for political reform. This suggests they will struggle to find a unified policy toward an Arab region that seems set for further dramatic changes.

*Correction: A previous version of this sentence stated that Xe Services was hired by the UAE. In fact, it is Erik Prince, who no longer works for the private security company, who was hired.

Jane Kinninmont is a Senior Research Fellow at the Middle East and North Africa Program at Chatham House.