Crisis puts future of Saudi reforms and GCC in doubt – HuffPost

A three-week-old, Saudi-UAE-led diplomatic and economic boycott of Qatar threatens to complicate newly promoted Saudi Crown Prince Mohammed bin Salman’s reform plans and undermine the Gulf Cooperation Council (GCC), the Middle East’s most successful regional association.

Designed to impose Saudi Arabia and the UAE ‘s will on a recalcitrant Qatar, the boycott suggests that power politics irrespective of cost trump the need for reforms in Prince Mohammed’s world.

The stakes for 31-year old Prince Mohammed and Saudi Arabia’s ruling Al Saud family are high. Failure to deliver sustainable economic and social reforms could undermine the prince’s popularity whose age has allowed him to connect with significant segments of the kingdom’s youth, who account for two thirds of the population, in ways his predecessors could not.

“The isolation of Qatar is but one example of how the politics of the Gulf Arab states are getting in the way of economic diversification and transformation,” said Karen E. Young, a senior scholar at The Arab Gulf States Institute in Washington, in an analysis of the impact of the Gulf crisis on the region’s economic reform plans. Ms. Young noted that the depth of the crisis and the hardening of positions on both sides of the divide “suggests that economic growth and the liberalization of these political economies are secondary priorities for all parties involved.”

Irrespective of how the Gulf crisis is resolved, it already has damaged institutional as well as informal building blocks of a restructuring of the Saudi as well as the region’s economy. The GCC that groups Saudi Arabia, Qatar, the UAE, Kuwait, Oman and Bahrain, has suffered a body blow that it may not survive.

Continued Qatari membership is in doubt with the Gulf state’s refusal to accept Saudi-UAE demands that would end its at times provocative policies and render it a vassal of the kingdom. Kuwait and Oman are likely, in the wake of the crisis, to be more reticent about further regional integration, having long charted relatively independent, albeit less boisterous, courses for themselves.

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