For games and sports enthusiast MBS, the past week witnessed another feather being added to Saudi Arabia’s hat as the announcement came that the country would be hosting the 2034 Football World Cup. This week also saw the beginning of the run-up to COP28 in the UAE. Hopefully, the events calendar in the GCC can get the world back to international cooperation on critical issues, including green energy goals.
However, any success in the region cannot come without addressing the rather mammoth elephant in the room. The conflict in the Middle East stayed at a point of no resolution this past week. Israeli airstrikes have turned into a ground invasion and the Palestinian death toll surpassed the 9k mark, with a second Hamas commander also reportedly having been killed. Fears of regional escalation have grown as Houthi militant activity from Yemen also picked up. Increased strikes against US bases in Iraq and Syria have prompted President Biden to call for American forces to withdraw from these parts of the region. Complete withdrawal from the conflict is not an option for the US, though, as it agreed to provide a further $14bn in aid to Israel, while also calling for a ‘humanitarian pause’ in the military operations in Gaza.
Domestically, support for PM Netanyahu has been declining. After a year of protests against his right-wing cabinet’s judicial reforms, the conflict has further fueled the distrust in his government. Protests demanding PM Netanyahu focus on the release of Israeli captives held by Hamas is intensifying.
An unexpected impact of the conflict was also seen in Dagestan where mobs thronged the airport in expectation of a flight landing from Tel Aviv, searching for Jewish passengers. Some were reported to have suffered injuries, raising concerns about whether the conflict is likely to incite hate crimes against Jewish and Muslim communities.
A regional spillover of violence may not be a trend as yet but neighbouring economies are reporting a decline in their health. Jordan and Egypt are both reporting a reduction in tourism, with Egypt raising concerns about not having enough FX buffers to absorb the loss of tourism revenue. The volatility of energy markets is also expected to affect global oil prices should the conflict intensify.
Geopolitical cooperation seems to be suffering a setback in relation to another ongoing war- the Russia-Ukraine conflict. The US has introduced new sanctions against the UAE, Turkey, and China with hopes of detaining exports into Russia that could be used in its military offensive against Ukraine. Western countries have also been clashing with KSA over the UN Climate Fund, where KSA is resisting Western calls for it to increase its donor base for poorer countries to help them cope with the impact of climate change.
This latest round of sanctions and disagreements highlights the fragility of the peace in the international order. The influence of the once exclusively powerful US and EU has been diluted by the growth of emerging economies like those of the GCC and Turkey. As key US allies in the region, sidelining these economies through sanctions could lead to tricky relationships.