From the wars in Syria and Libya to the catastrophic bombing campaign in Yemen, the Gulf states led by Saudi Arabia and the United Arab Emirates have been the main Arab forces involved in the region’s current conflicts. The Gulf also increasingly shapes the political and economic policies of other Arab states, promoting economic liberalization along with hardening authoritarianism and repressing social protest. Their destructive prosecution of the war in Yemen is an attempt to position themselves as the principal mediators of the maritime routes and territorial hinterlands located in and around the Arabian Peninsula—a strategic prize that will be decisive to shaping the Middle East’s future geopolitical landscape.
Eight years since a wave of uprisings swept across the Middle East, the specter of violence, social destruction and mass displacement has largely replaced the hopes of 2011. In the first phase of these region-wide revolts, protesters sought an end to authoritarian rule and articulated widely felt aspirations for a new political and economic order. The remarkable manner in which these uprisings initially leapt across borders signaled the commonalities of lived experience throughout the Middle East—forcefully shaking a regional framework in place since the 1970s.
Precisely because of their regional reverberations, the Arab uprisings represented a particularly serious challenge to long-established US imperial strategy—and that of other Western states—in the Middle East.
Through the late twentieth century, this US strategy had come to rest on three main pillars of regional support—Israel, the Gulf states and a range of Arab authoritarian rulers—each with their own distinctive relationships to the core global powers. The West’s economic, political and military support would help underpin governments that had little interest in upsetting the regional order—epitomized most visibly in the decades-long rule of individuals such as Egypt’s Hosni Mubarak and Tunisia’s Zein El Abidine Ben Ali. Within this structure, the Gulf states, principally Saudi Arabia, but also Qatar and the United Arab Emirates (UAE), came to play a critical role in terms of both their unique multi-decade strategic connection to the United States as well as their own significant influence in other Arab states.
The popular movements that broke out across the region from 2011 threw the stability of these political arrangements into disarray. In response, the second phase of the uprisings saw a determined effort by Arab political and economic elites, Western countries and other powers vying for regional influence to remake the Middle East in a way amenable to their continued interests. The crises that have emerged since that time are a direct consequence of this effort, which can be summed up in two interconnected objectives: first, to crush the popular aspirations of the uprisings and protect (and extend) the socio-economic structures that preceded them, and second, the connected bid by major global and regional powers—including but not limited to the United States, European Union, Russia, the Gulf states, Iran and Turkey—to project their own authority over this newly fashioned regional order.
The Gulf states have emerged as key protagonists within these dual processes. From the wars in Syria and Libya—where different Gulf powers have supported an ever-shifting range of factions—to the catastrophic bombing of Yemen, the Gulf has been the main Arab force involved in the region’s current conflicts. Outside these areas of open war, the Gulf also increasingly shapes the political and economic policies of other Arab states. In partnership with international financial institutions such as the World Bank, the International Monetary Fund and the European Bank for Reconstruction and Development, billion-dollar funding packages from the Gulf states have insisted on the standard tropes of market-led development, prioritizing privatization, opening up to foreign investment and cutting subsidies and social spending. Politically, this economic liberalization has been closely entwined with hardening authoritarianism and repression of social protest through the years that followed 2011.
The consequences of the Gulf’s deepening involvement in the region are reflected in the growing linkages between the political economy of various Arab countries and the dynamics of Gulf capitalism. This interweaving of the regional political economy is driven by different forms of cross-border capital flows originating from the Gulf, including mergers and acquisitions, minority portfolio investments in other Arab stock markets, the establishment of cross-border subsidiaries and control over licensing and agency rights. At the same time, the Gulf itself has become a highly significant zone for other Arab capitalists—most notably in sectors such as construction, logistics and retail. Through these and other intra-regional relationships, the tempo of capital accumulation in the Gulf increasingly acts to shape productive, commercial and financial activities in neighboring Arab states.
Tensions in the Gulf
Across the wider region, this projection of the Gulf’s political and economic power has reproduced and generalized numerous frictions emanating from the Gulf itself. The starkest example of this dynamic is the escalating tensions between Saudi Arabia and the UAE, on the one hand, and Iran, on the other, which became particularly evident following the ascendance of King Salman to the Saudi throne in 2015 and his appointment of Mohammed bin Salman as defense minister and crown prince in 2017. Both father and son have consciously heightened the Gulf’s conflict with Iran and have found a reliable and enthusiastic ally in the Crown Prince of Abu Dhabi, Mohammed bin Zayed bin Sultan Al-Nahyan. Acting through this united front, Saudi Arabia and the UAE have sought to use the rivalry with Iran as a means to step up their own direct intervention in the region, thereby implanting themselves at the center of any eventual political transitions or settlements.
The repercussions of this inter-regional conflict have been felt across all countries in the Middle East, but they are most intensely seen in Yemen, Syria, Iraq and Lebanon—four countries that to varying degrees remain outside of the Gulf’s full orbit of control. This conflict has also generated a whole series of crises, schisms and political realignments at the global level. These crises include the divisions within and between President Donald Trump’s administration and the US political class, the growing regional influence of other powers such as Russia, China and Turkey and the increasingly open alliance between Israel and the leading Gulf states.
Another important illustration of how the tensions within the Gulf are reproduced at the regional level has been the Saudi-Emirati-led blockade of Qatar. Despite the commonalities of different Gulf states—their dependence on hydrocarbon exports, a reliance on a largely rightless, non-citizen labor force and close relationship to the United States and other Western states—the Gulf Cooperation Council (GCC) integration project did not extinguish the competitive rivalries within the Gulf. Instead, a sharp hierarchy of political and economic power has marked the GCC since its inception in 1981, with the main pivot revolving around a Saudi-Emirati axis. These two countries have formed the principal zones of capital accumulation in the Gulf and, at least until the recent blockade of Qatar, have acted as the main interlocutor between other Gulf states and the wider world market.
Dominated by this Saudi-Emirati axis, the other Gulf states have felt marginalized within the GCC’s wider political and economic structures. Qatar, in particular, with its tiny citizen population (only 313,000 citizens out of a total population of 2.6 million) and its enormous wealth arising from its role as the world’s largest exporter of liquefied natural gas, has particularly chaffed at this hierarchical structure. One consequence has been Qatar’s attempt to carve out an autonomous regional policy for itself and achieve a relative independence from Saudi Arabia and the UAE. Much like the Saudi and Emirati roles in the wider region, Doha’s attempted projection of power has occurred through both financial and political means—including its support for different Islamist movements and Arab governments, its attempt to dominate the Arab world’s media landscape and hosting a variety of exiled individuals and political parties.
This intra-GCC schism continues to echo throughout the region. In late January 2019, Qatar announced that it would buy $500 million in Lebanese bonds, a step toward deeper involvement in a country where Saudi Arabia has traditionally been the main Gulf player. Doha is also attempting to reassert its weight in the Gaza Strip, pledging in November 2018 to cover six months of civil servants’ salaries in the besieged territory. At an international level, alongside the closer association with Turkey and Iran that followed in the immediate wake of the Saudi-Emirati blockade, Qatar has sought to establish a rapprochement with countries usually seen as much more aligned to its larger Gulf neighbors. In this respect, official visits by the leaders of Pakistan and Sudan to Qatar in January 2019 marked an important diplomatic victory for the isolated Gulf state.
The War in Yemen
These regional dynamics provide the backdrop to the bombing campaign launched by Saudi Arabia and the UAE against Yemen in March 2015, a war that pits the Middle East’s wealthiest economies—fully backed by the world’s most powerful states—against the poorest country in the region. Much commentary has rightly focused on the immediate humanitarian calamity resulting from the war, but it is equally important to place Yemen’s crisis in its wider regional and historic context.
Positioned at the center of east-west trade routes traversing the Arabian Peninsula, East Africa, the Red Sea and Indian Ocean, Yemen is a key battleground for the towns, ports, military bases and shipping lanes that will underpin global power in the coming decades. Control over these logistical nodes holds significant implications for the success of China’s One Belt One Road initiative, Indian ambitions in South Asia and the Indian Ocean and the efforts of core Western states to maintain their military dominance within the region. In this environment, all Gulf states are attempting to position themselves as the principal mediators of the maritime routes and territorial hinterlands located in and around the Arabian Peninsula—a strategic prize that will be decisive to shaping the Middle East’s future geopolitical landscape.
Up until the first Gulf War of 1990–1991, Yemeni workers formed an important component of Saudi Arabia’s overall migrant labor force. Now, driven by its broader regional aspirations, Saudi strategy has shifted to a more direct alliance with Yemeni President Abd Rabbu Mansour Hadi and various local tribal and military leaders largely concentrated in the northern parts of the country. The status of these leaders depends upon patronage networks funded by Saudi Arabia, plentiful opportunities for war profiteering and Saudi disbursement of weapons, cars and passports.
Replicating recent GCC practice in Egypt, Jordan, Tunisia, Iraq and Lebanon, the kingdom has placed up to $3 billion in Yemen’s Central Bank. Until early 2018, revenues from Yemen’s oil exports were actually held in an account at the Saudi-owned Al Ahli Bank in Riyadh. This tremendous influence over Yemen’s political economy has been further buttressed by direct Saudi control over Yemeni territory, including the port of Midi, located adjacent to the kingdom’s Jizan province on the Red Sea, and the port of al-Ghaydha, in the eastern al-Mahra governorate.
Such territorial conquests are an integral part of Saudi ambitions to dominate maritime routes through the Gulf of Aqaba. They also complement other Saudi initiatives such as the recently announced Red Sea Alliance, which aims to establish a common security and political framework between the kingdom and six other countries bordering the Red Sea and Gulf of Aden: Egypt, Djibouti, Somalia, Sudan, Yemen and Jordan. To this end, Egypt’s 2017 agreement to cede its Red Sea islands of Sanafir and Tiran to Saudi Arabia is striking confirmation of the kingdom’s growing pan-regional muscle. The two islands are projected to form part of the $500 billion NEOM megacity project, which will see new cities, economic zones and agricultural areas established under Saudi hegemony across both sides of the Red Sea.
In contrast to Saudi Arabia’s focus on Yemen’s northern regions, the UAE’s main theater of military operations has been in the South. Here, the UAE has seized a number of Yemeni ports—Mukalla, Aden and Mokha—as well as the country’s sole gas-liquefaction plant and an oil export terminal located in the eastern coastal city of al-Shihr. The island of Socotra has also emerged as a key pivot of Emirati strategy, with one British newspaper noting, “the UAE has all but annexed this sovereign piece of Yemen, building a military base, setting up communications networks, conducting its own census and inviting Socotra residents to Abu Dhabi by the planeload for free healthcare and special work permits.”
These interests in Yemen are linked to an expanding arc of Emirati influence across East Africa, including the establishment of ports and military bases in Eritrea, Djibouti and Somaliland, the training of African security forces and the placement of over $1 billion of Emirati reserves in the central banks of both Ethiopia and Sudan. In a manner that foreshadows possible post-conflict trajectories in Yemen, Emirati development aid has been an important instrument in facilitating this growing Emirati political and military footprint across Africa. In 2016, for example, investment pledges by the state-owned Abu Dhabi Fund for Development were given in return for an exclusive 25-year Emirati lease on a military base in Somaliland.
The intensifying Saudi and Emirati presence across these maritime routes helps explain the focus of the Gulf-led intervention on al-Hodeidah, a northern Yemeni port through which 90 percent of the country’s food and humanitarian imports entered prior to the beginning of the war. Al-Hodeidah is a critical target for the Gulf’s wider regional ambitions. Located alongside one of the busiest choke points in global shipping—the 30-kilometer-wide Bab Al Mandeb at the intersection of the Red Sea and the Gulf of Aden—control over al-Hodeidah is viewed as essential to securing maritime trade between Asia and Europe. Nonetheless, despite fierce battles and a prolonged blockade by Saudi Arabia and the UAE through 2018, which led UN agencies to warn of imminent famine and the risk of cholera outbreaks throughout the country, the port remains under Houthi control.
This projection of Saudi-Emirati power throughout the Indian Ocean, Red Sea and East Africa occurs amidst the growing geographical reach of other regional and international actors, including Qatar, Turkey, Iran and China. Seen through the lens of these regional rivalries, it is misplaced to view the Saudi-Emirati attack on Yemen as simply a result of overzealous adventurism driven by the ambitions of the young and inexperienced crown princes of Riyadh and Abu Dhabi. Likewise, US support for the war cannot be reduced to Trump’s personal affinities with authoritarian rulers such as Mohammed Bin Salman or the desire to market American arms to a GCC war machine with seemingly insatiable appetite for weapons and military hardware. While the US political class sharply debates the efficacy of Saudi-Emirati strategy and the eventual outcomes of the intervention remain unclear, there is a compelling geopolitical logic behind the struggle to dominate Yemen’s future.
The deep embroilment of Saudi Arabia and the UAE in Yemen’s war positions these two Gulf states as major players in defining the direction of the country’s post-conflict reconstruction. As with other conflicts in the Middle East, notably that of Syria, the precise contours of Yemen’s reconstruction and rebuilding are yet to be determined. But it is essential to view post-conflict scenarios in continuity with the dynamics of the war itself—a new phase in the competition over territory, markets and maritime routes in which all key protagonists will attempt to consolidate and formalize any gains made over the past four years.
A possible indication of where this phase in Yemen might head is foreshadowed by the Gulf’s role in post-uprising transitions elsewhere in the region. In addition to political and diplomatic alliances, a key element to this has been the extension of Gulf aid and financial support to other Arab governments. This support has occurred in a multiplicity of forms, including development aid, bilateral investment flows, central bank deposits and the provision of subsidized oil and gas. Large GCC-based institutions such as the Saudi Fund for Development, the Abu Dhabi Fund for Development, the Kuwait Fund for Arab Economic Development and the Islamic Development Bank are already active across the region and will certainly play a major part in determining where post-conflict funding in Yemen goes and on what it is spent. Aid from these institutions typically focuses on large infrastructure projects, agribusiness and financial reform. If experiences in other Arab states are a reliable guide, support to these sectors as part of reconstruction efforts will continue to bolster the Gulf’s political alliances and strategic interests in Yemen.
Another factor to consider alongside such financial flows is the significant regional reach already held by large Gulf firms (both state and privately owned) over key economic sectors in the Middle East. In the context of Yemen’s post-conflict reconstruction needs—particularly for sectors such as power, water, infrastructure, food, housing, energy and logistics—Gulf-based conglomerates are well placed to further deepen their economic interests in the country. Indeed, Saudi Arabia’s cement firms have seen a huge spike in their share-prices over the last three months in expectation of the coming boom in Yemen’s reconstruction. The macabre reality is that such firms stand poised to reap enormous profits as a direct result of their own government’s deliberate destruction of Yemeni infrastructure, estimated to be worth around half of the country’s 2013 GDP.
There has also been a notable tightening between the delivery of humanitarian relief in the region and the position of the Gulf states as logistical nodes for the transport and provision of aid, encapsulated in the decisive role of Dubai’s International Humanitarian City as the main nexus for humanitarian work across the entire Middle East. Saudi Arabia has also begun its own foray into humanitarian relief in Yemen, with the launch of the Saudi Development and Reconstruction Program for Yemen in August 2018. This fund has focused in particular on the reconstruction of airports, maritime facilities and energy infrastructure in those areas now under Saudi control.
How successful the Gulf’s ambitions may be in moving forward remains unclear. The eventual outcome will be shaped by intra-Gulf competition as well as the particular configuration of political power that marks the end of the war. Other actors are also intensely involved—vying political factions in Yemen, international financial institutions, foreign governments and new economic actors thrown up in the course of the conflict itself. The interests of these groups do not always align, and they will face considerable challenges in pushing forward their visions. Nonetheless, despite all these contingencies, the mere cessation of hostilities and the expected reconstruction boom—now predicted daily in the region’s business press—will do little to challenge the realities of power in the Arabian Peninsula. There is a need to “follow the money [in order to] uncover the power dynamics” as Mandy Turner has aptly put it. Within this unfolding process, the strategic goals that drove the initial Saudi-Emirati attack on Yemen need to be seen in continuity with what may come next.
 Adam Hanieh, Money, Markets, and Monarchies (Cambridge, 2018).
 The Economist, “Saudi Arabia and the UAE are gobbling up Yemen,” February 22, 2018.
 Heba Saleh and Ahmed Omran, “Saudi Arabia and Egypt agree $10bn deal to develop economic zone,” Financial Times, March 5, 2018.
 The Economist, 2018.
 Bethan McKernan and Lucy Towers, “Socotra island: The Unesco-protected ‘Jewel of Arabia’ vanishing amid Yemen’s civil war,” The Independent, May 5, 2018.
 A key actor in this regard is world’s third-largest port operator (by capacity), DP World, headquartered in Dubai’s massive Jebel Ali Port and controlled by the Dubai government. DP World has rapidly expanded its activities across 77 countries including India, Djibouti, Somaliland, Somalia, Saudi Arabia, Egypt and Algeria, as well as a range of European ports.
 Nizar Manek, “U.A.E. Military Base in Breakaway Somaliland to Open by June,” Bloomberg, November 6, 2018.
 China, for example, has identified the region as a key focus of its OBOR Initiative and to this end established its first overseas naval base in Djibouti in 2017 (the United States, France, Japan and Italy also maintain bases in Djibouti). While there is a strong element of rivalry involved in China-GCC expansion in the region (particularly around the control of ports), both the UAE and Saudi Arabia are also keen to integrate themselves into OBOR, setting themselves up as local facilitators for the trade of oil, food and other commodities through the Strait of Hormuz and Indian Ocean, as well as the Red Sea and Mediterranean.
 Filipe Pacheco, “Stock Investors Bet Saudi Arabian Cement Will Rebuild Yemen,” Bloomberg, November 20, 2018.
 Office for the Coordination of Humanitarian Affairs, The 2017 Humanitarian Needs Overview Yemen (2016).
 Rafeef Ziadah, “Constructing a logistics space: perspectives from the Gulf Cooperation Council,” 201712 Mandy Turner, “Follow the money, uncover the power dynamics: understanding the political economy of violence,” Environment and Planning D: Society and Space, August 29, 2017.
 Mandy Turner, “Follow the money, uncover the power dynamics: understanding the political economy of violence,” Jadaliyya, August 29, 2017.