Topic: BusinessAccounting

Last updated: March 19, 2019

2017 division with QatarOn June 5 2017, Saudi Arabia, Egypt, UAE and Bahrain had formally ended diplomatic bonds with Qatar. Saudi Arabia explained it took the choice to end diplomatic bond due to Qatar’s acceptance of a lot of sectarian and terrorist groups wanted to unstable the land, which include the Muslim Brotherhood, Al Qaeda, Islamic State of Iraq and Syria (ISIS) and groups favored by Iran in the kingdom’s eastern province of Qatar. Islam Hassan stated: Beginning from 2000 and after it, Qatar has been following an independent foreign policy that sometimes conflict with the Saudi strategic concerns in the land. The point that Qatar has not been following the Saudi foreign policy, and working with states and non-state players that the Saudis didn’t agreed of have created this stress in relationship throughout the years that have been passed, largely after the Arab uprisings.

This stress was recovered by the hacking saga of Qatar News Agency and the statement that was assigned to Sheikh Tamim bin Hamad. This occurred at a time when Mohamed bin Salman was encountering competition from Mohamed bin Nayef over the Saudi kingship. Mohamed bin Salman seek to have the US blessing during Trump’s visit to Saudi to threat Qatar to its knees and go back home with a win that would give him more admiration in Saudi Arabia, making his journey easier to power. With concerns to UAE, there has been always conflicts between al-Nahyans of Abu Dhabi and al-Thanis of Qatar.

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This competition goes as far as to the 1800s. The Arab uprisings helped a new chapter in the Qatari-Emirati conflict. The conflict caused to the Emiratis doing the main part in the removal of ambassadors from Qatar in 2014.

At the starting of the ongoing diplomatic problems, especially following the hacking saga, UAE was seeking to prolong the problem. Even how, Aljazeera’s publishing of Yousuf al-Otaiba’s leaked emails got the UAE on board with Saudi Arabia. To the extent as Bahrain is considered, the little Kingdom has been following the Saudi foreign policy for the past years that have been passed. It looks like that their splitting of bond with Qatar was mainly an answer to a Saudi call.In June, most of the members declared a ban on Qataris and their businesses. Qataris are not given permission to live in the country and also not given permission to enter in the country only if they have a wife who is living there and they have to carry a visa if they want to go to these countries. Flights from Qatar are not permitted to come there and also the flights from the country not permitted to come to Qatar.

Connected statesAfter the making of the council in 1981 its membership has not extended, with all partners being Arab monarchies. Some of the GCC countries have land borders with Yemen, Iraq and Jordan and sea borders with Egypt, Sudan, Iran, Eritrea and Somalia.EgyptOnly the Sinai Peninsula situated in the Arabian Peninsula, Bahrain has been spoken about its opinion on Egypt joining the GCC, in 2011, Bahraini Foreign Minister has declared for Egypt to be included as a partner of the GCC.IraqIraq is the only Arab country bordering the Persian Gulf that is not a partner of the Gulf Cooperation Council. In 2012, Iraqi Defense Minister Saadoun al-Dulaimi declared that Iraq seeks to include itself in the GCC. Kuwait helps Iraq joining the GCC. The little partnership of Iraq is largely believed to be because of the low-income economy, its large Shia population, its republican political system, and it’s capturing of member state Kuwait during the Gulf War.IranOn the December 2012 Manama summit, the GCC states declared for an end to Iranian taking part in their personal events.

Jordan and MoroccoOn May 2011, Jordan’s appeal to include itself in the GCC, which had been first given 15 years ago, was accepted and Morocco was welcomed to join the union. On September 2011 a five-year economic plan for both countries was put forward after a meeting between the foreign ministers of both countries and those of the GCC States, the first GCC meeting since May which included the Jordanian and Moroccan ministers. Even though a plan for accession was being looked into, it was noted that there was no timetable for either’s accession, and that discussions would go on. As Jordan and Morocco are the only two Arab monarchies not presently in the council, the present members see them as strong powerful allies.Jordan borders member Saudi Arabia and is economically linked to the Persian Gulf States. However, Morocco is not near the Persian Gulf, the Moroccan foreign minister Taieb Fassi Fihri notes that “geographical distance is no obstacle to a strong relationship”.

YemenYemen was in discussion for GCC partnership, and wanted to join by 2015. Moreover, it has no coastline on the Persian Gulf, Yemen lies in the Arabian Peninsula and have a same culture and history with other partners of the GCC.The GCC has already accepted Yemen’s accession to the GCC Standardization Authority, Gulf Organization for Industrial Consulting (GOIC), GCC Auditing and Accounting Authority, Gulf Radio and TV Authority, GCC Council of Health Ministers, GCC Education and Training Bureau, GCC Council of Labor and Social Affairs Ministers, and Gulf Cup Football Tournament. The Council made directives that all the important legal actions be taken so that Yemen would have the alike rights and commitment of GCC member states in those institutions.

On May 2017, the Gulf Cooperation Council didn’t accept the making of a transitional political council in southern Yemen, which called for the division of Southern Yemen, cooperating with Yemen President Abd-Rabbu Mansour Hadi in doing so.Role of Unites StatesThe unsteady and irregular regional environment, the support on a powerful and strong military power such as the United States continues to be seen as an important part for the GCC states to protect their own security and national being. From an absolute security point of sight, the GCC states are just not to be in a place to protect the Gulf region or its own territories from foreign attack. One of the outcomes of the Gulf crisis is the raised trust of Gulf States on the United States, especially the Trump administration, which is a situation of diminishing and weakening for the Gulf. The Trump administration has used Qatar’s blockade to best exploit money, plan contracts and manage concerns. The price of the union with Trump is high, particularly since his scheme is built on the element of financial depletion of the countries in the region.

Moreover, the Gulf crisis, which influenced the GCC countries and made them weak, has given profit to many countries beyond the Arab boundary. The crisis has profited Turkey, which has acted the main part in the Gulf area. It also profited Iran, which has founded that the Gulf front and the GCC are not united in the face of Iran’s regional policies, the Gulf crisis has given political gifts to China and Russia, as these 2 countries got gains because of the decreasing hope of some Gulf states in the United States. At the exact time, Israel profited from the Gulf crisis, as it discover a broken Arab and Gulf world wanting help to challenge Iran and spy on rivalries. Russia CooperationIn June 2016 bilateral conference Russia’s energy minister, Alexander Novak, wanted trade between Qatar and his country to increase to 500 million dollars and possibly above, and considered increasing interests from Russian energy companies in collaboration with Qatar.

Russian state energy giant Gazprom is working with Qatar gas on combine participation in gas markets and buying of liquefied natural gas (LNG), Qatar’s main export product. Novatek, another Russian factory which is quickly developing in the LNG business, is also eyeing up business agreements with Qatar gas.Russian businesses are also joining in Oman’s energy section, and trade between the two countries has increased orderly since 2010, while collaboration on civilian nuclear technology as well as hydrocarbons is on the scheme for Moscow’s relations with the UAE.

Agreeing with Russia, in spite of some diplomatic dissimilarities, has great mutual advantages. Russia’s economy has been hit firmly by the oil price collapse and Western sanctions, so the country is in want of new trading partners and investments. Russia is also a great developing market that has worthwhile promise for foreign investors such as those in the Gulf. There is improving agreement between Russia and the Gulf countries for a political agreement in Syria, which would profit all parties in the long time period.

Russia has also presented to make peace in other regional disputes.Building Bridges between GCC and RussiaBilateral trade between Saudi Arabia and Russia is presently worth 2 billion annually. In September 2016 the two countries accepted to a combined working group on checking the global oil market and enlisting suggestions for making prices stable.

The collaboration quickly lifted oil prices and is seen as in particular important after a period in which Riyadh was unwilling to limit production as Saudi Arabia looked to protect market share.UAE and the Kuwait were among the nations to welcome the deal, which can help raise Gulf government’s revenues after a period in which the decrease in oil prices took all the GCC countries into fiscal deficits (when a government’s total yearly expenditure go beyond its yearly revenue, excluding money from borrowings, it’s called a fiscal deficit).Relationship with Russia are also positive for many GCC states that see opportunities in the Russian market and the capability for partnership with Russian energy companies that are seeking technological advancements and marketing partners other than Europe.Ties between GCC and ChinaIn spite of the decrease in the Chinese economy in current years, investment and trade bonds between GCC and the China are likely to carry on to grow. China’s need for energy imports makes the resource rich Gulf countries significant members, but collaboration goes beyond selling oil and gas. GCC based businesses are also investing in energy infrastructure in China that should help protect market share in the long period, also advancing Gulf contractor’s international limit. The OBOR strategy has become a key theme of bilateral relations, and could also generate opportunities for partnerships in the many promising appearing markets between the China and Gulf.

ConclusionThe conclusion to be made is that the GCC has been not able to organize itself as a big and developed regional security organization. The major limitation are the absence of a supranational control in effect giving the organization with no political or power independence, and the deficiency of any form of supremacy that can demand the agreement of member states on any affairs. As the GCC see themselves as newly born nation states that only presently, historically speaking, got their independence, there has always occurred a high degree of opposition to giving up on its supremacy. There is thus a need to develop a scheme based on modest yet powerful forms of collaboration formed around familiar security knowledge such as the long term economic advancement of the region and making the flow and price of oil stable.In addition, there can be no Gulf security system without the comprehensive involvement of all parties including the GCC states alongside Iraq, Iran and Yemen.

If the process towards bringing such an arrangement can be initiated in the coming years, the GCC will indeed have proven invaluable to the peoples and states in the region.


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