Two men in Doha overthrew their own family members to sit on a throne built on sand and gas. Now that throne is about to be tested by the biggest geopolitical shake-up in the Middle East since the Soviet Union collapsed, and South Africans have more riding on the outcome than they might think, writes Albertus van Wyk.
Plenty of South Africans have skin in this game: trade ties with companies in Dubai and Doha, a cousin who packed up for a tax-free job in the Emirates, maybe a pension fund quietly holding a slice of Sasol’s enormous gas plant outside Doha. It matters to the ICU nurse weighing up a contract in a private Dubai hospital, and to the exporter who routes half their containers through Jebel Ali.
With the Iran-US negotiations in their initial fragile stages and almost derailed over the weekend with both sides launching strikes, but the 14-point memorandum still on the table, the big question is: what becomes of the Gulf states?”
Let’s leave Saudi Arabia out of this and focus on the UAE, Qatar, Kuwait, Bahrain and Oman, even though their fate will only become clearer once the nuclear programme, sanctions and the missile arsenal are settled in negotiations.
America has 19 bases and up to 50 000 personnel across the Gulf, among them Al Udeid in Qatar, CENTCOM’s wartime headquarters, and Bahrain’s home for the US 5th Fleet. Call it neocolonialism or hegemony, The US’s ambition is clearly more than just securing the homeland. Iran will probably open with a maximalist demand for full military withdrawal from the Middle East, mainly to extract concessions on the nuclear programme and the Strait of Hormuz. That may scale back to just the Gulf states, but it’s hard to imagine Iran settling for the kind of presence America had there before the war.
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Right now, in tents pitched in the dunes in their version of a bosberaad, the emirs, sultans and sheikhs of the Arabian Peninsula are holding council to figure out where their salvation lies once the Americans start packing. To understand what’s actually being plotted in those tents, you need to know who’s sitting in them.
The real Game of Thrones
A quick history of the Gulf states isn’t really possible. It’s a soap opera with at least 1 000 episodes. The “princes”, “emirs”, “sheikhs” and “sultans” are basically Bedouin tribal leaders who’ve been playing out Game of Thrones-style stories of bloodshed and betrayal for as long as anyone can remember. The Arab world really only has one ancient noble line going back to the time of Mohammed – the Hashemites of Jordan. The rest mostly crystallised in the last 300 years.
Take Sheikh Mohammed bin Rashid Al Maktoum, ruler of Dubai. His family has ruled since 1833, after leaving Abu Dhabi following a bitter succession feud with the Al Nahyan family. Sheikh Maktoum bin Butti headed north with around 800 tribesmen and founded the Al Maktoum dynasty in the pearl fishing village of Bur Dubai.
Or look at the princes of Qatar. In the early 19th century, Qatar wasn’t even a country, just warring tribes under the Al Khalifa clan of Bahrain. The Al Thanis, whose descendants rule today, weren’t thrilled about that. After the Al Khalifas raided Doha in 1867, Bin Thani signed a treaty with the British that settled Qatar’s status. His son, Sheikh Jassim, seen as the founder of modern Qatar, played the Ottomans and the British off against each other while unifying the tribes, and signed the agreement that made Qatar a British protectorate from 1916 to 1971.
So these “noble bloodlines” all took root pretty recently. All the Gulf states became British protectorates at various points, and gained independence between 1968 and 1971, not long after oil and gas reserves were discovered from 1932 onwards.
The postcolonial period
Once the British left, the ruling emirs used the endless oil money to modernise their states, although the centuries-old Game of Thrones-style power struggle never really settled down. In Qatar, the prime minister, Sheikh Khalifa bin Hamad Al Thani, overthrew his cousin, the emir, in 1972 while the cousin was off hunting with hawks in Iran. Sheikh Khalifa’s number was up too, since in 1995 he was overthrown by his own son (!), Sheikh Hamad bin Khalifa Al Thani. Imagine the dinner table conversations in that household. Everyone was rolling in dollars, though, so not too unhappy.
With the Iran-Iraq war and Saddam Hussein’s invasion of Kuwait, the Gulf Arabs realised how defenceless their small, wealthy states were against a monster like Saddam. That laid the groundwork for America around 1990, and defence agreements with all the GCC states soon followed.
The Americans told the emirs:
Right, you build the bases with the almost slave labour of India, Bangladesh and Pakistan, buy the equipment from us, and we’ll set up full security umbrellas for you. We’ll bring our banks in to diversify the economy. You sell your oil only for dollars, and the rest, after the sons’ Ferraris and Lamborghinis have been paid, gets invested by your sovereign wealth funds into our treasury bonds and businesses.
Win-win-win, unless you’re a migrant worker from Pakistan, which makes up north of 80% of the population and is kept out of sight.
The Gulf states are plenty of things politically, but liberal democracies or market capitalists, they are not. If Dubai and Doha feel as familiar and reassuring to you as Paris and New York, that’s because they were built to make you feel exactly that.
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What happens in domestic politics depends entirely on which family you’re from, who you know, and who wants you to marry whom. It sounds like a Monty Python sketch, but in Qatar you can buy access to an “Al Thani-influence chart” mapping the emir and his network of related power-families: $2 000 for limited access, $5 000 for full, offered with the government’s blessing.
Strict ethics calls it corruption; more pragmatic views call it a rentier state. Tomayto, tomahto. Income comes from oil and gas, not taxes, and in exchange for loyalty, the ruling family guarantees cradle-to-grave welfare. Favours and handouts even have their own name: wasta.
Dubai and Qatar can sell the idea that their economies have diversified all they like, but take away the oil and gas income and the house of cards collapses. What you really have is a hypercapitalist elite who see themselves as royal and progressive, resting on an ancient feudal network with notorious cheap imported labour.
Will the money follow the boots?
I don’t have much of a reputation to risk by predicting the US military will slink out of the little Gulf states. The real question is whether the rest of the US’s investment presence sticks around or slips away. Every American business in the Gulf is there thanks to a bigger quid pro quo: the US invests there to gain control over oil and gas, and the military is there partly to guarantee contracts get honoured.
Diversification without the oil is mostly a myth, which is why Dubai and Qatar never built a local middle class capable of spending at scale. Around 10 million people live in the UAE, of whom 90% are workers from elsewhere with limited spending power. There aren’t really markets here, just logistics hubs and money spinning round on the backs of the oil rentiers.
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With Iran’s likely dominance going forward, the petrodollar is even more at risk than before the war. If oil gets sold in other currencies to the Chinese, Indians and the rest of the East, the western banks in Dubai, Abu Dhabi and Qatar become less necessary, and the wider service networks built around them scale back too. It’s hard to imagine all US investment vanishing overnight – finance, aviation and luxury retail can’t just up and leave – but the Gulf states face a far more uncertain few years without a major security partner. Business generally follows the flag.
Back to those tents in the dunes. The emirs and sheikhs know they’ll need a new partner, especially to draw another security umbrella and secure safe passage through the Strait of Hormuz. Doing nothing and waiting to see what unfolds would be foolish.
Iran may find it strategically irresistible to bring these oil and gas fields under its control, especially given its growing ties with China and Russia. There’s also the new alliance between Saudi Arabia, Egypt, Turkey and Pakistan, the so-called Sunni Diamond – if it turns hostile towards Iran, the smaller Gulf states become a flashpoint overnight, squeezed between two rival axes rather than sheltered by either. Nobody knows yet which way that relationship will tilt.
Uncertain future
The obvious question is why a business, South African or otherwise, would put meaningful resources into economies whose future is this uncertain. The oil and gas under the sand guarantees the cash starts flowing again, but who controls it determines which network it flows into – and that’s what makes our own exposure here, the trade, the investments, the tens of thousands of South Africans building lives in the Emirates, worth watching closely rather than taking for granted. Those networks could end up controlled from Beijing, Tehran, Mumbai, or even Moscow; we simply don’t know yet.
Should you still consider going to work as an ICU nurse or doctor in a private hospital in Dubai? If your contract’s right and there’s no violence, I’d still do it. Just be aware, the Gulf states, and everyone who still has an interest there, have landed in the tumble dryer of change. You might suddenly find yourself on a flight home.
- Albertus van Wyk is a freelance journalist.
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