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Will President Trump’s Win Change the Business Dynamic in the Middle East?

October 3, 2017
in Business, Featured, Middle East, National Security, Politics, World News
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Donald Trump’s surprising ascension to the White House has generated mixed emotions across the Middle East. The six Arab Gulf nations that compose the Gulf Cooperation Council – the oil-rich economies of Saudi Arabia, Bahrain, Kuwait, Oman, Qatar and the United Arab Emirates (UAE) – have adopted a wait-and-see attitude toward the new U.S. administration.

Indeed, across the Middle East the prevailing sentiment vis-à-vis Trump is “uncertainty,” observes Nidal Abou Zaki, the Managing Director of Orient Planet, a communications consulting group headquartered in Dubai.

“Arab political leaders were quick to send congratulatory notes to the new U.S. president. But given Trump’s dearth of diplomatic experience, his unfamiliarity with the Middle East’s political and military exigencies, his impolitic remarks about Islam, and his hastily-conceived Muslim travel ban, regional leaders remain apprehensive about a Trump presidency,” says Abou Zaki.

The volatile area continues to be plagued by instability. Violent civil strife haunts Libya, Syria, Iraq and Yemen, while the global glut in oil production hamstrings Arab Gulf economies, complicating their efforts to modernize. Iran’s January 29 ballistic missile test, though a failure, nevertheless drew a sharp rebuke from the Trump administration, which imposed additional economic sanctions and refused to take military retaliation off the table. Put all these factors together, Abou Zaki points out, and “a Trump administration is a serious concern for the whole Middle East region.”

Given the Middle East’s ongoing tensions, as well as the U.S.-led coalition’s landmark nuclear deal with Iran that Trump repeatedly assailed during the campaign, the Trump administration has no choice but to engage in the region. “Had Hillary Clinton won, the expectation is that her administration would have maintained long-established regional alliances and economic partnerships. Now the onus is on Donald Trump to allay concerns by clarifying his administration’s approach to these important relationships, especially in the wake of his abrupt attempt to impose the Muslim travel restriction,” says Abou Zaki.

Call it what you like, but there is little question that this is how the Middle East views Trump’s actions on the travel ban. A lesson for the new president is clear – had he gone through the Departments of State and Justice, he could have gotten what he wanted without drawing such uniform resistance – opposition that has only served to make business interests more sensitive.

Although Gulf Cooperation Council (GCC) stock markets initially dipped over fears surrounding Trump’s impulsive behavior, they have since recovered. Industry analysts worry that, over the long haul, Trump’s protectionist views could have an adverse effect on open sky policies. The region’s burgeoning aviation sector, which has made significant investments in the U.S., could be undermined if Trump persists in pursuing narrow economic policies.

Since the Trump Organization has had substantial business interests in the Middle East stretching over a number of years, such protectionist policies would surprise his long-time regional partners. Still, Middle Eastern business leaders are preparing for all scenarios, good and bad.

To be sure, certain regional leaders have been open in their praise of Trump. Saudi Prince Al Waleed Bin Talal, the head of Kingdom Holding, clearly sent conciliatory signals to Trump after engaging in a 2016 Twitter quarrel with him. “President elect @realDonaldTrump whatever the past differences, America has spoken, congratulations & best wishes for your presidency,” he tweeted.

Sabahat Khan, a senior analyst at the Institute for Near East and Gulf Military Analysis in Dubai, has expressed confidence in Trump’s presidency, maintaining that deep ties between the UAE and US will not be affected and will continue to “flourish.”

“The Trump campaign has faced a lot of negative media coverage . . . but when it comes to business, the new Trump administration will be serious and informed and could well bring the decisiveness many feel has been lacking with President Barack Obama on key international challenges,” Khan said.

Dubai businessman Khalaf Al Habtoor was less effusive, dismissing Trump’s Muslim barbs as “for elections only” and volunteering that GCC leaders would be willing to offer a clean slate if Trump is forthright. “[Donald Trump] should communicate in the right terms and not dictate, because that will never be accepted,” he said.

Overall, Abou Zaki notes, there is at least a modicum of confidence that Donald Trump’s win will not sever the deep ties between GCC nations and the U.S. Indeed, many view Trump’s win as a new opportunity to reengage the U.S. in its global role to maintain stability in the region.

The UAE’s Minister of State for Foreign Affairs, Dr. Anwar Gargash, has urged the Trump Administration to seize the opportunity to work with regional officials in devising an overarching strategy for the region, a gesture that would be welcomed by opinion leaders as long overdue.

“Rarely has it been more important for a new administration to articulate clear goals and principles,” maintain Middle East scholars James Jeffrey and Dennis Ross in a recent paper released by the Washington Institute for Near East Policy.

“With 30 percent of the world’s hydrocarbons still flowing from the Middle East, safeguarding that supply remains a critical U.S. national security interest, along with preventing nuclear proliferation, countering terrorism, and preserving stability,” write Jeffrey and Ross. Jeffrey served as U.S. Ambassador to Turkey and Iraq; Ross as U.S. point man on the Middle East peace process in both the George H. W. Bush and Clinton administrations.

Abou Zaki calls the Middle East’s reaction to a Trump presidency a “tug of war between faith and skepticism.” Given Trump’s rhetoric and actions in his first three weeks in office, that tug of war is going to be spirited.

 

 

Source: Forbes

Tags: businessChangeDynamicMiddle EastPresident Trump's Win
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