The Russian invasion of Ukraine had created various crises on the international stage, particular in energy prices, food supply chains, and inflation. These events made many countries reconsider the strategic importance of the Middle East and the Arabian Gulf. In a virtual roundtable hosted by the Politics and Society Institute in coordination with Friedrich Ebert-Stiftung, experts from the Arab World and the EU joined to discuss the new role that the MENA region plays in energy, food, and the global economy.
In the workshop titled “Jordan Navigating its Interests in EU-GCC New Strategic Partnership,” participants noted that today’s international uncertainty is an opportunity to deepen economic integration between the Middle East and the EU at all levels, not just in the energy field. However, achieving the desired objectives of a partnership between the two regions requires learning from past mistakes. It is important that countries avoid bilateral agreements and instead create “economic blocs” that ensure the participation of the largest possible number of partners to serve the desired goals and achieve common interests.
Experts also highlighted that Jordan is faced with an opportunity to benefit from an EU-GCC partnership. Jordan can play a role in facilitating and strengthening cooperation between the regions to help attract European and Gulf investments in Jordan and strengthen the Jordanian economy, which is full of economic opportunity. However, participants underscored the need to attract direct investments and develop a productive economy through cooperation with the Kingdom’s other strategic partners. This is especially true given the growing indicators of a future decline in direct financial support, whether coming from the Gulf or European side.
It is noteworthy that this session was the fifth and final session within the project titled “Turning Point: How Can Jordan and its Allies Navigate the Uncertainty Phase?” As a component of this project, the Institute issues policy papers to illustrate the political reality, possibilities, options, and recommendations to various decision makers. Below, you will find the policy options created from this session:
First: The strategic partnership between the Gulf Cooperation Council and the European Union
Coinciding with the recent global changes as a result of the Russian invasion of Ukraine, actors on the international stage – led by the European Union countries – have begun to redefine their interests and reposition themselves to serve their security and strategic interests. Gulf states are not absent from these new international dynamics, especially considering the impact the war has had on energy markets. The crisis in energy prompted the European Union to work with the Gulf and thus, the two regions agreed to a strategic partnership in May 2022.
This new-found cooperation between the EU and the GCC has created an opportunity for various regional powers to reposition themselves. Additionally, it has brought the EU and the Gulf closer on many regional issues in which the two have previously disagreed on. Such repositionings will lead to restarting the wheel of security understandings and it will also provide greater opportunities for investment and trade. Moreover, these changes on the international stage represent a promising opportunity for both parties’ partners – such as Jordan and Egypt – who are able to play a mediating role to enhance cooperation politically, geographically, economically, and culturally.
On the other hand, the question of EU-Gulf cooperation faces several problems with regard to the idea of a “Gulf unitary economy.” Although the Gulf countries are similar in their source of income, they differ in their priorities and methods of managing and distributing this wealth. Additionally, geopolitical challenges among the different Gulf countries have historically led to the failure of several plans for cooperation between the two blocs. However, the timing of this partnership has provided the Gulf states with the upper hand in light of the Europeans’ urgent need for energy sources to alternate to Russian fuel.
On the security side, the Europeans hope this partnership with the Gulf states will resume the paths of understanding between the Gulf states and Iran in regard to the 2021 Baghdad Summit. However, Gulf countries believe that the time for rapprochement with Iran is over. The belief is that Iran’s influence in the region has passed and is now in a state of decline. Therefore, the Gulf countries today see the priority in focusing on economic and development interests, especially with the rise in oil prices today, which guarantees the Gulf countries financial returns that enable them to implement planned economic projects and visions.
Second: Jordanian interests and strengthening cooperation with partners
Since the 2008 global financial crisis, the economic exchange model between Jordan and the Gulf states was based on the exchange of “labor for capital.” This has begun to change as the current model is based on shared responsibilities and strategic understandings and stray away from slogans of Arab nationalism. Considering these facts, the Kingdom of Saudi Arabia remains the most important partner for Jordan in order to consolidate the relationship with the Gulf countries, not only because of its size, but also for its social and cultural cohesion and geographical location.
Jordan’s most important role remains mediating European-Gulf cooperation, as Jordan is a strategic security partner and a geographical and cultural bridge linking the two parties. Jordan’s pivotal position in Saudi Vision 2030 and in the EU’s strategic vision for the region makes it capable of bridging views and pushing for effective partnership in various issues including energy, environment, and water resources management. Therefore, Jordan must not only receive support and assistance, but also seek to create an attractive climate for investments by developing infrastructure and legislation that aligns with the strategic objectives of European-Gulf cooperation.
The biggest challenge lies in the fact that economies in the Arab World are still unable to penetrate the European market due to the poor quality of products and pressure from European industrial lobbies. Therefore, Jordan, in partnership with the Gulf countries, should seek to transform this exchange; rather than exchanging fossil fuels for products, the regions should attempt to diversify their trade exchange. Such a diversified exchange could include cultural exchange programs, scientific and research cooperation, and the development and training of competencies to raise the quality and competitiveness of markets in the Arab World.
- Today’s European quest to contain the energy crisis resulting from the Russian-Ukrainian war is an opportunity to strengthen EU-GCC economic and security cooperation and develop direct European-Gulf relations in light of the US repositioning in the region.
- Uncertainty on the international stage is an opportunity to establish strategic partnerships and form new alliances, in fields that go beyond economic and security, but also in culture, environment, and sustainable development.
- The success of strategic partnership plans depends on the ability of the various parties to build cooperation between the “economic blocs” rather than bilateral cooperation. This will ensure a more integrated and diversified model and thus greater effectiveness in achieving the desired goals.
- The European side does not see itself able to resume negotiations on the nuclear agreement nor play the role of mediator between the Gulf states and Iran because it does not have any pressure cards. Additionally, the EU is preoccupied with the crises that resulted from the Russian invasion of Ukraine.
- The Gulf countries, led by Saudi Arabia, believe that their current priority is to capitalize on the global situation to achieve their economic and development interests. This is especially the case given their conviction of the decline of Iranian influence in the region.
- Jordan, along with several countries in the region, have an opportunity to benefit from European-Gulf cooperation by playing a role in attracting investment by both parties and straying away from slogans of Arab nationalism.
- The strategic partnership with the EU should not be limited to energy, political and security, but should include the trade of non-oil products as well. Such diversification includes cultural exchange, environmental and development exchange which could deepen economic integration between the Arab countries and the European Union.