Gulf States: The weak link in sanctions on Iran

The question is, what does a munificent United States get from the Gulf States in return?

A helicopter from the Nimitz-class aircraft carrier USS Abraham Lincoln (CVN 72) patrols the Persian Gulf during a transit in the Strait of Hormuz (photo credit: REUTERS)
A helicopter from the Nimitz-class aircraft carrier USS Abraham Lincoln (CVN 72) patrols the Persian Gulf during a transit in the Strait of Hormuz
(photo credit: REUTERS)
As relations between the United States and its European allies record new lows, driven in part because of their resistance to the Trump administration’s decision to renew sanctions against Iran, a major loophole in the sanctions policy – the robust financial and economic ties between Gulf States and their Iranian nemesis – is being largely overlooked.
It is high time for the administration and Congress to tell the Arab Gulf states – probably the greatest beneficiaries of the United States’ might in the world today – that they have to put their purse and economic dealings in line with their anti-Iranian rhetoric rather than undermine sanctions that come at considerable cost to American taxpayers and business interests on their behalf.
Gulf states keenly know how important the US security umbrella is to their very existence. Iraq, in its invasion of Kuwait in 1990, proved beyond any doubt how vulnerable they were. Kuwait was conquered in less than two days and would have probably been incorporated into Saddam Hussein’s state to this day had it not been for the US-led coalition that drove them out.
And once that regime was first contained and then destroyed by the US-led invasion in 2003, Iran could have since repeated and widened that exercise to include other “lucrative” objectives such as the United Arab Emirates and Qatar, with which it ostensibly has good relations – had it not been for the United States security umbrella. 
Like Kuwait, these are “walkover” states with little ability to defend themselves against a state whose population is 10 times their combined citizen populations, highly motivated and of late, with increasing scientific and technological knowhow.
Even Saudi Arabia would have been vulnerable to direct Iranian military attack by land through Iraq’s south, which since the United States invasion has been governed by Shi’ites or through Iraq and Kuwait.
Though many ‘Shi’ite elites in the Iraqi government have their differences with Iran, it is hardly conceivable that the Iraqi Army would sacrifice lives to prevent Iranian troop movements through Basra to secure the vulnerable oil rich areas of Saudi Arabia.
It is the vivid memory of the US blitzkrieg in Iraq in 2003, a feat that matches if not surpasses the German occupation of Poland in September 1939 (the comparison is exclusively military and in no way, moral), and other incidents such as Operation Praying Mantis in April 1988, in which the US Navy destroyed five Iranian boats at the cost of 55 men against the loss of a helicopter (due to technical failure) that keeps Iran at bay.
In addition to historical memory, there have been many recent reminders of the military power of the United States which the Iranian leadership has no doubt registered. The devastating needle-point precision with which the US Air Force killed hundreds of Syrian troops, pro-government militias and ostensibly Russian mercenaries who threatened the American military support teams to Kurdish-led fighting forces in the Deir al-Zor area in northeastern Syria in February 2018, demonstrated without doubt the military power of the United States that contrasts sharply with its much more tarnished image as occupying forces or as state-builders.
AFTER SUCH an incident, the Iranian military leadership realizes that were they to undertake the 250-kilometer thrust into the oil-rich areas of Saudi Arabia through flat desert terrain offering little cover, they would be at the mercy of United States’ air and missile strikes. Such an attempt, then, is likely to replicate scenes of the Egyptian Army in 1967 in their desperate attempts to flee to the west of the Suez Canal.
The question is, what does a munificent United States get from the Gulf States in return?
After all, President Trump, as a businessman, is rightly concerned with the political and economic dividends of American largesse.
To be sure, the Gulf states are major buyers of US military hardware. In 2016, Saudi Arabia ranked first in the purchase of US military goods, the UAE ranked fourth and Qatar ranked fifth. They are also minor but lucrative markets for goods and services produced in the United States. Saudi Arabia and the UAE are among the 20 largest export markets of the US, albeit at the end of the list. 
Yet, they totally fail in backing up the spirit of the sanctions against Iran by being robust economic and trade partners with the regime that threatens them most.
Iran’s non-oil trade with the UAE, Iraq, Kuwait, Qatar, Bahrain and Saudi Arabia, amounted to $23.89 billion in 2017 and the first three months of 2018, an increase of nearly 17% compared to the previous year. Such trade yields a surplus for Iran of $3b., though substantially less than in previous years.
Most of this trade, over $16b., occurred between Iran and the United Arab Emirates despite Iranian occupation of the Abu Musa and al-Tunb islands which the UAE claims as its own. The UAE was Iran’s second biggest trading partner last year after China.
Equally robust are the flight connections and getaways that the UAE, principally Dubai, offers to and from Iran. Dubai is the second largest getaway for Iranian citizens after Istanbul.
Though flights are not part of the sanctions (they should be), denial of flight routes is an important dimension of what sanctions try to achieve – a sense of isolation from international society and economy.
Such a sense of isolation is meant to change the stances of the Iranian leadership, or alternatively, encourage its citizenry to rebel against the regime that brings about such isolation.
Curtailing flight routes also has a depressing effect on tourism to Iran, which the Iranian state was keen to promote and which indeed increased slightly after restrictions were lifted in 2015. Nevertheless, the 600,000 tourists that did visit Iran, a country rich in cultural and historical sites, are a fraction of the number of tourists who visit neighboring Turkey annually (between 30 and 38 million tourists depending on political conditions in the country).
The United States is of course right in pressuring European firms. They have the technological know-how, which also enhances Iran’s military capabilities, but the Gulf states should hardly be left off the hook.
For these states, not to curtail trade ties with Iran at this juncture is not only a matter of “a penny saved, a pound foolish,” it might run the risk of losing their kingdoms altogether.
The writer is a senior research associate at the Begin-Sadat Center for Strategic Studies and a professor of political and Middle Eastern studies.