Remarks on Oman to the 31st Annual Arab-U.S. Policymakers Conference

Remarks on Oman by Ambassador (Ret.) Dr. Richard Schmierer delivered at the National Council on U.S.-Arab Relations’ 31st Annual Arab-U.S. Policymakers Conference on November 3, 2022, in Washington, D.C.

I am pleased to have been invited by the National Council to contribute to this session on the Sultanate of Oman and am honored to follow two such impressive and accomplished Omani speakers. I had the privilege of serving as the U.S. ambassador to the Sultanate from 2009 through 2012, a period during which Oman played a pivotal role in support of key U.S. policy pursuits.

Oman is, in many respects, a unique country, and has been particularly fortunate in the leadership it has enjoyed over the past several decades. The almost 50-year rule of the late Sultan Qaboos must be seen as one of the most remarkable periods of governance in the modern era. During his reign Sultan Qaboos transformed a closed, almost entirely undeveloped society – little education, little medical care, little infrastructure – into a modern, stable, and prosperous nation. During my time as ambassador in Oman, in 2010, the UN Development Programme published a list of the countries of the world that had made the most development progress in the preceding 40 years. Oman was listed first; China was second.

Oman’s unique aspects are, in many cases, its strengths. It is the most ethnically diverse Arab country, deriving from its history as an Indian Ocean maritime empire, with outposts and trading partners from present day Iran, to Pakistan, to the East African coast. This gives Oman and its leaders an appreciation of the value of openness and diversity.

Continue reading “Remarks on Oman to the 31st Annual Arab-U.S. Policymakers Conference”

The Energy Transition in the Middle East: The Outlook for 2040

عربی AR

Download as PDF: English | عربی AR

Published in partnership with the King Faisal Center on Research and Islamic Studies.

The views and opinions presented here are solely those of the author and do not reflect the views of the United States Government, the National Council on U.S.-Arab Relations, or the King Faisal Center on Research and Islamic Studies.

Summary

Discussions about post-oil planning in the Middle East were rather common around fifteen years ago, when experts sought to focus attention on the need for economic diversification and consultancies aimed to help clients prepare long-term strategic visions. Governments that had the foresight to recognize the scope of the problem and the political will to commit real resources to it, have already begun the lengthy, arduous process of changing public mind-sets, bureaucratic cultures, and regulatory regimes. Some will succeed, gaining a competitive advantage over regional neighbors in terms of technology, efficiency, and productivity, making them valued partners for the international community in terms of maintaining peace and security in the Middle East. Others will survive, but their growth will be stunted and they will struggle to explain to the international community how they are contributing to global efforts at climate change and why Western countries should continue to lend them political, military, and financial support. Those governments that have not yet begun to address the problem probably do not have the time that will be required to accomplish all the necessary steps before peak demand arrives, their oil exports lose value and/or market share, and they can no longer maintain the patronage networks that are the backbone of regime survival. In a sense, we can already see the outlines of the post-oil future taking shape around us and we can start to assess its impact on industry, governance, and society, even if oil itself will continue to have value for decades to come and energy companies transform to meet the needs of the global economy.

The Future is Now

One thing that we must keep in mind is that for most people who are currently reading this article, these fundamental transformations in the region will occur in our lifetimes. This story begins in Canada, far away from the date palms and camel races of Riyadh and Abu Dhabi. Jason Kenney, the provincial premier of Alberta province, ran in 2019 on a conservative platform of deregulation of the oil industry, in support of the profits from oil sands that it generates for Alberta’s residents. He now finds himself shifting tack, as Alberta’s government seeks to develop investment in renewables and forms of energy with lower CO2 footprints, while at the same time proposing a fund that taxes carbon emitters to help pay for carbon capture and storage. Investors and insurance companies have signaled that they are wary of projects that do not meet certain basic environmental criteria, and the Keystone XL pipeline will likely face serious obstacles from the new administration in Washington.[1] The politics are not simple. Oil sands from Alberta comprise the largest single source of U.S. oil imports and support for the oil industry is a mainstay of the Conservative Party’s platform.[2] Even as the Alberta government explores energy diversification, it has also funded the Canadian Energy Centre to rebrand the image of Canada’s oil industries and backed indigenous groups that are willing to support energy projects through legal action.[3] Kenney and the Conservatives in Edmonton are caught between the oil politics of the present and the climate activism of the future.[4] This is what the energy transition looks like – oil producers and politicians having to reposition themselves to account for changing public, corporate, and governmental tastes. It is a story that will play out throughout the Middle East over the next ten to twenty years.

Continue reading “The Energy Transition in the Middle East: The Outlook for 2040”

The Road of Interdependence

Download as PDF: English

Introduction By Dr. John Duke Anthony

The author of the essay that follows heads the Gulf Cooperation Council (GCC). Founded in Abu Dhabi on May 25, 1981, the GCC is comprised of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates. Its Secretariat, comprised of representatives of all six of the Member States, is headquartered in Riyadh, Saudi Arabia.

His Excellency Dr. Abdullatif Bin Rashid Al Zayani is the GCC’s fifth Secretary-General. He was appointed by the GCC’s Supreme Council, which is the organization’s highest decision-making body. The Supreme Council is composed of the Heads of State of the GCC’s member countries.

The GCC has long been viewed as the most successful sub-regional organization in modern Arab history.

Incorrect and Flawed Perceptions

Some take issue with this description. They disagree. In the eyes of some of the GCC’s critics, such a positive assessment is incorrect and misleading.

Some contend that the GCC has failed to live up to its aspirations regarding maximum cooperation. Others emphasize how the GCC has fallen short of integration. Still others point to the lack of success in forging a more unified set of achievements.

The GCC’s leaders do not deny that there is a significant measure of truth in these complaints. They acknowledge their shortcomings. They admit to their having failed to achieve what some had hoped and others expected the organization to accomplish at the time of its founding.

In fairness, though, one needs to ask: what organization’s achievements have not fallen wide of what its founders hoped to effectuate? No such organization exists. In this, the GCC is no different.

This writer was present at the GCC’s founding meeting. He has attended each of the GCC’s Ministerial and Heads of State Summits since then. He has experienced firsthand the heady atmosphere and the genuinely euphoric mood that accompanied the GCC’s establishment. He has witnessed firsthand also the genuinely jubilant climate that has followed many of its subsequent summits.

Regional Comparisons

Shortcomings and all, the six east Arabian Peninsula countries never cease to amaze. Their material progress has been and continues to be mind-boggling. The nature, pace, and extent of their modernization and development can be catalogued in myriad ways.

Lest one suspect such comments are a paid advertisement, which they are not, check them out. For comparison, examine the entire 22-country Arab region and, regarding the 16 other Arab countries, see if there is anything remotely comparable to what the GCC, as an organization, and its Member States as its components, have accomplished. One will not find it because it does not exist.

The unconvinced are urged to apply a different test. Use another set of contexts to test the viability and robustness of the GCC. Attempt to find another international organization in the region that meets with as much frequency. Searchers will not find a comparable example nor even a remotely similar one.

What one will discover instead is that the GCC Secretariat hosts and administers no fewer than 400 meetings a year. They will learn that, in some years, it hosts as many as 700 meetings. What is more, there are no absences; all six of the members convene to discuss common issues and challenges. No Arab organizational grouping and no Arab countries meet as regularly to anywhere near the same degree.

Additional Frames of Reference

Still not persuaded? Try another frame of reference.

To determine the robustness, and overall appeal and attractiveness to local and foreign investors of a given region, or even of a single country, the following test might be useful. Examine the nature, pace, and extent of people clamoring to enter the GCC region or one of its specific countries. Determine whether it could be classified as: (1) many, (2) some, (3) few, or (4) none. In many countries, the answer is either of the latter options. In the GCC region, it is the first.

Flip the coin and examine the trend from the opposite perspective. Ask how many people are trying to leave the region. Ask what the reality is in terms of the same four options. The answer will be between (3) and (4).

The reason for these positive realities is clear to specialists if not to generalists. It has to do with the six countries being globally distinctive in terms of their domestic safety and external defense. Search the globe and one will not find six other geographically contiguous countries or six identical systems of governance that illustrate these same realities.

In other words, the negative, pessimistic, and dismissive views that one will find in much of the media are at once incorrect, unfair, and misleading. The extraordinary frequency with which the GCC Member State representatives meet to further their countries’ and peoples’ progress is but just one example.

Agenda Items

Of related importance is the range of matters that the GCC brings members together to discuss: security, defense, intelligence, economics, commerce and trade, investment, and technology cooperation. In addition, the members meet regularly to plan operations pertaining to the members’ periodic security and defense maneuvers and exercises designed to enhance their common deterrence and protection.

These facets of the GCC’s forward momentum in matters of a material, social, and economic nature have no rival among any of the world’s other sub-regional organizations. More specifically, the region as a whole and each of its countries exhibit a range of truisms, certainties, and predictability that would-be investors find a marvel to behold. These do not, however, exist in a vacuum.

At The Helm: Preparation, Preparation, and Preparation

They are present alongside the author of the remarks that follow, His Excellency Dr. Al Zayani. Abiding by the strictures of three-year terms in office, Dr. Al Zayani is presently in his ninth year as head of the six-country organization’s Secretariat in Riyadh. What is it that to date has made this particular leader so effective in the eyes of his peers as well as his superiors?

Dr. Al Zayani, a native of the Kingdom of Bahrain, is a graduate of Sandhurst, Great Britain’s premier military academy. Upon returning to Bahrain, he began a period of service in his country’s armed forces and its Ministry of Defense for the next three decades.

From there, Dr. Al Zayani was transferred to Bahrain’s Ministry of Interior, which is not like America’s Department of Interior but rather, in close association with the administration of an effective system of civil justice, is focused on the maintenance of law and order. He served there as Bahrain’s Chief of Public Security with responsibility for all aspects of the Kingdom’s domestic security and safety.

After that, Dr. Al Zayani could have taken up a full-time teaching position—he holds a PhD and has taught at several universities. Rather than do so, however, he accepted an appointment at Bahrain’s Ministry of Foreign Affairs. He was serving in that role when he was appointed Secretary-General of the Gulf Cooperation Council by the GCC’s Supreme Council in 2011. Dr. Al Zayani was elected for a second three-year term in 2014 and elected yet again to a third three-year term in 2017.

In October 2018, Dr. Al Zayani addressed the National Council on U.S.-Arab Relations 27th Annual Arab-U.S. Policymakers Conference in Washington, D.C. In his remarks, Dr. Al Zayani stepped outside of his role helming the Gulf Cooperation Council’s Secretariat. In doing so, he drew upon his deep knowledge of public service to issue a personal call for a brighter future for the region’s people.

Dr. Al Zayani is mindful of the pessimism and feeling of hopelessness stemming from regional violence and turmoil. Despite this, he has charted a specific path forward through regional collaboration and cohesion. If national leaders were but to heed Dr. Al Zayani’s advice, they would realize the benefits in how it could breed optimism and bring shared peace.

The National Council is privileged to share here an edited transcript of his remarks.

John Duke Anthony, PhD
Founding President & CEO
National Council on U.S.-Arab Relations

THE ROAD OF INTERDEPENDENCE

By H.E. Dr. Abdullatif bin Rashid Al Zayani,
Secretary-General, Gulf Cooperation Council

Gulf Cooperation Council Secretary-General H.E. Dr. Abdullatif bin Rashid Al Zayani addressed the National Council on U.S.-Arab Relations 27th Annual Arab-U.S. Policymakers Conference in Washington, D.C., on October 31, 2018. This transcript of his remarks was lighted edited for publication.

Your Royal Highness, Excellencies, Distinguished Guests,

I am delighted to be with you this evening. It is a privilege and an honor to be among such a distinguished gathering of leaders in the capital of one of the world’s most important and powerful countries. I come before you to say a few words on some of the difficulties facing the Gulf and the Middle East. I do so also to briefly outline my vision, as a citizen of the region, of how such challenges might, in the longer term, be turned into an opportunity for genuine peace, stability, and prosperity.

Of course, any vision for the future must be rooted in the reality of today’s challenges. In the Middle East and North Africa (MENA) region, these geopolitical challenges are at once well known and exceptionally complex. Among the more intractable are those in and associated with Iraq, Libya, Syria, and Yemen.

Any vision for the future must be rooted in today’s challenges. In the Middle East and North Africa region, these challenges are at once well known and exceptionally complex.

The opportunity you have offered me is one that is seldom extended to someone in my part of the world.

It is not every day that one is asked to offer a vision of what may lie ahead. Even less frequently is one requested to suggest how one might best proceed to address the challenges they represent.

Lebanon as But One Example

Of the various challenges we face, Lebanon is but one among others. The structure of governance and the system of political dynamics in that Arab country are steered by Hezbollah (literally, “the Party of God”). People may differ in their descriptions of the party, but there is no doubt that many regard a significant proportion of it as a violent, sectarian, extremist militia.

Continue reading “The Road of Interdependence”

The Middle East Today: Where To?

Keynote speech by HRH Prince Turki Al Faisal delivered at the National Council on U.S.-Arab Relations’ 26th Annual Arab-U.S. Policymakers Conference on October 19, 2017, in Washington, D.C.

The Middle East today is in a state of turmoil as never before. I will limit my talk to issues causing disorder and anarchy and on my hopes for a peaceful, secure, and stable region.

Looking into today’s prevailing conditions and state of affairs in the Middle East, particularly, the Arab region, we find no credible signs that call for much optimism: strategically, it is vulnerable on all fronts and is widely exposed to all possibilities. This strategic vulnerability is as old as the establishment of the nation-state order following World War I. However, catastrophic events during the past decades such as the recurring Arab-Israeli wars and conflicts, the Lebanese civil war, the Iraq-Iran prolonged war, the invasion of Kuwait, the invasion of Iraq, and constant foreign interventions have contributed greatly to this vulnerability. Coupled with this is the failure of many of our states in facing the shared and constantly looming threats to our existence and to our people. Poor social, economic, educational, and cultural policies, and the selfishness that characterized some Arab leaders’ foreign and domestic policies for decades are causes of this mess.

All of what we witness nowadays unfolding and that was exposed by what is called the “Arab Spring” is but an indictment of these policies and natural results of it. In Iraq it has led it to becoming a failed state with a collapsing society; the cause of Syria’s free falling into a swamp of blood, destruction, desolation, terrorism, conspiracies and foreign interventions; the cause of the sinking of Yemen into an inferno of conflict and civil war; the cause of the failure of the Libyan state; the unrest in other Arab countries; the cause of the spread of the transnational phenomenon of terrorism within many of our states; the cause of the spread of armed militias that are not under the control of nation states; and the spread of appalling sectarianism and other negative development. All that is a condensed representation of our deplorable state of affairs.

Our unenviable present was the future of our recent past, and the way we deal with our present is the future awaiting us. It is imperative that we must consciously learn from the pitfalls of the past. We must plan our future wisely and be alert at all times if we want to avoid a catastrophic future. We must courageously face the challenges that threaten our existence and attain a visionary approach to the future, if we wish to attain a decent place on the world stage.

Continue reading “The Middle East Today: Where To?”

Can Saudi Arabia’s “Vision 2030” Get the Kingdom Off the Oil-Economy Roller Coaster?

Saudi Arabia has begun administering the Kingdom’s boldest, most innovative, and farthest-reaching modernization and development plan in the country’s history. It addresses the near, mid-term, and longer-term needs and challenges that strategists believe the country is likely to face in the next fifteen years. Conceptualized and approved by the country’s leaders, the plan’s name is “Saudi Arabia Vision 2030.”

The plan reflects an extraordinary degree of extended research, analysis, and assessment. It was aided throughout by the input and comment of some of the world’s most renowned and experienced advisors in forward planning, focus, messaging, and communication. The process was launched in 2015 soon after Custodian of the Two Holy Mosques HRH King Salman bin Abdulaziz Al Sa’ud appointed his son, HRH Prince Mohammed bin Salman, as Deputy Crown Prince and Minister of Defense.

In the eyes of his fellow citizens and the Kingdom’s inhabitants, Prince Mohammed is unique. A reason is not only because of his youth. He was 30 years of age on the day “Vision 2030” was officially announced in April 2016. Of special interest and in this century without precedent is that he has been entrusted to oversee, guide, and administer two of the country’s most strategically vital portfolios.

In one, in his position and role as Chairman of the Economic and Development Affairs Council, Prince Mohammed is tasked with protecting and advancing the material wellbeing of the Kingdom’s 30 million people. Not least among his challenges in this regard is how best to address the needs of the country’s burgeoning youthful citizenry. The nature and degree of unemployment among this segment of Saudi Arabia’s population is a matter of mounting and daunting concern, combined as it is with the goal of increasing dramatically the share of private sector and foreign investment involvement in the Kingdom’s economic growth.

A National Council on U.S.-Arab Relations delegation of Model Arab League students and faculty advisers, led by National Council Founding President and CEO Dr. John Duke Anthony, visits Queen Effat University in Jeddah, Saudi Arabia. — A National Council on U.S.-Arab Relations delegation of Model Arab League students and faculty advisers, led by National Council Founding President and CEO Dr. John Duke Anthony, visits Queen Effat University in Jeddah, Saudi Arabia, to meet with the emerging generation of the Kingdom’s leaders.

The Deputy Crown Prince has also been assigned to head the country’s principal armed forces establishment. The Kingdom’s military is tasked with defending the Arab and Muslim world’s most important and influential country in a region that, to a greater extent than any in the past half century, is laced – not within the GCC region, of which it is an integral part, but immediately beyond it – with an unprecedented degree of tension and turmoil.

In this regard, in close association with his ruling family cousin, Second-in-Command Crown Prince and Minister of Interior HRH Prince Mohammad bin Naif bin Abdulaziz Al Sa’ud, Deputy Crown Prince Mohammed is responsible for aiding the King in his role as Custodian of Islam’s two holiest places, Mecca and Medina. Internationally and domestically, the two leaders are jointly expected to ensure the Kingdom’s ongoing national sovereignty, political independence, and territorial integrity.

Stated differently, the two leaders, assisted by Minister of Foreign Affairs HE Adel bin Ahmed Al-Jubeir, are the primary Saudi Arabians tasked with protecting the country and the legitimate interests of its people. These include first and foremost enhancing the Kingdom’s security, stability, and peace, without which there would be no prospects for prosperity. Were these three interconnected factors to be weakened or lost, the likelihood of the country being able to maintain its present standard of living, let alone strengthen and advance it, would be difficult if not impossible.

It is with regard to this first aspect of the Deputy Crown Prince’s responsibilities that the National Council on U.S.-Arab Relations is pleased to provide an essay asking “Can Saudi Arabia’s ‘Vision 2030’ Get the Kingdom Off the Oil-Economy Roller Coaster?” The author is Dr. Paul Sullivan, a Council Non-Resident Senior International Affairs Fellow. Drawing on the courses he teaches on national security challenges and economic dynamics, and vice versa, at two of America’s leading institutions of higher education, Dr. Sullivan examines the nature and goals of as well as the necessary national material and human resources relevant to the Kingdom’s strategic development plan for the next fifteen years.

In keeping with National Council’s Analyses and Assessments series, of which this essay is a part, the author weighs the prospects for the Kingdom being able to manage and address “Vision 2030″‘s challenges effectively. In so doing, he sheds light on what in his view will be required to achieve even a portion of the plan’s stated goals. In the process, he provides an array of information about, insightful data on, and analysis and evaluation of the Kingdom’s economic development prospects that would otherwise be hard-to-come-by.

Dr. John Duke Anthony
Founding President and CEO
National Council on U.S.-Arab Relations
Washington, DC

The Saudi Arabian economy is dominated by oil and has been for many decades. Oil accounts for about 35-45% of the GDP of Saudi Arabia. It is the source of 75-80% of its government revenues and 85-90% of its export revenues. Petrochemicals, based on oil and a much more recent component of the Kingdom’s economy than hydrocarbon fuels, are Saudi Arabia’s next largest export.

Saudi Arabia’s Oil-Economy Roller Coaster

At times in the past Saudi Arabia’s economy has been like a roller coaster. There was an economic boom due to the October 1973 Israeli-Arab war-induced oil embargo and the 1979 Iranian Revolution’s boost to the price for hydrocarbon fuels. This was followed by the collapse of oil prices and the resultant damage to the Saudi Arabian economy, which began in the early 1980s and continued until the late 1990s. As international oil prices remained stagnate throughout the better part of these two decades until the turn of the present century, so too, in many ways, did the Kingdom’s economy.

As prices began to ramp up in the 2000s, Saudi Arabia’s economy moved up with them until the Great Recession hit in 2008 when they collapsed for a brief period as the 2008 recession took its toll on markets. Soon after, however, prices rose to more than $100 per barrel in 2011, where they would remain until May 2014.

The most recent price collapse – from May-June 2014 until about January-February 2016 – was precipitous. The price since then, however, has risen, albeit in an unstable, bouncy, and slow manner. In short, Saudi Arabia has ridden the good times of oil price booms. It has also ridden the bad times when the price has collapsed.

Saudi Arabia has ridden the good times of oil price booms. It has also ridden the bad times when the price has collapsed.

The average Saudi Arabian’s income and wealth increased dramatically from 2002 to 2014. This was mostly due to the elevated level of oil revenues. The result was an increase in government spending and massive capital expenditures together with public sector investments.

Past Saudi Arabian economic improvements have started with a significant and sustained increase in the price of oil with concomitant increases in government and export revenues. These have been followed by large expenditures and investments in public sector ventures, with corresponding increases in imported labor, in Saudi Arabian employment, in massive building programs, and in contributions to the Public Investment Fund as well as, to a much greater extent, the Kingdom’s foreign reserves.

Continue reading “Can Saudi Arabia’s “Vision 2030” Get the Kingdom Off the Oil-Economy Roller Coaster?”