Tiny Qatar's big plans may change US Mideast policy

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President Barack Obama greets Qatar Emir Sheikh Hamad Bin Khalifa Al Thani

President Barack Obama greets Qatar Emir Sheikh Hamad Bin Khalifa Al Thani

Qatar, a country of fewer than 2 million people set on a peninsula smaller than Connecticut, seems an unlikely candidate to become a regional power. Yet with little fanfare and less warning, tiny Qatar has emerged as one of the Middle East’s most influential states.

As the US struggles to understand and predict the new contours of the region, it would be wise to pursue even closer ties to this regional maverick.

Even with its demographic and geographic limits, Qatar has several assets that turn out to be in short supply elsewhere in the Middle East and to be of strategic value, given the tumult in the region.

First, it is home to Al Jazeera, the Arabic-language news network that has transformed how Arabs get their news. Many give the television channel more credit for spurring on the Arab Spring than Facebook or Twitter. By bringing the revolutions into the homes of every Arab, Al Jazeera drew regional attention to early events in Tunisia and helped boost the number of Egyptians on the streets from the thousands to the hundreds of thousands. Al Jazeera gives Qatar “soft power” well beyond its size.

Second, Qatar has resources. Last month, the International Monetary Fund released data demonstrating that Qatar is the richest country in the world. With a per-capita income of more than $88,000, Qatar’s citizens are better off than those of Luxembourg and are almost twice as rich as those of the US This wealth - and the annual growth rate of 16 percent that goes with it - is a reflection of Qatar’s vast riches.

Qatar’s natural-gas reserves of more than 900 trillion cubic feet are the third-largest in the world, and the country is reaping the benefits of an ambitious program to monetise those resources. Estimates suggest earnings from its liquefied natural-gas in 2011 will increase by more than 50 percent from last year.

Finally, Qatar has comparatively uncomplicated politics, a rarity in the Middle East today. The country is run by Sheikh Hamad bin Khalifa Al Thani, an emir who, in his late 50s, is decades younger than his counterparts in the gulf. While advised by a powerful prime minister (who is also a cousin), the emir is the ultimate authority in Qatar, streamlining decision-making. Partially on account of its small size, wealth and security service, Qatar has avoided the political turmoil of some other Middle Eastern states. Its government feels - and is - comparatively secure.

While the domestic politics of many other countries in the Arab world are forcing the attention of their leaders inward, Qatar has marshaled its assets and has embarked on an aggressive plan to shape the region.

In recent years, Qatar focused its energies on being a neutral party facilitating diplomatic compromises. It worked diligently to help broker the accord between Fatah and Hamas; it helped resolve a Lebanese impasse over the formation of the government in 2008; it even gets credit from the Sudanese for assisting in a political understanding over Darfur.

Such behaviour was consistent with the obvious needs of a small country in a dangerous and difficult part of the world. Qatar sought to establish relationships with as many countries and parties as possible, and endeavoured to prove its indispensability without ever taking sides on the region’s many sensitive matters.

But since the onset of the Arab Spring, Qatar has adopted a more aggressive and potentially more risky foreign policy. It no longer seems satisfied with balancing its relationships with the greater powers - be they the US, Iran or Saudi Arabia. Instead, it sees a window to steer and shape events, senses its comparative strengths, and has embarked upon a series of bold endeavours.

In Libya, Qatar was the first Arab state to vocally endorse military intervention against Muammar Gaddafi, prodding the Arab League to make the statement that ultimately gave the North Atlantic Treaty Organization political cover for its support of the revolutionaries. Going beyond rhetoric, Qatar provided six mirage jet planes to the fight - offering Arab credibility to the military operation. In Syria, Qatar has lent the weight of Al Jazeera to those seeking to end the Assad regime.

Even the priorities of its $100bn sovereign-wealth fund, the Qatar Investment Authority, have changed. Formerly focused on trophy investments such as Harrods Department Store Co or “passive” ones intended primarily to collect returns, Qatar is now turning to strategic investments in companies and countries with which it intends to build cooperative ventures and wield influence. For example, electricity-hungry Qatar bought a stake in Spain’s largest power utility, Iberdrola SA, for more than $2bn earlier this year.

Qatar seems committed to shaping the political and economic outcomes that will emerge from the regional volatility it is helping create. Already, it is actively aiding the Libyan National Transitional Council as it thinks through reforming that country’s national oil company, and there is talk of Qatar helping Libya explore its gas reserves. A Qatari-Libyan gas partnership would help Qatar address one of its primary strategic worries: the loss of markets for its gas in Europe.

In Egypt, Qatar has planted a flag with the announcement it intends to invest $10 billion there in the coming years. And in Sudan, Qatar will play a role in enforcing the new “Doha Document for Peace in Darfur,” which was accepted by Sudanese parties as the framework for conflict resolution.

The key question for the US is what does a region with a strong Qatari guiding hand look like? What kind of Arab world is Qatar seeking to achieve?

The answers aren’t entirely evident. One could make the case that a more active Qatar, which is already home to the US military’s Central Command, is good for American interests. Qatar - with its large investments in Western-style higher education, its relatively pragmatic approach to Israel, and its (still-too-modest) allowance of women’s participation in municipal elections - might be a moderating force in the region.

Yet one might make an equally compelling case that Qatar has little interest in political liberalisation in the Middle East (given its own closed system and its support for Saudi troops in Bahrain) and that its activism is grounded in a desire to supplant global energy markets with state-to-state bilateral deals. After all, Qatar’s long-term well-being rests on global gas consumption and the nation’s ability to capture highly competitive markets. Although Qatar has shown little interest in Iran’s entreaties for the formation of an OPEC-like gas cartel, a change of heart in this direction could harm America’s allies, if not America itself, which is almost self- sufficient in terms of natural gas.

A year ago, such questions would have been for curious minds or academic interest. Today, with the Arab world in tumult and Qatar in high gear, it is of high strategic importance.

The US is, no doubt, trying to do more than read the tea leaves - or rather, the coffee grounds - in the region. It needs to build and strengthen new strategic partnerships with regional actors, especially those that have the resources and imagination to shape events beyond their borders. Qatar should be on or near the top of its list. US-Qatari relations are cordial and positive. But the warmth and strength of this relationship has been limited by Qatar’s need to balance its ties with Iran, with which it shares an enormous gas field.

In recent months, the small emirate has moved away from a foreign policy based on hedging, toward a bolder and riskier approach. This seems to butt up against, or even challenge, some of Iran’s most central interests. Qatar’s encouragement of the revolution against Bashar Al Assad in Syria and its support of the status quo in Bahrain are two cases in point. This shift - while opening Qatar to a possible Iranian backlash - could provide the US with an opening to strengthen ties.

What can the US do? First, it might build on the meeting between President Barack Obama and the emir in April, and schedule more high-visibility encounters between US and Qatari officials. This may seem insignificant to Americans, but such sessions hold great importance for Qataris, who prize prestige and recognition.

Second, the US should trade in its ambivalence about Qatar’s regional diplomacy in exchange for a warm embrace of it. Qatar’s tendency to have relationships with everyone - friend and foe, including the Taliban when it ruled Afghanistan - has historically made the US uncomfortable. But in a transformed region, Qatar’s Rolodex may allow it to shape the region - ideally with the quiet support of America.

Third, the US should work with Qatar, and possibly other Gulf states, to craft economic support packages to post- revolutionary states. The US might lend expertise and organisation in Egypt and Libya, while Qatar foots more of the bill.

Finally, the US should cultivate greater links between Qatar and American businesses. Qatar plans $100bn in infrastructure projects in the run-up to its hosting the 2022 soccer World Cup; many US companies could profit from these ambitions. This is how the fabric of closer bilateral ties is woven, and the payoff goes well beyond corporate profits.

(Meghan L O’Sullivan is a Bloomberg View columnist. The opinions expressed are her own.

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