Thursday, October 3, 2024

The game between the US and China in the Gulf is being played on technology. Who will win?

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Saudi Arabia and the United Arab Emirates never miss an opportunity to show how crowded the “album” of international friendship is: including the United States but Russia, China but India and many European countries.
Fueled by oil and gas exports, the diversity of Saudi Prince Mohammed bin Salman and Emirati President Mohammed bin Zayed knows no bounds. This has complicated the historical alliance with the United States: the relationship with China, initially related to energy, has grown so much that it has become a strategic partnership, precisely now that the Americans and the Chinese are competing for global supremacy. In recent days, Saudi Arabia and the Emirates welcomed the Chinese Premier to consolidate bilateral relations and the Saudi Kingdom has already introduced the teaching of Chinese language in schools widely in the Emirates. Abu Dhabi will participate as a member of the BRICS summit in Russia in October, to which Mohammed bin Salman has also been invited.

All is lost, America? On closer inspection, the extravagant diversity of Arabia and the Emirates still retains some brakes. It is there that the Americans can prevent Chinese incursions into the Gulf. Indeed, in some key sectors such as advanced technologies and artificial intelligence (AI), Riyadh and Abu Dhabi are doing business with American and Chinese companies, making it difficult to maintain a balance between the two rivals. Gulf Arab capitals are also investing in advanced technologies and AI. This is the result of economic diversification away from hydrocarbons: new technologies apply to all contexts, from the most everyday (transport and logistics, health) to the most sensitive (security and safety). Saudis and Emirates are not satisfied with “being there” but want to excel, according to the Global AI Summit in Riyadh on September 10-12. In 2017, the Emirates became the first to appoint a minister for artificial intelligence and Saudi Arabia established a $100 billion fund to make its AI strategy a reality, starting with Neomin’s digital infrastructure, a futuristic urban project in the desert.

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However, there is now a risk of a geopolitical short circuit between the Gulf US and China, which has so far played strongly on both tables. Washington fears that the Chinese could access and re-import its technologies from third countries. The monarchies cannot cut themselves off from American innovations, nor will it benefit the Saudis to complicate negotiations for a new defense deal with Washington now. The multipolar spirit then stumbles.

The case of the Saudi firm Allad is illustrative. A few months ago Alat signed an agreement with Dahua, a major Chinese surveillance technology company: Dahua, however, is subject to US sanctions for “threats to national security”. Faced with American dismay, Aladin’s leaders publicly announced that they were willing to divest from China if the Americans asked. As already happened in the United Arab Emirates last spring, Mohammed bin Zayed’s brother’s AI company G42 divested from China by transferring assets to another fund after pressure from the Biden administration and congressional Americans. Signing a lucrative deal with Microsoft.
When the Gulf monarchies are swayed by the Americans, they again choose Washington to avoid compromising the ambitious plans of their technocratic leadership. Because achieving them also means military leadership. For Saudi Arabia and the Emirates, multipolarity is attractive (and useful) as long as it does not compromise ambitious national goals. An awakening that could help the US in its long and difficult game with China for influence in the Gulf.

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