As recent years have shown, it isn’t only a global wealth management hub and a neutral arbiter on the global stage.
By Nadim Koteich, The National,
While the UAE may lack the snowy peaks and alpine vistas of Switzerland or the culinary and horological masterpieces for which the Swiss are known, the Emirati leadership is quietly building the foundation for a new role – that of the “Switzerland of the Middle East”.
The tumultuous Arab uprisings, and the ensuing turmoil in Egypt, served as a crucial inflection point for the UAE’s customary approach to regional conflicts. The ascendance of Islamist groups and their potential to destabilise the Middle East posed a direct challenge to the UAE’s own security and stability. Consequently, the Emirati leadership responded by adopting a more interventionist approach to the region’s conflicts, such as the decision to militarily intervene in Yemen. This approach marked a departure from the UAE’s long-held position as a quasi-neutral regional player, established by the Founding Father, the late Sheikh Zayed bin Sultan Al Nahyan, as the region itself changed. Instead, the era ushered in a more assertive and proactive role for the UAE, which US former Centcom head Gen James Mattis once likened to “a little Sparta”.
Despite the prevailing challenges, the Emirati leadership has opted for a fresh approach, ingeniously seizing the economic prospects brought forth by the post-pandemic landscape. On the other hand, by astutely responding to ongoing geopolitical and military conundrums, such as the situation in Ukraine, the UAE fortified its position as a neutral arbitrator and mediator par excellence.
Owing to its strategic geographical positioning, congenial business climate, state-of-the-art infrastructure, tax-friendly environment and forward-thinking policies, the UAE has emerged as a veritable lodestone for international investment, a financial epicentre, and a nexus of trade, all of which hinge on the maintenance of stability.
The county is set to experience a substantial boost in financial wealth, with a predicted compound annual growth rate of 6.7 per cent, leading to more than $1 trillion by 2026, thanks to the influx of high-net-worth individuals (HNWI), according to recent reports. In the post-pandemic era, Dubai alone saw its HNWI population surge by 18 per cent, propelling the emirate to the top spot in the Mena region.
Yet, the Emiratis have surpassed merely mirroring Switzerland’s blueprint of being a global wealth management hub and a neutral arbiter in the complex realm of international politics. Instead, Abu Dhabi formulated its unique model, centred on cutting-edge industries, global alliances and partnerships, and influential soft-power projection. Skilfully blending these three components has propelled the UAE towards this newfound, multifaceted role, both politically and economically.
The UAE has adopted a proactive foreign policy that recognises the urgent need for regional countries to come together and establish new economic, security and political frameworks to ensure regional security and stability, in light of Washington’s strategic shift to disengage from the Middle East. Accordingly, the UAE champions several significant endeavours involving Arab nations and, in some cases, collaboration between Arab countries and Israel. Abu Dhabi has earmarked funding, which by certain calculations amounts to $18 billion, for the construction of an oil pipeline connecting the southern Iraqi city of Basra to the Jordanian port of Aqaba. Concurrently, the UAE has fostered a strategic accord between Jordan and Israel encompassing the establishment of a 600-megawatt solar energy facility, complete with an electrical energy storage system situated in Jordan, aimed at generating clean power for export to Israel. As a reciprocal measure, Israel will embark on a programme to develop sustainable desalination initiatives, supplying Jordan with an estimated 200 million cubic metres of treated water each year.
Moreover, since the latter part of 2021, the UAE demonstrated its nimble diplomatic prowess by making significant strides in reconciling with former adversaries, mainly restoring full diplomatic relations with Iran and Turkey. Notably, the UAE played an earlier leading role in brokering the Abraham Accords, historic peace agreements with Israel that paved the way for Bahrain, Sudan and Morocco to join the normalisation club with Israel.
In the cases of Turkey and Israel, the UAE pursued a path of peaceful reconciliation, anchored by robust economic agreements and trade arrangements. Through this approach, it sought to establish enduring common interests that reflect the UAE’s unwavering commitment to tangible actions and concrete results, rather than mere rhetoric, when it comes to building stable and constructive relationships with its neighbours.
The UAE’s expanding trade agreements with Turkey, India, Indonesia and Israel, in addition to pre-existing deals within the Arab world, forge connections to new markets encompassing more than 2.2 billion people and entwining the country’s economy with a remarkable 10 per cent of global economy.
In a bold demonstration of the UAE’s commitment to confronting obstacles and fostering alliances as a resolute and long-lasting strategy, President Sheikh Mohamed recently opted to withdraw Abu Dhabi’s bid to host the 2026 World Bank and International Monetary Fund meeting. In a conciliatory gesture, Sheikh Mohamed extended his support to Doha as a prospective host.
During the donor conference for the 2023 Humanitarian Response Plan for Yemen, the Minister of State, Noura Al Kaabi, expressed the UAE’s commitment to aiding the Yemeni people and called for international efforts to achieve peace in Yemen in 2023. The UAE has already provided Yemen with $6.6bn in aid since 2015, and this year it will continue its support for reconstruction and rehabilitation projects with approximately $325 million. Such a stance is a significant departure from UAE’s previous involvement in the Yemen conflict.
In a trailblazing move in 2018, the UAE engaged with the Assad regime, despite scant support from fellow Arab nations. This stance has since gained traction, with key regional players, including Egypt and Saudi Arabia, following suit in the wake of the Turkey-Syria earthquake, marking a watershed moment in the UAE’s ascent as an Arab trendsetter. Last Sunday, Sheikh Mohamed received Syrian President Bashar Al Assad in Abu Dhabi, where the two leaders discussed the stability in the Middle East.
Internationally, the UAE played a pivotal role in facilitating a prisoner swap agreement between Russia and Ukraine, which was reportedly linked to the resumption of Russian ammonia exports to Asia and Africa via Ukrainian Black Sea ports. Moreover, Abu Dhabi and Riyadh mediated the release of American basketball player Brittney Griner from Russia through another prisoner swap that took place after Sheikh Mohamed’s visit to Moscow last October.
Further, the UAE’s notable standing as the 10th-most influential soft power player globally and the top-ranked Middle Eastern nation, according to the Global Soft Power Index, emphasises its expanding influence on the global scene. The UAE’s unwavering commitment to enhancing its soft-power capabilities, as evidenced by hosting prestigious events such as Expo 2020, increasing foreign aid allocations, and embarking on a Mars mission, bears witness to its steadfast ambition to become a formidable force in global affairs.
Showcasing its soft power and commitment to promoting hope and tolerance, the UAE has forged a partnership with Unesco, in pursuit of the visionary “Revive the Spirit of Mosul” initiative. This co-operative endeavour aims to breathe new life into Mosul’s historic architecture and treasured heritage sites, with a particular focus on reconstructing the city’s famed Al Nouri Mosque and its 45-metre tall Al Hadba minaret, a landmark built in 1172 by Seljuk ruler Nour Al Din Zanki, which bestowed upon Mosul its nickname, Al Hadba. Also, the UAE’s generous $50m grant has facilitated the restoration of the famous Dominican Al Saa’a Church and Al Tahera Catholic Church, underscoring the nation’s ongoing dedication to the preservation of cultural legacies and the advancement of global understanding and tolerance.
Nestled on the banks of the Tigris River in northern Iraq, the historic city of Mosul – whose name in Arabic signifies “The Connector” – has served as a vibrant nexus of cultures, civilisations and faiths. A crucial hub of commerce on the Silk Road, Mosul has welcomed a diverse array of communities, including Arabs, Kurds, Turkmen, Assyrians and Armenians, as well as Muslims, Christians and Jews. The city’s 2014 capture and subsequent three-year occupation by ISIS was a targeted assault on the ideals and symbolism that Mosul has long embodied. The commitment to rebuild the city is a powerful counter-message, affirming the restoration of public spaces as a means to foster co-existence, tolerance and hope for a brighter future.
However, the UAE’s ambition to become the “Switzerland of the Middle East” is not without its challenges. One major challenge the country faces is competition from other regional players, who are also seeking to establish themselves as dominant political and economic centres in the region.
The Middle East is a challenging and enduring neighbourhood made for marathon runners, not for sprinters. The UAE is a marathoner, guided by the values of “Zayed Doctrine” of positive communication, regional dialogue good neighbourliness, stability, development and prosperity.
Its first strategic choice is to be more Swiss and less Spartan.
