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Gulf in risk of miscalculations, predicts agency

|By Arabian Post Staff| Rhetoric casting the future of the Middle East as an existential battle between the two regional powers has soared – particularly on the Saudi side – over the past year. However, a direct military confrontation between Iran and Saudi Arabia remains unlikely, Control Risks, the specialist global risk consultancy, has warned that businesses in  its Middle East risk map for 2018.

Iran and Saudi Arabia’s struggle for regional influence will however remain a primary driver of regional developments. Direct and indirect Iranian involvement in conflicts across the region is a significant driver of this concern for Gulf states, which have responded in kind to exert hard and soft power from Yemen to Lebanon. This rivalry will continue to play out indirectly, not face-to-face. Look for that simmering, rather than boiling, animosity in almost all the other regional flashpoints. Prominent among them are Lebanon, Iraq and Oman.

Referring to Oman, the agency talks about a succession risk in the sultanate. It says succession is a perennial risk in the Gulf. A change in leader almost always threatens change at numerous other levels, including ministerial appointments, state spending and foreign policy priorities, and the fortunes of local businesses. This will be twice as risky in Oman, where Sultan Qaboos bin Said Al Said effectively centralises all decision-making responsibilities in the country and has no clear successor in line. Add to this the recent volatile relationships within the GCC and the broader Gulf and you have a succession which could have an outsized impact on the country’s foreign policy and the broader balance of power in the region.

Sultan Qaboos has ruled for 47 years. He is well respected domestically and internationally for delivering remarkable economic and social development to his country. Oman’s longstanding neutrality on a number of issues has allowed it to act as an important mediator in regional and geopolitical issues – the sultanate under Qaboos has successfully balanced the agendas of the Gulf Cooperation Council (GCC), Iran and the West. Yet it remains unclear who will succeed the 76-year-old Qaboos amid mounting concerns about his health.

Whoever the new leader is, he will be faced with rapidly deteriorating state finances triggered by persistently low oil prices, and will have less popular legitimacy and experience than the current ruler. Oman will increasingly need to look for foreign investors to grow its economy, and will no doubt have many suitors seeking political influence in return for economic support. The UAE and Saudi Arabia have already been quietly pressuring Oman to move more resolutely into their economic and political embrace. These calls have become somewhat less subtle of late: Oman has become a major hub for transit and shipping into Doha since June 2017, when Saudi Arabia, the UAE, Bahrain and Egypt cut diplomatic ties with Qatar and restricted the movement of goods and people to the country. Qatar will not want to lose Oman as an economic and political ally, and Iran will also not stand by without getting involved.

To compound the problem, any instability in Oman could provide opportunities for militant groups in neighbouring Yemen to infiltrate the country and in theory pose threats to other Gulf Arab states – making the question of succession more serious than one may think.

Also published on Medium.