Monday, April 22, 2024

Kung Fu Panda vs. John Wayne

The brokered truce between Iran and Saudi Arabia is an astounding diplomatic victory for China. Conversely, it is a gigantic diplomatic failure on the part of the Biden administration and for the US’ strategic interests as far as the Middle East is concerned.

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The regional protagonists will emerge from this deal with one significant bonus, that of ‘de-escalation’. Whether it will be immediately translated in Yemen or Iraq or Syria or Lebanon, is of no immediate importance. Because for Saudi (and GCC) this ‘de-escalation’ gives it a breathing room to calibrate its oil and gas strategy without having to factor-in an energy security risk ratio, in the short to medium term at least. This means energy prices will hold steadily supported by increased exports to Asia, which in turn translates into solid revenues to oil-producing nations. These revenues will be used in a two-fold strategy: investing abroad in latest technologies through the SWFs and; funding economic diversification at home by further investing in education, infrastructure, trade, commerce, industry, tourism, and everything non-oil.

This truce will hold as long as the Iranian regime perceives the US as an existential threat and as long as Saudi perceives it as an untrustworthy ally. The deal with China is the direct result of the mutual distrust that both Saudi and Iran have vis a vis the US. On the one hand, and for decades, Iran has engaged in covert and overt discussions with the US, hoping to restore its pre-Shah status as the US’ primary ally in the Persian Gulf. That got Iran nowhere even under the most pro-Iranian President to wit, Obama. Money flew, tensions decreased, fists were unclenched, but trust was never fully restored. On the other hand, and for time immemorial, Saudi has acted in a compliant (some even say in a docile) manner with the US’ successive bi-partisan administrations. Heeding the requests of Washington to turn the oil spigot on/off to meet developed markets’ expectations, buying defense hardware from US contractors at steady volumes, selling its energy in US dollars despite the allures of the Euros and Renminbi, and adjusting its sails to the US’ foreign policy winds. That got Saudi nowhere. Obama was bent on forcing Saudi to recognize Iran’s superior position and accept its ‘equities’ in the Arab world through proxy armies in Yemen, Iraq, Lebanon, and Syria. Trump did not even lift a finger when Aramco’s facilities were under direct attack by the Houthis, and Biden wanted to turn MBS into a pariah.

In politics, you reap what you sow. Thus, if the US has been sowing bad politics for the past decade or so, it cannot expect but a poor crop. What to expect next from this US administration? 

Biden was hoping for a peace treaty between Israel and Saudi, but he seems to have lost the momentum. In Israel, the Biden administration is viewed by Bibi’s government as dangerously meddling in domestic politics including the controversial judicial reforms. In Saudi, now that the Iranian issue has been relatively neutralized, the need for a deal with Israel is of no priority. If not a diplomatic counter-initiative to thwart China’s success, what yet can this administration do? It could back an Israeli surgical air raid on Iranian nuclear sites, but with limited benefits. Israel (and the Western hemisphere) would breathe a sigh of relief, but Iran, the Arabs, Turkey, China, and Russia would be angered at this unprovoked increase in tensions when ‘de-escalation’ has been their goal.  The US would be viewed as enabling an aggressor rather than eliminating an imminent threat.

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Kung Fu Panda has bested John Wayne in Mideast diplomacy. John Wayne was not known for his diplomatic methods to start with. So, who will win in the end? An old Chinese proverb might have the clue” “A distant journey tests the strength of a horse and a long task proves the character of a man.”

Judging from current events and the character of the key players, our bets are on the Panda. 

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