Home Business The Transactional Partnership of the US and Qatar

The Transactional Partnership of the US and Qatar

Qatari Emir's meeting with US President Donald J. Trump amid on-going US-Iran rift reflects the transactional nature of partnership between the two countries. While Qatar continues to share cordial ties with Iran, the relationship it shares with the US seems to be driven by economic and strategic interests and therefore, both countries continue to strengthen their ties based on cooperation.

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News Desk |

The recent visit of the Emir of Qatar, Sheikh Tamim bin Hamad Al Thani, to meet President Donald J Trump in Washington has further substantiated the transactional nature of the partnership between the two countries.

The Emir met President Donald J. Trump on Tuesday at the White House to discuss and formalize various agreements on trade, economy and military partnership. The bi-lateral meeting between the two head of states was held after a day the Treasury Secretary Steven Mnuchin hosted a dinner for the Qatari Emir that too was attended by President Trump on Monday.

On what is being described as a “warm welcome”, President Trump hosted the delegation from Qatar to discuss the regional security of the Gulf- which at present continues to be embroiled in a conflict. President Trump called the Emir his “friend” and “a highly respected man, a real leader in a large part of the world and a very important part of the world”, while both clasped hands for official press photographs of the visit.

The US LNG production and export has faced major losses since the trade war as a result of Chinese pull out from the US LNG exports.

The meeting took place amid tensions in the Gulf between Iran and the US, and the on-going Gulf blockade imposed on Qatar by its neighbors and US allies, Saudi Arabia and the United Arab Emirates (UAE).

Large Transaction

During the press meet, President Trump kept hinting at “large transactions” between the countries. On the contrary, the Qatari Emir talked more about Qatar’s shared values of freedom while sparingly criticizing its Gulf neighbors for not having the same beliefs.

Both countries have reportedly signed numerous trade and military deals including five commercial agreements on the visit of the Emir. Qatar Airways, the national carrier of the Gulf state, is reportedly scheduled to buy five Boeing 777 freighters and a large-cabin aircraft from Gulfstream Aerospace. It also plans to power its Boeing aircrafts with General Electric Co jet engines- all US-based companies.

Qatari Emir, Al-Thani, told reporters that the country had planned to double its economic partnership with the US which at present stands at $185 million.

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Moreover, the White House has also reported several military agreements between the two states. It is reported that Qatar has planned to spend a whopping $85 billion on US weapons, aircrafts, and other commercial deals. The Qatari Defense Ministry is expected to finalize a Raytheon missile defense system deal which is deemed imperative for Qatar in its hostile neighborhood.

Chevron Phillips Chemical and Qatar Petroleum have also signed an agreement on Tuesday to develop an $8 billion petrochemical plant along the U.S. Gulf Coast; it is the second pact between the companies to build such plants in the last few weeks. Known as the U.S. Gulf Coast II Petrochemical Project, it is expected to include 2,000 kilotons per year (KTA), ethylene crackers and two 1,000 KTA polyethylene units for the production of hard plastics.

The US LNG production and export has faced major losses since the trade war as a result of Chinese pull out from the US LNG exports. Being the largest LNG importer in the world, China is seeking to invest into LNG rich markets to resolve its chronic air pollution problem. Despite being the fifth largest exporter of LNG, US still relies on LNG imports from other countries, primarily for two reasons; pipeline bottleneck issues and the 1920 Merchant Marine Act that restricts it to use its own domestically produced LNG. Qatar is planning to construct four-LNG trains for its exports to the US and is actively providing China with LNG for its domestic use and production.

A Complicated Relationship

Qatar and the US share a complicated yet intriguing relationship, primarily based on the strategic and economic realm. The relationship is a classic example of what is known as “economic interdependence” through which both countries share an equal amount of benefit from each other. Qatar continues to be blockaded by US allies in the Gulf since 2017, including Saudi Arabia, Egypt, UAE and Bahrain over alleged support to Islamist groups including Al-Qaeda, Taliban, Hamas, Muslim Brotherhood, Hezbollah and ISIL. Moreover, Qatar’s alliances with Iran have also been a major bone of contention between Qatar and its neighbors in the Arabian Peninsula.

The gas-rich country has reportedly spent $8 billion on the maintenance and improvement of the US military bases in the country for which President Trump thanked the Qatari Emir.

Initially, the Trump Administration seemed divided on the blockade as it had been demonstrated by President Trump’s ‘tweet-applause’ for the blockading quartet following the sudden boycott. He had also called Qatar “a funder of terrorism at a very high level” in 2017 during a Joint Press Conference with Romanian President Klaus Iohannis.

However, five days after the President’s statement, both countries finalized a massive $12 billion arms deal for Qatar’s purchase of 36 F-15 planes. Additionally, the recent developments show Qatar’s strategic significance for the US as both countries continue to cooperate amid the blockading crisis. It is perhaps significant to acknowledge the authority of the US military intelligence and its influence on the foreign policy that requires a state like Qatar for its Middle Eastern ‘shenanigans’, topped with Qatar’s wealth which is most certainly quite resourceful for the US arms sale. After Trump’s comments came out in 2017, the Pentagon contradictorily expressed its gratitude for Qatar’s partnership in the region.

In the past, the US has signed multiple comprehensive military partnership deals with the tiny Gulf state, which relies heavily on the US for military purchases. On the other hand, the US depends greatly on Qatar for its strategic presence in the Persian Gulf. Qatar hosts the important Al Udeid airbase, where 10,000 US troops reside. Known as the nerve center of the fight against terrorism, the US defense establishment maintains a different view of Qatar’s utility.

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The gas-rich country has reportedly spent $8 billion on the maintenance and improvement of the US military bases in the country for which President Trump thanked the Qatari Emir, while stating that Al Udeid airbase “is incredible . . . right in the middle of the Middle East,” during the meeting at the White House.

Qatar’s geo-strategic position makes it a lucrative partner for the US in the Gulf region; located in the east of Arabia, it shares the larger part of its border with the Persian Gulf and a small portion of its land tucked with Saudi Arabia- the only country it shares its land borders with- forming a peninsula that expands 11,437 km sq. towards North of the Persian Gulf. With Iran on the opposite side of the Gulf, it is in fact at the epicenter of the Arabian and Persian Gulf and their politics at large.

Qatar to Balance its Alliance Between the US and Iran

However, the significant geo-strategic position of the peninsular country has also been a bane in its existence. In the middle of the hostile Gulf, Qatar has continued struggling to balance its regional alliances with its Arab neighbors and Iran’s, with which its shares its gas-rich reservoir, Pars natural-gas field. Qatar seems to be in troubled waters in the on-going US-Iran fiasco amid fears of potential military escalation. The tiny peninsula has received generous support from Turkey and Iran for its airspace operations particularly, Qatar Airways- an important source of revenue for the country- as it continues to be under a severe blockade by the Saudi-led bloc which has barred it from entering its airspace.

The sanctions on Iran were re-imposed by the Trump administration after its withdrawal from the 2015 Nuclear Deal that restricted Iran from developing a nuclear arsenal.

A military escalation between the US and Iran would create a difficult position for the country as it would require to chose sides, causing a possible stalemate of its airline operations over Iran’s airspace. Qatari Foreign Minister Mohammed bin Abdulrahman al-Thani in an interview on Wednesday stated that while the US had no intention to wage war on the Persian state, it was also adamant on continuing severe sanctions on the country as a means to bring it to the negotiation table. He, however, asserted that Qatar was to continue its efforts to mediate between the two countries despite the stalemate. “We cannot afford any war between our ally and our neighbor,” he said during the interview.

Iran on the other hand remains chaffed by crippling US embargoes that has restricted the international community from trading with the Persian country, particularly for its oil exports. The sanctions on Iran were re-imposed by the Trump administration after its withdrawal from the 2015 Nuclear Deal that restricted Iran from developing a nuclear arsenal. Most Middle Eastern states, including Israel, Saudi Arabia and the UAE, had reservations over certain clauses of the deal that was initially finalized by the Obama Administration as it allowed Iran to resume enrichment after 2031.

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Amid fears of military escalation and further sanctions on the country, Iran has warned to exceed its uranium enrichment limitation beyond 3.67 percent in case of E3+2 (Germany, France and Britain + Russia and China) – parties that failed to negotiate relief from the US sanctions.

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