The meeting of foreign ministers of the six GCC states in late June opened the latest chapter in the long-running project to develop a more closely integrated Gulf. Gathered in Manama, representatives of Saudi Arabia, the UAE, Oman, Qatar, Bahrain and Kuwait discussed the agenda for Bahrain’s leadership of the organisation, which begins on 1 April 2011.

[Qatar’s leadership of the GCC] hasn’t lessened any of the rivalries and jealousies, [or settled any member disputes]

Gerd Nonneman, Institute for Arab & Islamic Studies at Exeter University in the UK

The aim of the GCC, according to the terms of the charter signed at its inauguration in Abu Dhabi in May 1981, is to “effect coordination, integration and inter-connection” between the member states and to “strengthen existing ties”. The past 30 years have seen a certain amount of progress towards these aims.

During the eight years since Abdulrahman al-Attiyah became GCC secretary general in April 2002, Qatar has presided over the creation of a common market, increased labour mobility and the liberalisation of cross-border trade.

But Manama takes the reins at a difficult time for the GCC, when economic integration is faltering and the limits of political integration are as apparent as ever.

Lost momentum for GCC integration

“Up until last year you could say that some progress had been made in the economic sphere,” says Gerd Nonneman, professor of international relations and Middle East politics at the Institute for Arab & Islamic Studies at Exeter University in the UK. “They were getting closer to currency union. It had become easier to cross borders and make investments within the GCC, trade agreements had been signed with Singapore and other third parties, and at long last they seemed to be getting a policy together towards the EU.”

These [GCC] countries regard their … national independence as very important and don’t want to compromise it

Simon Henderson, Gulf energy project, Washington Institute for Near East Policy

Unfortunately, the downturn in the region’s economies in 2008-09 has been accompanied by a similar decline in momentum towards GCC integration. On 20 May 2009, the UAE announced it had withdrawn from the single currency plan, leaving just four countries on course to join. Oman decided in December 2006 that it would not join the single currency at its launch. Kuwait, meanwhile, has maintained its commitment to the scheme, despite dropping the dinar’s peg to the dollar in May 2007.

In the political sphere, a series of intra-regional disputes have arisen to blight any notion of a region acting with one common interest. Bahrain’s original nomination of Mohammad al-Mutawa for the post of GCC secretary-general in June 2009 was vetoed by Qatar. The emergence of a compromise candidate, Abdul al-Zayani was only made possible by the intermediation of Mutab bin Abdullah al-Saud, the son of Saudi Arabia’s leader.

A long-running border dispute between Bahrain and Qatar has, meanwhile, found new life in Doha’s detention in late May of scores of Bahraini fishermen, allegedly for fishing in Qatari waters. A dispute over the international border between Saudi Arabia and the UAE also remains unresolved. An agreement was signed in 1974 delimiting the border, but it has not been ratified by Abu Dhabi.

Symptomatic divisions

“A few border incidents and very quickly it looks like, if there is any political cohesion, there’s very little,” says Nonneman. “[Qatar’s leadership of the GCC] clearly hasn’t lessened any of the rivalries and jealousies and there has been no real progress on settling disputes between the members.”

While the border issues themselves might seem surmountable, their periodic re-emergence is symptomatic of deeper political divisions between the GCC members. In recent months, the GCC states have shown a tendency to return to national agendas when they have not got their own way on the supranational stage.

“The border issues are symptoms rather than drivers of the tensions,” says Anoush Ehteshami, director of the Centre for the Advanced Study of the Arab World at Durham University in the UK. “None is that serious, and they can be suspended in good times, but they bubble to the surface when there are tensions between the parties.”

That the disputed border between Saudi Arabia and the UAE should still be an issue has much to do with the UAE’s dissatisfaction at the decision taken in May 2009 to locate the GCC central bank in Riyadh. Abu Dhabi is concerned that Saudi Arabia, which has by far the largest population and the largest economy of the Gulf states, would already have a disproportionate amount of power over the bloc’s economic policy and that the balance will be tilted even further with a GCC central bank in the kingdom’s territory.

According to economic analysts in the region, these same concerns were also a factor in the UAE’s decision to withdraw from the currency union.

Similarly, the border dispute between Qatar and Bahrain and the contested choice of the new Bahraini secretary-general are two sides of the same coin. The border issue was formally settled by the International Court of Justice in March 2001, but Qatar is still using it as a political tool. Doha based its opposition to the selection of Al-Mutawa on outspoken comments he made on the border issue almost 10 years ago. The recent detention of Bahraini fishermen was just the latest chapter in this same altercation.

The precedence of national economic policies over regional ones has been accentuated by the recent economic downturn, with each of the Gulf nations choosing to deal with its problems on a state level rather than regionally. The parochialism of these economic preoccupations has exacerbated the political divide between the nations.

“There has been a disengagement of members on some of the crucial economic issues and as this has happened some of the security issues have been nationalised rather than regionalised,” says Ehteshami. “This combination has had an effect on the GCC as a whole.”

That is not to say Qatar has not been politically engaged during its eight years at the head of the GCC. Quite the reverse. The emirate has shown a willingness to tackle all the major political issues that have arisen in the region in recent years.

“Qatar’s real coup de grace internationally has been to try to stabilise Lebanon, Sudan, Palestine and GCC-Iran relations,” says Ehteshami. “Even the EU presidency, despite the organisation’s size, sets a very modest agenda, while Qatar is carrying the whole burden of all these regional issues on its shoulders. It has certainly not been passive.”

The crucial point, though, is that these issues have been borne by the shoulders of Qatar, not by those of the GCC. Rather than underscoring GCC unity, in some cases this has undermined it. “Qatar has been working to build its own reputation and it has done so very effectively,” says Ehteshami. “It’s been an area of tension because not every GCC country has agreed with Qatar’s strategy of engagement.”

National policy for GCC countries

Qatar’s promotion of its own status on the diplomatic stage is typical of the type of power play that still characterises political relations between the Gulf states. The leaders of all six countries are deeply attached to a sense of their own national identity and the importance of their individual histories and traditions and they are unwilling to let this be subsumed within a supranational body.

“These countries regard their newly discovered national independence as being very important and don’t want to compromise it at all,” says Simon Henderson, director of the Gulf energy project at the Washington Institute for Near East Policy in the US. “If anything, with the passage of time those differences are accentuated.”

When there is agreement, it is often more by luck than design. “There is no coherent GCC foreign policy,” says Nonneman. “Each of the countries works out their national policy and then they try to coordinate, and, if possible, come up with a joint statement.”

The main driving force behind the GCC’s creation in 1981 was to deal with the potential threat to the region of Iran, following the deposition of the Shah in 1979. To this day, Iran remains the greatest foreign policy preoccupation of the six countries.

Compared with the existential threat posed by the Islamic republic, the GCC’s intra-regional border issues are trivial. Yet the organisation’s members have failed to agree a common position on dealing with its neighbour. “They all agree that they don’t want Iran to be a nuclear power, but are not clear on the best way to achieve that,” says Nonneman. The relative strengthening of the emirate of Abu Dhabi that has resulted from the disproportionate impact of the global financial and real-estate downturn on Dubai may mean that on this issue at least a more consistent GCC policy will begin to take shape. Until now, the UAE’s policies towards Iran have been constrained by Dubai’s economic ties with the Islamic republic.

According to regional analysts, these may now take second place to Abu Dhabi’s political agenda, allowing it to engage more constructively with Saudi Arabia in formulating a Gulf strategy towards Tehran.

Meanwhile, the six states, heavily supported by the US, continue to invest in the development of an air-defence system to protect themselves in the event of an Iranian attack. Although defence strategies have largely been developed on a national level, they are gradually developing into something more. “Some kind of air-defence network is emerging,” says Henderson. “It’s a bit patchy, but it’s a work in progress.”

Unfortunately, this is likely to remain one of very few areas in which GCC cooperation can go hand in hand with matters of national sovereignty. The emergence of a GCC unfettered by petty rivalries and border squabbles will remain unrealistic as long as it maintains an institutional framework in which all power is derived from the six heads of state. But the same national priorities that bring such disputes so often to the fore also mean that institutional reform is one item that will certainly not be on Bahrain’s GCC agenda.