Title: Pathways Of Regional Integration In The Gulf- Energy As The Driving Force

Title: Pathways of Regional Integration in the Gulf- Energy as the Driving Force

Author: Justin Dargin

Affiliation: Dubai Initiative, Belfer Center-Harvard University

Abstract

Regional integration in the Gulf region (Bahrain, Oman, Kuwait, Qatar, Saudi Arabia, and the United Arab Emirates) has been the subject of much speculation since the creation of the Gulf Cooperative Council (GCC) in 1981. Although initially created to oppose Iranian and Iraqi hegemony in the Gulf, the GCC became the medium for a more cohesive bloc espousing political, economic, and security cooperation among member states. However, the quest to combine these states into one unit experienced notable successes and failures.

Several profound advantages would accrue if the GCC realigned into a more interconnected union. Specifically, regional integration should succeed because:

· A collaborative security arrangement could enhance regional stability, and protect energy infrastructure.

· Increased economic amalgamation would enhance influence and bargaining power on the international economic stage.

· A common cultural, religious, social, and political identity amongst the member states implies minimal social barriers to melding.

However, even with the sincere movements towards integration, major obstacles remain. The much anticipated Pan-GCC currency, which many commentators have christened the Kha eeji, intended to buttress the movement toward a cohesive regional monetary union, has met with innumerable delays. The GCC has also delayed its efforts to comply with the World’s request to martial its considerable assets within its gargantuan sovereign wealth funds to inject liquidity into the global financial markets.

In spite of these obstacles, however, the GCC nations have made epic strides towards the goal of becoming a single commercial/trading bloc. For example: Qatar successfully completed the mammoth Dolphin natural gas pipeline, which connects the natural gas pipelines of Qatar, the United Arab Emirates, and Oman. Another example is shown in the fact that Phase One of the pan-GCC electricity grid[1] is due to come online in first quarter 2009.[2]

Given the current turbulence in the Middle East, regional integration will have seismic implications for other players in the region and beyond. This study will examine the GCC’s relevance as a regional entity in an age of dynamic political, economic, and security developments. The research will focus on energy as the foundational pillar of GCC integration, and as a catalyst for financial, political, and military assimilation. The article will analyze policies and trends, to determine whether a viable GCC bloc, patterned on the EU model will emerge, or whether an atomized Gulf will cleave to the status quo.

[1] See GCC Power Grid Work Set to Start in September, Arab News (Mar. 26, 2005)

[2] The $1.1 billion first phase, which will link Saudi Arabia to Bahrain, Kuwait and Qatar through 800 kilometers of transmission lines, was completed at the end of June and the second phase will link the UAE with Oman. Further studies are being conducted to determine the viability of a linkage with Egypt from Saudi Arabia. See Issac John, 7Bn Power Grid Project on Track, Khaleej Times Online (Sept. 11, 2007)