UAE and Iran: Frenemies forever

The visit of Iranian President Mahmoud Ahmadinejad's to the disputed islands located between the UAE and Iran was met with a torrent of condemnation and denunciation by the Gulf States and several other Arab states. The UAE objected officially and recalled its ambassador in Tehran for consultations, whereas Gulf foreign ministers met in Doha yesterday to denounce the Iranian provocations. The question that must be raised today is: Why did President Ahmadinejad choose to visit the islands at this particular time? Did Iran really mean to provoke the UAE? Are there other motives at play? The reality is that Iranian-Emirati relations are extremely complex. On one hand, trade levels between the two countries exceed 13 billion US dollars annually - with Dubai being one of the most prominent channels for Iran's imports and exports, and the UAE being home to the largest Iranian expat community in the Gulf, who are engaged in various commercial and banking activities there. In spite of all this, Iran and the UAE are two halves of the most significant border dispute in all the Gulf waters, a dispute over the sovereignty of the islands Greater and Lesser Tunbs, and Abu Musa. This situation has prompted both parties to be “friends and enemies at the same time”, to borrow a phrase from a book published by Dr. Mohamed al-Rumaihi in the mid-1990s. The disagreement between the two sides dates back at least 200 years, however in terms of contemporary history, the issue transformed into a continuous regional crisis when the Iranian Shah seized the three islands by force in November 1971, following withdrawal of the British occupation from the Gulf. This particular incident was a prominent reason behind the accelerated establishment of an Emirati confederation by the end of that year. Many people have written extensively about the history and causes of the struggle, perhaps most notably "Iran, Saudi Arabia and the Gulf: Power politics in transition 1968-1971" by Dr. Faisal Bin Salman al-Saud (I.B. Tauris, 2003), and "Small Islands, Big Politics", edited by Hooshang Amirahmadi (Palgrave Macmillan, 1996). The importance of these three islands does not only lie in their oil reserves – the Mubarak oil field [off the coast of Abu Musa] is governed by a resources agreement signed between the emirate of Sharjah and Iran - but also in their strategic proximity to an oil tanker shipping lane to and from the Gulf. For this particular reason, Iran is keen to maintain control of the islands, and has imposed a 12 mile-long marine border. In 1996, Iran constructed an airport [on Abu Musa] and increased the number of troops deployed there, thereby further complicating relations between Tehran and the Gulf Cooperation Council (GCC). It is essential here to indicate that the majority of news agencies and newspapers have labelled Ahmadinejad's recent visit as the first conducted by an Iranian President to the disputed islands. Historically speaking, however, this is actually the second visit, as President Hashemi Rafsanjani visited these islands back in 1992. At that time, the crisis between Iran and the Gulf States had just been rekindled, with Iranian authorities expelling foreign laborers from Abu Musa and imposing entry visas on UAE citizens in August 1992. There are similarities and dissimilarities between the crisis of 1992 and that of 2012. As for the similarities, Rafsanjani's visit, as is the case with Ahmadinejad's visit, occurred at a time when the Iranian economy was suffering a sharp economic recession, let alone the threats of additional economic sanctions. The visit served as evidence that Iran was seeking to emphasize its sovereignty, in light of its fear that the Americans would succeed in convincing the neighboring states to attempt to regain the islands. True, this scenario was highly unlikely, but the Iranian politicians were not convinced by such reassurances, especially as the islands, given their strategic location, enabled Tehran to cripple navigation systems in the event of any anti-Iranian military developments in the Gulf region. As for the dissimilarities, this latest visit, coinciding with the 20th anniversary of Rafsanjani's, has occurred at a time when Tehran needs to win over the UAE in order to find solutions to the economic sanctions it has suffered, impacting upon the Iranian Central Bank and other economic institutes that are important for its foreign trade, a situation that ultimately prompted the UAE to cut the banking services it offers to Tehran. Apart from this, the cessation of Iran's revenues incoming from the European Union has rendered the UAE as Iran's sole mediator, and the only entity that can ensure its foreign purchases as well as the remittance of its expat community, especially those in the UAE itself. The value of Iran's annual imports that pass through the UAE is estimated at 20 billion US dollars, constituting one-third of Iran's overall imports. There are two probable explanations as to why Iran has taken such a provocative measure: the first relates to the nuclear issue, whilst the second relates to the possible decline in Iranian influence in the region as a result of the Syrian crisis. Regarding the nuclear issue, Iran has appealed to the 5+1 Group to resume negotiations. Accordingly, it could be argued that Iran is seeking to reflect its strength and resilience at the time when it is preparing to offer carefully-formulated concessions with regards to its nuclear file, such as reducing its amounts of enriched uranium instead of completely relinquishing it, or granting access to a limited international mission with Russian and Chinese representatives to visit its nuclear facilities. Hence, Ahmadinejad's visit could be seen as a message to the Gulf States that Iran is still active and strong, even if it has to offer some temporary concessions with regards to its nuclear issue. As for the other explanation, this relates to the consequences of the Syrian crisis, as Tehran seeks to remind the Gulf states that it is capable of threatening their interests, especially oil supplies. It also threatens to cease its oil dealings with these countries, aiming to skew economic calculations at a time when Dubai needs to revive its trade following the economic crisis. Tehran would necessarily benefit from a rise in oil rates as a result of such fears. Currently, there are contradictory indicators. Iran, on the one hand, attempted last December to impose sanctions on trade with the UAE, and on the other, it has once again called upon the Emirati people to help it overcome its own sanctions, particularly after the international banking industry communication network – commonly known as "Swift” – expelled all Iranian banking institutions. This has prompted Tehran to conceal the true amount of its oil exports, to the extent that the National Iranian Tanker Company (NITC) demanded that its tankers disable their black boxes so international radars cannot locate them on international shipping routes. The surprise visit paid by Sheikh Abdullah bin Zayed, the UAE Foreign Minister, to Tehran last March was a clear example of the complex relations between his country and Iran. At the time Tehran, according to observers, declined to provide any positive answers to what was said to be an Emirati initiative to relieve the tension between Iran and its neighbors, in the wake of the popular uprisings across a number of Arab states last year. Without a doubt, the consequences of the Arab popular uprisings have begun to impact upon the balance of power in the Gulf, and Iran is engaging in regional activities in an attempt to compensate for the probable loss of its Syrian ally. This is in addition to the confirmed involvement of other parties such as the Nuri al-Maliki government, which seeks to play the role of an Iranian ally in the future, despite the Kurdish and Sunni opposition towards such a development, as expressed indirectly recently by Massoud Barzani, President of the Kurdistan Region of Iraq. Besides this, the Iranian regime has also acted to awaken its sleeping extremist Shiite cells in the Gulf, in a bid to intensify its sabotage and assassination operations abroad. It is likely that the Iranian regime is racing against time to fulfill its nuclear weapon project, which is now its strategic option for survival, following the decline of the resistance axis that it once led. The change in the balance of power may take a decade or even more before its features are made apparent, as all Gulf parties are maneuvering and moving to secure their strategic interests. When the Chinese Premier Zhou Enlai (1945 - 1976) was once asked for his opinion on the impact of the French Revolution, two centuries after it had occurred, he answered: "Too early to say." Perhaps this also applies to the new transformation in the balance of power between Iran and its neighbors.