Qatar announced earlier this month that itplans to contribute $1.5 billion to the new Gulf Development Fund established by the Gulf Cooperation Council (GCC) in December to aid nonmembers Jordan and Morocco. In an email interview, Steffen Hertog, a lecturer in comparative politics at the London School of Economics, discussed the GCC’s development activities.
WPR: What is driving the GCC’s interest in enhancing ties with Jordan and Morocco, and what role will the Gulf Development Fund play in these efforts?
Steffen Hertog: The primary motivation seems to be the defense of conservative Arab monarchies in the face of regional unrest. The announcement of the Development Fund last December came seven months after Jordan and Morocco had been — surprisingly — invited to join the GCC. The latter initiative seems to have come undone: It was announced unilaterally, apparently on Saudi urging; it resulted in puzzlement especially in Morocco; and there has not been much follow-up on a working level. The fund appears to be a more modest attempt to recreate momentum and, realistically speaking, supplant the more ambitious initial integration plan. The GCC, Jordan and Morocco have also deepened their commercial and especially investment links during the oil boom decade of the 2000s, involving public and private players on both sides. But economic returns were quite likely a secondary consideration in setting up the fund.
WPR: How effective have past GCC efforts to establish development funds been, and what have been the main obstacles?
Hertog: Although the GCC is the most successful case of subregional integration anywhere in the Middle East and North Africa, GCC-wide institutions have historically had trouble getting off the ground. Even the $20 billion assistance fund for Oman and Bahrain announced in March 2011 in the wake of the unrest in both countries has not yet been capitalized.
In the past, most aid emerging from the GCC has been provided bilaterally. The sums involved have been huge, especially during the first oil boom of the 1970s and early 1980s, but there have been questions over transparency and effectiveness. The United Arab Emirates have upped their game after facing international criticism about the opacity of their aid efforts, and the Kuwait Fund for Arab Economic Development also has a solid reputation.
GCC governments would generally want to go beyond pure checkbook diplomacy in their aid policies, but institutional capacity for more substantial development assistance is usually weak, as governments are already overstretched with local development tasks.
WPR: What are some of the development priorities among member states, and to what degree is the fund necessary to achieve them?
Hertog: The priorities of the fund announced in December appear to be political, to signal solidarity among conservative monarchies and support Jordan and Morocco in providing employment and public services to stave off potential unrest. This primacy of politics also characterized previous aid policies in the 1970s and 1980s, when GCC oil states provided huge aid payments to the tune of several percentage points of their GDP for the Arab “frontier states” in conflict with Israel.
Bilateral aid in the GCC has consisted either of unconditional loans and grants or financing for specific large projects rather than more-focused technical assistance. Qatar has recently indicated that it wants to support a gas storage project in Jordan through the new fund, a signal that aid policies will continue their big-project focus — quite similar to the capital-intensive development approach GCC countries have used at home.
Photo: Logo of the Gulf Cooperation Council (photo by Wikimedia user MKay).
