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Continuity in Oman’s problems and policy prescriptions

Over the next few months Oman is likely to exercise caution in addressing key issues. Its new sultan may keep continuity with his predecessor's approach.

Analysis | Middle East

In the personalistic nature of leadership in the Arab world, the ouster or death of a king, sultan, emir, or president is tantamount to the inauguration of a new era in the life of a nation. Such was the case following the removal of many Arab leaders over the decades and the deaths of Gamal Abdel-Nasser of Egypt (1970) and King Faisal of Saudi Arabia (1975), among others. This was not so in Oman, however, following the passing of Sultan Qaboos bin Said Al Said, who died after leading the sultanate for half a century after overthrowing his father in 1970. While his death ushers in a new phase in Oman’s national life, it is unlikely to lead to serious changes in the way the country tries to manage its domestic affairs and its regional or international relations.

Yet, conditions inside and outside the country may challenge the new sultan, Haitham bin Tariq Al Said, in sustaining the same approach that prevailed during his predecessor’s reign. Now in his fourth month as leader, Haitham may find that his biggest challenge is in how to manage very difficult economic circumstances during a global slowdown caused by the coronavirus pandemic—and all in the midst of regional uncertainty and chaos. Consequently, over the next few months Oman is likely to exercise much caution in how it addresses pressing problems. At the same time, the new sultan may still find it advantageous to maintain the tried and true maneuvers the departed leader had practiced for over half a century of unfettered rule.

Economic Shortcomings

Not a stranger to economic troubles that necessitated serious responses in the past, Oman today must address the deleterious effects of a slowing international economy reeling from the pandemic that, as of April 21, has afflicted over 1,508 Omanis (though killed only eight of them). The sultanate relies on oil and gas exports for 70 percent of government revenue. Last March, it produced some 1 million barrels of oil per day––90 percent of which went to China; but now it will be cutting production by some 200,000 bpd in May and June, according to the new OPEC+ agreement. Muscat needs prices to be around $82 per barrel for a break-even budget, which is nowhere near the current collapsed price of $11.47. Moreover, the severe contraction in the Chinese economy resulting from COVID-19 is bound to impact Omani finances, at least partly and in a negative direction. Finally, with limited trade and tourism revenues shrinking, Oman is in for serious belt-tightening.

Such belt-tightening has indeed begun. Oman’s Ministry of Finance recently directed government ministries and agencies to implement an across-the-board 10 percent cut in expenditures—but to be careful not to furlough Omani government employees or decrease their benefits. In 2011, the late Qaboos relied on public financing and assistance from fellow states in the Gulf Cooperation Council to help stanch a serious protest movement. Today, however, the Omani government may not have the same ability to address the negative repercussions of any potential public unrest. The national debt was at 60 percent of gross domestic product in 2019, up from 15 percent in 2015, while the budget deficit in 2020 is expected to reach 8.7 percent—and that is before measuring the impact of COVID-19 on the economy, the government’s response to it, or the plummeting oil price.

This cursory look at Oman’s financial troubles poses a series of important questions, such as: could the deficits in economic performance and their potential negative repercussions force Sultan Haitham to risk Oman’s independence and seek assistance from rich GCC neighbors? While he, as Qaboos’s chosen successor, enjoys the necessary legitimacy, is he strong enough to make the requisite trade-offs to manage the cost of rationalizing the sultanate’s finances (in effect restructuring the social contract between government and citizens)? Or will he choose to avoid that painful restructuring by seeking to side with one faction of the GCC over the other? In the current circumstances of generalized economic slowdowns, can other GCC states undertake to assist him? What regional and international exigencies demand the Sultan’s attention in this difficult task of keeping a distance from unwarranted alliances and changing circumstances?

Concentric Regional Circles

While Qaboos had the connections necessary to sustain an arms-length relationship with all regional and international actors, he still had to maneuver his country amid uncertain conditions. Typically, his concentric circles of worrisome issues rotated around the core of balancing his regional relations with other members of the GCC. His choice to build strong commercial ties with Qatar while preserving good relations with those besieging it--Saudi Arabia, the United Arab Emirates, and Bahrain--was both expected and smart since he succeeded in making Oman a pivotal actor in the crisis and in affirming his independence of action. It would thus be uncharacteristic for Sultan Haitham to do an about-face, especially that there remains no regional or international credibility left in the original claims levied against Doha.

What he may have to contend with, however, is a renewed anti-Qatar campaign by the three Gulf countries that still refuse to end their siege and boycott of the peninsular nation. To be sure, despite their current preoccupation with myriad issues--fighting COVID-19, addressing economic troubles, and dealing with Yemen, among other things--the blockading countries have hardly eased up on their ostracism of Qatar. Good gestures and initiatives last December have not resulted in a hoped-for thaw. In fact, efforts to resolve the 2017 crisis have practically ended amid continued insistence by boycotting countries on demands that Qatar has long declared illegitimate. Here, Oman could help Kuwait in reviving attempts to restart intra-GCC talks to resolve the crisis, now that Saudi Arabia and the UAE may have realized its true costs and negative impact on the GCC’s effectiveness.

In addition, there is the uncertain situation in neighboring Yemen whose civil war has always been an Omani concern because of sheer geography and security ramifications. The late Sultan Qaboos maintained old tribal and social links with the people of Yemen’s Mahra province on the border. He also availed Oman’s offices for a series of talks related to Yemeni developments: between the United States and the insurgent Houthis in 2015 and intermittently between the latter and other Yemeni parties to the conflict, as well as Saudi Arabia, in 2017, 2018, and 2019.

The last round that began in September 2019 witnessed the dispatch to Muscat of Saudi Arabia’s deputy minister of defense, Prince Khaled bin Salman--who has been put in charge of the Yemen file--to participate in indirect talks with the insurgents. The prince continues to discharge his duties today; but it appears that Saudi Arabia has decided to find an easy way out of the Yemeni debacle, in which it immersed itself directly as a warring party in March 2015. The Saudi-led coalition’s recently declared unilateral cease-fire in Yemen is an indication that this is indeed the case. However, hostilities continue as the Houthis angle to better their position on the ground opposite the forces loyal to President Abdrabbuh Mansour Hadi. For Oman, the best course of action is to increase involvement as a facilitator and possibly to expand its efforts to become a full mediator between the parties. Helping to end the war next door not only serves the ultimate goal of sparing the people of Yemen repeated calamities in the age of the coronavirus but it also protects Oman’s stability and overall national security interests.

As for Iran, Oman can continue to rely on a good relationship established and strengthened by the late Sultan Qaboos. Three recent developments even add to the saliency and utility of this relationship:

1. There is an apparent realization by Saudi Arabia and the UAE of the futility of the war in Yemen and, subsequently, of blaming the Islamic Republic for the Houthis’ actions. Muscat thus may not be accused of impropriety by having cordial relations with Tehran.

2. There has been a clear thaw in Emirati-Iranian relations. Two specific developments stand out in this context. First, UAE National Security Advisor Tahnoun bin Zayed made a secret visit to Tehran in October 2019; then, a week later, the UAE released $700 million of frozen Iranian assets. Second, the UAE sent 32 tons of medical supplies in March to help Iran fight the coronavirus pandemic.

3. Saudi Arabia has become quite nervous about moves in the US Congress to punish it for what some US lawmakers call violations of long-standing bilateral relations. As a precaution, Riyadh may seek to de-escalate relations with Tehran, allowing Muscat more leeway in its relations across the Gulf waters.

Iran’s behavior in the Gulf should be a point of concern for the new Omani sultan, a situation that should increase Muscat’s need for playing more of a mediator role.

On the other hand, Iran’s behavior in the Gulf should be a point of concern for the new Omani sultan, a situation that should increase Muscat’s need for playing more of a mediator role. Tehran must be made to understand that its challenge to the American presence in the Gulf will not stand—not because this presence is imperative, acceptable, or inevitable, but because it is simply impossible to end. Indeed, not much could be gained from the latest harassment by the Islamic Revolutionary Guard Corps (IRGC) of US ships operating in the northern Gulf region, except perhaps whipping anti-American sentiment and whetting the appetite of zealous warmongers in Tehran. Such behavior by the IRGC only leads to more animosity and agitation and could easily lead to unwarranted repercussions.

Disinterest in Washington?

As world leaders or their representatives poured into Muscat to offer their condolences during the three days of Omani national mourning for the death of Sultan Qaboos, US officials were nowhere to be seen. On January 15, an American delegation headed by Secretary of Energy Dan Brouillette finally arrived to offer its respects. On January 12, President Donald Trump had expressed his condolences, extolling Qaboos’ “unprecedented efforts to engage in dialogue and achieve peace in the region.” While the administration has not been very efficient and has paid little attention to international norms of behavior, this slight was inexcusable, considering the long-term and strategic relationship between the two countries.

Whether the reason for the dereliction was the president’s busyness with his impeachment proceedings, his lack of knowledge of international affairs, or the Trump Administration’s negative view of Muscat’s role in hosting negotiations for the nuclear deal with Tehran in 2015, Oman’s sultan should not waste much time doubting his country’s importance in American Middle East policy. Instead, Oman would do well to continue on its current course of improved relations with Iran since that will help its mediatory role in the future. Whatever the level of White House interest in good relations with Oman, the country will continue to represent a forward base for military operations for the United States and a possible conduit for hopeful relations to end the war in Yemen.

Caution Continues to Be the Way Forward

Oman is a rare example of a country whose leader’s departure will not likely engender radical domestic, regional, or international policy changes. The late Sultan Qaboos’s style of unfettered rule helped him maintain control and manage dangerous external conditions. But circumstances may have changed and may require added caution and reasoned policy prescription by his successor. For now, perhaps the best Sultan Haitham can do is try to consolidate his rule domestically and maintain those policies that have helped the sultanate survive its dangerous environment: balanced relations with the states of the GCC, diligent work to help Yemen reach a civic peace, and open but not unconditional relations with the Islamic Republic of Iran.

This article has been republished with permission from the Arab Center Washington DC.

U.S. Secretary of State Mike Pompeo meeting with Omani Sultan Haitham bin Tariq, February 2020 (State Department photo via Flickr)
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