”The Weaponized Gulf Riyal Politik(s) and Shifting Dynamics of the Global Arms Trade”

: This article considers the politics and economics of arms trade in the Persian Gulf from the perspective of the importers, rather than the usual focus on the exporters. It analyses the purposes that weapons purchases have served over the last three decades for three of the most important Middle Eastern arms importers—the Kingdom of Saudi Arabia, the United Arab Emirates, and Qatar. This shows an increasingly blurred divide between the political, economic and strategic dimensions of the arms trade. It suggests an important shift in the relations between the arms client/importing states, supplier/exporting states, and defense industrial companies.

Analyzing the arms trade in the Gulf region provides a useful way of considering the major shifts in standing and influence between stakeholders within the triangle of links between arms client states, supplying states, and the defense industrial companies. The next section gives an overview of some of the main characteristics of the politics and economics of arms procurement in the Gulf. The article then connects these to the broader patterns of the global arms trade, where it is becoming increasingly difficult to distinguish between the political, economic and strategic dimensions of the trade. Finally, it considers the implications for the power dynamics among the stakeholders. One clear development is the increasing bargaining power of the Gulf clients in the relationships with their Western suppliers and partners.

Arms trade in the Arabian Peninsula: A political weapon
The Persian Gulf has attracted a significant portion of the global arms exports for a long time, and the three monarchies of the Arabian peninsula under focus here were already in the world's "top 5" for military spending per capita in the early 1980s. This does not come as a surprise, given that the region is situated at a strategic node between Asia, Africa and Europe, home to crucial international reserves of oil and gas, and has a high potential for conflicts associated with the internal dynamics of the Gulf regional security complex. Moreover, Saudi Arabia, Qatar and the United Arab Emirates are some of the richest countries in the world in terms of GDP per capita. Their armed forces represent a notable proportion of their citizens-as "national-minority states", their total population is largely composed of non-citizens. They also have little to no indigenous defense industrial capability, although they are working on developing this. These three countries thus provide clear examples of the way in which the decision to import arms reflects threats, ability to pay, the labor intensity of force structure, and domestic weapons production capability. 3 For these Gulf Arab states, however, defense procurement has always been about much more than acquiring the means to directly address security threats. Lucrative arms deals have been a means of securing continued interest, support, and protection from external partners. An important driver of arms procurement for Gulf leaders has been to keep their Western security guarantors close, by investing massively in their industrial military complexes and helping sustain them through these contracts. Of course, Western powers-in particular the United States, the United Kingdom and France-have long been involved in Gulf security for numerous reasons linked to their own national security and strategic interests, including the importance of securing and maintaining the flow and their access to oil. It has been demonstrated that oil dependent economies have an incentive to transfer arms to oil rich countries (even in the absence of a direct bilateral oil-for-weapons exchange) to reduce their risk of instability and consequent disruption to oil supplies. 4 While it is true that arms trade is an effective foreign policy tool for oil dependent countries, the relationship between suppliers and recipients has more of a quid pro quo dynamic-part of a broader, tacit and mutually beneficial "oil-for-security" pact. Purchases of advanced weapons have also been used as a foreign policy tool by the Gulf regimes to make sure that the world powers remained concerned about their security and stability. Additionally, studies generally posit that the acquisition of new equipment improves the defense capabilities of recipients.
However, for a long time the purchase of advanced military systems by Saudi Arabia, the United Arab Emirates and Qatar did not lead to any increase in their fighting capacity. This was dramatically illustrated by their lack of preparedness in the face of the invasion of Kuwait by the troops of Saddam Hussein in the early 1990s. Rather, the security of Gulf states was improved through arms transfers thanks to the protection guarantees they secured from Western powers. 5 Another political aspect of arms procurement that is seldom considered is the internal security and stability provided both directly and indirectly. Purchasing an impressive set of jetfighters, armored vehicles or missiles can be used to promote national unity and encourage the population to stand behind their leaders both by stirring a sense of national pride and by instigating existential fear toward a real or hypothetical enemy. It might also represent an unspoken threat of repression to encourage the population to behave. 6 Last, but not least, arms procurement has increasingly become part of distributive dynamic within the rentier states of the Gulf. As the basic hypothesis of the "rentier state" paradigm implies, natural resource rents create specific power dynamics and provide leaders with high co-optative capacity and associated weak political opposition. Not only does the absence of fiscal taxes lead to the establishment of a "rentier social pact", allowing leaders to keep their population away from decision making processes, but it can create groups of people who are not keen on reforms as long as they benefit from the rents. The diffusion of modern arms has long been used by outside patrons to affect dominance patterns within countries, reinforcing the internal security position of state-centric elites while weakening the position of other groups that could benefit from alternative definitions of security and development. Military purchases have increasingly been used by the clients themselves, with Gulf leaders, especially in the United Arab Emirates, utilizing the arms trade as a new vessel of such internal bargains. 7 As part of their offsets strategy, the United Arab Emirates led the way in terms of requiring international defense companies to operate through joint ventures, with a local partner as a 51% shareholder. Such joint ventures reflect the core rentier distributive designs of the United Arab Emirates and other countries of the Arabian peninsula, as many of them employ very few locals, and end up being little more than a way for the majority shareholders to benefit simply by being Gulf citizens. Of course, this might change over time, as a real effort has been put on training and on nationalization ("Emiratization", "Saudization", etc.) of the workforce in the private sector of all these Gulf countries. It is, however, very likely that the arms trade will also remain a means of achieving political and economic interests-facilitated, for both importers and exporters, by the lack of transparency in the trade. 8

Politics, economics, and strategy: The increasing blurred lines of the global arms trade
For manufacturing countries, arms sales have historically relied on both economic and political motives. In fact, the capacity to determine the economic drivers of the arms trade is limited because this sort of trade is predominantly determined by political, military or other non-economic factors. The economic literature on arms trade has, therefore, developed to incorporate these elements. Levine and Smith provide an influential dynamic model to analyze the strategic interactions between arms exporters and importers, market structures, and national and international regulatory regimes. 9 Economists have closely associated exports with issues such as employment and the amortization of research and development costs. The number of jobs associated with any given arms deal, in progress or already signed, is indeed often one of the first arguments brought forward by the media and intended to influence public opinion. The salience of the arms sales issue in public opinion, and the way it is framed in national media, has been shown to have had a major influence on the degree of arms export regulation in Europe. Studies have shown, however, that there tends to be a negative causality relationship between military expenditure and growth, pointing in particular to negative externalities of military expenditure on the civilian sector. 10 As for political motives, these have traditionally included alliance building as well as political leverage or influence, with the cold war's end seeing arms supplies remaining an important policy instrument for the United States globally and many other suppliers regionally. The interconnections between the political and economic dimensions of arms trade would now seem to have increased to such a point that they are hard to distinguish from one another. This Another important factor has been the increasing importance of offsets for arms deals. As already argued, exports of military technology in the 1980s did indeed help boost the role of the arms producers, making them participants in the cycles of negotiations leading up to arms deals. The growth of offsets, both military and civil, has further strengthened their position. 12 Finally, the dependence of the defense technological and industrial base of arms producing countries on exports has increased tremendously. Any country with a relatively small domestic arms market is inclined to promote exports to reduce unit costs through economies of scale.
Today one can witness a surge in the amount of political support that arms exports receivedisplaying almost an "existential need" to export. This is true for traditional arms producers and for the newer arms producers emerging as a result of offsets. State-based arms industries kept alive by an infusion of costly state aid often turn out to be too weak to survive in the global arms market, and "become infant industries that never grow up and drain the economies of the mother state". It is also argued that, while the very survival of defense companies is increasingly linked to finance capital and to globalization, the companies themselves have not globalized (in the sense of becoming transnational and losing their home base)-they require the support of their national governments both as continued customers and in promoting them on the export front. 13 These developments can be explained by two trends. The first one was the shrinking of Western defense budgets which occurred in the aftermath of the end of the cold war in the early 1990s, and the contraction of defense budgets (particularly in Europe) in the aftermath of the global financial crisis in the late 2000s. These encouraged arms companies to eagerly turn to export markets. The second is the growing export race within the international arena, with the emergence of new (or increasingly active) competing arms producers, in particular Russia, China and Brazil, and, to a lesser extent, South Korea, Israel, and Ukraine.

Shifting relations amidst the client state, supplying state, and industrial companies triangle
The political value of arms trade in the three Gulf monarchies used to be such that companies, through their governments, could virtually sell anything they wanted (leveraging their clients' lack of knowledge for advantage and profit). This might, of course, be seen as a sign of indifference rather than ignorance, given that the purchases met their foreign policy mission from the perspective of the clients. More recently, changes have been taking place. These countries have developed their armed forces, investing more effort in training and modernizing equipment, and have increasingly projected their militaries onto foreign theaters of operation. As a result, their procurement has become more mission-oriented and coherent, with identified capability needs. In addition, they have increasingly looked to develop their own defense technological, and industrial base. This is seen as a means to reduce their security dependence on their traditional Western partners and to reduce their economic dependence on oil as their main source of wealth. 14 These changes are to be expected, given the argument that states wanting to minimize their arms dependence generally have two alternatives. The first is to increase self-sufficiency in arms production. This is difficult even for the most advanced economies and self-produced arms still need to be complemented by imported weapons or components. The second alternative is to enhance the state's autonomy by diversifying its supplier portfolio. This is particularly apparent for the United Arab Emirates, with Saudi Arabia following since the beginning of Mohammed bin Salman's ascendency to power. 15 These changes do not mean that arms trade in the Gulf has lost its (geo)political dimension.
Quite the opposite, the leadership in these three monarchies of the Arabian peninsula being well aware of the "magnet" they represent for defense manufacturers and governments and keen to use the export race to their advantage.
As argued elsewhere, the turmoil which the region has gone through since the beginning of the Arab Spring became an enabler for assertive and competing Gulf power plays. The power vacuum led the United Arab Emirates, Qatar and Saudi Arabia to conduct more vigorous policies to defend their security and stability but also to enforce their views as to the direction in which the region ought to be heading. They did this using military force in some places (Bahrain, Libya, Syria, Yemen) but mostly using their economic muscle through what can be termed a proactive "riyal politik", that is economic diplomacy through riyals. Similarly, their considerable wealth at a time when many countries were struggling economically has allowed them substantial outreach in the rest of the world. Thus, the arms trade in the Gulf might be seen as a weaponization of the regional actors' ever more assertive riyal politik. 16 One consequence is that the specificities of products no longer matter less than other unspoken criteria (namely the political support and security guarantees these arms purchases allowed them to buy, but also the "under the table" capital transactions they were often associated with). Industrial companies are unanimous in the belief that it has become more difficult to please these demanding client states. 17 It is also possible that there is a shift or perhaps even a reversal in the relations between the client states and supplying states (in line with the phenomenon of "reverse influence"). Two caveats are important to note. First, it is often difficult to establish with certainty who exerts influence on whom when there is such a convergence of multifaceted interests between the actors. This is apparent in the literature on patron-client relations. The second caveat is that some forms of influence are so subtle that, while it is crucial to point out their existence, they are particularly tricky to trace. Further to this, arms and military technology may reflect "dependent militarization", where the "accumulation dynamic is a reflection of external forces rather than self-sustaining". As such, the link between the identity of a country's supplier and its foreign policy preferences may not be obvious. 18 Still, it is reasonable to consider the Arab monarchies of the Persian Gulf as effectively nurturing a newfound strategic leverage onto all the states that are competing to export arms to them. This leverage seems to not only affect what a given producing country is willing to sell to its Gulf partners, but possibly the foreign policy it is willing to implement in the region as well. Gulf leaders might have the ambition to rely on the growing relative advantage in their relationships with external partners not only to bolster their power and assertiveness, but also to deprive the external partners of their capability to hinder or interfere with those policies. For example, the alignment of French policy choices with Gulf countries, especially the United Arab Emirates in Libya, might be linked to a surge in French regional arms exports, including to Egypt, a close ally and client of Abu Dhabi. The limited response of the United States, the United Kingdom, and France to the Yemen War plus the lack of a strong condemnation after the killing of the journalist Jamal Khashoggi might also be seen as illustrations of a will to prioritize business as usual. 19 Of course, it is possible to argue that the growing leverage that Gulf countries have on their arms suppliers has in fact a lot to do with the oil dependence of the latter's home states. Gulf defense spending has, however, continued increasing even as oil prices dropped over the last decade. It might be that these two aspects of international relations are so closely intermingled in the Gulf, that it is difficult to establish which prevails. More empirical data might be needed to sort one from the other. 20

Conclusion
Ultimately, the argument of this article is not to deny the economic and strategic interests that the arms trade with Arabian peninsula countries represents for major exporters-particularly the United States, the United Kingdom, and France (which remain the Gulf States' main suppliers). Nor is it to dispense with the increasing importance of arms purchases in the implementation of autonomous security and defense strategies on the part of the Gulf states.
Rather, it aims at raising awareness that the military contracts signed with the Gulf Arab states also continue to play a crucial role in broader (geo)politics and multifaceted power dynamics-especially so for Saudi Arabia, the United Arab Emirates and Qatar. These dynamics are primarily between stakeholders within these states and between arms suppliers and clients, but also occur between political and economic actors within the exporting countries. A factor playing a key role in these multiple power shifts is the increasing leeway and authority of defense industrial companies in the global arms trade, possibly leading to increased political sway in their relations with their host governments. While this issue has only been touched upon in this piece, it is a promising avenue for future research, especially as it can be tied into wider considerations on the intensification of the role of the private sector amidst a financialized world. This case study of the Gulf States is certainly useful in showing how the traditional rules of the game and the political, economic, and strategic interests of all state and non-state actors has been changing.