SM Teo Chee Hean at the Middle East Institute Annual Conference 2022

The Middle East: A New Arena for Competition or Cooperation?

Mr Bilahari Kausikan, Chairman of the Middle East Institute,
Distinguished Guests,
Ladies and gentlemen,

Introduction

I am pleased to join everyone again for the MEI Annual Conference.

I last spoke at this conference one year ago. Since then, the geopolitical situation has grown much more complex and volatile. Jostling for influence by the big powers has intensified and become more polarised, with each competing to carve out its own spheres. Even before we could fully digest the implications of the withdrawal of the US and other foreign forces from Afghanistan, a new crisis erupted in Ukraine. These seemingly unrelated conflicts in different parts of the world are not unlinked. The contesting powers are circling each other warily, watching each other’s moves, getting the measure of the power, influence, and resolve of the other parties, and shaping their actions accordingly.

In Europe, the war in Ukraine has rocked the uneasy order that has been in place since the end of the Cold War. Instead of the quick victory that many predicted when Russian troops invaded on February 24, the situation has now turned more dangerous. As Russia persists with its aims, and the US and its allies continue to provide weapons to Ukraine, fears of a wider war have grown. What the situation will look like when the dust settles – which may take some time – is anybody’s guess.

Developments in the Middle East

The new US administration has now been in office for nearly a year and a half. Its arrival signaled a change of approach to the Middle East, not least in reviving talks with Iran. The withdrawal from Afghanistan sent shock waves through the region. Although the US had signaled its intention to withdraw since the Obama administration and had been drawing down troop levels, regional allies and global competitors alike did not seem to believe that the US would or could really leave. They were left flat-footed and scrambling to adjust when President Biden decisively cut the Gordian Knot. The withdrawal operation and unexpectedly rapid collapse of the then Afghan security forces and government, left the Taliban to rapidly come into power. The withdrawal from Afghanistan, paradoxically, thus also served to underscore the key role that the US plays in the regional balance.

These shifting currents come as the debate continues over the US’s role in the region. The US’s focus on the Indo-Pacific strategy, and now its added preoccupation with Russia, will take up much of the US’s bandwidth. Some have wondered whether the re-ordering of Washington’s priorities in the Middle East signals a retreat from the Middle East. However, the US Navy’s continued presence in Bahrain, the US Air Force’s Al-Udeid base in Qatar, and the recent engagement of incoming missiles by Patriot batteries and the F-22 deployment to the UAE in response to Houthi attacks suggest otherwise. It was not so much a retreat as a recalibration of the terms of engagement to deemphasize the role of ground forces.

Energy has also once again become weaponised, as it was in the 1970s. The Middle East remains a key player in energy geo-politics. The Gulf exporters have not been in a rush to respond to American calls to turn on their oil spigots to moderate prices in the wake of the Ukraine war. The repercussions are being felt even here in Singapore. Spiking energy prices have forced some companies to shut down, and hit consumers and households.

Within the region itself, countries are seeking a reset in ties. The Turkish President was recently in Saudi Arabia as part of a bid to turn the page on a rocky relationship. The US and the West are engaging in back-channels with Iran and promising to lift sanctions, not just because of nuclear proliferation concerns, but in the hope of enticing Iran out of Russia’s orbit. The Abraham Accords have spurred a flurry of groundbreaking activity. One took place barely a month ago: A summit in the Negev in Israel attended by four Arab foreign ministers. Quiet discussions are taking place between Saudi Arabia and Iran, facilitated by Oman. Although it is premature to conclude that long-standing historical and sectarian suspicions can be erased and these adjustments will hold over the long-run, this would have been unthinkable just three years ago.

These changes in the external environment have resulted in equally profound internal recalculations; they have recognised that internal adjustment is a necessary condition of successful adaptation to changes in their external environment. Many Middle Eastern countries are relooking at their domestic polices, including their social contracts with citizens. These countries have ambitious transformation plans to diversify their economies and create new jobs. The shifts are also necessitated by reducing over-reliance on hydrocarbons, as the global call for climate change and sustainability grows. At the same time, there will be a continuing need for subsidies to maintain social stability in the face of rising inflation, especially in food prices. New sources of state revenue will therefore have to be found. Bahrain, Oman, Saudi Arabia and the UAE have already introduced a Value-Added Tax. After a lengthy review, Oman is considering introducing personal income tax next year although there remains no official confirmation.

In order to prepare for the future economy, Middle Eastern countries have realised that change at the social and religious level is also needed. For instance, the UAE has embarked on a major drive to position itself as an oasis of tolerance. In 2019, Pope Francis held a papal Mass in Abu Dhabi, which was attended by around 135,000 people. During this visit, Pope Francis and the Grand Imam of Al Azhar Sheikh Ahmed Al-Tayyeb signed a Document on Human Fraternity which called for unity and goodwill among all peoples and faiths whilst rejecting extremism of any kind. The re-opening of a synagogue in Manama, Bahrain and the Dubai Challah Bake which drew much attention last month are also signs of the times – the Jewish community in the Gulf are not just practising its traditions openly, but growing as well.

Asia and the Middle East

In Asia, home to most of the world’s Muslims, these transformative shifts are being studied closely, both in Muslim-majority countries, as well as in countries where Muslims are a significant minority.

The Abraham Accords have an important economic motivation, with the Arab countries benefiting from Israeli technology and Israel benefiting from Arab investments and export markets. But closer readings of the communiques that emerged from the Negev summit point to a future in which the Accords will become an instrument of geopolitical competition, within and beyond the region.

In that respect, the question of Palestine will continue to be salient. Until it is resolved, the issue remains ripe for being seized upon by various parties and forcing itself back onto the international stage. The issue continues to have deep resonance and support among Muslims in South East Asia. Singapore has taken a principled stand on the Palestinian issue – as we have done with Ukraine – to seek a peaceful and negotiated solution.

There are also new strategic players in the geopolitical competition in the Middle East. China’s Belt and Road Initiative has seen it enter into many top-level partnerships with Gulf countries and Iran. India has begun to look west again to its “near abroad” in the Middle East with its large diaspora in the Gulf. Both China and India, as have many other countries in Europe, recognise the importance of engaging the Middle East to secure energy supplies in the face of uncertainties over Russian supplies. As the Asian giants compete in the Middle East, particularly with the recent flare-up in China-India border disputes, the potential for friction in the Middle East between the two Asian powers has grown.

What can Asia and the Middle East Do Together?

Against this increasingly complex backdrop, what can Asia and the Middle East do together? I would like to highlight three important areas.

First, instead of choosing a side, regardless of issue or context, we should signal that we take principled positions to uphold a rules-based, inclusive, open and connected global order that is based on international law, mutual respect and mutual benefit. Deciding our positions based on clear and consistent principles will make us reliable and steadfast partners.

Second, smaller countries can come together to help shape the global order, for example by upholding and updating the global security architecture and trading system, even if the major powers are unable to reach an agreement. For example, Singapore was the first country from outside the region to sign a Free Trade Agreement with the Gulf Cooperation Council (GCC), which came into force in 2013. There is potential to participate in various initiatives across the Middle East, such as Smart Dubai, Saudi Vision 2030, Digital Egypt, and Morocco’s New Model of Development. Middle Eastern countries can also find many opportunities for investment and partnership in Asia, especially in growth areas such as green energy, sustainable economy, technology, and infrastructure development.

Third, both regions can work together to strengthen mutual understanding and people-to-people exchanges. As the birthplace of Islam, how the Middle East understands the religion, and Islam’s relationships with other faiths, will shape the practice of Islam all over the world, including in Asia. We should work together to promote a better understanding of Islam, in particular its fundamental beliefs and values, around the world. Countries in Asia, be it China, Japan, Korea or those in Southeast Asia, have had a long relationship with the Middle East. We should exchange experiences and knowledge about each other’s development journeys and governance as we foster closer ties between Asia and the Middle East.

Conclusion

Whether it is between Asia and the Middle East, between the superpowers, or with the rest of the world, we need more constructive interactions to enhance mutual understanding. This will form the basis for countries to work together for enlightened self-interest for the benefit of all, rather than narrow self-interest. I was therefore glad to visit the Dubai World Expo this January, the first World Expo hosted in the Middle East. It was fascinating to see so many countries around the world represented and the exchange of ideas on important global issues.

Ultimately, the more we work together and share in one another's success and prosperity, the lower the likelihood of conflict and the brighter our collective future can be.

I wish everyone a fruitful conference. Thank you.