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Betting big on Middle Eastern dictatorships will not end well for Putin

Russia is making common cause with Iran and its Persian Gulf neighbours in a bid to kickstart the much touted “new world order”, albeit at the risk of becoming entirely beholden to West Asia’s main players.

August 21, 2023 - Saahil Menon - Articles and Commentary

Russian embassy in Tehran. Photo: Elena Odareeva / Shutterstock

Underwhelming as Yevgeniy Prigozhin’s attempted power grab last June was, it lay waste to Vladimir Putin’s strongman image and further weakened his dysfunctional politburo. As he is not one to let bygones be bygones, the Russian President’s uncharacteristically muted response could be a form of psychological affliction intended to keep the hot-dog vendor turned billionaire catering mogul looking over his shoulder with paranoia until his day of reckoning finally comes.

Putin’s flimsy response to the gravest direct challenge to his leadership yet reflects Wagner’s indispensable role in Ukraine. It is no secret that the full-scale invasion has not gone according to plan, however the use of non-state actors and private military companies (PMCs) in theatres of conflict is gaining currency. Prigozhin’s mercenaries, many of whom are convicted felons duped into putting their lives on the line for early release, have emerged far more battle-hardened and menacing to Kyiv than Russia’s demoralised army.

Interestingly, the Wagner boss did not go into hiding following the high-stakes stunt he pulled. Nor has his ill-gotten wealth been expropriated by the Kremlin as retribution. It is worth recalling that Belarusian dictator Aleksandr Lukashenko acted as a go-between in the immediate aftermath of the insurrection and purportedly managed to talk Putin out of eliminating his “chef”. The former restaurateur’s banishment to Minsk was nonetheless short-lived, as Prigozhin brazenly appeared smiling in photos with dignitaries of the Russia-Africa Summit in his native Saint Petersburg a week ago.

Deciding not to make an example of Prigozhin for “stabbing him in the back” might be perceived, in the eyes of Western policymakers, as Putin exercising a degree of self-restraint at a time when he can least afford any more dissension or controversies within his ever-shrinking inner circle. By contrast, Putin allowing a treasonous act to go unpunished will send a clear signal to Middle Eastern states characterised by one-man rule. Authoritarian leaders in that region now smell blood and almost certainly view the self-styled tsar as yesterday’s man.

 The “mutual respect” cliché

As Russian diplomats gallivant all over the Global South like snake oil salesmen and cajole developing nations into bolstering cooperation with their radioactive government, they routinely spout nonsensical claims about bilateral ties being underpinned by mutual respect and non-interference. Whether it be Latin America, sub-Saharan Africa or the Indian subcontinent, Moscow has sought to one-up legacy Western powers by downplaying the hegemonic aspirations and imperial undertones of its frantic diplomatic efforts.

To appreciate the insincerity of this foreign policy recalibration, one need not look any further than Central Asia and the South Caucasus. Both regions are still reeling from the aftershocks of Soviet occupation, not only with respect to plundered natural resources and ongoing border disputes but also the prevalence of mini-oligarchies enriched on the back of ordinary folk. The alarming brain drain and dire social inequality smaller republics like Kyrgyzstan, Tajikistan and Armenia contend with has seen remittances from their overseas diasporas accounting for a huge share of their annual gross domestic product (GDP).

Tethering their economies to Russia decades after achieving independence has proven a recipe for disaster and ought to serve as a cautionary tale for non-CIS states on a similarly suicidal trajectory. Repeated rounds of Western sanctions have bled the Kremlin’s coffers dry and inflicted unprecedented damage on non-oil sectors – including construction, retail and mining in which a disproportionate volume of guest workers from the poorer former Soviet states are employed. Meanwhile, disaffected Russian youth flocking to ex-USSR colonies in droves exude an unmistakable air of superiority and entitlement despite being shunned by the rest of the international community.

Russian engagement with the Gulf Cooperation Council (GCC) continues to reflect an unwritten code of not meddling in each other’s internal affairs. This arrangement puts the six sheikhdoms’ long-standing fatigue with constant finger-wagging by the West in greater contrast. That these states are aligning themselves with an increasingly isolated and financially crippled Moscow highlights their monarchs’ penchant for exercising autonomy from Western partners. Criticism regarding human rights from the United States and other supposed guarantors of regional security, such as the United Kingdom and France, continues to cause disenfranchisement in the region.

 Shifting sands in the Middle East

Arguably the most significant recent development in the Middle East was the Beijing-brokered détente between Iran and Saudi Arabia. The arch-rivals’ full-fledged restoration of diplomatic relations is not so much a case of putting their historic animosity to bed as their shared disdain for outside forces’ toxic intervention in the region. The overriding consensus, in Riyadh and Tehran alike, is that dialogue and self-sufficiency are more conducive to ensuring stability in the Middle East and North Africa than seeking military cover from third parties or buying into baseless fearmongering by large arms exporters with their own obvious interests.

The Middle Eastern situation has parallels for Ukraine. Blowback from their indiscriminate bombardment of neighbouring Yemen ultimately led the House of Saud and its satellites to realise that it was preferable for them to lose face than to continue losing the proxy war they had been waging. Just as Yemen’s indigenous Houthi rebels managed to force the hand of the Saudi-led coalition by striking targets in the Saudi interior with Iranian-supplied artillery , Kyiv’s counter-offensive is slowly but surely imperilling national security in mainland Russia and unnerving the country’s leadership. Nonetheless, irrespective of recent retaliatory attacks on civilian infrastructure, Putin is unlikely to entertain any kind of negotiated settlement given his absolutist approach towards the bloodbath in Ukraine.

Moscow continues to project weakness and desperation, whether it be by Defence Minister Sergey Shoigu visiting North Korea hat in hand at the end of July or the President himself missing out on the upcoming BRICS conference in South Africa for fear of arrest. It is likely that the normalisation drive between Syria and the GCC (except Qatar) will breathe new life into the Arab League and encourage member states to foreign relations as a collective entity. Should this happen, the Chinese will no doubt not be the only ones looking upon the Russians as junior partners. The United Arab Emirates, in particular, has already accrued considerable leverage over Putin and his cronies by becoming their de facto workaround for access to the international financial system.

The Kremlin is doubling down on efforts to attract Foreign Direct Investment (FDI) from the aforementioned energy-rich Gulf states. The launch of streamlined e-visas and the designation of Iran, Oman, Kuwait, Bahrain and Saudi Arabia as “friendly states” with easier access to the country are but examples of Moscow attempting to salvage whatever tourism revenues it can muster before the off-season. Nonetheless, petrodollars flowing in from the Persian Gulf could cause instability in Russia at a time when its society is more fractured than ever. Moscow is not necessarily entering this troublesome alliance with Gulf autocracies with its eyes wide open; its flirtation with these states could yet come back to haunt the Kremlin.

Saahil Menon is an independent wealth advisor based in Dubai with an academic background in business, economics and finance.

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