Can France Become Saudi Arabia’s Closest Ally?

by Giorgio Cafiero and Daniel Wagner

Giorgio Cafiero is the Founder of Gulf State Analytics. Daniel Wagner is the CEO of Country Risk Solutions. In the picture Daniel Wagner

Influential members of the Saudi Arabian government believe that the United States -- the kingdom’s most valuable strategic ally since 1945 -- has abandoned Riyadh on a host of regional issues, most notably Iran’s nuclear program. As the Saudis respond by seeking to enhance their political and economic relations with countries other than the U.S., France sees an opportunity to supplant Washington as Riyadh’s closest ally. While it remains unlikely that Paris will entirely replace Washington as Saudi Arabia’s most important ally, France can compete with the U.S. to become the kingdom’s top supplier of advanced military technology in the future.

Following the interim nuclear agreement of November 2013, French officials joined their Saudi counterparts in questioningwhether Tehran could be trusted, and Iran’s commitment to ending its ability to build a nuclear bomb. While it remains to be seen how the recently signed Iranian nuclear agreement will impact Paris and Tehran’s relationship, of all parties in the P5+1 talks, France is said to have taken the toughest stance against the Iranian nuclear program, which has not gone unnoticed in Riyadh.

 

French Arms Deals in the Gulf

Although France’s economy barely maintains positive GDP growth rates, its arms industry is booming. As the world’s fourth largest arms exporter (behind the U.S., Russia, and China), France sold nearly double the amount of arms in the first five months of 2015 (more than $16billion) than in all of 2014. From 2010 to 2014, 38 percent of French arms exports went to the Middle East, making it the most important region for the country’s arms industry (30 percent went to Asia; 13 percent to Europe; 11 percent to North and South America; and four percent to Africa). France’s arms sales for the first half of 2015 created more than 30,000 jobs -- significant for a country grappling with record high unemployment. 

France has waged a robust diplomatic engagement with Saudi Arabia for years. In June, Saudi Deputy Crown Prince Mohammed bin Salman visited France to sign deals worth $12 billion, which included $500 million for 23 Airbus H145 helicopters. Saudi and French officials also agreed to pursue feasibility studies to build two nuclear reactors in the kingdom. The remaining money will involve direct investment negotiated directly between Saudi and French officials. 

In May, French President François Hollande visited Riyadh to address a Gulf Cooperation Council (GCC) summit (the first time a non-GCC head of state has done so) and to launch a strategic initiative between France and the Council. Hollande spoke of the GCC facing “dangers emanating from countries’ designs and interference in (GCC) internal affairs”, a clear reference to Iran. Hollande’s address was delivered one day after he was in Doha, where he signed a $7billion deal that included the sale of 24 French Rafale fighter jets to Qatar, along with the training of Qatari intelligence officers. 

In 2013, President Hollande, Foreign Minister Laurent Fabius and Defense Minister Jean-Yves Le Drian traveled to the kingdom to meet with the late King Abdullah, other Saudi officials, former Lebanese Prime Minister Saad Hariri and Ahmed Jarba of the Syrian opposition. A delegation of 30 businesses accompanied Hollande on his visit, which ended with the signing of a deal in which France pledged $3 billion of French weapons for the Lebanese Army (a grant worth twice as much as Lebanon’s entire military budget). 

The meeting underscored Paris and Riyadh’s growing alignment. Just three months earlier, France was the EU military power most in favor of direct military engagement against Bashar al-Assad’s regime, following the Ghouta chemical attack of August 2013. In April, Foreign Minister Fabius also visited Saudi Arabia to emphasize French support for the kingdom’s campaign in Yemen, an additional sign of Paris and Riyadh’s alignment on regional matters.

 

The Broader Geostrategic Context

Saudi Arabia’s growing interest in fostering a stronger alliance with France should also be understood within a grander geostrategic context, in which Washington’s traditional Sunni Arab allies have become frustrated and confused by U.S. foreign policy on a plethora of issues, such as the “Arab Awakening”, human rights and the Iranian nuclear agreement. Officials in Saudi Arabia, as well as Egypt and other GCC states, have sought to explore deeper partnerships with powers beyond the U.S.

The United Kingdom’s decision last year to double down on support for Bahrain by opening a naval base in the island kingdom (which marked the British navy’s first permanent return to the Gulf since the British officially departed in 1971) was rich in symbolism. As the Obama administration’s rhetoric condemning Bahrain’s human rights violations has fueled tension in U.S.-Bahrain relations, Manama’s growing military alliance with London factors into the Bahraini leadership’s determination to explore relationships with other powers. Qatar and Kuwait’s recent signing of defense deals (and talks of others) with France, Germany and Italy fits into the same geopolitical context. Apart from the gradual thaw in U.S.-Iran relations, the Obama administration’s declared pivot-to-Asia (a shift in focus away from the Middle East) has prompted reconsideration of basic post-World War II geostrategic and security norms in the oil-rich Persian Gulf. 

Perhaps nowhere has Riyadh’s interest in diversifying its strategic partnerships been as evident as the kingdom’s recent dealings with Russia. Deputy Crown Prince and Minister of Defense Mohammed bin Salman’s visit to St. Petersburg last month -- where he signed agreements in the areas of nuclear technology sharing, oil production, and space exploration -- sent a clear message to the U.S. that the kingdom will not hesitate to collaborate with Washington’s rivals to gain leverage by taking advantage of Moscow and the West’s deteriorating relationship. 

However, given Russia’s growing alliance with Iran, its ongoing strong support for the Syrian regime, Moscow’s opposition to the Riyadh-led military campaign in Yemen, and the Kremlin’s anger over the kingdom’s oil production policy, there are clearly a host of issues that will likely prevent Russia from supplanting the U.S. as Riyadh’s key ally. Similarly, although China’s quest for energy in light of its economic explosion has enabled the Saudis to keep a foot in both the U.S. and Chinese camps by buying arms from Washington while selling an increasingly sizable portion of its oil to China and other Asian countries, Beijing’s position on various regional issues (most notably Iran and Syria) will similarly limit the extent to which China could supplant the U.S. as the kingdom’s key ally. 

Although Saudi Arabia finds more support for its foreign policy agenda from France than from other world powers, a growing French-Saudi alliance would face its own complications. Just as U.S. criticism of Saudi Arabia’s human rights record does not sit well with officials in Riyadh, France’s condemnation of the kingdom’s liberal use of capital punishment undoubtedly annoys Saudi officials. While in Saudi Arabia for the GCC summit, Hollande called on the kingdom to abolish the death penalty (the previous day Saudi authorities executed five foreigners on charges of murder and robbery).  

At the same time, French public opinion is a factor as France weighs strategic and moral costs. Following France’s sale of 24 of its own Rafale fighter jets to the Egyptian government, Julien Bayou, spokesperson for the EELV (France’s green party), denounced “the delivery of weapons of war to a military dictatorship whose violations against human rights…are now legion.” Given Saudi Arabia’s abysmal human rights record, opposition to selling arms to GCC countries may create a political dilemma for French officials, as it has recently in Germany.  

A potential improvement of French-Iranian relations -- both in economic and security spheres -- following the June 14 agreement could erode France’s image as the most hawkish world power on Iran. France’s businesses, like those of most European countries, see Iran as a potentially lucrative market once the sanctions are lifted. Fabius visited Tehran earlier this month, marking the first trip of a French diplomat to Iran in 12 years, to discuss bilateral trade with Iranian officials. 

In late July, PSA Peugeot Citroën’s CEO announced that the company reached an agreement to sell its DS model in Iran (until three years ago, Iran was PSA Peugeot Citroën’s second largest market and the French car manufacturer sold nearly half a million vehicles in Iran each year until western economic sanctions were imposed.) In addition to PSA Peugeot Citroën, other French businesses -- including Total and Renault -- are eyeing a reopening of the Iranian market with great anticipation. In September, representatives of the Mouvement des Entreprises de France (MEDEF) -- France’s largest employers’ federation -- are expected to visit Iran. 

The EU and Iran’s mutual concerns about Daesh (the Islamic State) in Iraq and Syria have led European officials also to explore the idea of greater European-Iranian cooperation in security sectors. Late last month, EU foreign policy chief Federica Mogherini met with Iranian Foreign Minister Mohammad Javad Zarif in Tehran, where the two diplomats discussed regional issues. Mogherini hailedthe nuclear deal as having “the capacity to pave the ground for wider cooperation between Iran and the West”. 

From the Saudi Arabian perspective, the reintegration of Iran into Western-led economic and security initiatives would constitute a strategic loss for Riyadh, which sees is rivalry with Tehran as a zero-sum game. Indeed, if the international community views Iran as compliant with the July 14 agreement throughout upcoming months and years, relations between the West and Iran have much potential to improve significantly, yet it will take years for relations to fully normalize with Iran.

 

An Important Ally, but Not the Most Important

Regardless of developments in French-Iranian relations following the nuclear agreement, France’s defense companies are likely to continue pursuing lucrative opportunities in the GCC, which outspends Iran on arms ten to one (as the world’s top arms importer , Saudi Arabia outspends Iran more than five to one ). On the political front, other issues -- including the question of Palestine, the Syrian crisis, and Riyadh's war in Yemen -- further align France and Saudi Arabia, and create more fertile ground for the two nations to explore a stronger alliance. 

Although France is unlikely to entirely supplant the U.S. as the kingdom’s most important ally, Paris does compete with Washington as an arms supplier and provider of advanced military technology. With Saudi Arabia’s war against the Houthis in Yemen unlikely to be resolved in the near future, the growing threat of Daesh and other extremist organizations inside the kingdom, and Riyadh’s cooling relationship with Washington, the kingdom is likely to remain a major client of France’s arms industry. 

Saudi Arabia’s enormous oil wealth and its strategic leverage in the Middle East give the kingdom the luxury of easily choosing the powers it wishes to draw closer. Political turmoil and declining U.S. influence in the Middle East have given rise to a new order, which is of grave concern to officials in Riyadh. Leaders in Saudi Arabia and other Gulf states appear to be hedging their bets by investing in a deeper military partnership with France. 

While deeper ties between Riyadh and Paris will not spin the kingdom out of Washington’s geopolitical orbit, the French are beneficiaries of the chill in U.S.-Saudi relations.  Saudi Arabia and other U.S. allies in the region have come to view Washington’s foreign policy decisions in the Middle East -- from the 2003 invasion of Iraq to the Iranian nuclear deal -- as a source of instability, and have doubts that America will ever again have the influence in Middle Eastern affairs that it commanded for decades.  

Yet for all their anger and disappointment, Saudi leaders seem to understand that their ability to entirely reconstitute their geopolitical alliances is rather limited. Although France’s growing commercial interests in Saudi Arabia and overlapping interests in the region can pave the way for a stronger alliance, the kingdom cannot expect Paris to replace Washington as the power responsible for guaranteeing its security from foreign enemies. Historically, and for the foreseeable future, there is only one country capable of providing that security umbrella to the kingdom – and that country is the United States.



Daniel Wagner is CEO of Country Risk Solutions and author of "Managing Country Risk", please see below for link to Amazon. For Country Risk Solutions' web site, please click here.

You can follow Daniel Wagner on Twitter: www.twitter.com/countryriskmgmt


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