Saudi Arabia, Egypt and the Mediterranean Migrant Crisis

05/07/2016 13:22 | Updated 05 July 2016

As the world focuses on the foreign policy challenges facing the United Kingdom, another kingdom consisting of four separate regions also faces immense foreign policy challenges. The Kingdom of Saudi Arabia, which in reality is a union of the Eastern Provinces, the central Nejd (where the Sauds originate), the Hejaz and the south-western Asir region, faces a foreign policy turmoil.

For Saudi Arabia, its reputation abroad is about to become even more important as it embarks on its debut in the international bond market as it arranges $15 billion in debt. This bond is part of the Kingdom's strategy not just to survive the downturn in oil prices but to thrive and re-orient its economy away from dependence on oil. Low oil revenues is the second potential existential challenge that the Kingdom has faced in the past five years. The foreign policy challenges unleashed by the Arab Spring still threaten the Kingdom, including:

- Competition from Iran for regional power,
- Threat to regional stability from Daesh and the Muslim Brotherhood,
- Pressure on its relationship with the US e.g. proposed US legislation (recently passed in the Senate) to hold Saudi liable for 9/11.

Saudi Arabia has reacted to these challenges in two distinct ways. One way has caught the world's attention and attracted a great deal of criticism. The second, while it has not gone unnoticed, has not attracted the credit it deserves for the role it has played in supporting the interests of the wider international community. The reaction that has attracted attention and criticism is the military response: first in Bahrain and on a larger scale in Yemen.

Saudi Arabia deserves more credit for its second reaction: the provision of financial and economic aid. While Saudi humanitarian aid is not new, its financial support of Egypt since 2011 has been on a scale not matched by any other country and goes beyond purely humanitarian help. In that period, Saudi Arabia has pledged at least $4 billion per year to Egypt and ensured its Gulf allies Kuwait and the UAE have made similar pledges. In 2013, this aid rose to $5 billion and has reached $3 billion so far this year. This contrasts with annual aid of $1.4 billion from the US and less than $1 billion from the EU. Saudi financial assistance has underpinned Egypt's economy and contributed to preventing a crisis turning into a catastrophe which would have had far-reaching consequences for international stability.

Without massive economic support, events in Egypt could have taken a very different course and unleashed forces beyond the control of any government or group of governments. Imagine this: a populous Arab country bordering the Mediterranean suffers an internal uprising and economic collapse resulting in millions of its citizens risking their lives to flee to Europe. Syria? Libya? Yes but it could also have been Egypt. While Egypt has experienced political turmoil since the 2011 Arab Spring and the economy has weakened, Egyptians make up only a small proportion of those attempting to reach Europe through Italy or Greece. In 2015, roughly 4000 Egyptians were recorded trying to reach Europe. By contrast, around 8000 citizens from the small African country of Gambia attempted the same journey.

Egypt could have followed the same path as Syria. Escalation of the violent clashes in January 2011 or in the summer of 2013 would have undermined security, especially if in early 2011, Mubarak had attempted to hang on, Assad style. Lack of economic opportunity drove much of the discontent with the Mubarak regime. As a result of the mass protests, Egypt suffered a number of economic blows. Foreign exchange levels plummeted to half their pre January 2011 levels, tourists stayed away, major investment was delayed

Chaos in Egypt in the aftermath of the Arab Spring would have eclipsed Syria. The result would have been millions more refugees attempting to get to Europe. The current migrant crisis would have been a magnitude more tragic. Europe has already struggled to cope with the dimensions of the current crisis. A larger influx of refugees would have overwhelmed some European states.

While the Egyptian economy has yet to return to pre-2011 levels of growth, it has stabilised and is demonstrating steady growth of nearly 4% in 2015. Foreign direct investment is also recovering, having risen to more than $3.5 billion in 2015 from a post revolution low of around $1.4 billion. The influx of Saudi and other Gulf aid has played a central role in supporting the Egyptian economy, preventing the country's collapse and avoiding an even greater human tragedy than that currently unfolding. Saudi's financial support to Egypt is an example of where Saudi's interest - a stable Egypt - coincided with the wider international community's interest.