Bloomberg Businessweek - USA (2019-06-10)

10

◼ AGENDA

● ConstrainingIranwillrequireArabunityandresolve.

TheU.S.mustreconcilethefeudingSaudisandQataris

◼BLOOMBERGOPINION

WrittenbytheBloombergOpinioneditorialboard ILLUSTRATION

BY

LARISSA

HOFF

It’snowalmosttwoyearssincea coalitionofArabcountries

imposeda misguidedeconomicembargoon Qatar.The

group—Bahrain,Egypt,SaudiArabia,andtheUnitedArab

Emirates—saidit waspunishingthegas-richemirateforitsties

withIranandtheMuslimBrotherhood,butit’swidelyseenas

partofa largercompetitionforpreeminenceinArabaffairs.

Endingit shouldbea priorityforPresidentTrump.Ofthe

Arabworld’smanydivisions,noneis moredamagingtoU.S.

interests.TheSaudi-ledgroup’sobjectiveshaven’tbeenmet.

Onthecontrary,deniedfoodsuppliesfrom—andairroutes

over—thesanctioningstates,Qatarhasgrownmoredependent

onIran,whileitseconomyhaseasilyweatheredtheembargo.

Meanwhile,thedisputeisputtingU.S.alliesKuwaitand

Omaninanawkwardposition.Bothhavestrongrelationships

withQatarandmaintainwarytieswithIran,whichis close

enoughtomenacetheirsecurity.Butneithercanaffordto

antagonizeSaudiArabia,theregion’smostpowerfulnation.

MoreimportantforTrump,theimpasseis nowobstructing

hisbroaderMiddleEastpolicy,inparticularhismaximum-

pressure campaignagainstIran.Effectivelyconfronting

IrananditsproxieswouldrequiretheArabstatestounify

behindtheU.S.Instead,Americafindsitselfinthemiddleof

EndtheQatarEmbargo

aninternecineArabconflict:WhileSaudiArabiais itsmost

importantallyintheregion,QatarhoststhegiantAlUdeidAir

Base,forwardheadquartersofU.S.CentralCommand,which

is essentialtokeepingpressureonIran.Therifthasalsohand-

icappedTrump’seffortstocreatean“ArabNATO”toguard

againstIran’smischief-making.

Resolvingthequarrelis thereforeimperative,andtheU.S.

wouldbethenaturalmediator.Unfortunately,aftersomeearly,

desultorypasses,theTrumpadministrationhaslargelyaban-

doneditseffortstointervene.AnthonyZinni,thespecialenvoy

assignedtherole,steppeddownearlythisyear,havingfailed

togetmuchtractioninDohaandTehran,ormuchsupportin

Washington.Hehasn’tbeenreplaced.

Trumpshouldnowredoubletheeffort.Heshouldstate—if

necessary,directlytotheQatariemirandtheSaudiking—that

endingtheriftisa priority.Heshouldappointanenvoyto

takeZinni’splace.Andheshouldprevailonthesanctioning

nationstodropthemaximalistanddeliberatelyoffensivelist

ofdemandsthey’vemadeofQatar.TheQataris,fortheirpart,

needtoofferconvincingreassurancestheywon’tallowrela-

tionswithIrantothreatentheirneighbors.

ArabunityandresolveiscrucialtoconstrainingIran’s

malignactivities,whichtheU.S.hasrightlyidentifiedasthe

mostpressingconcernintheMiddleEast.SaudiArabiaknows

this:KingSalmanAbdulazizrangtherightalarmbellsatemer-

gencymeetingsofArabandMuslimnationsinMeccaatthe

endofMay.Therecanhardlybea bettermoment for the U.S.

to press for an end to lesser squabbles. <BW>

BeijingreleasesitsinternationaltradebalanceonJune10,

providinginsightintohowtheescalatingtradewarwith

theU.S.andslowingdomesticdemandareaffecting

Asia’sbiggesteconomy.Economistsstillseetheriskof

recessionaslowin thenext 12 months.

▶TheBankofRussia

announcesitskeyrateon

June14.Thebankhassaid

a cutis possibleaftertwo

surprisehikeslastyear

helpedcontrolinflation.

▶Teslaholdsitsannual

generalmeetingonJune11.

Thestockhaslostabout

40%in valuethisyearas

demandslidesforitscars

anditsdebtloadtakesa toll.

▶Inditex,parentoftheZara

fashionchain,reportsfirst-

quarterearningsonJune12.

Retailersarestrugglingto

emergefroma prolonged

shoppingmalaise.

▶TheSwissNationalBank

revealsitsratedecision on

June13.Switzerlandhas the

world’slowestinterestrates,

andeconomistsdon’tsee

anincreaseanytimesoon.

▶TheSuperReturn

privateequityconference

convenesin Bostonon

June10-11todiscuss

investmenttrendsin the

energysector.

▶Entertainment

memorabilia,includinga

Beatles-eraguitarplayed

byGeorgeHarrison,go

onauctionatBonhams in

LondononJune12.

▶ China’s Trade in the Balance

Bloomberg Businessweek June 10, 2019