The Gulf Region is on the Rise

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Our royal couple during the visit to the port of Duqm

Our royal couple during the visit to the port of Duqm © Port of Duqm SAOC

Between 2 and 5 February 2022, the Belgian royal couple embarked on an official visit to Oman and the United Arab Emirates (UAE), the latter of which hosted the 2020 Dubai World Expo up until the end of March. This was, in fact, not the first high-ranking Belgian visit to the region. Her Royal Highness Princess Astrid had already led an economic mission to Saudi Arabia and Oman in 2014, followed by Qatar and the UAE in 2015.

At the start of 2021, His Majesty the King visited Oman to offer his condolences to the new Sultan following the death of his late predecessor Sultan Qaboos, the father of this small Gulf state. Such royal and princely visits to Gulf monarchies help strengthen our bilateral relations with those countries, both politically and economically.

Belgium pays considerable attention to developments in the Gulf region (see box). Our country has four embassies stationed there, while regional agencies promoting foreign trade (FIT, AWEX and are also well represented. Our exports to these six countries totalled around 7 billion euros in 2021, with imports accounting for 6.5 billion euros. The European Union (EU) is also taking steps to strengthen its ties with the Gulf region.

The Gulf Region

The Gulf region refers to the six constituent countries of the Gulf Cooperation Council (GCC), namely Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates (UAE). This economic union was established in 1981 to, among other things, establish a unified internal market and facilitate the adoption of a common currency. Despite internal political struggles, these objectives remain unchanged.

Map gulf region

© Shutterstock

Political and Geopolitical Importance

The Gulf states  are of considerable political and geopolitical significance for Belgium and the EU. They are situated in a region beset by major conflicts (Syria, Yemen, etc.) and tensions, particularly with regional superpower Iran. It is important to bear in mind that they are more diverse than one might think. Take the serious internal crisis that occurred at the GCC (see box) between 2017 and 2021.

It is therefore very important for the EU and its Member States to maintain close dialogue and fruitful cooperation with these states. The stability of the Gulf region and beyond, the search for resolution to its many conflicts, the joint fight against terror and extremism, and support for multilateralism are just some of the many topics high on the agenda.

Human rights - a central theme of Belgian diplomacy - also form an important part of our political dialogue with countries in the region. Issues such as the death penalty, women's rights, the rights of migrant workers and freedom of expression are raised at every level. 

Burj Khalifa

View of Dubai, with the Burj Khalifa in the middle, the world's tallest skyscraper, co-produced by the Belgian company BESIX. © Shutterstock

Economic Significance

From an economic perspective, the region has for decades been of great importance due to its oil and gas production. Accounting for more than half of public funds, the Gulf states still rely heavily on oil and gas revenues. However, they are equally aware of the need to diversify their economies.

This much-needed diversification requires, among other things, an overhaul of education and training, along with a greater role for women within the economy and wider society. Providing enough jobs for their very young populations is also often proving a challenge. All these elements have resulted in the Gulf states currently undergoing profound social transformations.

Most Gulf states have policies in place to increase their level of attractiveness within both the investment and tourism sectors alike. For instance, in recent years, they have played host to an increasing number of major international events. Just think of Qatar hosting the World Athletics Championships in 2019, along with the FIFA World Cup towards the end of this year, or the Dakar Rally in Saudi Arabia and the World Expo in Dubai.

Their economic transformation also extends to renewable energy, healthcare, waste management, port and infrastructure projects, tourism, food security and technology. These are all areas in which Belgium excels.

Belgium's economic presence in the Gulf region is already significant and often highly visible. For example, Belgian company BESIX took part in the construction of Dubai's world-famous Burj Khalifa, currently the world's tallest skyscraper at 828 metres, while dredging firms Deme and Jan De Nul have, among other projects, also left their mark by constructing artificial islands off the coast of the UAE.

With the genuine potential of further strengthening this Belgian economic presence and trade relations, the recent royal visit to the region was certainly strategic.

Our royal couple, just after the official inauguration of the port of Duqm. On the far left, the brother of H.M. the Sultan

Our royal couple, just after the official inauguration of the port of Duqm. On the far left, the brother of H.M. the Sultan. © Port of Duqm SAOC

Energy Transition

The energy transition presents numerous opportunities for Belgian companies, with the Gulf region boasting many natural assets, namely sun, wind, space, sea and... investment capital. While our country is unfortunately not blessed with the same level of resources, it does offer a great deal of expertise. In short, Belgium and the Gulf region complement each other perfectly in this regard. For our country, this is a unique opportunity. After all, Belgium could never become climate-neutral by 2050 on its own, meaning such collaborations are desperately needed.

Our royal couple's visit to Oman is a good indication of the potential the Gulf region offers our companies and the extent to which it complements our country. In Duqm, Their Majesties visited Hyport, a green hydrogen plant being built as a result of an ambitious collaboration between Belgian company DEME and Omani energy company OQ.

Hyport is designed to harvest wind and solar energy, which it will partly convert into green hydrogen and other by-products such as green methanol and ammonia.  Some of this will be exported across Europe, including to Antwerp's own petrochemical cluster.

These exports will be made from the new port of Duqm, which His Majesty the King has officially co-inaugurated with HRH the Sultan's brother. This new port is also the result of a Belgian-Omani partnership, between the Belgian consortium CAP (Consortium Antwerp Port, an alliance between the port of Antwerp and DEME) and Omani company Asyad.

Solar panels at the Dubai World Expo 2020

A country like the UAE has understood the challenge of climate change and the need for renewable energy. Photo: Solar panels at the Dubai World Expo 2020. © Shutterstock

As with Belgium, the Gulf states are fully aware of the challenges being posed by climate change. However, not all countries within the region are moving at the same pace in terms of energy transition, nor do they all hold the same potential in terms of renewable energy. That being said, all Gulf states unveiled ambitious plans to combat climate change at the recent COP26 climate summit in Glasgow. It is also very symbolic that the UAE - one of the pioneers of diversification - is set to host COP28 in 2023.

The Gulf region has a lot to offer Belgium, not only in enabling its transition towards climate neutrality, but also in many other areas. Countless Belgian companies are already active in the region and have even played a crucial role in its enormous transformation within such a short space of time. Together with the EU, our country wants to contribute towards the further development of this promising region.