GULF JULY 2018

Gulf’s Fever for Infrastructures: Kuwait and Basra’s “Trojan Horse”

 The Gulf has been experiencing a fast rise in infrastructural and mega-projects, as ports, new financial and/or industrial cities and ad hoc built-islands for tourism (as in the case of NEOM, the  Red Sea Project, Qiddiya and King Abdullah Economic City in Saudi Arabia, Duqm port and the expansion of Salalah’s maritime facility in Oman). This trend, favoured by Gulf’s strategies of post-oil diversification and the Chinese-Indian commercial and maritime competition, has been also involving Kuwait.

Besides the expansion of Shuwaikh and Shuaiba ports, the Al-Sabah’s led emirate has just re-launched the Madinat Al-Hareer project, known also as “Silk City”, encompassed by the Kuwaiti National Development Plan (“Kuwait 2035”). A $86 billion dollars investment, Silk City would be constructed in Subiya, Northern Kuwait, within 25 years: the new city would be connected to the capital Kuwait City by Jaber Causeway, while Jaber Bridge would link the Silk City’s Economic Zone with five islands part of the project: Boubyan island is going to include Mubarak Al-Kabeer port, which will become the biggest Kuwaiti port (with a planned capacity of 3,6 million Twenty Foot Equivalent Units, TEUs).

With an intended housing capability of 700.000 people, Silk City is expected to boost trade, business opportunities and tourism. According to Kuwaiti authorities, such a project will put the emirate at the centre of two parallel -and maybe intertwined at some levels- commercial routes, thus attracting foreign investments. The first route will connect Kuwait with Central Asian republics, Russia, AFPAK and Eastern Asian countries, while the second one will cross Iraq, Iran and the Gulf monarchies.

China is at the forefront of foreign investments in Kuwaiti infrastructures: as remarked during the last Kuwait Investment Forum, Beijing looks at “Vision 2035” as a  complementary plan to the Chinese “One Belt One Road initiative” (OBOR) [Executive Bulletin, “Kuwait’s Silk City is key project in China’s One Belt One Road initiative”, 22 March 2018]. In 2014, Kuwait and China signed a cooperation agreement for the development of Silk City and Boubyan island. Moreover, the Afro-Asian Economic Council (AAEC), founded in 2017, has recently launched a project aimed to link Kuwait, Egypt and other African countries to OBOR, thus increasing international shipping traffic through the Suez Canal [The Maritime Executive, “Egypt and Kuwait Plan Belt and Road Initiatives”, 13 May 2018].

But the development of Kuwaiti infrastructures brings also security implications, as the need to secure the neighbouring Iraq’s Southern border, since Silk City and Mubarak Al-Kabeer have to be established in Northern Kuwait. In this framework, mega-projects can support Gulf monarchies’ geopolitical strategies aimed to contain and challenge the Iranian geopolitical penetration of Iraq: for confessional and geographical reasons, this is especially true for the Shi’a Basra governorate.

After years of delays, Iraq announced the formation of a joint venture for the re-launch of Grand Faw Port in Basra (planned capacity of 2 million TEUs): city’s residents would be allowed to own shares of the joint-stock company [Technical Review Middle East, “Iraq to form joint venture for the Grand Faw port project”, 20 June 2018]. As evident, Grand Faw and Mubarak Al-Kabeer will likely become direct competitors in the Northern Gulf, where a real “ports bulge” is already in the making.  Kuwaiti authorities are attempting to change the narrative, depicting a future of cooperation, and not competition, between Kuwait and Iraq’s infrastructures.

The most recent wave of popular protests in Iraq, started in June 2018 with Basra as epicentre, could offer to the Gulf monarchies an unexpected chance to gain leverage in this oil-rich Iraqi region, historically tied to the Arabian Peninsula: Kuwait sent fuel to operate suspended power plants and 17 generators [Sara Al Shurafa, “Kuwait helps Iraq to overcome electricity crisis”, Gulf News, 25 July 2018]. This policy could also push Gulf monarchies to side with Basra’s autonomy plans. Cooperation on infrastructural projects might be included into this positive-sum scheme: the economic development and the stabilization of Basra would contribute to insulate Kuwait’s Northern border, downplaying also the Iranian influence in Iraq.

Eleonora Ardemagni is Associate Research Fellow at the Italian Institute for International Political Studies (ISPI), regular analyst for the Aspen Institute Italy. She teaches at ASERI (Graduate School of Economics and International Relations, Catholic University, Milan, Master in Middle Eastern Studies).

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