#SaudiArabia's MBS and the #UAE's MBZ Are on an Economic Collision Course - Bloomberg

Saudi Arabia's MBS and the UAE's MBZ Are on an Economic Collision Course - Bloomberg

Come on down to Riyadh. 

 Photographer: FAYEZ NURELDINE/AFP

For several years now, Saudi Arabia and the United Arab Emirates have been in lockstep on foreign policy. The close friendship of their de facto rulers, Saudi Crown Prince Mohammed bin Salman and Abu Dhabi Crown Prince Mohammed bin Zayed, is the Middle East’s most important alliance. It allows them to boss around the Gulf Cooperation Council, to the disquiet of other members, and set the agenda for the wider Arab world.

Better known as MBS and MBZ, the two leaders share a fear of Iran and a loathing of Turkey and the Muslim Brotherhood. Their countries have formed coalitions with other Arab states to fight a war in Yemen and impose an (only recently lifted) embargo on Qatar. Beyond the Middle East, they have collaborated to broker a peace deal between Ethiopia and Eritrea and pursue military and security alliances in Asia and Africa. They have even, on occasion, pledged economic partnership, at home and farther afield.

Although they are mostly united by their mutual interests, there is one shared goal that threatens to divide them. Both are keen to reduce their dependence on hydrocarbon exports by diversifying their economies — and this puts them on a collision course.

The Saudis and Emiratis are pursuing diversification into the same sectors: tourism, financial services, logistics, petrochemicals, technology. Since they both lack the talent pools required to serve these industries, they must vie with each other for expatriate expertise as well as investment.