Saudi Arabia and UAE pledge $8bn to Egyptian Economy

Saudi Arabia and the UAE have pledged $8bn to help prop up the high problematic and deeply troubled Egyptian Economy.  On the face of it, this is a gesture aimed at providing a mix of cash, central bank deposits and oil products, as the new Egyptian administration gets to grips with what a declining currency and potential foreign exchange reserves crisis.

Yet, a deeper analysis tells us something much more fundamental about how regional political power is shaping up and the regional impact of Egypt’s second revolution.  The commitment comes as the UAE and Saudi Arabia are pleased with the toppling of Morsi and the muslim brotherhood.  Not only is it a demonstration of the potential consequences of removing authoritarian regimes to their own populous, but a clear move to counter Qatar who backed the Morsi regime.  Both Saudi Arabia and the UAE offered billions back in February 2011, but ultimately it was Qatar who played the role of financing Morsi’s government. This informs our understanding of how whilst there are dividing lines emerging within domestic settings, these alliances can draw on the more regional divides of power.  To understand the Arab Spring, therefore is as much about understanding the inside of the state as the regional interplay.

English: Map of the Arabic Peninsula, displayi...

English: Map of the Arabic Peninsula, displaying Saudi Arabia, Yemen, Oman, United Arab Emirates, Qatar, Kuwait, Iraq, Syria, Jordan, Lebanon, Israel and Egypt. (dutch version) Nederlands: Kaart van het Arabisch Schiereiland. De afgebeelde landen zijn Saoedi-Arabië, Jemen, Oman, Verenigde Arabische Emiraten, Katar, Koeweit, Irak, Syrië, Jordanië, Libanon, Israël en Egypte. (nederlandse versie) (Photo credit: Wikipedia)