Renewable energy a great opportunity for EU-Gulf cooperation
https://arab.news/np464
Relations between the EU and the members of the Gulf Cooperation Council — Saudi Arabia, the UAE, Qatar, Bahrain, Kuwait and Oman — have been robust in several fields, including economic, security and geopolitical. Nevertheless, there exists an opportunity for the EU to further strengthen its ties with the Gulf states through closer cooperation in renewable energy.
The ties between the GCC and the EU are based on the Cooperation Agreement Document, which was signed in 1989 and included several sectors — trade, investment, research and regional cooperation, among other issues. The EU has also established several delegations in the region concerning ties with the GCC, such as the EU Delegation to Saudi Arabia, the EU Delegation to the UAE and the EU Delegation to Kuwait.
In a step in the right direction, the EU-GCC Joint Cooperation Committee last year endorsed another agreement known as the Joint Cooperation Program for the five-year period from 2022 to 2027. The EU appears to have come to the realization that the GCC — which was established with the purpose of strengthening relations between its members, safeguarding their sovereignty and addressing general concerns about their affairs and interests — has become a key international player that is capable of ushering in significant and positive changes, not only in the region but also beyond.
The EU is the second-largest trade partner of the GCC. According to the European Commission, “17.8 percent of the GCC’s imports came from the EU in 2020. The EU thus ranked as the GCC’s No. 1 import partner. In 2020, the EU was the fourth-biggest export partner of the GCC, as 6.9 percent of the GCC’s exports went to the EU. EU-GCC total trade in goods in 2020 amounted to €97.1 billion ($106 billion). The EU’s imports were worth €29.6 billion and they were led by fuel and mining products (€18.6 billion, 62.8 percent), as well as chemicals (€3.4 billion, 11.5 percent). The EU’s exports totaled €67.5 billion and were dominated by machinery and transport equipment (€26.7 billion, 39.6 percent), chemicals (10.4 billion, 15.4 percent) and agriculture and raw materials (€8.9 billion, 13.2 percent).”
The GCC has become a key international player that is capable of ushering in significant and positive changes
Dr. Majid Rafizadeh
But it is important to point out that the European leaders will be keen to find further common ground on which they can build stronger and more positive partnerships in other critical areas, particularly renewable energy and climate change.
This is an opportunity for the EU for several reasons. First of all, while the Gulf is known for its abundance of oil, it is also richly endowed with renewable energy resources, such as wind and solar. For example, located in the center of the so-called sun belt, Saudi Arabia has great potential to produce power from the sun. Jeddah, Riyadh and Dammam, which are three of the largest cities in the Kingdom, enjoy an average irradiation of 5.78 kilowatt-hours per sq. meter per day, considerably more than the global average.
The second factor is the Gulf nations’ green ambitions and their determination to address climate change and restructure their carbon-driven economies. The region has experienced a shift in its understanding and recognition of the fact that avoiding action on climate change is no longer possible. In addition, there seems to be a growing understanding in the Gulf that technologies such as carbon capture and storage need to be developed to keep the oil industry viable in the long term.
There are also an increasing number of projects and initiatives in the Gulf related to renewable energy. For instance, Saudi Arabia and Bahrain have pledged to increase the proportion of their energy mixes that come from renewable sources, while the UAE has committed to a 31 percent reduction in its greenhouse gas emissions by 2030. Meanwhile, Saudi Arabia has announced hugely ambitious plans to build NEOM, the world’s first city without roads — a clear signal of its intention to change course in a more environmentally friendly direction. And Sultan Al-Jaber, the chairman of Masdar, has pointed out that the UAE “aims to play a central role in the emerging green hydrogen economy.”
While the Gulf is known for its abundance of oil, it is also richly endowed with renewable energy resources
Dr. Majid Rafizadeh
The EU-GCC Dialogue on Economic Diversification, which has been in progress since 2019, focuses on exchanging expertise and experience in order to help in advancing economic diversification strategies.
This brings us to another key benefit linked to cooperation and investment in renewable energy between the EU and Gulf nations, which is economic diversification. This has been a key goal of all GCC economies since they began pumping oil out of the ground.
Furthermore, cooperation with the Gulf nations in terms of renewable energy will benefit the EU significantly, as it will reduce fluctuations related to the energy process. For example, the pandemic gave us the first glimmer of price fluctuations in the energy sector. This is why the development of domestic, knowledge-based industries has arguably become an urgent economic necessity, rather than a welcome add-on.
Besides, the EU is ranked one of the largest producers of solar power products, while the Middle East is an obvious candidate for the mass deployment of solar panels as a source of renewable energy.
In a nutshell, thanks to the Gulf nations’ green ambitions and their firm determination to address climate change, renewable energy presents a great opportunity and invaluable common ground for the EU to strengthen its cooperation and ties with the Gulf states.
- Dr. Majid Rafizadeh is a Harvard-educated Iranian-American political scientist.
Twitter: @Dr_Rafizadeh
