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The UAE-Iran Rapprochement: Causes and Effects

Earlier this month, Anwar Gargash, a diplomatic advisor to the United Arab Emirates’ (UAE) President Mohammed bin Zayed (MbZ), announced that Abu Dhabi was “in the process of sending an ambassador to Tehran.” Gargash explained that Iran was the UAE’s “neighbor,” and that Abu Dhabi’s preference had historically been for engagement with the Islamic Republic. Gargash stressed that “the way is not confrontation, because confrontation will complicate the regional scene as a whole.”

The normalization of UAE-Iran relations comes more than six years after Abu Dhabi downgraded its relations with Tehran to show solidarity with Riyadh during the January 2016 Saudi-Iranian crisis. When tensions in the Gulf escalated through the summer of 2019, Abu Dhabi began making cautious diplomatic overtures to Tehran. For the past year, the Emiratis have been discussing the eventual return of their ambassador to Iran and the return of Iran’s ambassador to the UAE. In December 2021, UAE National Security Advisor Sheikh Tahnoon bin Zayed Al Nahyan visited Tehran, signaling Abu Dhabi’s continued pursuit of better ties with Iran despite serious political opposition to the Islamic Republic’s regional foreign policy.

“The UAE does not want a conflict with Iran. Since 2019 especially, Abu Dhabi has acted to de-escalate tensions by dispatching senior officials to Tehran, adopting friendly rhetoric, and engaging in greater outreach,” Dr. Elham Fakhro, a research fellow at the Centre for Gulf Studies at Exeter University, said in an interview with the Gulf International Forum. “The two countries benefit from a strong trade relationship—the UAE recently surpassed China as the largest exporter to Iran, and Dubai is home to many Iranian nationals.”

Emirati Policies Toward Tehran

The UAE’s leadership has come to terms with the fact that America’s “maximum pressure” in the Trump years failed to protect the UAE from Iranian sabotage, terrorism, and perfidy. Ultimately, Abu Dhabi is pursuing a hedging strategy aimed at protecting itself from Iran’s ability to subject Gulf Cooperation Council (GCC) members to higher levels of instability and pressure.

“This is a lesson learned from Donald Trump’s ‘maximum pressure’ and the period of 2019 when Iran attacked tankers and ships in the Persian Gulf near Fujairah, damaging the UAE’s image of a safe and secure place to do business,” Dr. Sanam Vakil, deputy director of the Middle East North Africa program at Chatham House, told the Gulf International Forum. “[The UAE] has calculated that it is more prudent to engage with the Islamic Republic to protect itself from escalation and pressure, and also to offer economic incentives that might over time moderate and positively influence Iranian behavior.”

The UAE’s diplomatic overtures to Iran, and its quest to normalize relations with its Persian neighbor to the north, must be understood within the context of Abu Dhabi’s increasing concerns about Washington’s uncertain future as a reliable security guarantor for the GCC states. The Emiratis have come to realize that “they have to pursue their own goals and objectives in the region in order to secure themselves and de-escalation with Iran is part of that,” pointed out Dr. Dina Esfandiary, a senior advisor for the Middle East and North Africa at the International Crisis Group, in an interview with the Gulf International Forum.

“President Trump’s ‘maximum pressure’ campaign showed them that even pressure doesn’t work on Iran because it just tends to just lash out in the region and they’re vulnerable to Iran lashing out. That, combined with COVID—a virus doesn’t know any borders—taught them that they would have to basically take matters into their [own] hands and pursue de-escalation directly with Iran themselves on a bilateral level, which is exactly what they’re doing,” added Dr. Esfandiary.

Iran’s Stakes

The will for improving bilateral relations is mutual. Tehran realizes that normalizing relations with Abu Dhabi can advance many Iranian interests—particularly when considered against the backdrop of the dwindling prospects for a revival of the Joint Comprehensive Plan of Action (JCPOA).

The Islamic Republic stands to gain significantly from a normalization of its relationship with the UAE. Better ties with Abu Dhabi can help Tehran counter American and Israeli efforts to isolate Iran. President Ebrahim Raisi’s administration has made improving Iran’s relationships with neighboring countries in the GCC and Central Asia, as well as China and Russia, a high priority in Tehran’s foreign policy agenda. With few analysts optimistic about the U.S. and Iran reconstituting the JCPOA, Iranian policymakers are preparing for a future in which Washington maintains crippling sanctions on Tehran and seeking to counteract them through engagement with other, mostly local, partners.

“I think Iranians benefit a whole lot from lesser tension in the region and an improved relationship with the GCC, especially the UAE,” Dr. Abdulkhaleq Abdulla, a Dubai-based Emirati political scientist, told the Gulf International Forum. “Iran definitely and desperately needs the UAE as a conduit for not just commerce, but finances also. There is a lot that goes [on] these days between the two countries—trade relations have increased massively in the last two or three years. It is back to what it was pre-U.S. sanctions. So, I think both countries benefit from an improved relationship and the UAE is definitely eager to continue with it.”

Within this context, Iran’s links to countries such as the UAE are important to its national interests at a time in which the Islamic Republic is likely set to maintain negative relations with the U.S. and other Western powers. From Tehran’s perspective, there are valuable opportunities for deeper economic, investment, and trade ties with Dubai and Abu Dhabi which could result from a restoration of full-fledged diplomatic relations with the UAE.

“For Iran, this seems to be a defensive move,” said Dr. Trita Parsi, the executive vice president of the Quincy Institute. “[Tehran] needs the trade options that relations with the UAE provides. Secondly, it needs to avoid getting completely isolated in the region. By improving relations with the UAE, Tehran may seek to dispel the impression that the region is aligning itself against Iran.”

Describing Iran as a “pragmatic and opportunistic regional actor,” Dr. Vakil explained that the Islamic Republic could secure a “huge win” if its diplomatic ties with the UAE were fully restored. In her words, this development would show “that Tehran yet again is not isolated and has access to the Gulf states and it can continue to use that access to its own advantage.” At the same time, “Iran obtains access to the Emirati market, [and] the re-export of goods—particularly Iranian oil—goes through the UAE. That no doubt benefits Iran. The UAE is also using Iran as a transit point and perhaps over time that will yield further economic and investment integration that will imbed the relationship further.”

Not lost in this equation is the fact that the UAE’s desire to pursue better relations with Tehran leaves the Iranians feeling empowered regionally and gives them a sense of relief. Iran’s engagement with the Emiratis is a “low-cost endeavor” that is “beneficial” to Tehran while “the leadership in Iran is realizing that de-escalation on a regional front on areas where there need not be animosity is useful,” explained Dr. Esfandiary. “After all, they are stretched a little bit thin, so it’s kind of an unnecessary escalatory front. Also, they feel that they have the upper hand when it comes to the Emiratis. They’re the bigger power. They have the ability to cause quite a bit of disruption in the UAE. They’re comfortable in that knowledge, not that they’re going to use it, but it makes them feel superior.”

The Israel Factor

One of Iran’s key motivations for improving relations with the UAE pertains to Tehran’s concerns about the relationship between the UAE and Israel. Through improved relations with Abu Dhabi, Iran can more easily and clearly lay down their red lines regarding Israel’s presence and role in the Gulf.

A topic of intense scholarly debate over the past year has emerged over how the UAE and Iran’s normalization of relations this year could affect Abu Dhabi’s commitment to the Abraham Accords. In truth, the restoration of full-fledged diplomatic relations between Abu Dhabi and Tehran will probably not lead to major problems in the Emirati-Israeli partnership. This is important to the UAE, which seeks to “continue expanding its economic and strategic interests” by balancing Abu Dhabi’s “strong relationship with Israel with its desire for friendly ties with Iran,” as Dr. Fakhro explained. By continuing to build on the Abraham Accords while making public its plans to send an ambassador back to Tehran, Abu Dhabi would send the message that good relations with both Israel and Iran are “not at odds” with one another and “could in fact be complementary to its own interests.”

Dr. Parsi concurred, telling the Gulf International Forum that he did not see Emirati-Iranian relations “undermining the UAE’s orientation towards Israel. It may temper it a bit, and that may be one of Tehran’s aims. But I don’t see it changing the trajectory that the UAE strategically has chosen for its relations with Israel.”

To its credit, the UAE has skillfully separated its normalization with Israel from its normalization with Iran while being “quite transparent on both tracks to both tracks,” according to Dr. Esfandiary. “Basically, they’ve been very good at talking to Iranians about where their relationship with Israel is going—what they’re doing, what they’re not.” At the same time, the leadership in Abu Dhabi has laid down clear red lines of its own with Tel Aviv, making it clear that its territory could not under any circumstances serve as a base for an Israeli military assault on nuclear facilities in Iran. “[Emirati officials have] generally been quite good at being very clear to both [Israeli and Iranian] interlocutors and very transparent in order to ensure that neither side is frightened by what the UAE is doing with the other side,” added Dr. Esfandiary.

Indeed, the UAE maintains relatively cordial relationships with many countries which are on hostile terms with each other, from Iran and Israel to the United States and Russia. “We try to manage and navigate our relationships and maintain the best of relationships between adversaries,” explained Dr. Abdulla. “Our relationship with Iran is not going to hinder our relationship with Israel, and a stronger relationship with Israel is not going to affect the growing relationship with Tehran. I think these two are not mutually exclusive.”

The Road Ahead

The future of Emirati-Iranian relations will probably have many potholes. At the end of the day, setting aside rhetorical commitments to diplomacy and engagement, MbZ views the Islamic Republic as a dangerous and malign regional actor, and Tehran sees the UAE’s close partnership with the U.S. as a major threat to Iran. These two regional players have extremely different perceptions of the Middle East and have backed opposing stakeholders in a host of countries with high sectarian temperatures, from Yemen to Lebanon and Iraq to Bahrain. Iran’s occupation of the islands of Abu Musa and the Greater and Lesser Tunbs is another issue that will remain a persistent source of tension between Abu Dhabi and Tehran, as it has since the UAE’s early years of independence when the Shah of Iran was in power.

“There is a lot that is holding the relationship from being fully amicable,” said Dr. Abdulla. “The question is not whether Iran is a major threat to Gulf security and to [Emirati] security. The question is moving from that to how to deal with that. I think all the GCC countries—the doves and the hawks—have come to realize that maybe we’re better off at this stage to just engage Iran and talk to Iran. Hopefully somebody in Iran listens and moderates its threats to the stability of the Gulf.”

In the final analysis, it is quite telling that the UAE went from lobbying the Trump administration to impose “maximum pressure” on Tehran to realizing the failure of that policy and finding new ways to move past it. Although a scenario whereby the UAE and Iran quickly overcome all their differences and remove all tension from bilateral relations is unthinkable under current conditions, there is a good reason to believe that Abu Dhabi and Tehran will successfully find ways to manage friction between them as well as finding some common ground. During a period in which greater pragmatism takes hold in the Gulf, there is an opportunity for the Emirati-Iranian relationship to move in a more stabilizing direction.

The views and opinions expressed in this article are those of the authors and do not necessarily reflect the views of Gulf International Forum.

Giorgio Cafiero is the CEO of Gulf State Analytics. He is a frequent contributor to Middle East Institute, Atlantic Council, Carnegie Endowment for International Peace, Middle East Policy Council, Al Jazeera, New Arab, Qatar Peninsula, Al Monitor, TRT World, and LobeLog. Throughout Cafiero’s career, he has spoken at international conferences and participated in closed door meetings with high-ranking government officials, diplomats, scholars, businessmen, and journalists in GCC states, Iran, Turkey, and Egypt. From 2014-2015, he worked as analyst at Kroll. Cafiero holds an M.A. in International Relations from the University of San Diego.

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