Economic Realignment in the Desert
President Trump’s first major foreign visit on Friday concluded a three-nation Middle East tour marked by pomp, opulent receptions and announcements of business deals with wealthy Persian Gulf states. In Riyadh, Saudi Crown Prince Mohammed bin Salman broke royal protocol by personally greeting the president on the tarmac. Trump’s motorcade from Qatar’s Doha airport was flanked by bright red Tesla cyber trucks and riders on horseback. And in Abu Dhabi, UAE leader Mohammed bin Zayed awarded his American counterpart with the Order of Zayed Award, the nation’s highest civil honour.
The optics of the U.S. leader’s Middle East visit were strong, showcasing the larger-than-life opulence of the region’s richest petro states — and how much of that wealth they are willing to spend to deepen their ties with the U.S. and advance their own economic agendas. Gulf countries have been looking to revamp their ties with the US, moving away from a transactional oil-for-security understanding to stronger partnerships that are rooted in bilateral investments and shared visions.
Forging American commitment to Riyadh: Saudi Arabia wanted a formalized security deal with the US. While it didn’t get that, experts say it came significantly closer to one. Last year, the two nations came close to finalizing a landmark defence and trade pact – but the deal stalled over the Saudi insistence that Israel commit to a path toward Palestinian statehood. However, this year marked a significant milestone in relationship between US and Saudi Arabia where at a formal signing ceremony in a gilded ballroom at the Saudi capital’s Royal Court on Tuesday, Trump and Crown Prince Mohammed bin Salman signed memorandum of understanding, letters of intent and other executive agreements spanning different government agencies.
Saudi Arabia also committed $600 billion in US investments, including an expansive defence partnership valued at nearly $142 billion, which the White House has touted as the “largest defence sales agreement in history. The visit fell short of offering Riyadh US cooperation on a civilian nuclear program, which the kingdom had been eyeing. The program has been held up over Saudi Arabia’s insistence on enriching uranium domestically – raising concerns in the US and Israel over nuclear weapons proliferation. Uranium, when enriched to high levels, can be used to produce nuclear weapons. For the Saudis, the détente between the US and Syria was also a major diplomatic win. During his visit, Trump met and had tea with Syrian President Ahmad al-Sharaa, a former jihadist who until recently had a $10 million US bounty on his head.
The US president also announced the cessation of sanctions that had been placed on former Syrian President Bashar al-Assad, possibly breathing life back into the country’s crippled finances. Gulf States, including Saudi Arabia, have been keen to invest in Syria and prop up its economy but have been wary of violating US sanctions. Trump’s move is likely to remove such barriers, making way for potentially billions of dollars in investments and returns. Having the rapprochement between the US and Syria take place under Saudi auspices may give Riyadh greater opportunities in Damascus.
An inaugural visit to Qatar, signalling a new chapter in diplomatic and economic relations: Qatar this month received its first-ever official state visit by a US president. The last time a sitting US leader visited the nation was in 2003, when former President George W. Bush paid a visit to Central Command headquarters, where he addressed US military personnel. Qatar’s emir, Sheikh Tamim bin Hamad Al-Thani, said that talks with Trump on this trip will “give new impetus to the existing strategic cooperation between our two countries in various fields. The two nations signed a host of deals during Trump’s visit, including a $96 billion agreement for Qatar to acquire up to 210 American-made Boeing planes, according to a White House factsheet. Trump also accepted a Boeing 747-8 jet from the Qataris, to be used initially as Air Force One.
The American president accepted the mammoth jet despite the ethical and legal controversies it raised. Critics have accused Qatar of seeking to gain influence in the Trump administration through the gift. Doha’s biggest win was perhaps the security assurances received from Trump, in which the US vowed to “protect” its long-time security partner in the face of threats. “We are going to protect this country,” Trump said at a business roundtable, explicitly referring to geographical proximity of Qatar to Iran and the latter’s potential threats to Qatar and its US military base. Qatar is the Gulf Arab nation with the most formalized security ties with Washington. It hosts the biggest US military installation in the Middle East, which the State Department describes as “indispensable” for US military operations in the region.
An AI Mega complex expansion in UAE, cementing bilateral partnership on next-generation technology and economic transformation: The UAE’s primary objective from Trump’s trip was deeper investments on AI and technology, and while it achieved victories in that regard, the visit fell short of what Abu Dhabi really wanted: unrestricted access to advanced American microchips. During Trump’s visit to the UAE, the two countries announced a partnership to build a massive data centre complex in Abu Dhabi to advance AI capabilities with 5-gigawatts of capacity – enough to power a major city.
The UAE hopes to become a global leader in AI by 2031, but it needs American chips to achieve this goal. Under the Biden administration, the US had tightened curbs on AI exports to keep advanced technology out of the hands of foreign adversaries such as China, which the UAE has been hoping to see eased. The chips may, however, soon become available to the UAE. Boeing and GE Aerospace also signed an agreement with Etihad Airways, the UAE’s national carrier. Etihad will commit to a $14.5 billion (€13.1 billion) investment to purchase 28 wide body aircraft, including 787 and 777X models powered by GE engines. Both companies were among the biggest winners from Trump’s regional tour. Just a day earlier, Boeing signed a $96 billion order with Qatar Airways.
Boeing shares climbed to a 52-week high, while GE Aerospace shares hit their highest level since 2001 by market close on 15 May. In the energy sector, US giants including ExxonMobil Corp., Occidental Petroleum Corp., and EOG Resources Inc. will partner with the Abu Dhabi National Oil Company (ADNOC) to expand oil and gas production in a deal valued at $60 billion (€54 billion). Additional agreements include projects with Emirates Global Aluminium for aluminium smelting and gallium production. The UAE and the US plan to spend $440bn in the energy sector through 2035, Sultan al-Jaber, and the head of the Gulf state’s oil giant ADNOC said. This is just one of the business deals the two countries signed during Trump’s trip to the UAE.
As President Trump’s Gulf visit comes to an end, its impact and significance will resonate well beyond the moment because the strategic embrace between the United States and the Gulf nations signals more than just diplomatic theatre—it underscores a deepening economic convergence. With trillions in investments pledged, defence and technology deals inked, and new partnerships emerging in AI and infrastructure, the message is clear: the U.S.–Gulf economic alliance is entering a bold new chapter, one driven by pragmatism, profit, and power projection. Whether this heralds long-term stability or a fragile transactional bond, only time will tell.
Zubair Mushtaq, Research Scholar in Department of Commerce, Kashmir University.
