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Jordan's Inter-Arab Relations: The Political Economy of Alliance Making
New York Chichester, West Sussex
1994
3 Jordanian-Saudi Relations
The early years of Jordanian-Saudi ties certainly offered no indications that the relationship would eventually develop into Amman's most important Arab source of financial support. In the "pre-state" period, the House of Sa'ud (of the Najd region) and the House of Hashem (of the Hijaz area) were bitter rivals for power within the Arabian peninsula itself. In the military conflict that ensued, the Hashemites were driven from the Hijaz as Ibn Sa'ud's men secured the territory for what became the Kingdom of Saudi Arabia. Ever since, the Saudi ruling family has suspected Jordan's Hashemites of harboring irredentist claims. Beyond that, however, they must live with the fact while they control the holy cities of Mecca and Medina, it is the Hashemites who trace their lineage to the prophet Muhammad, thus giving Jordan's ruling family a place of respect and honor in Arab and Islamic circles to which the Al Sa'ud can never aspire.
Despite the conflictual beginnings, intersections of interests eventually improved bilateral relations. Saudi Arabia's first open offer of support to Jordan accompanied similar promises from Syria and Egypt in 1955 to encourage King Husayn not to join the Western-sponsored Baghdad Pact. The Saudis also committed brigades to Jordan in 1956 (Suez), 1957 (following the coup attempt) and 1967 (the June war) as a form of moral or political support for the regime. As Saudi oil wealth increased, the financial dimension of the relationship developed even further. Following the 1967 war and again in 1974, Saudi Arabia (among other Arab states) promised budgetary assistance to Jordan. Officially, this aid was intended to help Jordan, as a confrontation state, counter the Israeli threat; however, the money was intended to buy security from Arab threats as well. Even as early as the 1950s Jordan had come to constitute a security belt for the Saudis, and it continued to serve as a buffer between the conservative peninsular states and the various revolutionary or pan-Arab political currents that swept the Arab East in successive decades. Jordan also worked to prevent arms and drugs smuggled from Lebanon, Syria, and Iran from reaching Saudi Arabia. In addition, the development of the Saudi state and economy required a skilled labor force that Riyadh lacked. In response, tens of thousands of Jordanians, most of them Palestinians, were recruited by or found work in the kingdom, whether in the public or private sector. The migration of Jordanian workers to Saudi Arabia decreased unemployment pressures at home and added substantial foreign currency remittances to the Jordanian economy.
The empirical evidence in this chapter supports the argument that a critical basis of the bilateral relationship for the Jordanians was Saudi budgetary support to help underwrite Jordanian domestic security. For its part, Riyadh provided this substantial economic assistance to Amman for both developmental and military purposes because a stable Jordan was viewed as key to Saudi security as well. "In exchange," the Jordanians provided a variety of military and intelligence services that reinforced Saudi security.
The pre-1990 period witnessed no changes in alignment between these two conservative, pro-Western monarchies. While there were instances of disagreement, given the strong Saudi predisposition not to air inter-Arab disputes in public, some, perhaps many, went without published indication or report. In any case, given the budget security argument, one would expect Jordan to be intent upon preserving its ties with its most important regional patron. The only truly serious test of the relationship came in August 1990, with the Iraqi invasion of Kuwait, after a period of decreasing and only sporadic displays of Riyadh's former generosity. This episode in the bilateral relationship is covered in the concluding chapter.
Why include coverage of Saudi Arabia, or Kuwait in the next chapter, if neither provides an example of an alignment shift? In the first place, continuity in bilateral relationships is the obverse of change. One must understand the bases of both. Second, such coverage is necessary in order to explain Jordan's response to the 1990 Gulf crisis, discussed in the conclusions. Just as important, however, as chapter 1 indicated, individual bilateral relations of small states can rarely be explained in isolation from other key relationships. As the later chapters will show, an examination of the underpinnings of Jordan's ties with Saudi Arabia, its primary external funder, is critical to understanding Amman's alliance shifts with other regional actors.
Before proceeding, a word of caution and explanation is in order. Substantiating statistics on trade exchange in these bilateral relations is not an easy task, since the figures reported in one statistical book often differ from those in another. However, even more difficult to ascertain reliably are aid contributions: what is promised is not always forwarded, and often sums are sent or assistance of various kinds is provided which is not reported or acknowledged by either side. In general, the Gulf states prefer to work behind the scenes, without fanfare. This is even more so the case in the economic realm, because they are usually dealing in direct budgetary support (often for the military) and in large amounts. Hence, what follows is an attempt to piece together the available evidence and, based on the coincidence of certain events, engage in well-founded speculation, but often speculation nonetheless, about the topics and goals of certain meetings.
The Boom Years 1975-1981
Political Developments
In early March 1975 it was revealed that Jordan was giving 21 Hawker Hunter jet fighters to the Sultanate of Oman and that a Jordanian battalion had been sent to Oman's southern Dhofar province (which borders Saudi Arabia) to help Omani, Iranian, and British troops suppress the rebellion there. While no Saudi troops appear to have been involved, the Jordanian assistance was certainly tacitly approved, if not actively encouraged, by the Saudis, who preferred to keep a low profile in regional affairs. The fact that King Husayn visited Oman in April after having talks with King Khalid of Saudi Arabia strongly suggested a Saudi role in the Jordanian assistance to Oman. 1
King Husayn returned to Saudi Arabia in early June, while Prime Minister Rifa'i paid an unexpected visit on September 29 to deliver a message from Husayn to King Khalid, who himself visited Jordan in late December. On January 21, 1976 Husayn and Rifa'i flew to Saudi Arabia following a visit to Damascus, to brief Khalid on the outcome of their talks with Syrian President Asad, which must have dealt in part with the intended establishment of an Egyptian-Syrian Joint Command, as well as developments in the civil war in Lebanon, which the security-conscious Saudis were watching carefully. The Saudis had become increasingly involved in mediation efforts in the Lebanese conflict and finally succeeded in convening a mini-summit in Riyadh (to which Jordan was not a party) in October 1976, which brought an end to the first round of the fighting.
On January 9-10, 1977, the kingdom hosted a multilateral Arab meeting attended by the foreign ministers of Egypt, Syria, Kuwait, Qatar, the United Arab Emirates, and the Palestine Liberation Organization. This critical meeting, to which we shall return in subsequent chapters, dealt with the issue of financial assistance from the supporting (read oil-producing) states to the frontline states. This gathering, and perhaps the subsequent one held a few days later in Cairo, led to a reaffirmation on the part of the supporting states that the aid to the confrontation states, which had been decided upon at the 1974 Rabat summit conference, was a continuing obligation, not limited to a single year's contribution, as the recipients had feared. 2 (See Aid below.)
In March and April visits by Jordan's Interior Minister Sulayman 'Arar, Chief of the Royal Court 'Abd al-Hamid Sharaf, Commander-in-Chief of the armed forces Zayd bin Shakir, and Prime Minister Badran covered security issues and financial affairs. By late spring and early summer consultations were being held on the respective monarch's meetings with U.S. president Jimmy Carter. These consultations dealt at least in part with the second Geneva Middle East peace conference (the first having been held in 1973 following the war), 3 which was proposed for later in the year. Husayn himself went to Medina on July 6, accompanied by Badran, Sharaf, and bin Shakir. He stayed only one day, but the talks were described as successful. 4
These talks may well also have dealt with finances. King Husayn had been vocal in his criticism of the Arab Gulf states for not providing the frontline states with sufficient financial assistance. The London weekly newsletter Arabia and the Gulf reported that the Saudis, upset by the criticism, in the summer of 1977 were reconsidering their decision to pay $500 million of the $540 million total cost of the U.S. Hawk missile system desired by the Jordanian military. 5 (See below.) Saudi defense concerns must also have been key issues as bin Shakir went on a "private" visit of several hours on July 17, during which he met with Defense and Aviation Minister Prince Sultan bin 'Abd al-'Aziz. It was subsequently reported that Saudi Arabia had agreed to allow Jordan to use its northern air bases in the event of a war with Israel; however, Saudi Arabia refused the Jordanian suggestion that a full military pact be concluded between the two. 6
During October 1977 there were a number of visits back and forth between Jordanian and Saudi officials. Husayn received Prince 'Abdallah, commander of the Saudi National Guard, and his delegation on October 17; Prince Nayif, the interior minister, arrived nine days later for a visit of four days; and Sharaf met with King Khalid at Khubar at the end of the month. During Prince Nayif's visit a joint committee was established which was to look into border cooperation, coordination of public security organs, and communications between the two interior ministries. 7 The king himself arrived in Riyadh on November 5 as part of a series of visits to coordinate Arab positions only a few days before Egyptian president Sadat announced his willingness to visit Jerusalem.
The Saudi reaction to Sadat's visit to Jerusalem was, at least publicly, one of surprise, and Riyadh reiterated that any Arab initiative in connection with the Arab-Israeli conflict should stem from a unified Arab position. 8 In the meantime, Arab speculation had it that the Saudis and the Kuwaitis were likely to throw their weight behind efforts to mediate between Egypt and Syria (which had vehemently criticized the visit) to try to restore unity to Arab ranks, since they viewed inter-Arab feuding as a security threat. 9 Husayn was back in Riyadh with Badran, Sharaf, and Court Minister Khammash for meetings with King Khalid on December 19, which no doubt dealt with Sadat's initiative and the appropriate Arab response to it.
The diplomatic consultations continued in early 1978, with frequent exchanges of messages and a trip by Information Minister 'Adnan Abu 'Awdah to Saudi Arabia on January 10. Jordan was clearly involved in the flurry of activity, but the main arena was Saudi mediation between Egypt and Syria. Husayn arrived in Jeddah on May 20 for a two-day visit, and returned, on July 22, this time to Ta'if, the Saudi summer capital, for talks that reportedly dealt with strengthening solidarity, joint cooperation, and standing fast against aggression (a reference to the March 1978 Israeli invasion of Lebanon). A series of subsequent high-level meetings in both countries, which focused on possible cooperation between their security and civil defense establishments, led in September (the month of the Camp David talks) to the signing of a security agreement which, according to Saudi Interior Minister Prince Nayif, covered all security questions of interest, including smuggling, illegal entry, and facilities for the movement of citizens between the two. 10
Following the signing of the Camp David Accords, Arab diplomatic contacts were stepped up again, and Husayn met with Saudi Crown Prince Fahd in Jeddah on October 1 as part of a larger Gulf tour aimed at gaining support for convening an Arab summit. Husayn's visit to the Gulf states suggests that coordination of positions among the conservative monarchies was on the agenda, since the Saudis had demonstrated a distinct lack of enthusiasm for any moves that would irrevocably ostracize Egypt. Husayn's trip had been preceded by a visit from Syrian president Hafiz al-Asad and was followed by a call by the PLO's Yasir 'Arafat, all pressing their respective points of view on the accords and urging the Saudis to support the convening of the summit. 11
Although Riyadh opposed Sadat's move because of its impact on Arab unity, it did not want to risk the radicalization of Egypt that a boycott causing Sadat's demise might trigger. Consequently, the Saudis led a campaign at the summit to prevent Egypt's isolation. 12 As a result, the November summit resolved to establish a fund of up to $9 billion for the confrontation states, $5 billion of which would be for Egypt to persuade Sadat to remain in the fold. The balance of the funds was earmarked for annual support to Syria ($1.8 billion), Jordan ($1.2 billion), the PLO ($150 million), and the occupied West Bank and Gaza ($150 million). Saudi Arabia's contribution to the fund was set at $1 billion a year. 13
Husayn returned to Saudi Arabia on January 22, 1979 for meetings with Khalid. Their discussions must have covered the most pressing Gulf security topics: the then recent demise of the Shah of Iran and the ongoing border crisis between North Yemen and the People's Democratic Republic of Yemen (PDRY) (again, in the Saudis' backyard) which subsequently erupted into warfare on February 23. Bin Shakir arrived in Jeddah on an official three-day visit on March 9. Sharaf followed him for a several-hour visit on March 16, the day that Jordan-, Syrian- and Iraqi-led efforts ended in a ceasefire between North Yemen and the PDRY. 14 These visits were followed by a two-day trip by Husayn to Saudi Arabia on March 21, accompanied by Badran, Sharaf, Court Minister Khammash and military secretary Lt. General Muhammad Idris. Probably as a result of these talks, a group of Jordanian military men, as part of the Arab League Military Delegation, was sent to assist in bringing about an end to the conflict between the two Yemens. 15 Again, Jordan was involved in an extraterritorial role with implications for Saudi security. More directly and openly, between 1972 and 1982, Jordan seconded 674 officers, and 1,576 military men of other ranks to the Gulf states. Of those only one officer went to Saudi Arabia. However, during the same period, 602 Saudi officers and 1,717 Saudis of other ranks were trained in Jordan. This total of 2,319 made Saudi Arabia the largest Gulf state exporter of military men for training in Jordan, followed by the UAE with 1,876 and Kuwait with 1,489. 16
In the meantime, by early March the Saudi position on the pending peace treaty between Egypt and Israel had become clearer. On March 15 both Saudi Arabia and Jordan reacted angrily to the role the United States was playing in promoting the peace agreement, and on March 19 Saudi Arabia declared its opposition to the treaty if it retained its bilateral form and neglected guarantees for the Palestinians. Shortly thereafter, on March 27, the day following the signing, the Arab foreign and economic ministers met again in Baghdad, this time to reassert the Egyptian expulsion and boycott decisions discussed the previous November. In the meantime, Egypt had rebuffed several Saudi offers of mediation and financial support. 17 By the time of this meeting, therefore, the Saudis had been convinced to take a strong position and voted for the boycott of Egypt they had so strongly resisted the previous November.
Officials from the two kingdoms exchanged numerous visits throughout the summer and fall of 1979, a number of which were clearly related to security. The two monarchs met in Geneva on September 20, and Husayn was back in Saudi Arabia for the hajj 18 on November 2. Prince 'Abdallah went to Amman for a two-day visit on November 10, but the Saudis were soon distracted on November 20 by the seizure of the Great Mosque in Mecca by armed militants. Husayn made a brief visit to Riyadh during this incident and congratulated Khalid on December 4 at the end of the ordeal. However, the Saudis faced further disturbances in late 1979 and early 1980 in the form of Shi'i anti-regime activity in Qatif in the kingdom's Eastern province.
Bin Shakir visited Riyadh for talks in early January and Husayn went on a two-day visit to Saudi Arabia for talks with Khalid and other senior Saudi officials on April 28. Early in the year, the Saudis had decided to raise oil prices, a move that threatened to raise Jordan's $210 million oil bill by $72 million, and the Jordanians had requested "frank and clear" oil price talks with Riyadh. 19 Otherwise, consultations continued throughout the year on security and military issues. In August there were numerous instances of Iraqi and Saudi contacts on which the Jordanians were regularly briefed, as the three states began to form a new triangular relationship. The official topic of the Saudi-Jordanian talks was generally given as "the Palestinian issue," but in retrospect it seems far more likely that the discussions concerned the increasing hostilities on the Iraqi-Iranian border and Iraqi president Saddam Husayn's possible military response.
This was certainly the case in the October 11 meeting between King Husayn and Saudi leaders, who conferred to discuss joint plans to help Iraq only a few weeks after the war began. The specifics of the discussions were not released, but subsequent events indicated that the Saudis were attempting to find means of assisting Iraq without associating themselves too closely and so as not to provoke Iran. Safran, in fact, contends that the Jordanians and the Saudis likely worked out a division of labor: Jordan, a declared ally of Iraq, would make Aqaba port available to transship weapons, while the Saudis, in the role of friendly neutral, would allow their Red Sea, not Persian Gulf, ports to be used for transshipping civilian supplies, and perhaps some nonlethal military equipment, although not heavy weaponry. 20 The consultations between Jordan and the Saudis grew increasingly frequent. Near the end of the year, when the Syrians massed troops on the Jordanian border, it was Saudi Prince 'Abdallah who mediated a troop withdrawal and the termination of the crisis before actual hostilities began. 21
Husayn attended the Islamic summit in Saudi Arabia in January 1981 and then made another trip to the Gulf, including Saudi Arabia, in mid-May 1981. In the meantime, the Gulf Cooperation Council had been established and Husayn reportedly made a bid for associate membership, offering military assistance to "douse any future revolutionary fires in the Gulf," 22 presumably along the lines of what Jordan had done previously in Dhofar and between the two Yemens. (It will be recalled that only a year earlier, in response to the fall of the Shah and the Soviet invasion of Afghanistan, the United States had proposed the formation and dispatch of a Rapid Deployment Force for use in the Gulf.) In early April, the king had announced a plan that included a number of points dealing with security in the Middle East, the most important of which were the principles of neutrality of the Gulf, Gulf state self-reliance for defense, and the rejection of the use of the oil weapon. 23 Nonetheless, despite his interest and his country's past contributions to Gulf security, Husayn's request for membership in the GCC was ignored.
On August 7, 1981, the Saudis inadvertently became involved in the Middle East peace proposal game, for on that day Crown Prince Fahd gave an interview to the Saudi Press Agency in which he outlined his vision of a future Middle East peace settlement. His statement, which developed a momentum of its own and became known as the Fahd plan, included a call for complete Israeli withdrawal from the territories occupied in 1967, the creation of a Palestinian state, and the right of all states in the region (including, implicitly, Israel) to live in peace. Although Sadat condemned the plan as offering nothing new, the proposal gained the support of Jordan, Morocco, the UAE and the PLO's Arafat. The Syrians, on the other hand, voiced strong opposition. The Saudis tried to garner additional support for the plan in the weeks preceding the Arab summit in Fez, Morocco and seemed confident despite Syrian opposition that the plan would be adopted more or less intact. However, the day of the summit, the Syrians announced that Foreign Minister Khaddam, not President Asad, would be attending. The same was true of the heads of the other staunchly anti-Camp David states, as well as the PLO. After four hours of sometimes acrimonious debate, Morocco's King Hasan simply adjourned the summit. 24 The Jordanian position, nonetheless, and probably not surprisingly, was one of continuing support for its primary patron's plan.
Economic Developments
AID
Saudi Arabia has been an important aid donor to Arab states since the late 1960s, when it began providing subsidies to the confrontation states in keeping with the resolutions of the 1967 Khartoum summit. Indeed, since 1974 it has been the second largest donor in the world, behind the United States. Grants have accounted for 47 percent of the assistance, while the rest has been in the form of highly concessionary loans. The grants and loans have come from a number of sources. Individual members of the royal family have always been able to dip into the massive reserves of the Saudi Arabian Monetary Agency (SAMA) to provide support. However, as the importance of project aid grew in the 1970s, the Saudi Development Fund (SDF) was established in 1975. It operates similarly to other Arab development funds, but draws on a great deal of outside expertise and administers less than 10 percent of Saudi overseas development assistance. Other agencies such as the cabinet, the Ministry of Finance, and the Ministry of Education and Higher Education have also provided assistance. 25
By 1975, Saudi Arabia, with Kuwait, had already emerged as a major source of finance for Jordan, having provided 38 percent of all Arab budgetary support for Jordan in 1974. The first installment of (military) aid promised to Jordan by Arab states at the Rabat Arab League summit in October 1974, $51.63 million from Saudi Arabia, arrived on January 11, 1975. It was part of the total annual contribution of $300 million promised by several Arab states to Jordan, along with contributions of $1 billion each to Egypt and Syria and $50 million to the PLO. 26 A trip to Jordan by King Faysal that same January resulted in a further Saudi grant of $57 million. According to the communique issued at the end of Faysal's visit, $47 million of this was to be for "urgent requirements" and the balance for the construction of housing for Jordanian army officers. Saudi Arabia was also providing budgetary support to the tune of $36 million in 1975. 27
In December 1975, King Khalid (Faysal had been assassinated by a nephew on March 25, 1975) made a three-day visit to Jordan ostensibly to win support from Jordan and its then close ally Syria, for Egypt's Sinai disengagement agreement with Israel. 28 Any sympathy gained, however, appears to have been purchased, as only days after the visit, the kingdom promised to contribute $215 million to help implement Jordan's $2.3 billion 1976-1980 Development Plan. The aid, to be provided in installments over several years, was in addition to regular Saudi budgetary support payments, estimated in 1975 at $36 million. 29 To help further with development, Saudi Arabia agreed to cede to Jordan a 14-mile strip along the Red Sea coast to allow for the expansion of the port of Aqaba. Iraq had promised to help finance the expansion project, hoping to import up to 300,000 tons of transit goods per year through the port. 30
The Saudis also played a role in financing Jordanian arms purchases. For instance, in 1975 Jordan was seeking to purchase a U.S. air-defense system, 14 batteries of U.S. Hawk anti-aircraft missiles, at a cost of $800 million. Not surprisingly, such a proposed sale to an Arab state fueled a controversy in the U.S. Congress, and as a result a variety of conditions were attached to the deal. 31 In early April, Husayn canceled the deal, reportedly because Saudi Arabia had withdrawn its financial support. Reports indicated that although Saudi Arabia had been prepared to pay the original $300 estimate, it had balked at the revised $800 million price tag. 32 In May, a trip by Husayn to Moscow drove rumors that he was contemplating concluding an arms deal with the Soviets. In response, rumors circulated, but were denied, that Saudi Arabia had threatened to cut off aid to Jordan if it purchased Soviet SAM missiles. 33
Discussions of the deal continued as Husayn and Rifa'i began talks in Jeddah on June 5 with King Khalid, Crown Prince Fahd, and Foreign Minister Sa'ud al-Faysal. Primary among the topics discussed were overall Saudi aid to Jordan, Husayn's visit to Moscow, and the reported Soviet offer to sell Jordan arms. By early August, the Saudis had reversed their decision and had agreed to finance the Hawks deal. The price of the air defense network had been reduced by the Americans to an estimated $540 million, of which the Saudis had agreed to pay all but $40 million. 34 Husayn arrived in Ta'if on August 7, as part of a Gulf tour, to discuss the arms purchase further.
According to Badran, however, despite the financing of the Hawks, the Rabat and other budgetary aid was not forthcoming from the Gulf states in the sums promised. The former Jordanian prime minister, who assumed his post in mid-July 1976, contended that by the latter part of 1976 none of the Gulf states was paying what they had promised at Rabat. Jordan was therefore forced to cut spending and Badran complained that he had struggled month to month in late 1976 to find the money to pay the salaries of the army and the bureaucracy. He, Syria's Foreign Minister 'Abd al-Halim Khaddam, and Egypt's Foreign Minister Isma'il Fahmi went repeatedly together to the Gulf states to ask for the payments they had been promised. The response was never no, only the noncommittal but unchallengeable In sha' 'allah. 35
The year 1977 began with the conference in Riyadh mentioned earlier to discuss ways of "bolstering" (read "increasing the subsidies to") the frontline states. As a result of the meeting, the support states agreed to pay $570 million each to Egypt and Syria, $200 million to Jordan, and $27 million to the PLO for both 1977 and 1978. 36 This was about half the aid promised in Rabat, although there was still some question as to whether the Rabat commitments implied a one-time payment or a long-term pledge. 37
On May 17 Jordanian Minister of Transportation 'Ali Suhaymat arrived in Riyadh for discussions with the Saudi communications minister on means of cooperation and for meetings with officials at the SDF concerning several development projects 38 for which Jordan was reportedly seeking $261 million in development aid. 39 SDF loans and other development-related assistance for this period are listed in Table 9. In November 1978 at the Arab League meeting in Baghdad (Baghdad I) following Sadat's conclusion of the Camp David accords with the Israelis, the oil-producing states agreed to provide annual budgetary support for ten years to the remaining confrontation states: Jordan, Syria, and the PLO. This was the formal commitment that King Husayn had been dreaming of: $1.2 billion per year, with Saudi Arabia the largest contributor. The commitment was reaffirmed at the Arab foreign ministers meeting following the signing of the Egyptian-Israeli peace treaty in March 1979.
Nevertheless, the U.S., intent upon securing the next link in the Camp David chain, continued to pursue and pressure Jordan. The second half of the Camp David Accords, that dealing with Palestinian autonomy, had not been completed, and the logical party to help move the process along was Jordan. The U.S. continued to coax and cajole Amman either to represent or to bypass the Palestinians, whose own representative, the POL, was deemed an unacceptable negotiating partner by the Americans and the Israelis.
Arab activity in the Jordanian capital during this period was intense as rumors abounded that Jordan might be ready to follow Sadat. Could Husayn have seriously considered such a move given the commitment of Arab aid as well as a domestic population (both Palestinian and Transjordanian), not to mention Syria and Iraq, that would have fiercely opposed such a move? One would htink not, but the clear courtship of Jordan by the Arab states during this period would seem to indicate that they had reason to be concerned about another defection from the ranks. Arab aid promises in the past, notably the Rabat commitments, had been demonstrated to be fragile, while U.S. aid to Egypt, effectively the "price of the peace treat," was substantial. Certainly one would have expected the U.S. to commit itself to protect Jordan in the event of threats of Arab military retaliation for signing such a treaty. Therefore, just as easily as balancing the U.S., Israel, and Egypt by adhering to the Arab position, could Jordan not also have balanced Syria, Iraq, the PLO and his domestic constituency by joining the Camp David chorus? The problem with trying to analyze Jordanian behavior in terms of balancing is that it could explain either outcome, depending upon which factor(s) one concludes posed the greatest threat.
| Year | Source | Amount | Project |
| 1977 | SDF | $27.0 million | Husayn Thermal Power Station |
| SDF | $25.0 million | Aqaba port piers | |
| 1978 | SDF | $80.0 million | Water and electricity projects |
| SDF | $73.5 million | Four development projects | |
| 1980 | Grant | $10.0 million | Repair winter flood damage |
| SDF | $11.6 million | Hijaz railway, housing, communication |
|
| Grant | 23 firetrucks & ambulances |
||
| Grant | $0.6 million | Nablus Municipality | |
| Grant | $5.0 million | UNRWA schools in Jordan and Syria |
|
| Grant | $5.0 million | Jordan University | |
| King Khalid | $5.0 million | Queen Alia Fund for Social Development |
|
| 1981 | SDF | $18.0 million | Aqaba port development |
| SDF | $29.4 million | Amman water project | |
| SDF | $30.6 million | Jordan Valley Authority projects |
SOURCE: FBIS, MEED; RSS, 'Alaqat al-Mamlakah b-il-Mamlakah; EIU, Saudi Arabia: Quarterly Economic Report.
Perhaps the king truly did waver, and considered joining the Camp David process. However, if financial and budgetary concerns were high on the list of priorities, aside from the tremendous budgetary support that the Arab states were offering, the king had to bear in mind that Jordan was also heavily tied to its regional markets, more so than any other Arab state. A boycott of Jordan like that imposed on Egypt would have killed Jordan's overland transport trade, and deprived Jordan of its most important export markets, thus devastating the private as well as much of the state sector. Making a deal with Israel would also have infuriated his population. Hence in one fell swoop Jordan would have cut its economic throat and perhaps triggered instability at home. Here budget security alone can probably explain the king's position; a consideration that the king may have been omnibalancing (appeasing a domestic constituency) perhaps overdetermines the outcome. If the king did appear to be considering joining Sadat, chances are that it was an attempt to secure the best aid deals he could from the Arab states and to put them on notice that they could not renege on their assistance commitments.
Overall trade figures for the period demonstrated a clear Jordanian deficit, for the various forms of aid granted by Saudi Arabia could only in part offset the increase in the cost of oil imports from the kingdom. In 1979 imports from Saudi Arabia totaled $230.8 million, 11 percent of the total import bill, making Saudi Arabia Jordan's largest supplier. Saudi Arabia had also become Jordan's largest export market, but the meat, vegetables, fruit, cigarettes, varnishes, and other goods sold to Riyadh brought in only $64.5 million, leaving Jordan with a trade deficit of $166.3 million. 40
Minutes of the meetings of February 2, 1980 do not provide the same insight into the nature of the bilateral relationship at this level as do those of the the joint economic commission. According to the previous meeting of the committee the Saudis had complained about a .04% charge on goods which they claimed was in violation of article 9 of the economic agreement between the two. The Jordanians countered that these charges went toward road maintenance and were in keeping with an Arab League decision of March 14, 1977. In response to Saudi complaints about additional vehicle charges, the Jordanians decided to exempt Arab League country nationals of this charge. The Saudis also mentioned Amman's failure to implement article 11 of the economic agreement and its adjustment to allow Saudi cars to remain in Jordan for three months. A long discussion followed, but the two sides were unable to come to agreement and so a decision was postponed, with the issue referred to the customs authorities in each country. For their part, the Jordanians complained about a problem with Saudi license plates for Jordanian vehicles and the Saudis promised to refer the question to the relevant authorities. 41 These appear to be obscure issues and relatively unimportant in a relationship in which huge sums of military and budgetary aid and the provision of security services seem to have been easily agreed upon. Nonetheless, they recurred, indicating either tensions in the relationship that could not be expressed on other levels or perhaps the lack of coordination between lower and upper levels of the economic decisionmaking apparatus within the two countries.
As noted above, no other Saudi import had the same importance, nor was any Jordanian export to Saudi Arabia of the same strategic significance to Riyadh as was oil to Amman. The "vehicle" of oil delivery was Tapline (the Trans-Arabian Pipeline), owned by the same consortium of companies that owned ARAMCO (the Arabian-American Oil Company). Tapline had been constructed in 1950 to carry oil out of Saudi Arabia across Jordan, through Syria, and then finally on to Lebanon. In late 1960, Jordan began to obtain its crude oil needs from Tapline oil passing through its territory on the way to the Mediterranean. According to agreement, Jordan paid Tapline the Mediterranean crude oil posted price minus 22 cents (based on the distance that the oil did not have to travel since it was taken out in Jordan). In turn, Jordan received a royalty payment for each barrel that passed across its territory. 42
Thus, officially, it was Tapline and not the Saudi government that sold the oil to Jordan. However, on a number of occasions, as an expression of its understanding of where the real power behind the agreement lay, Jordan sought Saudi intervention with Tapline on the question of prices. To the Jordanians' disappointment, the Saudi response was always that Tapline was no different than any other company operating in the kingdom: the Saudi government had no influence over its actions and insisted that the Jordanians speak with the company directly. 43
Then, in 1970, the price of oil began to fluctuate. Expecting the price increases to be minor, the Jordanian government at first indicated that it would absorb them. However, when prices rose dramatically in 1973, the government was unable to avoid passing price increases along to consumers. A dispute then arose between Jordan and Tapline when the company sought to raise the price of the 5 million barrels a year it supplied Jordan from $2.27 to $13.64 a barrel. As a result, in late 1973 Jordan simply stopped payment, leading Tapline to suspend the $7.5 million a year in transit fees it had been paying Amman. On February 9, 1975 Tapline went a step further and suspended pumping, supposedly because it was cheaper to lift oil by tanker from the terminals in the Gulf than from the terminal at Sidon, Lebanon, where the line that passed through Jordan ended. But there is no question that the company's action was intended to pressure Jordan and Lebanon to accept the substantially higher prices demanded for the crude used in their refineries. However, in a clear and dramatic demonstration of the previously denied Saudi influence, at the end of April King Khalid ordered Tapline to resume pumping. 44
Talks aimed at solving the dispute between the Jordanian government and Tapline were held in Saudi Arabia during the first week of June 1975. 45 However, the dispute continued, and the Jordanian Finance Minister and Central Bank Governor returned to Riyadh and Jeddah for talks on January 23, 1976. Not until March 2, 1976 was an agreement finally reached, according to which the Jordanian government acquiesced in a tripling of the price it had been paying for oil: instead of $3.67 a barrel Jordan agreed to pay the world price of $11.50. Yet, at virtually the same time, the Saudis promised $116 million in additional financial assistance to Amman. 46 Jordanian sources insisted that the Saudi aid had nothing to do with the Tapline agreement, 47 but the Saudis evidently had provided the additional financial assistance precisely for that purpose. 48 They simply preferred to work quietly behind the scenes. Arrears payments of $116 million for the oil were made by the Jordanian government by April. 49
The potentially most serious oil-related development of 1976 for Jordan was the announcement by Tapline that it would not be able to continue operations on the same terms once the pending nationalization of ARAMCO was complete. With the reopening of the Suez Canal in June 1975 and the advent of the supertanker, Tapline had become uncompetitive. The pipeline had a capacity of 500,000 barrels a day, but since February 1975 only about 10 percent of that volume had been pumped intermittently to supply Lebanon's and Jordan's needs. Tapline's considerable losses had been borne by the Saudi government and by ARAMCO as an indirect form of budgetary subsidy that was scheduled to end with the completion of the nationalization. 50 However, in August 1979 the Saudis announced that they would continue pumping oil through the Tapline to the Zarqa refinery, located to the northeast of the Jordanian capital, despite the $40 million losses incurred. 51
In July 1977, following discussions between Jordanian and Saudi officials, it was reported that Saudi Arabia was considering rebuilding the historic Hijaz railway, linking Medina with Amman and Damascus. 52 It promised to be an expensive as well as a politically sensitive undertaking, and the slow pace of discussions--in Amman in early October 1977, and among the Jordanian, Saudi, and Syrian ministers of transportation in June 1978--indicated that pressures were being exerted to move ahead cautiously.
Following the January 7, 1979 meeting of the tripartite committee charged with studying the project, the SDF granted a loan of US$11.7 million for the project. Although a Jordanian-Saudi delegation met only a few days later to discuss the project, the tripartite committee did not meet again until January 1980. Two months thereafter, an $11.6 million loan from the SDF was approved to strengthen a 21-km stretch of the Hijaz railway in southern Jordan, but not across the border. 53 The footdragging on the Saudi side seemed obvious, and probably owed to deep-seated concerns regarding reestablishing the Hashemites' ties with the Hijaz. It was not until late June 1981 that the Saudi and Jordanian governments announced that they were beginning to repair the Hijaz railway (and, again, only a Jordanian segment of it). 54 In the meantime, Jordanian-Syrian relations had deteriorated to the point that the Syrians were no longer involved in the discussions.
Perhaps the most important Jordanian export to Saudi Arabia (in terms of its effect on the Jordanian economy) has been human capital in the form of expatriate labor. Such workers not only sent home remittances of critical hard currency, they also served to ease pressure on the Jordanian labor market. While Jordanians could be found throughout the Saudi economy, their contributions in the field of education were particularly notable. In May 1977 the Jordanian Minister of Education, 'Abd al-Salam al-Majali, toured the Gulf states to discuss the issue of seconding Jordanian teachers to Gulf state schools. Agreement was reached that this would be undertaken through and with the approval of the relevant ministry. 55 At this time it was reported that there were some 8,000 Jordanian teachers in Saudi Arabia. Of those, about 500 were on secondment from the Jordanian Ministry of Education to the Saudi government. 56 In September another 300 Jordanian teachers were seconded, along with six Jordanian doctors for Saudi hospitals. In October Riyadh borrowed another thirty-four Jordanian teachers. 57
Summary
Throughout this period, Jordanian-Saudi relations were quite good, with the two governments in accord on the major regional developments: the Egyptian-Israeli peace treaty and the Iran-Iraq war. The official aid relationship, which began at Khartoum in 1967, was strengthened and virtually institutionalized during this period. Indeed, Saudi Arabia became Jordan's first, substantial aid donor, with aid including grants and development loans, assistance for military purchases, and subsidized oil supplies. As such, Saudi assistance became the cornerstone of Jordan's budget security by the early 1970s. In exchange, Jordan also played a key security role for Saudi Arabia, but a more traditional one. Jordan served as buffer between the Saudis and both the Arab-Israeli conflict and the more radical forces for change in the region. Jordan also trained Saudi officers and played a role in terminating unrest in neighboring parts of the peninsula-- Oman and the Yemens.
Nonetheless, while the Saudis did provide substantial sums to the Jordanians as direct and indirect investments in their own security, they did not strike easy bargains, nor could their largess be taken for granted. The regular meetings and consultations at the highest levels between the two makes this clear. The Saudis had clear ideas about what they were "purchasing" and what they were due in return. It may be from such a stance that their toughness in the economic committee meetings derived. In the same way, they held firm on issues of border crossing as well as on any issues that appeared to touch their security, which included their balking on the efforts to rebuild the Hijaz railway.
The Years of Austerity: 1982-1990
Political Developments
It is during this period that the Iran-Iraq war began to weigh heavily, both from a financial and a security point of view, upon all the Gulf states, and by extension, upon Jordan as well. On February 5, 1982, U.S. Secretary of Defense Caspar Weinberger visited Saudi Arabia on a tour that also included Oman and Jordan. The Saudis reportedly asked for American help in establishing a Gulf arms industry and urged that Jordan be supplied with advanced weaponry. 58 Weinberger is credited with proposing the creation of a Jordanian Rapid Deployment Force, to help in circumstances in which American assistance to the kingdom would be embarrassing or difficult. The Saudis reportedly secretly approved the project, although whether they made a commitment to provide material support for it is not clear. 59 Shortly thereafter, King Husayn was asked about the likelihood of a Jordanian military role in the Gulf to protect Gulf state stability through a Jordanian rapid intervention force. His response was that he did not like the term "rapid intervention force," but that Jordan supported any Arab country that was or might be the target of aggression and was ready to offer all the assistance it could afford. 60
In mid-June Husayn went to Saudi Arabia for the funeral of King Khalid, but most of the subsequent consultations between the two countries concerned the response to the June 6 Israeli invasion of Lebanon and its regional impact. These discussions and others eventually paved the way for the September 1982 Arab League summit in Fez, Morocco, where an Arab peace plan, based on the earlier Fahd plan (1981), was agreed upon. King Husayn strongly supported the Fez plan because it was an Arab plan that fit within the general parameters of what Jordan was seeking in a settlement and, at the same time, went a long way toward meeting U.S. President Ronald Reagan's basic requirements for peace in the area. 61 Subsequently, a seven-member committee comprising Jordan, Saudi Arabia, Algeria, Morocco, Syria, Tunisia, and the PLO was established to meet with the five permanent members of the security council to explain the summit's resolutions. Husayn returned to Saudi Arabia in mid-November to review developments on the Palestine question and the results of the activities of the seven-member committee.
Most of the discussions between Jordan and Saudi Arabia during 1983 appeared to focus on the Palestine question, the May 17 agreement (the U.S.-brokered Israeli-Lebanese "peace treaty"), and the outbreak of inter-Palestinian conflict in Lebanon in late May. Regular consultations on these regional issues continued. Amman was reportedly disappointed by the lack of Saudi support during its negotiations with Arafat, which had broken down in the spring. The Saudis, who had been hesitant to encourage Husayn to join the peace process unless he could first get PLO support, did not themselves press for Arafat to come to terms with Husayn, and then reportedly used economic assistance as a means of restraining Husayn. ('Arafat, of course, at the time faced dissension in his own ranks which only weeks later escalated into full-scale inter-Palestinian combat). 62
In 1984 the Lebanese issue and the Gulf war preoccupied Jordanian-Saudi attention. In April, Husayn, accompanied by a high-level delegation, met with Fahd. The king had telephone contacts with Fahd and Iraq's Saddam Husayn on May 24 to follow up on developments in the Gulf war and then on June 27 returned to Saudi Arabia both to perform the 'umra 63 and to meet again with the Saudi monarch. Relations continued to be good until Jordan announced its decision to restore ties with Egypt. Although there had been no criticism of Jordan during 1983 as it gradually restored economic ties with Egypt and served as a conduit for Egyptian support of Iraq in the war, Saudi Arabia did criticize Jordan for taking the step of reestablishing diplomatic relations in September 1984 without seeking the counsel of other Arab states. Despite the criticism, however, there does not appear to have been any attempt at political or economic retribution.
In January 1985 Husayn met with Fahd to try to persuade the Saudi monarch to convene the long-delayed Arab summit in Riyadh and endorse his proposed formula for Jordanian-Palestinian coordination in the peace process. However, the cautious Saudis, not wanting to alienate and anger further a Syria that was already outside the Arab consensus because of its support for Iran in the Gulf war, preferred to wait. 64 In the meantime, consultations between the two continued indirectly. Husayn did not return to the kingdom until May, during which visit his discussions dealt with the political coordination between Jordan and the PLO, which had recently been formalized in the February 11 accord. During the summer and fall, the Saudis were active in working toward a Syrian-Jordanian rapprochement, which, by the end of the year, was bearing fruit.
In 1986 consultations continued on regional issues, particularly the Iran-Iraq war and attempts to mend the Syrian-Iraqi rift. Throughout 1987 In 1984 the Lebanese issue and the Gulf war preocthere were periodic contacts and messages between the two monarchs, including meetings by Prince Nayif in Amman on security cooperation between the two. 65 As the fall approached and passed, the two were particularly concerned about preparations for the upcoming Arab summit. Husayn visited Saudi Arabia on September 29 as part of these efforts and returned only a month after the summit, on December 7. Part of the meeting no doubt concerned following up the summit's calls for a reconciliation between Egypt and Syria on the one hand, and Iraq and Syria on the other.
On February 21, 1988 Prime Minister Rifa'i arrived in Riyadh with a message for Fahd. This visit was followed by a March 16 visit by the Jordanian monarch to Saudi Arabia, among other Gulf states, for the first of four meetings between the two kings that year. The talks reportedly focused on the Palestinian uprising, which had begun early the past December, and on attempts to convene an international peace conference. However, Husayn was unhappy that the Arab summit in late spring had ignored Jordan's role in supporting the Palestinians of the occupied territories and had decided to channel all future Arab assistance to these Palestinians directly through the PLO. Husayn may well have complained about this in his July meeting. He may also have given the Saudis a preview of his intention to disengage from the West Bank, or he may simply have made an additional plea for assistance. The fourth meeting came at the end of August, with the subject again, reportedly, the uprising, the PLO, and the Palestinians, although, again, given that the dinar had begun to decline, one should not rule out the possibility that financial matters were discussed.
Husayn visited Fahd in late January 1989, accompanied by a high-level delegation. Jordan's economy was in crisis and there were reports that during the visit the king had sought to convince the Saudis to renew their annual $360 million Baghdad commitment that had expired in 1988. 66 Only a few weeks later, the Arab Cooperation Council (ACC) was established by Jordan, Egypt, Iraq and North Yemen, triggering Saudi anxiety over the potential regional role of the ACC economic/military bloc. Husayn subsequently made a visit to Riyadh to allay these fears. However, by mid-April Jordan was preoccupied with unrest at home, and there were numerous phone and other consultations between the two countries in the wake of Jordan's economic riots.
By 1990, thwarted in his attempts to have the Baghdad assistance renewed, Husayn had chosen a new fundraising theme: the threat to the West Bank and by extension, Jordan, posed by the arrival of large numbers of Jews from the collapsing Soviet Union and Jordan's consequent need of additional Arab support. In mid-February, discussions between Husayn and Fahd reportedly focused on this topic, the situation in Lebanon, and the continuing feud between Syria and Iraq. 67 However, given the political liberalization process that had begun in Jordan in the summer and led to the country's first free elections, "democratization" may well also have been on the agenda, since the Saudis made no secret of their dislike for the process.
In early May 1990, prior to the Arab League summit in Baghdad, Saudi Arabia proposed to host a mini-summit in Riyadh for Egypt, Syria, Iraq, Jordan, Saudi Arabia, and the Palestinians, designed to discuss Syrian-Iraqi reconciliation. 68 The summit, of course, never took place. On July 18, only days after the Iraqi complaints against Kuwait and the UAE had been raised, Husayn made a trip to Saudi Arabia as part of his mediation or conciliation efforts, which also ultimately failed.
AID
As the Iran-Iraq war took its toll on the Gulf states, Saudi Arabia gradually came to bear an increasing share of the dwindling Baghdad-promised aid. In January 1982 Saudi Arabia promised to cover the Baghdad financial commitments of Libya, which had stopped paying its promised support. This likely came as a result of talks Husayn held with Khalid in early January, although the press reported that the discussions had dealt with the Fahd plan and Jordanian support for it. 69 Later in January Husayn had talks with Prince Fahd, and in April returned to Saudi Arabia as part of a Gulf trip that also took him to Qatar. In 1983-84 the overall amount contributed fell from $668 million to $321 million. Riyadh then pledged to cover payments from Qatar and the United Arab Emirates if either failed to contribute the promised amount. In fact, neither of them paid in 1984, but Riyadh did not make up the shortfall. 70 Jordan was forced to seek external financing to cover the resulting deficit. Development project support did continue, and a list of projects funded is provided in Table 10.
Sausi Development Aid to Jordan, 1982-1990 (Thousand JD *)
| Year | Source | Amount | Project |
| 1983 | SDF | $35.0 million | Aqaba Thermal Station |
| SDF | $35.1 million | Irrigation projects | |
| SDF | $17.1 million | Seven development projects | |
| 1984 | SDF | $23.8 million | Vocational schools |
| SDF | $11.4 million | Roads and railroad construction | |
| 1985 | SDF | $22.4 million | Industrial Estate (Irbid) |
| SDF | $56.0 million | Medical School | |
| 1986 | SDF | $171.4 million | Nine development projects |
| King Fahd | $0.5 million | Queen Alia Fund for Social Development |
|
| SDF | $7.8 million | Zarqa-Ghor road | |
| 1987 | SDF | $18.5 million | Medical Sciences Faculty |
| 1988 | SDF | $11.3 million | Aqaba Road projects |
| 1989 | SDF | $8.8 million | Industrial Estate (Irbid) |
SOURCES: FBIS, MEED; RSS, 'Alaqat al-Mamlakah b-il Mamlakah.
In September 1986 the Saudi government expressed its willingness to provide funds for Jordan's announced development plan for the West Bank. 71 This plan was quite controversial when it was proposed because it was clearly a part of a Jordanian attempt to reassert Hashemite ties to the occupied territories in the face of Jordanian-PLO political feuding. However, just over a year later, in December 1987, the Saudis decided to send their $21 million contribution to the Jordanian-Palestinian joint committee (which channeled Arab state funds to the occupied territories) rather than to the controversial 1986 development plan. This move was a bitter disappointment for Amman and erased any lingering hopes that the Gulf states might reconsider their negative position on the development plan. This policy, in keeping with the Saudi practice of avoiding inter-Arab disputes, also appeared to be part of a strategy on the part of Riyadh to maintain leverage over both Jordan and the PLO. 72
In another setback for the kingdom, at the Arab League summit in late May 1989 the Gulf states failed to renew their 10-year Baghdad commitment, which had expired in 1988, to provide annual support to the confrontation states. Nevertheless, Husayn arrived in Jeddah on August 1 and, certainly not coincidentally, on August 4, it was reported that Saudi Arabia had contributed $200 million in financial aid to enable Jordan to overcome the financial crisis that had triggered the domestic economic riots the previous April. 73 The support was certainly welcome, but it was ad hoc, not the kind of commitment made earlier at Khartoum, Rabat, and Baghdad.
By the end of 1989 Saudi Arabia, along with Kuwait, the UAE, Qatar, and Oman, had agreed to deposit a total of $300 million for Amman's use with the Arab Monetary Fund to support the dinar. Amman was to pay interest 2 percent below market rates. 74 In his February 1990 meetings with Husayn, Fahd reportedly offered an additional $200 million in assistance as well as spare parts for the Jordanian armed forces. Relations between the two appeared very cordial, and Prime Minister Badran stated that Fahd had "expressed full understanding of Jordan's financial and economic situation during the talks." 75 By May, however, when Husayn went to Saudi Arabia to perform the 'umra, the promised aid was not yet forthcoming and officials in Amman were frustrated by the delay. 76
Just as was the case in the previous section on trade, an examination of the minutes of the meetings of the joint committees provides fascinating insights into the nature of the Saudi-Jordanian relationship below the monarch-to-monarch level. The exchanges on issues related to trade transport and vehicle entry provide the best examples among the documents studied for this project of the nature and substance of everyday politics, the role of bureaucratic implementation in bilateral relations, and the nature of the obstacles to further Arab economic integration.
In July 1985 the fifth meeting of the joint economic commission was held. Again it was decided to amend the list of tariff-free products. There was also agreement to set up temporary trade exhibitions and to exchange trade delegations. The Jordanians asked that a government-sponsored joint investment company be set up to undertake development projects in the two countries in the areas of industry, tourism, agriculture, and the like. Jordan suggested that a plan for the establishment of the company as well as bylaws be drafted and presented. The Saudi side agreed to study the proposal. 77
For their part, the Saudis once again raised the issue of the charges on cars and trucks going into and out of Jordan. They complained again that this was against the terms of the economic agreement (discussed in 1980). When the Saudis threatened to put equivalent charges on Jordanian cars and trucks, the Jordanians agreed to lift the charge on trucks bound for Saudi Arabia, but not for Saudi trucks bound for a third country. The Jordanians asked for the same treatment for their trucks. The Saudis agreed to work on this, but asked the Jordanians to eliminate the remaining charges on Saudi trucks going to third countries.
The Jordanians also raised what was a more serious issue: the implications of the Saudi decision that Jordanian refrigerator trucks arriving at the border be required to be emptied and then have their contents carried by Saudi refrigerator trucks across the border. The result was a great deal of damaged or spoiled Jordanian produce. The Saudis countered that this policy was aimed at preventing contraband from entering the country. The Jordanians then further complained that the Saudis required drivers to have permission to enter the country of final destination and that this often caused Jordanian drivers to be delayed for a day at the border because of the early closing of customs posts on Thursdays and Fridays. The Saudis also promised to study this. These last two issues appeared to be deliberate forms of harassment cloaked in bureaucratic garb. However, since the practice continued over a long period of time, it is impossible to attribute it to a particular Jordanian policy decision or position with which the Saudis were unhappy. It may well simply have been a function of the Saudis' extreme sensitivity on issues related to their security. Or, it may have been a Saudi way of reminding the Jordanians of how dependent they were upon them.
The joint economic committee met again in December 1986. The more substantive matters concerned the disputed transport issues discussed in the 1985 meeting. The Jordanians asked again that their refrigerator trucks be exempted from the regulations that produce be transported by Saudi trucks at the border. The Saudis, however, were not to be moved, responding that these measures were taken only after a great deal of study and as a security measure. They claimed they were trying to prevent damage and that the same measures were applied to all countries. As for the Jordanian request that their drivers not be required to have the permission of the countries of destination (other Gulf states) prior to entering Saudi Arabia, the Saudis responded that the demand was based on conditions set by the other Gulf states.
In the realm of actual commodity exchange, in 1987 as in 1986, Jordan purchased subsidized wheat from Saudi Arabia. In 1987 the total was 200,000 tons 78 and by September of that year Jordan was seeking to purchase 200,000 tons of wheat annually from Saudi Arabia as a hedge against possible world shortages. In the past, Saudi wheat had been sold to Jordan for less than $90 a ton, compared with a world market price of about $175 a ton. 79 The two also signed an agreement covering the exchange of agricultural products, cooperation in animal and crop disease control, and the use of recycled water. 80
At the end of the first week of February 1988 the joint economic commission had its seventh meeting. For the first time, the Saudis agreed to the establishment of a Jordanian trade exhibit in Saudi Arabia and expressed an interest in setting up another exhibit in Jordan in 1989. 81 Riyadh welcomed the renewed Jordanian request to buy Saudi wheat and to exchange agricultural expertise, and asked Jordan to send a technical team to the kingdom. The Jordanians also asked yet another time that their refrigerator trucks not be required to unload completely at the border, but the Saudis were unrelenting. 82
In the October 1989 meeting of the committee, the two sides noted that trade between them was still modest, below the desired level in comparison with the possibilities. The Jordanians asked that their products not be denied entry into Saudi Arabia simply because they were similar to Saudi products before the relevant specialized authorities were consulted. The Saudis responded that no product was denied entry until a study was completed that established that the product's similarity to the Saudi product. 83
TAPLINE AND OIL
By late September 1984 Jordan had reached yet another agreement with Tapline according to which the company committed itself to supplying Jordan with all its crude oil needs and Jordan, in return, agreed to absorb the costs of operation, estimated at $26.7 million a year. Either party could cancel the agreement, but not without two year's notice, which could not be served before October 1985. The minimum duration of the agreement was three years. In practice, the agreement did not constitute a costly undertaking for Tapline, given the glut in the oil markets at the time and the drop in the spot prices below the $29 per barrel payable by Jordan. Tapline's only concession was a 45-day grace period for payment, which meant forgone interest of 43 cents per barrel. 84 One of the reasons for the decision to keep the line open appeared to be the delays surrounding the proposed (and ultimately aborted) Iraq to Aqaba pipeline, since Jordan had intended to compensate for the termination of Tapline service through increasing its imports of Iraqi crude. 85
Gulf investment was highly coveted by both the Jordanian public and private sectors, and had been discussed periodically in meetings of the joint economic committee. In mid-March 1986, the efforts finally bore fruit, as the Jordanian government approved a draft agreement setting up an equal equity Jordanian-Saudi company for industrial and agricultural investment. Unfortunately, only a month later the Saudis announced a freeze on all new projects, pending a clearer picture of oil prices in the international market. 86 Probably as a result, it was not until almost a year later that the Saudi-Jordanian Company for Marketing and Investment was established with capital of $500,000, 87 and not until the February 1988 meeting of the joint committee did the Saudis announce that all the necessary steps had been taken to establish the Saudi-Jordanian joint company. 88
On March 5, 1989 the two governments signed an agreement to establish a $50 million Amman-based Jordanian-Saudi Industrial Agricultural Company, intended to invest in Jordan. 89 In the 1989 meeting of the joint committee, the two sides stressed the role that this investment company would play and the need to get business underway. What seemed to be delaying progress was the failure of each country to pay its share of the capital. 90 In the case of Jordan there was certainly a problem of liquidity. In the case of the Saudis, there may have been a liquidity problem (although that seems unlikely), a lack of political or economic will, or concern that the Jordanians would not be able to find the funds to pay their share. Again, economic cooperation on the lower bureaucratic levels or for less economically- or security-sensitive issues appeared to have far more difficulty bearing fruit.
LABOR
The attractiveness of Saudi Arabia for Jordanian labor continued, despite the regional economic downturn. Some 3761 Jordanians reportedly went to work in Saudi Arabia in 1983, including 1,240 construction workers and 995 technicians. 91 In mid-year it was reported that there were at least 140,000 Jordanian workers in Saudi Arabia, nearly half the total number of Jordanians employed overseas. It was also reported that the Saudi Ministry of Education would soon issue contracts to 2,285 more Jordanian teachers. 92
This period witnessed a marked decline in oil state financial support for Jordan as a result of the drop in oil prices and the consequent decline in oil-state liquidity. Only Saudi Arabia continued to pay its Baghdad commitment, in addition to part of the share of the reneging states. Jordan suffered as a result of the drop in payments, but preferred to borrow abroad rather than scale back its planned expenditures. Bilateral political relations remained good, although there were a few differences over Jordan's restoration of ties with Egypt, Saudi failure to fund the 1986 development plan for the occupied territories, and the failure of the oil states to renew their Baghdad commitments in 1988.
Beyond the aid relationship, Saudi Arabia continued to provide development loans, ensure Tapline oil for Jordan, and support ongoing attempts to establish joint industrial projects, although they seem to have had little life beyond official discussions. The Saudis characteristically continued to focus in meetings of the economic committees on issues of border crossing and customs (including the refrigerator truck problems) which further demonstrated their preoccupation with internal security issues, or with making the Jordanians aware, even in more minor details, of Saudi importance to them.
Economic Relations
The most obvious form of economic statecraft in this case is the Saudis' use of substantial grants and loans. Of all Jordan's relations with Gulf states, indeed of all Jordan's relationships in the Arab world, that with Saudi Arabia has been most important from the standpoint of budget security, precisely because of the tremendous sums granted over the years. Whatever begging and cajoling may have been required of the Hashemites in dealing with the House of Sa'ud, even in the absence of definitive statistics there is no question that, whether budgetary, military, or developmental, Saudi aid has been Jordan's most secure and extensive form of support over the years. In exchange, of course, Jordan served Saudi security needs in a variety of ways: working as a stable buffer between the Saudis and Israel, sending troops when the Saudis preferred only indirect involvement, as in the case of Oman in 1975, providing border surveillance to thwart smuggling, and, most basic of all, succeeding in preserving itself as a conservative (as opposed to an Arab nationalist) regime on Saudi Arabia's western border. To ensure Jordan's continuation in this role, Riyadh paid well, although not as well as the Jordanians and other Arabs had often hoped or requested.
Interviews with members of the political elite in Jordan (not to mention the populace) made clear that the Jordanian view of Saudi aid differed substantially from the Saudi view. Quite simply, Jordanians considered the aid from Saudi Arabia to be their right. Arab oil money, they reasoned, belonged to the Arab nation at large and Jordan as a poorer and frontline state deserved the aid. The Saudis, on the other hand, according to Jordanians, believed that the financial aid effectively bought Jordan as a friend and ally and that that was where the story ended. 93
Not surprisingly then, despite the "money-for-security" exchange that at base defined the relationship, the Saudis clearly saw their position in the relationship as superior, a fact that they periodically reinforced. The Gulf states have been generous, but regardless of whatever profligacy may have characterized their spending on consumer items and weaponry at home, they were not interested in underwriting wasteful spending of Gulf money by their aid-recipient Arab neighbors. There is good reason to believe, based on official testimony, that at least part of the reason for the disagreement over the funds promised at Rabat in 1974 (finally straightened out in January 1977) derived from Gulf state displeasure with Egypt's initial use of this money.
Oil and Tapline policy was another key instrument of Saudi economic statecraft. The Saudis were obviously disingenuous in their public statements regarding their influence with Tapline: they clearly were able and willing to affect Tapline policy when they so chose, as evidenced by King Khalid's order that the company resume pumping to Jordan in April 1975. However, the Saudis preferred to keep a low profile in such matters. When Jordan did finally reach agreement with Tapline over increased oil prices, the Saudis made a grant to Jordan in the same amount as the increase in the oil bill, and then denied there was any connection between the two events. Although oil supplies from Iraq eventually overwhelmed the supplies Jordan received from Saudi Arabia, for most of the period under study Saudi supply and subsidization of oil to Jordan constituted just one more key form of indirect budgetary assistance, supporting the same goals of Jordanian (and, ultimately, Saudi) security and stability as did the grants and loans policy.
In the realm of trade, given Saudi Arabia's wealth and the nature of its imports from Jordan (mostly fresh produce), the Saudi export market was far more important to Jordan than was the Jordanian market to the Saudis. Jordan exported neither the type of products nor the amounts necessary to make Saudi Arabia vulnerable to a Jordanian border closure. Much more important to the Saudis was Jordan's role as a transit country through which exports from other countries passed on their way to Saudi Arabia, or on to the lower Gulf states. This is clear from the focus on transport and transit issues in the minutes of the joint committee meetings.
Although both countries have relatively free market economies, trade and transport between the two has long been regulated by a formal protocol, unlike, for example Jordan's relationship with the also free-market Kuwait. While the customs-exempt product list is regularly revised, the protocol does not provide for individual deals nor does it set trade quotas, as is the case with the other Arab countries with which Jordan has protocols. In the Jordanian-Saudi relationship trade is the prerogative of the private sector. Having said that, the state can and has on occasion interfered in commodity exchange. There is the notable example of Saudi Arabia's forcing Jordanian trucks to empty all their goods at the border and transfer them to Saudi trucks, leaving the produce to spoil. The fact that this practice continued over a period of time--it was first noted in the minutes of the July 1985 meetings, was noted again in December 1986 meetings, but is not mentioned in the next round of talks in February 1988--makes it unlikely that it was linked to a particular Jordanian misstep, for which the Saudis sought to exact punishment. Instead, it is more likely that either a general heightened concern for security led to lower-level bureaucratic implementation of such a policy or that the Saudis, because the losses in imports to them were of no significance, simply used the policy as a way of reminding the Jordanians of their dependence and vulnerability.
The negotiations recounted in the minutes of the joint committee meetings are instructive for other reasons as well. First, they demonstrate a Saudi focus on detail and an unwillingness to bend or compromise, at least in the open. Jordanian appeals on several issues were repeatedly rebuffed and a number of what appear to be relatively minor issues related to minimal transport fees which the Saudis viewed as unfair were raised several times. Second, the discussions clearly demonstrate Saudi caution: in each case in which a new issue or proposal was raised the Saudis were very careful to make no commitment beyond "raising it with the relevant authorities" or "taking it under consideration." While the real power behind these committees generally does rest with the top decision makers, nonetheless, there is little that the Saudis agreed to in these meetings beyond revised customs lists.
Finally, there is the issue of Jordanian expatriate workers in Saudi Arabia. As will be demonstrated even more clearly in the case of Kuwait, skilled Jordanian labor, perhaps Jordan's most important export, has played a crucial role in the development of the Gulf states. Statistics are hard to come by and notoriously unreliable, but at its zenith, the Jordanian (largely Palestinian) community in Saudi Arabia may have numbered as many as 150,000. However, the size of Saudi Arabia and its more closed atmosphere prevented the emergence there of the sort of Jordanian or Palestinian community that developed in Kuwait. Like the Kuwaitis, the Saudis treated or related to the community as if it were Palestinian, the responsibility of the PLO. Thus, politically, the community's primary importance was to the PLO. However, while it did contribute to the Palestinian resistance, it also played a major economic role for Jordan: these expatriates sent back substantial remittances that shored up foreign currency reserves, just as their absence eased unemployment back home. Saudi Arabia depended upon skilled Jordanian teachers, physicians, engineers, and businessmen, while Jordan counted upon their continued absorption by the Saudi labor market and the hard currency they sent home. Jordanian skilled labor was not as easily replaced as Jordanian fruits and vegetables, so in this instance the bilateral exchange was far less lopsided.
Economics and Alliances
Unlike its relationships with Egypt, Syria, and Iraq, Jordan's relations with Saudi Arabia do not manifest clear or marked shifts, at least not until the Gulf crisis. While the Saudis were evidently displeased with Jordan's warming relations with Syria in 1976-77, and Jordan was unhappy with the decline in Saudi aid in 1976 and the failure to renew the 1979 Baghdad commitments at the 1989 Arab summit, these developments did not lead, for example, to a shift in the security arrangements between the two. Indeed, one of the striking features of Arab politics throughout the 1980s was the unformalized Saudi-Jordanian-Iraqi alliance.
Despite its size and tremendous wealth, Saudi behavior appears to be that of a state obsessed with security. The subsidies to Jordan may have been viewed by some Saudi policymakers as a form of Arab or Islamic solidarity. However, in more pragmatic terms, the grants and loans over the years served as investments in Saudi Arabia's own security: a strong Jordan could resist any political or economic pressures for radical change from within that might spill over into the peninsula; it could also constitute an effective land buffer between Saudi Arabia and the Arab East; and on occasion it meant the Saudis could count on the Jordanians to undertake military or diplomatic activity that the Saudis' preference for a low profile led them to avoid.
To be sure, the arrangement was facilitated by the fact that in the Jordanians the Saudis were not courting ideological opponents. As a conservative and generally pro-Western monarch, Husayn, too, saw a major political challenge to his regime from adherents of pan-Arab or Arab socialist ideologies, from those who were both inimical to the continuation of monarchies and sought to erase the artificial borders in the region imposed by the French and the British. Given the political division between radical and conservative and the threat the former attempted to pose to the latter, a Jordanian-Saudi coincidence of interests in security was natural, despite lingering suspicions owing to the rivalry between the two ruling families earlier in the century. The alignment or alliance equation at base was a simple and reinforcing one: Saudi Arabia paid support of various kinds to keep Jordan solvent and stable, and a consequently solvent and stable Jordan then reinforced Saudi security indirectly, and occasionally directly.
Moreover, because of Riyadh's wealth and influence in regional politics, maintaining good relations with Saudi Arabia had a multiplier effect. According to former Prime Minister Rifa'i, in relations with the Gulf states, selling a policy to the Saudis was the key to winning broader Gulf support: once the Saudis were on board, everyone else would follow. 94 A number of policymakers contended that the major difficulty in dealing with the Saudis was that they never stated directly or straightforwardly what they wanted. If one figured correctly, they showed their pleasure by increasing support; however, if one's calculations were wrong, they would decrease their support or take some other punitive action. 95
Policymakers also contended that relations with Saudi Arabia required a kind of balancing act: if Jordan pursued too independent a course (as in the case of its relationship with Syria in the mid-1970s) the Saudis would cut support as a way of reining it in, but if it became too dependent upon them, they would in effect lose interest and might also cut their support. Optimizing support, therefore, meant determining and maintaining just the right distance. 96 Given Jordan's success over the years in obtaining Saudi support, one may surmise that in addition to the insurance the Saudis assumed they were buying, King Husayn and his advisers probably proved fairly astute in managing relations with Riyadh.
Not until the end of the 1980s did aid from Saudi Arabia seriously wane. Perhaps then it is not coincidental that by the end of the summer of 1990 Jordan had taken a position constituting the only open and serious break with the Saudis in the history of the relationship: the clear refusal to join the multinational coalition opposing Saddam Husayn. That story is covered in the final chapter.
Note 1: Economist Intelligence Unit, Saudi Arabia and Jordan: Quarterly Economic Report (hereafter QER: Saudi Arabia and Jordan), no. 2 (1975): 11. Back.
Note 2: Middle East Contemporary Survey (Hereafter MECS) 1976-77, p. 59. Back.
Note 3: Foreign Broadcast Information Service/NEA (Hereafter FBIS), June 7, 1977. Back.
Note 4: FBIS, July 7, 1977. Back.
Note 5: QER: Saudi Arabia and Jordan, no. 3 (1977): 14. Back.
Note 6: Middle East Economics Digest, hereafter MEED, September 2, 1977. Back.
Note 7: FBIS, October 31, 1977. Back.
Note 8: FBIS, November 21, 1977. Back.
Note 9: FBIS, December 7, 1977. Back.
Note 10: FBIS, September 18, 1978. Back.
Note 11: Nadav Safran, Saudi Arabia: The Ceaseless Quest for Security (Cambridge: Harvard University Press, 1985), p. 262. Back.
Note 12: Alan Taylor, The Arab Balance of Power (Syracuse: Syracuse University Press, 1982), p. 76. Back.
Note 13: Safran, Saudi Arabia, p. 263. Back.
Note 15: Anthony Cordesman, Jordanian Arms and the Middle East Balance (Washington, D.C.: Middle East Institute, 1983), p. 193. Back.
Note 16: Ibid., Table 3, p. 22. Back.
Note 17: Taylor, pp. 76-77. Back.
Note 18: The hajj is the pilgrimage to Mecca, the holiest city in Islam. Back.
Note 19: MEED, January 4, and February 8, 1980. Back.
Note 20: Safran, Saudi Arabia, p. 369. Back.
Note 22: Middle East Contemporary Survey, 1981-82, pp. 688-89. Back.
Note 23: Royal Scientific Society, 'Alaqat al-Mamlakah al-Urdunniyyah al-Hashimiyyah b-il-Mamlakah al-'Arabiyyah al-Sa'udiyyah, 1978-88 (Amman, 1990), p. 15. (Hereafter, 'Alaqat al-Mamlakah b-il-Mamlakah). Back.
Note 24: Safran, Saudi Arabia, pp. 332-38. The Steadfastness Front comprised Libya, Algeria, Syria, the PLO and the PDRY. Its representatives gathered in Damascus on September 20, 1978, in the wake of the Camp David meetings, to determine ways of confronting its results and to explore the possiblity of setting up a unified military command. Back.
Note 25: Gerd Nonneman, Administration, Development and Aid in the Middle East, (New York: Routledge, 1988), pp. 152-55. Back.
Note 26: MEED, January 17, 1975. Back.
Note 27: Economist Intelligence Unit, Saudi Arabia and Jordan: Quarterly Economic Report, no.1, 1975, p. 14. Back.
Note 28: MEED, January 2, 1976. Back.
Note 29: MEED, January 16, 1976. Back.
Note 30: MEED, August 1, 1975. See chapter 6. Back.
Note 31: MEED, January 16, 1976. Back.
Note 32: MEED, April 9, 1976. Back.
Note 33: MEED, May 21, 1976. Back.
Note 34: MEED, August 6, 1976. Back.
Note 35: The phrase literally means "If God Wills," but is often used in the Middle East as a way of avoiding committing directly to do something. Interview with former Chief of Jordanian Intelligence and former Prime Minister Mudar Badran. Also FBIS, January 13, 1977. Back.
Note 36: FBIS, January 13, 1977. Back.
Note 37: MEED, January 13, 1977. Back.
Note 38: FBIS, May 17, 1977. Back.
Note 39: MEED, May 20, 1977. Back.
Note 40: MEED, October 3, 1980. Back.
Note 41: "Minutes of the Meeting of the Jordan-Saudi Joint Committee, February 2, 1980," pp. 80-85 in Majmu'at. Back.
Note 42: Interview with Sa'd al-Tall, Director-General of the Jordan Petroleum Refineries Company, July 13, 1992. Back.
Note 43: Al-Tall interview. Back.
Note 44: QER: Saudi Arabia and Jordan no. 2 (1975): 17. Back.
Note 45: MEED, June 6, 1975. Back.
Note 46: MEED, March 12, 1976. Back.
Note 47: MEED, March 26, 1976. Back.
Note 48: Al-Tall interview. Back.
Note 49: QER: Saudi Arabia and Jordan no. 2 (1976): 16. Back.
Note 50: MEED, August 12, 1977. Back.
Note 51: MECS 1979-80, p. 643. Back.
Note 52: MEED, July 15, 1977. Back.
Note 53: MEED, March 21, 1980. Back.
Note 54: Royal Scientific Society, 'Alaqat al-Mamlakah b-il-Mamlakah, p. 9. Back.
Note 55: MEED, May 6, 1977. Back.
Note 56: MEED, May 4, 1979. Back.
Note 57: Royal Scientific Society, 'Alaqat al-Mamlakah b-il-Mamlakah, p. 5. Back.
Note 58: Safran, Saudi Arabia, p. 418. Back.
Note 60: FBIS, April 1, 1982. Back.
Note 61: Middle East International, May 17, 1985. Back.
Note 62: MECS, 1982-83, pp. 645-46. Back.
Note 63: The 'umra is pilgrimage made to Mecca at a time other than the formal dates for the pilgrimage in the Islamic calendar. Back.
Note 64: Middle East International, January 11, 1985. Back.
Note 65: FBIS, September 9, 1987. Back.
Note 66: MEED, February 3, 1989. Back.
Note 67: FBIS, February 15, 1990. Back.
Note 68: FBIS, May 7, 1990. Back.
Note 69: FBIS, January 7, 1982. Back.
Note 70: MEED, July 13, 1985. Back.
Note 71: FBIS, September 16, 1986. Back.
Note 72: Middle East International, December 19, 1987. Back.
Note 73: FBIS, August 4, 1989. Back.
Note 74: MEED, December 19, 1989. Back.
Note 75: MEED, March 2, 1990. Back.
Note 76: MEED, May 18, 1990. Back.
Note 77: The following discussion is taken from "Minutes of the Meeting, July 13, 1975," in Majmu'at, pp. 86-95. Back.
Note 78: MEED, May 9, 1987. Back.
Note 79: MEED, September 16, 1987. Back.
Note 80: MEED, July 13, 1987. Back.
Note 81: "The Seventh Round of the Jordanian-Saudi Joint Economic Committee, February 7-8, 1988," photocopy from the Ministry of Industry and Trade. Back.
Note 83: "The Eighth Round of the Jordanian-Saudi Joint Economic Committee, October 8-9, 1989," photocopy from the Ministry of Industry and Trade. Back.
Note 84: FBIS, September 24, 1984. Back.
Note 85: MEED, September 7, 1984. Back.
Note 86: MEED, April 5, 1986. Back.
Note 87: Royal Scientific Society, 'Alaqat al-Mamlakah b-il-Mamlakah, p. 11. Back.
Note 88: "The Seventh Round of the Jordanian-Saudi Joint Economic Committee, February 7-8, 1988." Back.
Note 89: MEED, March 12, 1988. Back.
Note 90: "The Eighth Round of the Joint Jordanian-Saudi Economic Committee, October 8-9, 1989," photocopy from the Ministry of Industry and Trade. Back.
Note 91: MEED, February 3, 1984. Back.
Note 92: MEED, June 15, 1984. Back.
Note 93: Interview with the late Khalil al-Salim, former head of the Senate Finance Committee and former Governor of the Central Bank, October 15, 1991. Back.
Note 94: Interview with former Prime Minister Zayd al-Rifa'i, July 11, 1992. Back.
Note 95: Rifa'i interview; interview with former Foreign Minister and former Prime Minister Tahir al-Masri, July 11, 1992. Back.
Note 96: Rifa'i interview. Back.
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