An Economic War Looms on the Horizon Between Riyadh and Abu Dhabi

NYN | Reports and Analyses 

The British magazine The Economist has warned that the escalating tension between Saudi Arabia and the United Arab Emirates is no longer merely a political disagreement or a personal rivalry between the two leaderships. Instead, it is moving toward what resembles an undeclared “economic war” that could have profound repercussions for the economies of both countries and the wider region.

The Economic Dimension of the Conflict

The magazine explained that many observers frame the dispute as a personal rivalry between Saudi Crown Prince Mohammed bin Salman and UAE President Mohammed bin Zayed Al Nahyan. However, according to the analysis, this characterization overlooks the more dangerous aspect of the confrontation: strategic economic competition.

It noted that Riyadh has already begun imposing stricter bureaucratic measures on companies headquartered in the UAE, steps described as resembling an “undeclared sanctions program,” potentially negatively affecting the business climate and mutual investments between the two countries.

Countermeasures from Abu Dhabi

For its part, Abu Dhabi has not remained idle. According to the report, it has responded through direct economic tools, including directing affiliated companies to withdraw from major economic events in Saudi Arabia — a clear signal that the rivalry has escalated to unprecedented levels.

The report suggests that continuing along this path could push both countries toward an open economic confrontation, moving beyond diplomatic pressure to directly targeting commercial and investment interests.

Escalating Media Campaigns

The magazine also noted that the conflict is no longer confined to economic measures, but has extended into the media sphere and social media platforms, where mutual propaganda campaigns have intensified — an indication that the dispute now enjoys political backing at the highest levels in both countries.

Yemen… The First Spark of Dispute

The report recalled that the roots of the tension trace back to differences over managing the war in Yemen, which initially formed the basis of their alliance nearly a decade ago. It later evolved into a focal point of strategic disagreement over regional influence and post-war arrangements.

The magazine concluded its analysis by warning that continued escalation could open the door to broader regional repercussions, amid the absence of clear signs of a near-term settlement between the two Gulf powers.