Power and competition in the transitions toward postrentierism: The cases of Saudi Arabia and the United Arab Emirates

Abstract The imperatives of economic diversification mean that Saudi Arabia and the United Arab Emirates (UAE) are scrambling to secure international markets and investments amid a series of domestic changes taking place, including centralized decision making, the marginalization of other traditional modes of governance, and rising nationalism. While there is some evidence of formal security‐related cooperation in the Gulf Cooperation Council as well as an informal security alliance operationalized by Saudi Arabia and the UAE at the onset of the Arab uprisings, these two states have gone on to pursue competing economic policies. This article assesses the economic and political interactions of Saudi Arabia and the UAE, arguing that contrary to Rosecrance's concept of “virtual states” with an emphasis on services, expertise, and creativity, connected to visions strategies in these cases, their primary power remains rooted in territorial aspects. It also finds that there are other factors such as leadership style, political and economic role conceptions, the regional and international balance of power, threat perception, and alliance formation that will continue to determine the shape and form of their cooperation or competition.