How The Saudis Can Hit back on 9/11 Suit legislation and They Will

 

Saudi Arabia and its allies are warning that US legislation allowing the kingdom to be sued for the 9/11 attacks will have negative repercussions.

The kingdom maintains an arsenal of tools to retaliate with, including curtailing official contacts, pulling billions of dollars from the US economy, and persuading its close allies in the Gulf Cooperation Council to scale back counterterrorism cooperation, investments and US access to important regional air bases.

"This should be clear to America and to the rest of the world: When one GCC state is targeted unfairly, the others stand around it," said Abdulkhaleq Abdullah, an Emirati Gulf specialist and professor of political science at United Arab Emirates University.

"All the states will stand by Saudi Arabia in every way possible," he said.

When Sweden's Foreign Minister Margot Wallstrom strongly criticized Saudi Arabia last year, the kingdom unleashed a fierce diplomatic salvo that jolted Stockholm's standing in the Arab world and threatened Swedish business interests in the Gulf. Sweden eventually backpedaled.

On Wednesday, the bill became a law after the Senate voted to override President Barack Obama's veto of the Sept. 11 legislation.

Chas Freeman, former US assistant secretary of defense for international security affairs and ambassador to Saudi Arabia during operation Desert Storm, said the Saudis could respond to this bill in ways that risk US strategic interests, like permissive rules for overflight between Europe and Asia and the Qatari air base from which US military operations in Afghanistan, Iraq, and Syria are directed and supported.

"The souring of relations and curtailing of official contacts that this legislation would inevitably produce could also jeopardize Saudi cooperation against anti-American terrorism," he said.

Still, relations with Washington had already cooled well before the 9/11 bill sailed through both chambers of Congress.

The Saudis perceived the Obama Administration's securing of a nuclear deal with Iran as a pivot toward its regional nemesis. There was also Obama's criticism of Gulf countries in an interview earlier this year, despite their support for the US-led fight against the ISIS group in Iraq and Syria.

Obama had vetoed the Justice Against Sponsors of Terrorism Act, or JASTA, arguing that allowing US courts to waive foreign sovereign immunity could lead other foreign governments to act "reciprocally" by giving their courts the right to exercise jurisdiction over the US and its employees for overseas actions. These could include deadly US drone strikes and abuses committed by US-trained police units or US-backed militias.

Saudi Foreign Minister Adel al-Jubeir told reporters in June that the US has the most to lose if JASTA is enacted. Despite reports that Riyadh threatened to pull billions of dollars from the US economy if the bill becomes law, al-Jubeir says Saudi Arabia has only warned that investor confidence in the US could decline.

Joseph Gagnon, a senior fellow at the Peterson Institute for International Economics, said estimates put the figure of official Saudi assets in the government at somewhere between $500 billion and $1 trillion when considering potential foreign bank deposits and offshore accounts.

The kingdom had $96.5 billion in holdings of Treasury securities in August, according to the most recent number released by the Treasury Department. Saudi Arabia ranked 15th in its holdings of US Treasury debt.

The US-Saudi Business Council's CEO and Chairman Ed Burton says business between the two countries will continue, though potential deals could be jeopardized by JASTA.

"No business community likes to see their sovereign nation basically assailed by another nation," Burton said.

As one of the world's largest oil exporters with the biggest economy in the Gulf, Saudi Arabia also has other business partners to choose from in Europe and Asia, said President and CEO of the National U.S.-Arab Chamber of Commerce David Hamod.

"America is no longer the only game in town," he said. "No one knows how Saudi Arabia might respond to an override of President Obama's veto?"

The CEOs of DOW and GE sent letters to Congress warning of the bill's potentially destabilizing impact on American interests abroad. Defense Secretary Ash Carter this week sent a letter to Congress saying "important counterterrorism efforts abroad" could be harmed and US foreign bases and facilities could be vulnerable to monetary damage awards in reciprocal cases.

Such reactions may not come directly from Riyadh but countries connected to Saudi Arabia, said Stephen Kinzer, a senior fellow at the Watson Institute for International and Public Affairs at Brown University.

He said the eight-decade-long US-Saudi relationship is "entering into a new phase," in which ties will be mostly underpinned by arms sales, unlike during the era of warm relations under President George W. Bush.

Abdullah, the Gulf analyst at UAE University, said he expects to see a GCC that acts more assertively and independently of the US in places like Yemen, Bahrain and Egypt.

"This is not just a threat. This is a reality,” he said.

The Associated Press, Dubai