President Park Geun-hye, surrounded by South Korean and Iranian business leaders, speaks at a business forum between the two nations during her visit to Tehran, May 3.

President Park Geun-hye, surrounded by South Korean and Iranian business leaders, speaks at a business forum between the two nations during her visit to Tehran, May 3.

May 9, 2016

 

South Korea is on a tightrope between Iran and Saudi Arabia after the government overly lauded economic cooperation with Terhan during President Park Geun-hye’s historic visit there last week amid escalating rivalry between the two Middle East nations.

Analysts warned that exaggerating the Seoul-Tehran economic relations can mar South Korea’s friendship with Saudi Arabia, although they positively assessed Seoul’s emphasis on support from Iran for denuclearization of the Korean Peninsula.

To pursue balanced diplomacy in the Middle East, experts urged the Park administration to take into account rapid change in the regional economy as well as religious conflicts involving Shiite-dominant Iran and Sunni-led Saudi Arabia and other Arab states.

“The Saudis have been attributing all the region’s trouble to Iran and pressing everyone to back it, but any realistic policy in the region requires avoiding backing one side over the other in the Saudi-Iranian rivalry or the Shia-Sunni divide,” Leon Sigal, director of the Northeast Asia Cooperative Security Program, wrote in an e-mail.

Park Won-gon, an international relations professor at Handong University, said: “Creating a negative perception can cause a serious problem in Middle East diplomacy more than one can imagine.”

“And the government excessively highlighted its deal with Iran on economic cooperation for domestic political reasons,” he added.

Park was the first South Korean leader to visit Iran — from May 1 to 3 — amid growing calls to join the international rush after a landmark nuclear agreement on July 14, 2015.

Iran has sought to rebuild its economy after the country and six world powers — the U.S., China, the United Kingdom, France, Russia and Germany — agreed to lift decades-long sanctions on Tehran in return for curbing its nuclear program.

Saudi Arabia has been against the U.S.-led nuclear deal due to concerns that it may concede its regional hegemony to Iran and add to its woes over falling oil prices.

Since January, tension between Iran and Saudi Arabia has intensified after the execution of prominent Shia cleric Nimr al-Nimr in line with Riyadh’s sectarian policies and Iran let an angry crowd attack the Saudi Arabian embassy in Tehran.

Under such circumstances, it was reckless for the Park government to highlight the possible economic benefits from 66 memoranda of understanding (MOUs) signed between South Korea and Iran during the presidential visit, according to Park Won-gon.

Involving infrastructure projects, the MOUs can lead to contracts worth 42 trillion won ($37.1 billion) if the two sides carry them all out: but only six of them were legally binding.

“With low oil prices affecting the economy of Saudi Arabia and other Sunni Muslim countries, we should be careful about exaggerating our economic ties with Iran,” he said.

Yu Dal-seung, a professor at Hankuk University of Foreign Studies’ (HUFS) Department of Persian, agreed.

“Iran can sign MOUs with multiple countries for certain industrial projects and I’d say South Korea boasted as if it will exclusively carry out those projects with Iran,” he said. “We should carefully revise our Middle East diplomacy and ensure to avoid any situations that can push us into an Iran-Saudi Arabia conflict.”

The analysts said Saudi Arabia may press South Korea if it reckons Seoul’s diplomatic policies in the region are biased toward Tehran although it is not likely that Riyadh will actually take retaliatory measures.

“It may threaten South Korea by to banning crude oil exports in extreme circumstances but it will not actually do so,” Yu said.

He added such a strategy can be employed to woo its people amid economic concerns and turn their attention to outside factors, saying “mentioning those issues may help stabilizing its kingdom.”

Park Won-gon said the fact that Saudi Arabia accounts for over 30 percent of South Korea’s oil import worldwide may make Seoul a good target for Riyadh.

Citing that Saudi Arabia is seeking to restructure its oil-dependent economy, he suggested bolstering Seoul-Riyadh economic ties in information technology, health and medical care and other fields that South Korea excels at.

Meanwhile, analysts speculated that falling oil prices may limit Riyadh’s leverage on Seoul if they have diplomatic conflicts.

“As the world is awash in oil and prices remain low, its revenues will leave it in a worse shape to use financial leverage,” Sigal said.

Speaking on condition of anonymity, an Arabic professor at HUFS said “I believe South Korea shouldn’t worry too much about where to buy crude oil now.

Source: Korea Times

About Track Persia

Track PersiaTrack Persia is a Platform run by dedicated analysts who spend much of their time researching the Middle East, in due process we fall upon many indications of growing expansionary ambitions on the part of Iran in the MENA region and the wider Islamic world. These ambitions commonly increase tensions and undermine stability.