The dispute has been ongoing for the last two months, but Canada’s combative prime minster, Stephen Harper, stoked the UAE’s ire last Saturday when he accused the Gulf confederation of treating Canada shabbily.
“I could never see (Canada) treating an ally like that,” Harper said in an interview.
Then, Bob Rae, who serves as shadow foreign minster for the opposition Liberal Party, raised the stakes on Wednesday by taking the side of the UAE in the dispute.
“The Harper government’s diplomatic bumbling with the UAE has endangered a $2bn bilateral trade relationship,” he said in a blog posting.
Everyone agrees that the dispute is over Canada’s refusal to award additional landing rights to two UAE airlines, Emirates and Etihad. But Harper has raised the stakes by accusing the UAE of not fighting fair by closing a key Canadian military installation on its soil and imposing steep visa fees and restrictions on Canadian tourists. But analysts in the Gulf say Harper was wrong.
“It was never the UAE’s intention to have this develop into a crisis situation and the relationship deteriorate,” Christian Koch, director of International Relations at the Gulf Research Center in Dubai, told The Media Line. “It was a straightforward attempt by the UAE to promote its economic interests and try to persuade Canadian authorities to at least listen to some of the idea the UAE grant landing rights. Apparently it’s not been very successful.”
Landing rights are an important issue for the UAE, which has carefully cultivated the sector with generous financing and state-of-the-art airports that have turned the seven-nation confederation into a major hub for air long-haul travel over the past decade. With the real estate and finance sector in the doldrums, travel and tourism have become even more important to the economy.
Under a 1999 bilateral agreement each run three flights a week to Canada from the UAE airports. But Dubai and Abu Dhabi had sought to offer more frequent service. Air Canada objected to the request on the grounds that the carriers were merely flying passengers from third countries through the UAE, siphoning off potential Air Canada passengers from its other routes.
For Canada, too, the UAE is an important economic partner. Approximately 27,000 Canadians live in the emirates. Rae noted in his blog post that over 200 Canadian companies operate in the UAE and that two-way trade reaches $2 billion annually. The UAE is Canada’s single-biggest export market in the Middle East, he said.
But doing business with the UAE has gotten tougher since Jan. 2, when the UAE slapped a fee of as much as $1,000 for a visa and began requiring visitors to apply in writing to the UAE Embassy in Ottawa two weeks before they travel to get one. Last October, the UAE forced Canada to shut down its operations in a military base near Dubai known as Camp Mirage, used to funnel Canadian troops in and out of Afghanistan and denied its airspace to two top Canadian officials.
The cost of closing Camp Mirage was originally put at $300 million had Canada’s Afghanistan mission ended in 2011 as originally planned. But in November Canada said it would be staying in Afghanistan until 2014, which will raise the cost of the base’s absence.
But Koch noted that the UAE hadn’t ordered the installation closed, rather the agreement keeping it opened had expired and the emirates opted not to renew it. The new visa policy also wasn’t an act of retribution, he said. “I don’t think the UAE necessarily engages for tit for tat decisions. That’s not its policy,” he said.
The Harper government has had a string of foreign policy embarrassments, most notably when the United Nations General Assembly awarded a Security Council seat Canada was vying for in a secret vote to Germany and Portugal. In six previous instances, Canada had never lost a bid to sit on the Security Council. Since Dubai’s economy collapsed under the weight of its debt, Sheikh Khalifa Al-Nahyan, the emir of Abu Dhabi and president of the UAE, has implemented a more robust foreign policy in the name of the entire confederation, an unprecedented move.
