Trump’s Gulf Tour: A Blend of Tradition and Investments
On his return journey from a recent trip to the Gulf, President Trump expressed to reporters, “It was an incredible and historic four days.”
During his visit to Saudi Arabia, Qatar, and the United Arab Emirates (UAE), he maintained his characteristic confidence, claiming, “The jobs and investments entering our nations are unprecedented.” While he asserted that he secured more than $2 trillion in deals for the US, questions arise regarding the authenticity of these figures.
The trip itself was marked by grandeur, as the three participating Gulf nations showcased their hospitality. The events included military jets escorting his flight, lavish welcome ceremonies, a ceremonial 21-gun salute, along with displays featuring Tesla Cybertrucks, royal camels, Arabian horses, and traditional sword dancers. Notably, the UAE conferred upon Trump its highest civilian award, the Order of Zayed.
The visual impact of the visit was striking, with the wealthy oil states of the region displaying their wealth while signaling their willingness to enhance their partnership with the US in pursuit of their economic objectives.
Before departing, Trump, who brands himself as the “dealmaker in chief,” identified the primary goal of the trip as securing substantial investments. At first glance, he appeared to have achieved this ambition.
In Saudi Arabia, Crown Prince Mohammed bin Salman reaffirmed a commitment to invest $600 billion in US-Saudi initiatives, resulting in numerous deals in sectors such as defense, artificial intelligence (AI), healthcare, infrastructure, and security.
The $142 billion defense agreement, touted by the White House as the largest arms deal in history, garnered significant attention. Nonetheless, skepticism surrounds the realistic nature of these investment promises.
During his initial term from 2017 to 2021, Trump announced that Saudi Arabia would enter into $450 billion worth of agreements, yet actual trade and investment totaled less than $300 billion from 2017 to 2020, based on analysis from the Arab Gulf States Institute. Tim Callen, a former International Monetary Fund (IMF) representative to Saudi Arabia, noted, “The success of these new agreements will be evident in their outcomes.”
The White House did not provide a comment when approached for clarification.
In Qatar, Trump unveiled an “economic exchange” anticipated to be worth a minimum of $1.2 trillion. However, the official factsheet released by the White House only referenced deals totaling $243.5 billion between the two nations. One confirmed deal involved Qatar Airways’ purchase of up to 210 aircraft from Boeing for $96 billion, projected to support 154,000 jobs annually in the US over the deal’s lifetime.
The UAE also announced plans to build the world’s largest AI campus outside the US, aiming to secure access to 500,000 advanced microchips from Nvidia starting next year. This reflects the UAE’s broader commitment to invest $1.4 trillion in the US over the coming decade.
Despite these ambitious projections, challenges remain, particularly concerning oil prices. Following a decline to a four-year low in April, concerns regarding Trump’s tariffs suppressing worldwide economic progress lingered. This downturn has placed additional pressure on Saudi Arabia’s finances, prompting potential cuts in spending or increased borrowing to meet development goals. The IMF has revised its GDP growth forecast for Saudi Arabia for 2025 down to 3%, from a previous estimate of 3.3%.
Callen remarked on the difficulty for Saudi Arabia to fulfill the announced $600 billion commitment given the current oil market climate. Additionally, many agreements formalized during the visit were non-binding memorandums of understanding, which are less concrete than signed contracts and do not necessarily translate to actual financial transactions. Some of the deals included were previously announced.
For example, Saudi Aramco declared 34 agreements valued up to $90 billion with US firms, yet most were classified as non-binding. Additionally, an agreement for the annual purchase of 1.2 million tons of liquefied natural gas from the US company NextDecade, included in the list of new partnerships, had been disclosed months prior.
Nevertheless, these extensive investments signify a shift in the US-Gulf dynamic, moving from a traditional oil-for-security arrangement to deeper economic collaborations centered around mutual investments.
Bader Al Saif, an assistant professor at Kuwait University and researcher at Chatham House, pointed out that the agreements indicate a joint vision for the future of US-Gulf relations. The AI-related deals with both the UAE and Saudi Arabia, he noted, are indicative of their efforts to collaborate on shaping a new global order.
The growing importance of AI to US diplomacy was highlighted during the visit, with Trump accompanied by key figures like Sam Altman from OpenAI, Nvidia’s Jensen Huang, and Elon Musk of Grok AI. In advance of the trip, the White House also lifted stringent export restrictions on US semiconductors crucial for advanced AI systems, which had previously limited access for many countries including those in the Gulf.
Both Saudi Arabia and the UAE are prioritizing the establishment of large-scale AI data centers, with Abu Dhabi aspiring to become a premier global hub for AI technology. The UAE has taken deliberate steps to strengthen ties with US tech companies while reducing its connections to Chinese businesses, aligning more closely with American national security interests.
Al-Saif remarked that the UAE’s strategic investment in AI is a vote of confidence in US technological leadership.
The visit is being celebrated as a success on both sides. For the Gulf nations, particularly Saudi Arabia, it revives a partnership that felt strained during Biden’s presidency and highlights their ambitions to enhance their global standing. For Trump, showcasing “trillions” in new investment serves as a timely boost amidst economic challenges at home, including tariff-induced declines in global trade and the first quarterly dip in US production in three years.
Trump expressed concern that his successor might claim credit for the agreements once they materialize, stating, “I’ll be at home, and who knows where that will be, and I’ll think, ‘I accomplished this.'” He added, “Someone else will take credit for it. Remember this, press: I did it.”