Over the past decade, Gulf states have redrawn their foreign financial policies, shifting away from the “open-handed aid” model that had characterized them for earlier decades. Riyadh and Abu Dhabi — along with Doha and Kuwait — no longer view assistance as an expression of emotional solidarity or a purely moral commitment to “brotherly Arab states.” Aid has instead become a tool to manage stability, shape influence and protect regional security. That shift is most visible in dealing with more fragile states such as Lebanon, Egypt, the Palestinian territories, Syria and Sudan. Gulf donors no longer release large aid packages at once or without follow-up. Funding has now been tied to political and economic conditions and to standards related to state authority and governance.
Western observers note that the new Gulf approach is not only a re-ordering of priorities but part of a broader geo-economic toolkit for influence. A report by the International Institute for Strategic Studies (IISS) in October 2023 said Gulf states provided an estimated $363 billion to 22 countries in the Middle East and North Africa between 1963 and 2022 — and that portions of this funding were deployed during crises “in ways to change political calculations of recipient states.”
Conditional Grants
At Davos in 2023, Saudi Finance Minister Mohammed al-Jadaan said the kingdom had long offered grants and credit deposits without conditions but now works through international institutions to ensure there are “tangible reforms” in recipient countries. It was a clear signal that one era had ended and another had just begun — one in which funding is tied to reform, and reform tied to stability. Retired Maj. Gen. Mohammed al-Qubiban said the shift was rather a response to a changing regional environment and not just a policy choice. Moving from “aid with no strings attached” to support that is based on political and security considerations is an expression of Gulf states’ need to protect their own national security, he said. He cautions against viewing this as just a ploy to “buy political loyalty.” Since economics is the real driver of politics, the real impact, he says, is attained from “economic support that rebuilds the state and creates sustainable and shared interests”
This approach is endorsed by analyst Dhafer al-Ajmi. He says past experience in Lebanon, Yemen, Iraq and Syria has demonstrated how high the cost can be of supporting states that lack a unified central authority. He explains that assistance is now governed by two core conditions: internal stability to prevent waste and external balance to ensure funds do not end up in the hands of groups aligned with regional agendas that conflict with the interests of the Gulf. For that reason, Gulf states are wary of governments that suffer internal divisions or those that are largely influenced by Iran, political Islamist groups or Turkey. This caution is not expressed through direct confrontation but rather by calibrated financing policies designed to steer aid away from becoming a “guarantee” for armed factions or political parties that wield more power than the state itself.
A 2022 Carnegie Endowment study offered a more reserved view of Gulf aid as merely a stabilizing tool. The report said GCC states “have adopted a more commercial approach […] focused on political and economic returns.” It says several Arab countries “have lost their traditional Gulf safety net” and began to seek alternative sources from international institutions.” IISS data published in October 2023 showed that most Gulf rescue packages went to a small number of states, with Egypt and Iraq alone guzzling roughly 57% of total support amount between 1963 and 2022. Unlike Iraq — whose share of support was consolidated during its war with Iran — Egypt, Jordan and Pakistan have been the most consistent recipients of Gulf aid over the past six decades.
Gaza and Lebanon: Post-War Conditions
In the months following the 2023 Gaza war, the United Arab Emirates took the lead on humanitarian relief with more than $2.57 billion in aid, followed by Saudi Arabia and Qatar through air bridges and relief programs. But humanitarian support did not mask political disagreements across the Arab region over the terms for post-war reconstruction. Israel’s Kan broadcaster reported in October that Saudi Arabia and the UAE did not send senior representatives to the Sharm el-Sheikh reconstruction summit. According to the report, the “absence” was not procedural but sprang from a position that links reconstruction to the “dismantling of Hamas’s military infrastructure.”
Kan said both capitals realize that they will be the largest funders of Gaza’s rebuilding and would not want to pour money into an environment that could rekindle the conflict. A similar logic guides the Gulf’s positions on Lebanon. Donors remain highly cautious in dispensing aid while Hezbollah continue to wield influence. The shift became clear in 2016 when Saudi Arabia halted a $3 billion military grant to the Lebanese army — a move supported by the UAE and Bahrain. It marked a real transition from “open-ended support” to “support conditioned on the state’s ability to assert authority.”
Al-Qubiban described Lebanon as a “highly complex political case,” where armed groups and parties vie for control over political decision-making. Corruption and foreign inroads, he says, leave “very narrow margin for external assistance.” He adds that Lebanon’s economic crisis is “in part manufactured or driven by political agendas” prompting Gulf states to reassess their tools and move from direct financing to pressure mechanisms tied to genuine reforms. The recent Israeli attack on Lebanon, he concludes, underscored that the state does not control military decision-making — a reality “inconsistent with the Gulf Cooperation Council’s requirement to deal with a central government that holds its own authority.”
From Aid to Investment
In Egypt, Gulf involvement has taken a sharply investment-focused turn. Gulf states deposited roughly $30 billion in the Central Bank of Egypt over years of economic woes, thus providing a critical buffer for foreign currency reserves. This was followed by huge investments, the largest of which was the UAE’s Ras al-Hikma deal, valued at nearly $35 billion. Then came Qatar’s coastal project worth about $30 billion. Kuwait extended its $2 billion credit deposit through September 2025. These initiatives indicated that Gulf financial support would continue but as investment rather than aid. These steps reflect a transition from “emergency assistance” to “conditional investment,” with funding linked to economic and structural reforms aligned with international financial institution programs.
Transitional Support in a Turbulent Region
In Sudan, which has been at war since 2023, the UAE has been the largest Gulf donor, providing more than $3 billion. Saudi Arabia and Qatari offered aid through UN agencies. In Syria, after the fall of President Bashar Assad’s regime in December 2024, the Gulf has been cautious in offering aid: Saudi Arabia and Qatar helped support basic services and bankrolled pay for public-sector employees, while the UAE opted to finance specific projects such as the development of Tartus port. All these offering are contingent on clear political progress and the restoration of central authority over all of Syria. Al-Ajmi describes this phase as “a strategic transition from unconditional aid to long-term investment.” He notes that Gulf sovereign wealth funds are now the main instruments of this approach, where funding is tied to ownership, management and guaranteed returns. An approach that ultimate create relationships of interdependence.
New Calculations
According to al-Qubiban, Gulf states continue to provide humanitarian aid but monitor stability criteria — including fiscal discipline and alignment with international institutions — before committing to any major investments. Public acceptance, he says, remains essential, and Gulf states do not view their assistance as a tool of political coercion but rather as a moral responsibility “toward peoples before governments.” Under this new formula, Gulf assistance has become part of a broader strategy to manage regional risks. Money no longer flows out without calculations and conditions. It is an investment in stability, a political message and a lever of influence in a region where the balance of power is constantly shifting.
Sukina Ali
A Saudi writer, researcher, and TV presenter
