A recent report by The Economist described the beginning of close Saudi-Iraqi ties as making Iran nervous.
Following a series of events, including the near opening of a Saudi consulate in the city of Basra, and the resumption of air links between the kingdom and Iraq, creating over 140 flights per month, Iran is worried that their influence will be marginalized, as they consider Basra their “backyard”, the magazine reported.
Saudi Crown Prince Mohammed bin Salman was considered a key figure in restoring relations with Iraq in 2015, and reopening borders with the country in 2017.
The kingdom now aims to help in the reconstruction of Iraq and help them fight ISIS factions, where Saudi Foreign Minister Adel al-Jubeir said in a conference last month that the kingdom pledging one billion USD in loans to Iraq and $500 million in export credit.
Saudi Arabia also aims to strengthen economic ties through investments which will “wean Iraq off Iranian products”, according to the Economist. This includes several businesses, like the Saudi petrochemical giant SABIC, opening offices in Baghdad, and other projects reserved for Saudi investment like Basra’s declining petrochemical plant.
The magazine reported that Iranian influence is deeply rooted in southern Iraq to the extent that some streets are named after Iranian Islamic revolution leaders. They added that Iran’s biggest worry is the wave of competition that Saudi investments will bring.