Diplomacy
UAE weighs creation of new defense fund to invest in Ukrainian and Turkish drone makers
The United Arab Emirates is preparing to initiate investments in Ukrainian unmanned aerial vehicle (UAV) manufacturers, according to reports.
Abu Dhabi is currently discussing the establishment of a new investment fund specifically focused on the defense industry, Bloomberg reported, citing sources familiar with the matter. The primary objective of the proposed fund is to assist the UAE in bolstering its military capabilities in the face of threats originating from Iran.
According to the sources, the new entity will be granted the mandate to acquire equity stakes in defense companies across the globe.
These investments could encompass military producers in Europe and the United States, as well as drone manufacturers in Ukraine and Türkiye. Senior officials and Crown Prince Sheikh Khaled bin Mohamed bin Zayed Al Nahyan are reportedly participating in the high-level discussions regarding the project.
The discussions center on the creation of a new fund that would operate outside of Abu Dhabi’s three primary sovereign wealth funds and its existing defense enterprises, Bloomberg’s sources indicated.
The Emirate has previously established similar specialized platforms. These include MGX, which focuses on artificial intelligence investments, and Judan, a financial holding company with $237 billion in assets.
With total assets reaching $2 trillion, Abu Dhabi is positioned to become a significant buyer in a defense market that has surged due to a new global era of rearmament. This trend has been accelerated by Russia’s war against Ukraine and signals suggesting a potential decrease in US interest in NATO.
This shifting landscape is prompting private equity fund managers to establish dedicated teams and new vehicles specifically for investments in the national security sector.
The UAE is already a major purchaser of weaponry. According to data from the Stockholm International Peace Research Institute (SIPRI), the country accounted for 2.7% of global arms imports between 2021 and 2025.
During this timeframe, the Emirates assembled a military arsenal consisting of Patriot and THAAD air defense systems, F-16 fighter jets, and Black Hawk helicopters. Its primary suppliers include the US, France, and South Korea.
Following the onset of hostilities involving Iran, Washington carried out arms sales valued at approximately $16.5 billion to its Middle Eastern allies, including the UAE.
During the same period, Ukraine has utilized its experience in countering Russian drone strikes to sign defense agreements with several Gulf nations.
Diplomacy
UK plans targeted sanctions on Israel over West Bank settlement bids
British Foreign Secretary Ed Miliband has said the government will prepare “new, targeted sanctions” against Israelis involved in “illegal settlement expansion” in Gaza and the West Bank.
In a statement issued on Wednesday night (19 August), Miliband stated that following the Israeli government’s opening of tenders for the construction of 1,200 settlement homes in the strategically vital E1 area of the West Bank, the United Kingdom would not “stand back and accept the destruction of the two-state solution”.
“The E1 area will run straight through the heart of Palestine and risks cutting off the West Bank from East Jerusalem; this would jeopardise the viability of a two-state solution,” Miliband said, describing the Israeli government’s actions as “unacceptable and destructive”.
The British minister called on his Israeli counterpart, Gideon Sa’ar, to “halt the E1 plans immediately” and withdraw the tender.
Miliband also stated that he had summoned Charge d’Affaires Daniela Grudsky Ekstein, the country’s top diplomat in the UK, to the Foreign Office to convey these demands clearly.
Miliband said the UK would announce a “comprehensive range of measures in the coming weeks in response to the policies of the Israeli government”.
These measures underscore a harder line taken by the UK against Benjamin Netanyahu’s government under the new Prime Minister, Andy Burnham.
This shift in stance was evident even before Burnham officially became prime minister. Burnham apologised for the Labour Party’s previous position on Israel’s military campaign in Gaza under his predecessor, Keir Starmer, saying the party “had not got it right”.
Last month, the UK’s new Defence Secretary, Wes Streeting, stated that Israel was not “complying” with international standards in Gaza and the West Bank.
Other European allies have also hardened their stance towards Israel. Earlier on Wednesday, German Chancellor Friedrich Merz strongly condemned remarks by National Security Minister Itamar Ben Gvir, who called for nighttime assassinations in Gaza.
Israel, for its part, reacted against the London administration. Foreign Minister Sa’ar said: “The Jewish people have the right to live everywhere in the Land of Israel, just as the British have the right to live in London and throughout the UK.”
Maintaining that the British-issued 1917 Balfour Declaration “officially recognised the historic right of the Jewish people to re-establish their national homeland in the Land of Israel—including the area in question”, the minister pointed out that Britain still controlled colonial territories thousands of kilometres from its own shores.
Arguing that it was absurd for Britain to “lecture the Jewish people on where they can live in their historic and tiny homeland”, Sa’ar said the British Foreign Secretary’s statement condemned Israel while “turning a blind eye to Palestinian terrorism, incitement, and the Palestinian Authority’s ongoing financial support for terror—namely the ‘pay to slay’ policy”.
Sa’ar concluded his statement:
“The UK Government’s systematic policy of blaming only Israel while ignoring Palestinian extremism has already contributed to an enormous wave of antisemitic hatred and attacks against the British Jewish community. Continuing on this path will only make matters worse.
The British Government’s decision to damage relations between our countries is deeply regrettable. But Israel will not be a passive victim of this policy.
Israel will defend its rights, its interests, and its people.”
Diplomacy
Barrack urges tripartite deconfliction after Israeli Syria strikes
US Special Envoy for Syria Tom Barrack said that efforts are underway to establish a deconfliction mechanism between Israel, Türkiye, and Syria.
Yesterday, Israeli aircraft carried out eight strikes on Abu al-Duhur Air Base in Idlib, causing material damage.
Barrack, who also serves as the US Ambassador to Türkiye, stated that Türkiye was not warned in advance about the Israeli strikes, saying, “Türkiye therefore observed aircraft heading north toward its own territory and thus could reasonably prepare its own response,” referring to a possible Turkish military reaction.
In a telephone interview with Reuters, Barrack said, “Fortunately, cooler heads were able to prevent the situation from deteriorating further.”
Türkiye condemned Israel’s strikes on Abu al-Duhur air base in northwestern Syria, but made no further comment on the matter, including on a potential deconfliction mechanism.
A deconfliction mechanism is a communication channel established between military or political actors to prevent misunderstandings or accidental clashes.
Barrack said Israel’s strikes on the Syrian air base “reflected a perception, whether right or wrong, that Türkiye might increase its presence at that base in the near future,” and continued:
“This situation underscores the need for a deconfliction mechanism involving Israel, Syria, and Türkiye. We are actively working to establish this mechanism in order to prevent future miscommunications. The priority right now is to de-escalate tensions and prepare the ground for a more measured approach.”
The air base, located approximately 70 km east of the Turkish border, has not served as a military airfield since 2013.
Syria and Israel have held several rounds of talks on de-escalation and border issues since forces under the command of Ahmed Shara overthrew Bashar al-Assad, but no agreement has been reached.
Barrack said, “An incident of the kind that occurred this morning demonstrates that these efforts must be intensified and the process broadened.”
The envoy stated that the US is already facilitating an information-sharing and dialogue mechanism between the parties:
“What is required is a more robust structure to which more resources are allocated. Investing in such mechanisms is far less costly than relying on kinetic means of communication, which can cost hundreds of millions of dollars.”
An Israeli official told Fox News on Tuesday that Israel had shared “extremely sensitive intelligence” with the US prior to the strike, but provided no further details.
The official said, “Shara understands that he cannot act like the previous Syrian regime that held proxy forces. He may not have understood or known what was happening.”
In a statement immediately following the strike, Barrack had said that the Shara administration “does not maintain proxy forces” in Syria.
The office of Israeli Prime Minister Benjamin Netanyahu later issued a statement claiming responsibility for the strikes.
Arguing that Israel and Syria had agreed “on maintaining the status quo on security matters,” Netanyahu claimed Syria came to the brink of violating this by permitting the deployment of Turkish troops to an air base near Aleppo:
“Israel repeatedly warned Syria that such a deployment would pose a threat to Israel’s security. Syria, however, chose to ignore these warnings.”
The office stated that Tel Aviv warned Syria that such a deployment would threaten Israel’s security, adding that it “would welcome a return to the status quo.”
According to Axios, the Syrian government had been aware of Israel’s concerns regarding the base for some time. According to a source familiar with the matter, the Syrian government had sent messages to the Israelis explaining the reasons for rebuilding the runway and emphasising that they had no hostile intentions.
US and Israeli officials stated that the Israelis informed the White House that the purpose of the strike was to deter Türkiye from deploying advanced weapons systems to the air base and to prevent a broader military build-up in the area.
A Turkish official denied Israel’s claims, saying, “There was no Turkish presence at the air base. Israel is inventing pretexts to bomb neighbouring countries and destabilise the region.”
The Turkish Ministry of Foreign Affairs condemned the strike conducted by Israel, stating that Israel had “violated Syria’s territorial integrity and unity by targeting the country’s infrastructure and military capacity.”
Diplomacy
How mini-middle powers leverage geography, resources, and diplomacy?
As an international order emerges in which “middle powers” seek to come to the fore alongside the relative decline of the US, “mini-middle powers” may also be coming to light.
An assessment published in the Financial Times (FT) points to countries that cannot set the broader international agenda but are nevertheless capable of making a difference.
Arguing that these states can be defined as “mini-middle powers”, the article provides the following definition: states that generally possess limited power, but exert real influence in a few areas such as energy, transport routes, regional security, mediation, finance, technology, geography, or access to actors that major powers find difficult to reach.
Noting that the crucial factor is not merely possessing one of these advantages, but being able to leverage it, the FT counts Azerbaijan, Qatar, Kazakhstan, Uzbekistan, and Oman among these mini-middle powers.
The assessment points out that Qatar and Oman are mini-middle powers in diplomatic terms: Qatar has converted its natural gas wealth, financial clout, and access to hard-to-reach actors into an extraordinary diplomatic role.
Oman, meanwhile, relies on “common sense, its strategic location, and its ability to keep channels open between adversaries.”
For both countries, mediation is not merely a diplomatic role, but also a source of influence.
Azerbaijan, Kazakhstan, and Uzbekistan, on the other hand, possess influence rooted in geography and infrastructure. Azerbaijan exports energy, sits astride east-west trade routes, and holds significant weight in South Caucasus politics and security.
Kazakhstan’s oil, uranium, and position between Russia and China give the country an influence that extends beyond its region.
Uzbekistan’s demographic weight as Central Asia’s most populous country, combined with its central position, provides it with growing influence in regional trade and diplomacy.
The Middle Corridor demonstrates how this functions. While Azerbaijan and Kazakhstan sit at the centre of this Asia-Europe route, Uzbekistan is also strengthening its links with the corridor.
Although this route is more arduous than the northern route passing through Russia, it offers an alternative to governments and businesses.
The three countries are also developing a Caspian green energy corridor that could transport renewable energy generated in Central Asia through Azerbaijan and connect to the planned Black Sea electricity cable extending to Europe.
According to the FT, discussions regarding the South Caucasus and Central Asia are still too often treated as a rivalry between Russia, China, and the West.
Yet this approach overlooks how many countries in the region function. Azerbaijan, Kazakhstan, and Uzbekistan maintain multidirectional relations because relying on a single side presents risks for geographic, commercial, and security reasons.
Consequently, while attempting to maintain room for manoeuvre among them, these countries cooperate with Russia, China, Türkiye, the EU, and the US.
Qatar and Oman, despite having close security ties with Washington, also keep channels open with adversaries of the US.
In December 2024, after Russian air defence systems shot down an Azerbaijan Airlines passenger plane, Baku’s response was unusually sharp given the power imbalance.
While Baku demanded that Moscow accept responsibility, punish those at fault, and pay compensation, it also sought to maintain overall relations without disruption.
Russia subsequently acknowledged the contribution of its air defence systems to the crash and agreed to pay compensation.
The influence of these “mini-middle powers” becomes strongest when other countries require the resources under their control.
Azerbaijan’s oil and natural gas gain even greater importance when buyers seek alternative supply sources.
The Middle Corridor benefited from the disruption of trade passing through Russia; however, governments along the route are aware that should Western commercial relations with Russia resume, some freight could shift back north.
For Qatar and Oman, mediation becomes even more valuable when the parties themselves no longer speak directly to one another.
The FT article concludes:
“These countries will not set the terms of the next international order. But those who wish to shape that order will often remain dependent on their routes, resources, or diplomatic access. Major powers will find it difficult to succeed without their cooperation.”
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