Graeme Baker: US energy deal makes sound business sense

The United States agreement to help the United Arab Emirates become the first Arab state with nuclear energy might seem questionable, given its stance on Iran's programme and President Barack Obama's call to halt proliferation.

It may also seem absurd that an oil power wishes to build nuclear power stations.

But this deal will not result in an Arab state with nuclear weapons.

The technologies required for a military nuclear industry are far more advanced than those needed for civil.

While the UAE sits on one of the largest oil reserves on the planet, many of its regions suffer electricity shortages.

The UAE, especially Dubai and Abu Dhabi, have grown so fast and so high that there has been great difficulty in meeting energy demands. The country did not exist four decades ago, and in that time Dubai has morphed from a small fishing village into the Middle East's most modern city.

The UAE also uses more water per day per person than any other country in the world, yet has one of the smallest fresh-water supplies. Much of its drinking water is created through desalination - an expensive, energy-intensive and polluting process.

Its energy needs are spiralling and the rulers see nuclear energy as the future. They may have the oil now, but that may not be the case for very long.

The United States deal was signed in the final days of the Bush Administration, but America's interests remain the same now as then: the closer to the UAE's rulers, the more influence in the region and the better chance of securing future contracts in a still growing economy.

It also follows a deal to supply the UAE with billions of dollars worth of military hardware, including missile defence systems.

From a business perspective, this all makes sense.

Several Arab and North African nations in 2007 reported to the IAEA that they intended to kickstart civil nuclear programmes. Libya has made agreements with France. The United States is simply ensuring it also has a market.

The UAE is a thin stretch of water away from Iran. Iran is developing a nuclear programme which the United States and its allies claim is for military use.

By working with other regional powers to develop their own civil projects, something they are allowed to do under international treaties, it not only strengthens Washington's position in the region, it might show the Iranian regime how it should be done.

* Graeme Baker is the Herald's deputy news editor. He has worked as a journalist in the UAE.