US and Saudi Arabia Ink landmark $600 billion deal, US to lift Syria sanctions

In a landmark move that has sent ripples across global diplomacy, the United States and Saudi Arabia signed a historic deal in May 2025, marking a significant shift in Middle East geopolitics. This agreement, valued at over $600 billion, includes a $142 billion arms package and substantial investments in American industries.

Alongside this, the U.S. announced plans to lift long-standing sanctions on Syria, a decision that could reshape the region’s economic and political landscape.

Let us delve into the details of the USA-Saudi Arabia deal, its implications for the Middle East peace process, and the potential impact of lifting sanctions on Syria. We will explore how these developments could foster stability, economic growth, and diplomatic breakthroughs in a region long plagued by conflict.

The USA-Saudi Arabia Deal: A Strategic Partnership

On May 13, 2025, during a high-profile visit to Riyadh, U.S. President Donald Trump announced the signing of a $600 billion agreement with Saudi Arabia. The deal encompasses a $142 billion arms package, described by the White House as the largest defense cooperation agreement in U.S. history. This package includes advanced military equipment and training, bolstering Saudi Arabia’s defense capabilities amid regional tensions.

Additionally, Saudi Arabia committed to investing $600 billion in U.S. sectors such as energy, technology, and infrastructure, with companies like Amazon, Oracle, and Nvidia securing lucrative contracts.

The USA-Saudi Arabia deal is not merely a financial transaction; it’s a strategic alignment aimed at strengthening bilateral ties and countering regional adversaries, notably Iran. Saudi Crown Prince Mohammed bin Salman, a key architect of the agreement, has been praised for his role in fostering a “stable, peaceful, and prosperous Middle East.” The deal also aligns with the Gulf Cooperation Council (GCC) summit, where Trump met leaders from Bahrain, Kuwait, Oman, Qatar, and the UAE to discuss regional stability and economic cooperation.

This partnership signals a return to a transactional U.S. foreign policy, prioritizing economic and security interests over traditional alliances. By deepening ties with Saudi Arabia, the U.S. aims to secure a reliable partner in a volatile region, while Saudi Arabia gains advanced military technology and economic leverage. However, the deal’s broader implications extend beyond bilateral relations, particularly in the context of the Middle East peace process.

Implications for the Middle East Peace Process

The Middle East peace process has long been a complex web of negotiations, conflicts, and diplomatic efforts. The USA-Saudi Arabia deal introduces both opportunities and challenges for advancing peace in the region.

Strengthening the Abraham Accords

One of the deal’s most significant implications is its potential to advance the Abraham Accords, a series of normalization agreements between Israel and Arab states initiated during Trump’s first term. Trump expressed hope that Saudi Arabia would join the Accords, which already include the UAE, Bahrain, and others. Normalizing relations between Saudi Arabia and Israel could be a historic breakthrough, fostering economic cooperation and reducing regional tensions.

However, challenges remain. Israeli Prime Minister Benjamin Netanyahu’s opposition to a Palestinian state complicates Saudi Arabia’s participation, as Riyadh has historically supported Palestinian statehood. Trump’s decision to skip Israel during his Middle East tour, citing tensions over the Gaza conflict, underscores the delicate balance required to expand the Accords. Despite these hurdles, the USA-Saudi Arabia deal provides economic incentives that could encourage Saudi Arabia to move toward normalization, potentially reshaping the Middle East peace process.

Countering Iran’s Influence

The deal positions Saudi Arabia as a bulwark against Iran, which Trump labeled “the most destructive force” in the Middle East. By arming Saudi Arabia with advanced weaponry, the U.S. aims to deter Iranian aggression and reduce Tehran’s influence in Syria, Lebanon, and Yemen. This aligns with the GCC’s broader strategy to curb Iran’s regional ambitions.

However, Trump also extended an “olive branch” to Iran, expressing willingness to negotiate a deal to limit its nuclear program in exchange for easing sanctions. This dual approach—strengthening Saudi Arabia while engaging Iran—could either stabilize the region or exacerbate rivalries, depending on the outcome of future talks. For the Middle East peace process, managing the Saudi-Iran rivalry will be critical to preventing proxy conflicts that have historically derailed peace efforts.

Economic Stability as a Peace Catalyst

Trump’s vision for the Middle East emphasizes “commerce, not chaos.” The $600 billion investment from Saudi Arabia into U.S. industries, coupled with multi-billion-dollar deals involving American tech giants, signals a shift toward economic development as a pathway to peace. By fostering prosperity through trade and investment, the USA-Saudi Arabia deal could create incentives for regional actors to prioritize cooperation over conflict.

For instance, Saudi Arabia’s investments in AI, energy, and infrastructure could spill over into neighboring countries, creating jobs and reducing economic disparities that fuel unrest. The Gulf Cooperation Council is likely to play a pivotal role in coordinating these efforts, ensuring that economic gains are shared across the region. A prosperous Middle East is more likely to support peace initiatives, as economic stability often underpins diplomatic progress.

Lifting Sanctions on Syria: A Bold Move

In a surprise announcement during his Riyadh visit, Trump declared that the U.S. would lift all sanctions on Syria, imposed during the Assad regime, to “give them a chance at greatness.” This decision, urged by Saudi Crown Prince Mohammed bin Salman and Turkish President Recep Tayyip Erdogan, marks a dramatic policy shift with far-reaching implications for Syria and the region.

Economic Revitalization

Syria’s economy has been devastated by over a decade of civil war, with sanctions exacerbating its challenges. The lifting of sanctions on Syria is expected to unlock international investment and aid, enabling reconstruction efforts estimated to cost over $250 billion. Gulf states, particularly Saudi Arabia and the UAE, are poised to lead these investments, viewing Syria’s new government under President Ahmed al-Sharaa as a counterweight to Iran’s influence.

The removal of sanctions could also facilitate humanitarian relief, addressing the dire needs of 12.9 million Syrians facing food insecurity. Former U.S. ambassador to Syria Robert Ford emphasized that lifting sanctions is “absolutely vital” for enabling capital flows into Syria, which could stabilize the country and reduce migration pressures on neighboring nations.

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Diplomatic Reengagement

The lifting of sanctions on Syria paves the way for normalized relations between the U.S. and Syria’s new government. Trump’s meeting with President al-Sharaa in Riyadh—the first between a U.S. and Syrian leader in 25 years—signals a willingness to engage diplomatically. This detente, backed by Saudi Arabia and Turkey, could integrate Syria into regional frameworks like the Gulf Cooperation Council, fostering stability.

Moreover, Syria’s new government has signaled openness to de-escalating tensions with Israel, including indirect talks to address security concerns. While Israel’s occupation of Syrian territory near the Golan Heights remains a sticking point, the lifting of sanctions on Syria could create conditions for dialogue, potentially aligning with the Abraham Accords framework.

Risks and Challenges

Despite its potential, the decision to lift sanctions carries risks. Critics argue that it may legitimize a government still consolidating power, raising concerns about human rights and governance. Additionally, the move could embolden Iran if not paired with robust diplomatic efforts to curb its influence. The Middle East peace process will depend on careful coordination with allies like Israel to address security concerns while supporting Syria’s recovery.

Broader Regional Impact

The USA-Saudi Arabia deal and the lifting of sanctions on Syria are interconnected moves that could redefine the Middle East’s geopolitical landscape. By strengthening Saudi Arabia’s regional leadership, the U.S. is betting on Riyadh to drive stability and counter Iran. The Gulf Cooperation Council will likely amplify these efforts, coordinating economic and security initiatives across member states.

For the Middle East peace process, the deal offers a chance to build on the Abraham Accords, expand economic cooperation, and integrate Syria into a more stable regional order. However, success hinges on navigating complex rivalries, particularly between Saudi Arabia and Iran, and addressing unresolved conflicts like the Israeli-Palestinian issue.

Conclusion

The USA-Saudi Arabia deal and the lifting of sanctions on Syria represent a bold vision for the Middle East, prioritizing economic prosperity and strategic partnerships. By strengthening ties with Saudi Arabia and re-engaging with Syria, the U.S. aims to foster a more stable and peaceful region. While challenges remain, including Iran’s influence and unresolved conflicts, the deal’s focus on commerce and diplomacy offers hope for a new chapter in the Middle East peace process. As the Gulf Cooperation Council and the Abraham Accords gain momentum, the region stands at a crossroads, with the potential for transformative change.

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