Kuwait's postwar foreign policy is therefore based on two assumptions. The first is that security, notably with regard to Iraq, is its primary concern. The second is that security ultimately can be guaranteed only by the United States. It is clear that Kuwait alone, or even Kuwait with tÍÍÍÍhe support of the Gulf Cooperation Council (GCC), established in May 1981, and other Arab members of the coalition--a formal plan, known as the Damascus Declaration, to include Egypt and Syria in gulf defense arrangements was moribund soon after its issuance--cannot provide for its own defense needs (see Collective Security under the Gulf Cooperation Council , ch. 7). In August 1991, Kuwait and the United States signed a US$81 million Foreign Military Sales agreement. In September 1991, Kuwait signed a formal ten-year defense agreement with the United States that permits the United States to pre-position weapons and conduct military exercises in Kuwait at Kuwaiti expense. However, the agreement does not provide for establishing a permanent United States base there. In 1992 Kuwaiti and United States forces carried out joint exercises under the defense agreement. Kuwait has backed up its formal security arrangements with a close political and economic relationship with the United States. It has given much of its postwar reconstruction business to United States firms, including civil reconstruction contracts that have been awarded through the United States Army Corps of Engineers and many contracts directly related to defense needs. The new pro-United States policy is not without its detractors. In the summer of 1992, the speaker of Kuwait's since-disbanded National Council asserted that the United States ambassador was interfering in internal Kuwaiti affairs. The Kuwaiti government and numerous Kuwaitis, however, condemned these remarks.

Kuwait maintains similarly close ties with other members of the coalition, signing defense agreements with Britain and in 1992 negotiating an agreement with France. It is seeking similar agreements with the remaining Security Council permanent members, Russia and China. It remains very close to Saudi Arabia. Relations with a regionally resurgent Iran remain ambivalent. Kuwait's relationship with Iran improved dramatically after the Iraqi invasion, which, in drawing attention to Iraq's expansionist ambitions, seemingly vindicated Iran's wartime position. An inevitable conflict remains, however, between Kuwait's postwar aim of maintaining a high and visible level of United States support and Iran's desire to limit United States presence in the gulf. In mid-1992 this tension was seen in a minor dispute over the fate of Kuwait Airways passenger aircraft flown by Iraq to Iran during the war. Kuwait demanded the swift return of the aircraft, whereas Iran demanded US$90 million for servicing them while they remained in Iran.

Kuwaiti policy toward states that had supported Iraq has been unforgiving. One of the hard lessons Kuwait's rulers learned from the Iran-Iraq War is that foreign aid does 416 not buyuy popularity or enduring political support. Some of its largest aid was to Jordan, Sudan, and Yemen, countries that nonetheless failed to support the coalition. Kuwait cut those countries from its foreign aid program once sovereignty was restored. Kuwait was also a major donor to the Palestine Liberation Organization (PLO). The PLO's wartime support of Iraq also resulted in severance of Kuwaiti monetary and political support. In June 1992, the National Council approved denying economic aid to Arab countries that supported Iraq's invasion. Although foreign aid will continue as a feature of Kuwait's foreign policy, Kuwait's limited postinvasion revenues and its experience during the occupation indicate that such aid would decrease.

Data as of January 1993