Kuwait's foreign policy in 2011-15 will continue to be founded on its long-standing strategic alliance with the US. This could complicate efforts to improve ties with Iran, which have grown increasingly strained owing to heightened regional tensions. Although Kuwait will formally support further integration of the Gulf Co-operation Council (GCC), it will diverge from the GCC on policy issues when its national interest is at stake. Relations with Iraq remain tense as a result of disagreements over the demarcation of borders and Iraq's reparation payments, but there are increasing efforts on the diplomatic front to build bridges. Tensions are likely to persist and flare up at regular intervals over the next few years, but Kuwait could benefit economically if it develops as a transshipment and transport hub for Iraq's southern oilfields.