World Economic Forum Special Meeting

Saudi Crown Prince and Prime Minister Mohammed bin Salman will patronize the World Economic Forum (WEF) Special Meeting on Global Collaboration, Growth, and Energy for Development on April 28 and 29 in Riyadh.

More than 1000 global leaders, including heads of state and government, and thought leaders from across the public and private sectors, as well as from international organizations, academic institutions, and non-government organizations will participate in the two-day event convened by Saudi Arabia.

The Special Meeting, which will focus on three central themes of Global Collaboration, Growth, and Energy for Development, will address the most pressing present day global development challenges.

The sessions will witness productive dialogues to enhance global collaboration and stimulate collective international action to devise sustainable solutions in a world marked by growing social and economic disparities, as developed nations surpass pre-pandemic levels of activity, while emerging economies continue to play catch-up, the Saudi Press Agency reported.

Under Global Collaboration, dialogues will explore how to overcome today’s geopolitical upheavals and challenges, especially with the mounting humanitarian crises in the Middle East and Eastern Europe, while looking to foster inclusive dialogues between the Global South and North.

On the topic of Growth, the deliberations at Special Meeting will examine how the trends of transformation, innovation and economic policy-making are helping to create inclusive growth models through new investment frameworks, while looking to outline solutions to the deepening inequalities between developed and developing economies.

Under Energy for Development, leaders attending the meeting will focus on the need to achieve a net-zero future through an inclusive global energy transition.

The Special Meeting marks a continuation of the long-standing technical and policy-making collaboration between Saudi Arabia and the World Economic Forum, and builds on the impact of the Kingdom’s active participation and contributions at the Forum’s annual meetings held in Davos, Switzerland each year.

The agenda of the Special Meeting, which has been designed to revive the spirit of cooperation and collaboration, includes several panel discussions, workshops, and networking opportunities, and represents a unique convergence of global leaders and experts committed to forging a path towards a more resilient, sustainable, and equitable world.

The choice of Riyadh as the host for the WEF Special Meeting is tipped to be as a testament to Saudi Arabia’s global role in fostering international cooperation and collaboration. Since the launch of Saudi Vision 2030, Riyadh has emerged as a global capital and platform for thought leadership and action, innovation, and solutions that deliver worldwide impact, it was pointed out.

Saudi Crown Prince blasts international failure to halt Israeli aggression

Saudi Arabia’s Crown Prince Mohammed Bin Salman has affirmed the Kingdom’s unequivocal rejection and condemnation of Israel’s unjust war on Palestine.

Prince Mohammed described there was a humanitarian catastrophe that exposes the failure of the Security Council and the international community to curb the blatant Israeli violations.

He reiterated the call for an immediate cessation of military operations and the establishment of humanitarian corridors for the relief of civilians.

Crown Prince made his remarks as he chaired and opened the extraordinary joint Arab-Islamic summit in Riyadh on Saturday, on behalf of Custodian of the Two Holy Mosques King Salman.

He said, “This summit convened under exceptional and painful circumstances. In this regard, we strongly condemn and reject this unjust war, which our brothers in Palestine are enduring.

“Thousands of innocent civilians, including children, women, and the elderly, have fallen victim, and hospitals, places of worship, and infrastructure have been destroyed.”

“Saudi Arabia has exerted continuous efforts since the beginning of the events to protect civilians in Gaza, consulting and coordinating with its brothers and effective countries in the international community to halt the war.”

He renewed Saudi Arabia’s demands for an immediate cessation of military operations, the provision of humanitarian corridors for civilian relief, and enabling international humanitarian organizations to fulfill their roles.

He also called for the release of hostages and detainees, the preservation of lives, and the protection of the innocent.

“We are facing a humanitarian catastrophe that testifies to the failure of the Security Council and the international community to put an end to the blatant Israeli violations.

“It violates international laws, norms, and humanitarian law, demonstrating double standards and selectivity in their application.

“This threatens global security and stability. Therefore, it requires a coordinated collective effort to address this unfortunate situation.

Prince Mohammed called for working together to lift the blockade by providing humanitarian and relief aid, securing medical supplies for the sick and injured in Gaza.

He emphatically expressed Saudi Arabia’s firm rejection of the ongoing aggression, occupation, and forced displacement of Gaza residents.

The Crown Prince asserted the Saudi position, holding the occupying authorities responsible for the crimes committed against the Palestinian people and their resources.

He reiterated the conviction that the only way to achieve security, peace, and stability in the region is to end the occupation, siege, and settlement, ensuring the legitimate rights of the Palestinian people, and establishing their independent state within the 1967 borders with East Jerusalem as its capital.

Saudi Crown Prince calls for Palestinian state on 1967 borders

According to Saudi Gazette, Saudi Crown Prince Mohammed bin Salman has called for creating conditions that lead to stability in Gaza and lasting peace that ensures a just solution to the Middle East conflict by establishing a Palestinian state within the 1967 borders.

Prince Mohammed affirmed the Kingdom's categorical rejection of targeting civilians under any pretext and stressed the importance of adhering to international humanitarian law and the need to stop military operations against civilians and their infrastructure that directly affects their lives.

The Crown Prince made the remarks during his opening speech at the GCC-ASEAN summit in Riyadh on Friday.

"As we are holding this meeting, we are pained by the escalation of the ongoing violence in Gaza, the price of which is being paid by innocent civilians," he said.

Deputizing for Custodian of the Two Holy Mosques King Salman, Prince Mohammed chaired the Riyadh Summit of the Gulf Cooperation Council (GCC) and the Association of Southeast Asian Nations (ASEAN).

The Crown Prince received the leaders and heads of delegations participating in the summit upon their arrival at the summit's venue.

At the outset of the summit, verses of the Holy Qur'an were recited, following that the Crown Prince delivered the opening speech.

He said, "On behalf of the Custodian of the Two Holy Mosques, King Salman bin Abdulaziz, I am delighted to welcome you to the Kingdom of Saudi Arabia. We are pleased to hold this summit that is a testimony to the friendship and cooperation between the GCC states and ASEAN.

"Our meeting today aims to further develop cooperation and partnership in a way that fulfills the interests of peoples, increases opportunities for development, and consolidates security and stability."

He added, "The GCC-ASEAN countries have achieved a milestone in economic development, with the collective GDP of our countries exceeding US$7.8 trillion. We have witnessed economic growth that has increased our countries' contribution to the global GDP; the economies of the GCC and ASEAN countries have grown by 7.3% and 5.7%, respectively in 2022, motivating us to work together toward a more prosperous economy."

The growing GCC-ASEAN trade relations are evident by the volume of trade with the ASEAN countries, amounting to US$137 billion, 8% of GCC's global trade. The GCC exports to the ASEAN countries constitute 9% of its total exports; the GCC imports from ASEAN amount to 6% of the total GCC imports.

Over the past 20 years, the GCC invested 4% of its total foreign investments in ASEAN countries, amounting to US$75 billion. The ASEAN investment in the GCC accounts for 3.4% of the total foreign direct investments in the GCC countries, amounting to US$24.8 billion.

"We look forward to strengthening our economic relations, taking advantage of the available opportunities, and opening new scopes of cooperation in all fields, in light of the human resources, commercial opportunities, and promising investment projects that our countries possess."

Prince Mohammed commended "the level of coordination and cooperation our countries enjoy when it comes to international developments," while reaffirming the keenness to further advance joint action "to realize our goals and meet the aspirations of our peoples."

The Crown Prince appreciated ASEAN countries' support for the Kingdom's bid to host the Expo 2030 in Riyadh.

"The joint GCC-ASEAN action plan for 2024-2028 sets out a clear road map for increasing cooperation and partnership, which we are all keen to do, in various fields in order to serve our interests," he said.

He pledged that GCC countries will continue to be safe and reliable sources of energy, and contribute to maintaining the stability of global energy markets. "We are striving, at an accelerated pace, to meet, in a sustainable way, the requirements for developing clean, low-carbon energy technologies and petrochemical supply chains," Prince Mohammed said.

"We also look forward to achieving the maximum benefit from logistical resources and infrastructure, for expanding cooperation in tourism and cultural activities, enhancing communication among our peoples and establishing partnerships among the business sectors in our countries, to contribute to achieving the goals of our ambitious visions for a better future of prosperity, development and progress."

  

Saudi Crown Prince announces economic corridor linking India, Middle East and Europe

According to Saudi Gazette, Saudi Crown Prince and Prime Minister Mohammed Bin Salman announced the signing of a memorandum of understanding (MoU) for an economic corridor project connecting India with the Middle East and Europe.

The project aims to enhance economic connectivity, develop and upgrade infrastructure, and boost trade between the involved parties.

Speaking at the occasion of the launch of the corridor on the sidelines of the G20 Leaders' Summit in Delhi on Saturday, the Crown Prince said, “I am pleased today that we are gathered in this friendly country to sign an MoU for an economic corridor project connecting India with the Middle East and Europe.”

“This project is the culmination of our joint efforts over the past few months.

“It is built on principles that serve the common interests of our countries by enhancing economic connectivity and positively impacting our partners in other countries and the global economy as a whole.”

He added, “This project will contribute to the development and upgrading of infrastructure, including railways, port connections, and increased flow of goods and services, thus enhancing trade between the parties involved.

“It will also extend pipelines for the export and import of electricity and hydrogen to enhance global energy supply security, in addition to high-efficiency, reliable cross-border data transmission cables.”

The Crown Prince highlighted that the MoU also supports clean energy development efforts and will create new, high-quality employment opportunities along the corridors for all parties.

"To achieve what we have agreed upon in this memorandum, it requires the continuation of our collective efforts and the immediate commencement of developing the necessary mechanisms for its implementation within the agreed-upon timeframe," he said.

He also expressed profound gratitude to all those who worked together to take these foundational steps towards establishing this significant economic corridor.

Indian Prime Minister Narendra Modi announced the launch of the India-Middle East-Europe connectivity corridor, which is the first of its kind initiative on cooperation on connectivity and infrastructure involving India, UAE, Saudi Arabia, EU, France, Italy, Germany, and the United States.

The governments of Saudi Arabia and United States announced that they had signed a memorandum of understanding (MoU) between the two countries. The bilateral MoU provides a framework for developing a protocol for establishing intercontinental green transit corridors through the Kingdom to connect the continent of Asia with the continent of Europe.

This project aims to facilitate the transit of renewable electricity and clean hydrogen via transmission cables and pipelines as well as constructing rail linkages.

It is also intended to enhance energy security, support efforts for the development of clean energy, promote digital economy through digital connectivity and transmission of data via fiber cables, and promote trade and transport of goods by rail and through ports.

Saudi Arabia welcomed the role of the United States to facilitate and support the negotiation, establishment, and implementation of the green corridors transit protocol with the relevant countries.

Saudi Arabia launches plan to become global logistics hub

Saudi Crown Prince and Prime Minister Mohammed bin Salman, who is also chairman of the Supreme Committee for Transport and Logistics, has launched the master plan for logistics centers to make Saudi Arabia a global logistics hub.

The master plan aims to develop the infrastructure of the Kingdom’s logistic sector, as well as to diversify the local economy, and enhance the status of the Kingdom as a leading investment destination and a global logistics hub, the Saudi Press Agency reported.

The Crown Prince stressed that the plan is part of a package of ongoing initiatives set as targets by the National Transport and Logistics Strategy (NTLS) with the aim of developing the logistical sector to support the economy, as well as to increase the local, regional and international connections of the international trade networks and global supply chains. It also aims to boost the partnership with the private sector, and thus increase the opportunity to generate jobs, and make Saudi Arabia a global logistics hub, given its geographical location among three important continents: Asia, Europe and Africa.

The master plan for logistics centers stipulates 59 centers with a total area of more than 100 million square meters, including 12 in Riyadh region; 12 in Makkah region; 17 in the Eastern Province, and 18 distributed in the rest of the Kingdom. There are currently 21 centers under various phases of implementation and all centers will be completed by 2030.

The centers will also enable local industries to export Saudi products with high efficiency, support e-commerce by facilitating a rapid link between logistics centers and distribution centers in the Kingdom’s various regions, cities and governorates, as well as to provide high traceability and facilitate the issuance of licenses to practice logistic activity. This is especially after the launch of the unified logistics license and the licensing of more than 1,500 local, regional and international logistics companies, and the launch of the Fasah initiative, which is an e-system integrated in Saudi customs, in cooperation with the concerned government agencies.

The logistics services sector represents one of the promising pillars of economic diversification and development in the Kingdom. It is currently witnessing many important initiatives and major developments aimed at developing the sector and expanding its economic and developmental contributions. The Ministry of Transport and Logistics seeks to develop the logistics industry, enhance the export strategy, expand investment opportunities, and seal partnerships with the private sector.

 

Saudi Crown Prince discusses regional stability with US, UAE and Indian officials

Saudi Crown Prince Mohammed bin Salman met with senior officials from the United States, United Arab Emirates and India on Sunday. In Jeddah, he received Ruler of Abu Dhabi and National Security Advisor of the United Arab Emirates (UAE) Sheikh Tahnoun bin Zayed Al Nahyan; the US National Security Advisor Jake Sullivan; and the National Security Advisor of India Ajit Doval.

During the meeting, they discussed ways to strengthen relations and ties between the three countries in a way that enhances growth and stability in the region.

Crown Prince and Prime Minister received on Sunday the US National Security Advisor Jake Sullivan in Jeddah

During the meeting, they reviewed the strategic relations between the two countries and ways to enhance them in various fields. They also discussed the latest regional and international developments.

Attending the meeting from the American side were US Ambassador to Saudi Arabia Michael Ratney; the US National Security Council Coordinator for the Middle East and North Africa Brett McGurk; Special Presidential Coordinator at the Department of State Amos Hochstein; and Senior National Security Advisor Ariana Berengaut. 

Saudi Aramco transfers 4% stake to Sanabil Investments

A 4% stake in oil major Saudi Aramco has been transferred from state ownership to Sanabil Investments, which is wholly owned by the Saudi Arabia's sovereign wealth fund, Crown Prince Mohammed Bin Salman said on Sunday.

The state remains Aramco's biggest shareholder, owning 90.18% of the Company.

Riyadh-based Sanabil is an investment company that commits approximately US$3 billion a year to private transactions, its website says.

The transfer will solidify PIF’s strong financial position and credit rating, the crown prince's statement. The Fund is responsible for the bulk of projects aimed at transforming the Saudi economy to reduce its reliance on oil revenue.

 

Saudi Arabia launches Special Economic Zones

According to Saudi Gazette, Crown Prince and Prime Minister Mohammed bin Salman, who is also chairman of the Council of Economic and Development Affairs, launched on Thursday four new Special Economic Zones in Saudi Arabia.

The announcement about the new economic zones, which are located in Riyadh, Jazan, Ras al-Khair and King Abdullah Economic City, north of Jeddah, is line with the Crown Prince’s commitment to strengthening Saudi Arabia’s prime position as a global investment destination.

In a statement carried by Saudi Press Agency, the Crown Prince said, “Saudi Arabia is open for business, and welcomes investors from all around the world to see first-hand the historic opportunities we have to offer. The new Special Economic Zones, launched today, will significantly impact how business is done in the country, create tens of thousands of jobs, and contribute billions of riyals to our GDP.”

The new zones draw on Saudi Arabia’s strategic location at the heart of global trade, creating new hubs for businesses across key growth sectors to launch and scale the companies and technologies that will shape the future. The Special Economic Zones (SEZs) will support existing national strategies and create new linkages with international frameworks, building on the competitive advantages of each region to support key sectors including logistics, advanced manufacturing, technology and other priority sectors for the Kingdom.

Benefits for companies operating in the new SEZs include competitive corporate tax rates, exemption from customs duties on imports, production inputs, machinery and raw materials, 100 percent foreign ownership of companies, and flexibility to attract and hire the best talent worldwide.

The new SEZs will provide tremendous opportunities to develop the local economy, generate jobs and localize supply chains. They represent a continuation of the Kingdom’s long-running initiatives to transform into a global investment destination, and a vital hub for global supply chains, capitalizing on its position at the heart of global trade routes, at the crossroads between East and West. With a detailed program of regulations and incentives, these SEZs offer rewarding and attractive offers for foreign investment. This program will allow for the acceleration of the required reforms to facilitate doing business in all parts of the Kingdom.

These four SEZs build on previous free zone initiatives in the Kingdom, including the recent launch of the integrated logistics special zone at King Salman International Airport in Riyadh. Together, they represent the first phase of a major, long-term program aimed at encouraging foreign direct investment, attracting the most talented professionals from around the world, and promoting entrepreneurship and economic development within the Kingdom.

The Special Economic Zones, regulated by the Economic Cities and Special Zones Authority, provide new solutions to the challenges facing many global businesses as they look to localize and strengthen their supply chains. They will help the Kingdom take advantage of key macroeconomic shifts to create a truly differentiated business environment, activating new sectors and value chains, the SPA reported.

Mohammed Bin Salman chosen most influential Arab leader of 2022

Saudi Crown Prince and Prime Minister Mohammed Bin Salman (MBS) has been chosen the most influential Arab leader of 2022, according to an opinion poll conducted by the RT Arabic channel.

The Crown Prince has secured around 7.4 million (62.3%) votes out of the total votes of those who participated in the poll.

MBS obtained 7,399,451 votes out of the total 11,877,546 votes of those polled. The poll began on December 15, 2022 and ended on January 09, 2023.

The percentage of votes obtained by the Crown Prince broke the record in the history of opinion polls that RT Arabic conducts by the end of every year.

In the opinion poll, the second place went to the United Arab Emirates President Sheikh Mohammed Bin Zayed, securing 2,950,543 votes that represent 24.8% of the total votes.

Egyptian President Abdel Fattah El-Sisi won the third place with 1,387,497 votes; making up 11.7% of the total votes of those participated in the poll, carried out by RT Arabic, a global multilingual television news network based in Russia.

Biden advisers weigh Saudi Arabia trip for more oil

According to Axios, President Joe Biden’s advisers are discussing a possible visit to Saudi Arabia this spring to help repair relations and convince the Kingdom to pump more oil.

A hat-in-hand trip would illustrate the gravity of the global energy crisis driven by Russia's invasion of Ukraine. Biden has chastised Saudi Arabia, and the CIA believes its de facto leader, Crown Prince Mohammed bin Salman, was involved in the dismemberment of Washington Post columnist Jamal Khashoggi.

The possibility also shows how Russia's invasion is scrambling world's alliances, forcing the United States to reorder its priorities — and potentially recalibrating its emphasis on human rights.

Biden officials are in Venezuela this weekend to meet with the government of President Nicolás Maduro. Some Republicans and Democrats in Washington suggest Venezuela's oil could replace Russia's, according to the New York Times.

Any visit to the Persian Gulf would come amid a busy presidential travel schedule during the next few months.

Biden will likely take trips to Japan, Spain, Germany and, potentially, Israel, Axios has also learnt.

A White House spokesperson told Axios, “We don’t have any international travel to announce at this time, and a lot of this is premature speculation.”

President Obama visited Saudi Arabia more often than any of his predecessors, a total of four trips, but relations frayed over the wars in Yemen and Syria, as well as differences about how to deal with Iran.

President Trump made restoring the relationship a priority, and boasted about arms sales to the Kingdom.

He questioned the CIA's conclusion bin Salman was involved in Khashoggi's murder and defiantly refused to condemn him. "Maybe he did and maybe he didn’t!” Trump wrote on Twitter.

During the 2020 campaign, Biden called the Kingdom a "pariah," and early in his term, released an unclassified report assessing MBS approved the operation to "capture or kill" Khashoggi.

Bin Salman isn't making it easier on Biden to repair their relations.

He appeared to go out of his way to aggravate the White House during an interview with the Atlantic published last week.

“We don’t have the right to lecture you in America,” he said. “The same goes the other way.”

Sanctions against Russia's oil exports, including a possible ban on importing Russian oil into the US, would both elevate worldwide gas prices and stoke domestic inflation.

Biden officials want to preserve options for the president, including the chance to make amends with the Saudis and persuade them to increase their oil production.

Discussions about a potential visit are still in the early phases and officials cautioned a visit is far from finalized and may not happen.

Russian actions are also factoring into the president's other planned travel.

The invasion has sparked an international refugee crisis and raised worldwide prices, so the president wants to ensure US allies remain united. His in-person attendance at summit meetings also highlights how concern about COVID-19 has waned.

Biden's first trip this year is likely to Japan, potentially in May. He's set to meet with the other leaders of the Quad: Japan, India and Australia.

In June, he's scheduled to attend a G7 meeting in Germany. That will be followed by a NATO summit in Spain.

The European itinerary could also be expanded to include a stop in Israel, where Biden told Prime Minister Naftali Bennett he wanted to visit this spring.

Saudi bid to become regional business hub

Reportedly, Saudi Arabia has issued licenses to 44 international entities to set up regional headquarters in the capital Riyadh, as the kingdom seeks to project an image of change to lure foreign capital and talent.

Multinationals in sectors including technology, food and beverages, consulting and construction are among the entities eligible to set up headquarters. They include South Korea's Samsung, Deloitte, Unilever, Baker Hughes and Siemens.

Crown Prince Mohammed bin Salman is spearheading a campaign to make Saudi Arabia a regional business hub. State news agency SPA cited Fahd al-Rasheed, President of the Royal Commission for Riyadh City, as saying the moves would add 67 billion riyals (US$18 billion) to the Saudi economy and create around 30,000 jobs by 2030.

The country has set out a Vision 2030 program ‑ a neoliberal reform agenda aimed at reducing the Kingdom's economic dependence on oil.

Saudi Arabia also needs to reassure foreign investors nervous about putting money into the kingdom due to reputational risks stemming from purported human rights violations at home and in Yemen, and the sour taste left by the murder in 2018 of Saudi journalist Jamal Khashoggi in Istanbul.

The world's top oil exporter and largest Arab economy is also setting a deadline, saying in February it would give foreign entities until the end of 2023 to set up shop in Riyadh or risk losing out on government contracts.

Saudi Minister of Investment Khalid al-Falih told Nikkei Asia that it was not a case of merely competing with the UAE for foreign direct investment.

"We believe all capitals of the Middle East will continue to grow and thrive with the growth of Saudi Arabia. With the achievements of Vision 2030 [and] with the growth of Riyadh, it will create a spillover effect into the region," al-Falih said in the interview.

"Riyadh's economic quality will transform into higher growth sectors such as technology, health care, logistics, advanced manufacturing, food processing [and] financial centers ... centered in Riyadh to serve the broader region."

Al-Falih said his country was working to improve lifestyles for foreigners based in Riyadh.

"We are only starting the climb. This is an escalator we are riding to improve liveability in Riyadh," he said. "We are on a continuous, never-ending journey to improve our liveability [and] ... investment environment. Boosting skills for our talent and improving our competitiveness for the Saudi economy."

Saudi Arabia investment minister Khalid al-Falih speaks to Nikkei Asia in an interview in Riyadh. (Photo by Saudi Ministry of Investment)

But Ryan Bohl, a senior geopolitical risk analyst for intelligence firm Middle East at Stratfor, said it is unlikely that Riyadh will be able to quickly make improvements in legal and banking services, social issues, entertainment and education.

"Riyadh will take years to create the natural pulls needed to get these Asian and International institutions to shift over to Riyadh," he said. "There is a real chance Saudi Arabia weakens these provisions before the deadline, which would reduce the challenge to Dubai's model."

"But even if they don't, the Emirati government might decide to either provide compensation for those that endure Saudi penalties -- create new policies that liberalize the UAE's labor market further to make it an easier place to live and work than Saudi."

During the recent Riyadh Future Initiative Investment Summit, dubbed "Davos in the Desert," international investors were reluctant to speak openly about moving their Dubai headquarters to Riyadh.

"The Gulf region is growing fast enough to sustain offices in multiple jurisdictions," Tarek Fadlallah, CEO of Japanese Nomura Asset Management (Dubai), told Nikkei.

Anthony Habis, head of the Middle East and North Africa for BNY Mellon, said the U.S. investment bank was expanding its presence in Saudi Arabia with its local entity and strategic partnerships. "We are proud to have a Saudi CEO and local team based in Riyadh, and we share in the Saudi Vision 2030 of building capital markets."

Hazem Ben-Gacem, co-CEO of Investcorp Bahrain, lauded Riyadh's recent progress. "Crown Prince Mohammed bin Salman has done an exceptional job to challenge the status quo, not just in terms of structural and fiscal reforms but also on the social front."

Chinese artificial intelligence company Sensetime said it will be growing its presence in Saudi Arabia, but did not comment further.

The assassination of Khashoggi prompted numerous investors, including the CEOs of BlackRock and JPMorgan Chase, to pull out of an investment event in Riyadh in 2018.

A senior consultant who spoke to Nikkei on condition of anonymity said that "reputational risks are still a concern for some international and Asian investors." The person added, however, that while some investors "will be excited by the prospect and level of business activity in Riyadh, others will have social considerations."

What United States loves the most? Saudi Crown Prince or US$134 billion arms sale

At present, the United States and Saudi Arabia are experiencing a new era in their 76-year relationships. The priorities have changed after the release of the CIA findings. The report says Crown Prince Mohammed bin Salman (MBS) had ‘approved’ the 2018 murder of prominent Saudi journalist, Jamal Khashoggi.

Historically, an American president has never cut off personal links to the Saudi heir apparent, who has often served as de facto ruler of the kingdom. But the White House declared his intention to make that very heir a ‘pariah’ in Washington and internationally as well.

The State Department has also set a new precedent by issuing visa restrictions on 76 Saudis believed to have been engaged in threatening dissidents overseas’ under a new ‘Khashoggi ban’ created in memory of the Saudi journalist murdered inside the Saudi consulate in Istanbul in October 2018.

MBS has been deliberately spared from the Khashoggi ban, or any other sanction, to preserve a minimum communication and cooperation between the two governments. Former Saudi ambassador to Washington, Prince Turki al-Faisal noted, MBS is destined to live under a lifetime ‘stigma’ for his role in the affair. He is unlikely to be invited to the White House for years to come.     

Biden has said that from now on, he will only talk to King Salman, Mohammed’s father and the American President’s official counterpart. But the king is 85 years old and in failing health. When he dies, would Biden refuse to communicate with the kingdom’s new monarch? It will be an unprecedented situation in the history of US-Saudi relations dating back to World War II.

In the past, the personal relationship between the US President and reigning Saudi monarch has been a key determinant in setting both the tone and substance of ties between the two countries. At this point, the only senior US official authorized to talk to Crown Prince Mohammed, who is also minister of defense, is his counterpart, Secretary of Defense General Lloyd Austin III.

What impact the new Biden doctrine toward the crown prince will have on the overall US-Saudi relationship remains to be seen? It seems likely that the relationship will be reduced mostly to formal state-to-state transactions and to avoid an open break which neither side wants.

It is believed that the focal point of the relationship will remain the massive US arms sales to the Saudi kingdom and covert cooperation in demolishing Iran. Since 2010, the US Defense Security Cooperation Agency has notified Congress of US$134 billion arms sales to Saudi Arabia, which has been the most important foreign market for the American defense industry for decades.

The Biden administration has reiterated its commitment to defending Saudi Arabia from foreign aggression and will continue to provide ‘defensive’ arms. However, it has already announced the suspension of ‘offensive’ weapons being used against Houthi rebels, who have seized control of most of Yemen. Forthcoming arms sales to the Kingdom are now under review, presumably to determine which are defensive and which are offensive.

Other than MBS, the most divisive and immediate issue in US-Saudi relations is how to deal with Iran, the kingdom’s arch rival for regional primacy. Iran has proven itself to be the most serious military threat after demonstrating its ability to amass drones and cruise missiles to knock out nearly half of the kingdom’s oil production for several weeks in September 2019.

Biden has begun charting a diplomacy initiative to entice Iran back into the 2015 Joint Comprehensive Plan of Acton (JCPOA). This will certainly lead to even more discord in the fraught US-Saudi relationship. The two countries no longer see the personal ties bonding US and Saudi leaders had enjoyed in the past.