Stormy weather ahead

Saudi Arabia’s new crown prince Mohammad bin Salman will need to tread a finer line for the kingdom in times of economic dislocation.

Published: June 26, 2017 12:30 am
saudi arabia royal family, crown prince, mohammad bin salman, salman bin abdulaziz al saud, nayef In this April 4, 2017 file picture, Saudi boys pose in front of a huge billboard showing in the center, King Salman, with his 31-year-old son Mohammed bin Salman to the right, and Prince Mohammed bin Nayef to the left in Taif, Saudi Arabia. (AP Photo/Amr Nabil)

In appointing his son crown prince of Saudi Arabia at the expense of his nephew, the ageing King Salman bin Abdulaziz Al Saud has engaged in a high-stakes gamble on the future of the besieged petro-king. Prince Mohammad bin Salman, who has displaced Muhammad bin Nayef in the line of succession, is a pro-western moderniser. To the ire of the religious establishment, he has introduced film screenings, theatre and musical performance, and allowed exploration of the kingdom’s rich pre-Islamic heritage. He has also signalled his support for lifting the ban on women driving. The prince’s efforts to reform the kingdom’s rentier structure, though, have come at a price.

Saudis have seen their cradle-to-grave social security structures gutted as a consequence of the long-term decline in oil prices. There have been cuts in housing, vacation and sickness benefits, while salaries in the public sector, the country’s largest employer, have been slashed by up to a third. Reduced public spending and delays in payments have put two of the kingdom’s major companies, Binladin and Saudi Oger, on the edge. Thousands of employees have been unpaid for months. Binladin workers last year burnt a bus in Mecca in protest. Oger is reportedly bankrupt and likely to go into liquidation. The consequences, in Saudi terms, have been seismic. Protests, sparked off online by Prince Mohammad’s acquisition of a $500 million yacht shortly after he came to office, persuaded the government to roll back some of the austerity measures and restore most of the perks enjoyed by government employees. In a worst-case scenario, the discontent could fuel support for the Islamic State and al Qaeda, both of which have not-insignificant pockets of support in the kingdom.

This dislocation might have been more easily manageable were it not for the context. In his effort to contain Iranian geopolitical influence, the crown prince — who also serves as defence minister — has mired Saudi Arabia in two wars. Saudi Arabia’s state-of the-art military arsenal notwithstanding, victory in Yemen has proved elusive. Instead, three years of war have generated a gargantuan humanitarian crisis. There are, similarly, signs that the diplomatic and economic boycott of Qatar, initiated by Prince Mohammad and his UAE counterpart, Mohammed bin Zayed, may backfire. Qatar, a tiny state with only 3,00,000 citizens, has shown resilience in the face of the embargo, while Saudi Arabia and the UAE have so far failed to garner broad international support. Great storms lie ahead — and guiding the kingdom through them will not be an enviable task.

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