Advertisements
jump to navigation

Saudi Arabia and its Challenges 30, May 2015

Posted by thegulfblog.com in Saudi Arabia.
Tags: , , , ,
add a comment

The following article was published by King’s College London’s Defence in Depth blog on 25 March 2015.

__

In 2010 at a conference in Riyadh, an academic presented a cogent case as to why the fiscal picture for Saudi Arabia was, in the medium and long term, looking grim. His figures were correct, and his conclusions were not hyperbolic, but sensibly grounded in the facts. Nevertheless, the Saudi participants around the table, ranging from ministers to CEOs to academics to the state’s leading journalists, greeted the presentation with a weary shrug. Their point was that they had seen just such cogent presentations every five years for decades and yet the sky never did quite manage to fall in.

It would be, therefore, really quite a significant call to suggest that on this occasion, as opposed to the countless previous assertions, Saudi Arabia is actually facing some kind of a crisis. Yet, it appears that the state may well be entering just such a concerning phase.

At the core of this thesis are three interlinked factors that are facing quite unprecedented change and these changes look set to – at the very least – vastly complicate the already Gordian difficulties facing the Kingdom.

Oil: supply and demand

Saudi Arabia is, understandably, a state synonymous with oil. The substance has transformed the state entirely and continues to be the centre of gravity of the state’s economy. Yet it could be argued that there are vast supply and demand-related changes afoot that may fundamentally undermine the state’s central reliance on its black gold.

On the demand side, the central problem is that it is rising in places that Saudi Arabia does not really want it to rise, and falling in places where it would rather it didn’t. Most importantly, demand is rising within the country. This is not a good thing. Given the subsidies that exist for oil and its derivative products, the government loses money refining and processing oil for its domestic market as well as having less oil to sell internationally. There are even studies noting that Saudi Arabia may be a net oil importer by the late-2030s, a notion that indicates just how much of a paradigm-shift the Kingdom may be about to undergo.

Otherwise on the demand side, as America becomes ever more self-sufficient, the importance of Saudi Arabia declines, if it doesn’t disappear given the US’s reliance on a stable Gulf region is critical to its economy. That this drop in US demand is being picked up by China is a boon, but even growth in China is slowing relatively speaking and nor is China in any position in the foreseeable future to provide Saudi Arabia with any kinds of security guarantees.

In terms of supply too, Saudi Arabia’s dominating role in the oil industry may be under threat. Eventually, the likes of Iraq, Kurdistan, Libya, or Iran – all of which have huge oil reserves – are likely to add in a few more millions of barrels per day in oil to the market. Similarly, the unconventional hydrocarbon revolution has allowed states to tap reserves of oil and gas that were previously uneconomical. This means, first and foremost, that America may transition to an oil exporter – a large one – by the end of the decade; something that will upend the recent dynamics in the market.

These factors coalesce to present Saudi Arabia with a range of problems. At a time of burgeoning budgets inspired by a fear of the Arab Spring and growing youth unemployment, the state looks destined to spend even more on its subsidies. Meanwhile, the plunging oil price that looks set to stay nearer $50 per barrel than the $100 that markets and states had become used to, robs the state of further income. This all means that the state will run a budget deficit for the first time in years in 2015 and will continue with them for years to come. With low interest rates on the international market, huge foreign reserves, and being relatively debt-free to start with, this is not that problematic in the short-term at least. But the fiscal medium and long term look decidedly murky.

Defence and security

Historically, the Gulf states do not really use their militaries in an expeditionary fashion. They have preferred to rely on alliances, defence guarantees, and international coalitions where possible. But this is slowly changing, and the states are demonstrating a willingness to actually use their expensively assembled military kit around the Middle East. This is most clearly seen in the recent Saudi-led large-scale bombing campaign in Yemen. There are a variety of likely causes of this increased desire to utilise their forces.

The increasing Gulf disenchantment with America in recent years has now become palpable. After America dropped their long-term ally Hosni Mubarak in Egypt, Gulf leaders were irate, fearing, ultimately, that America may too one day drop them. This fear of being left alone by America was exacerbated by the ‘Pivot to Asia’ rhetoric and utterly compounded by America’s negotiations with Iran; something Gulf states fear will hasten America’s departure from the region, leaving an emboldened Iran to dominate.

The sense is, therefore, that Saudi Arabia is pointedly noting that if America will not secure the region, then they will. And they are clearly willing to utilise their military capacity towards this end. None of this bodes well for the future.

While America and her allies may well have blundered – spectacularly at times – in the Middle East, the local knowledge of Saudi Arabia is hardly affecting a different outcome so far: the bombing campaign in Yemen has been a brutal, ineffectual one to date. Moreover, Gulf states, unencumbered by the restraint inherent in believing the America will ultimately back them up, may act on their Iranian paranoia, further adversely affecting security in the region.

Succession

Succession in Saudi Arabia has long been a source of concern. In particular, many have been focused on the jump of leadership to a new generation of al-Sauds. Since the state’s modern inception in 1932, the Kings have all been sons of the founder, Abdul-Aziz al-Saud. This has meant that recent Kings and their successors have been exceedingly old and, on occasion, infirm. Two Crown Princes, for example, died in office waiting for now former King Abdullah al-Saud to pass.

But this gap has been breached. In a recent reshuffle, King Salman bin Abdul-Aziz ejected his brother, Prince Muqrin, from second in-line to the throne, and replaced him with a grandson of Abdul-Aziz al-Saud, Mohammed Bin Nayef al-Saud. More interestingly, he also installed his own son, Mohammed bin Salman, as the third-in-line to the throne. These two Mohammeds now have portfolios spanning all of the most important sectors of the Kingdom.

The jump to the 55-year-old Mohammed bin Nayef is no surprise and no cause for alarm. He is widely recognised as the leading candidate of the younger generation, and has steadily but effectively built up a reputation, internally and externally, as a diligent and effective minister.

But the jump to the 29-year-old Mohammed bin Salman is deeply surprising, if not shocking. He has emerged from nowhere to, in but a few months, be made Deputy Crown Prince, Minister of Defence, head of the centrally important economic committee, and Chairman of Aramco, the Saudi national oil company.

The implications of this shift are concerning.

Age and seniority are important aspects of Saudi social and political life. It is unclear how so completely trouncing established and widely regarded cultural rules will be received in the longer term. Similarly, both Mohammeds and the King himself come from the same Sudairi clique of the al-Saud. King Salman has, therefore, engineered that his section of the family hold practically all the most important portfolios and he has attempted to make sure that they will hold them for decades to come. Instead of the typical balance between Sudairis and non-Sudairis, this leaves most members of the latter camp completely disenfranchised.

Perhaps installing a young Deputy Crown Prince will prove to be a master-stroke, giving the aged Saudi leadership a voice for Saudi’s youth who dominate the state overall. But, taken together, the mix of a deteriorating fiscal situation, a far more militarily assertive foreign and security policy, controlled by a new leadership overseeing a delicate power balance, does not give confidence as to the longer term stability of the state.

Advertisements

Breaking the Saudi Rules of Succession 28, May 2015

Posted by thegulfblog.com in Saudi Arabia.
Tags: , , , , , , , ,
add a comment

The following article was published by the Washington Post in their longer-form blog on 27 May 2015.

__

On April 29, 2015, King Salman of Saudi Arabia appointed Mohammed bin Nayef, a grandson of the state’s founder, second-in-line to the throne as crown prince and placed Mohammed bin Salman, a 29-year-old prince, third-in-line as deputy crown prince. The major change comes just months after Salman acceded to the throne on Jan. 23, following the death of his half-brother Abdullah. The relatively seamless transition is surprising after many years of fevered speculation about the complications surrounding what might happen when Saudi Arabia’s leadership finally jumped down a generation instead of just passing the kingly baton from brother to brother. What does this mean for our understanding of power dynamics in the kingdom of Saudi Arabia?

The latter appointment in particular challenges the expectations of both scholars and analysts. For instance, Saudi-focused scholars, such as Gregory Gause, as well as analysts, such as Simon Henderson, have tended to cogently emphasize the importance of age as a factor in determining positions of authority. How then to explain the appointment of 29-year-old Mohammed bin Salman, to one of the most important positions in the land?

Other popularly cited explanations for royal succession also fall short in explaining the appointment. Henderson has suggested a range of other important factors, such as being a “good Muslim,” having a suitable Saudi lineage, possessing experience and acumen, being popular and offering stability. But again, the most recent changes suggest that some of these attributes – seniority, possessing experience and acumen and perhaps being popular – could be jettisoned with ease when the need arose. The time is therefore ripe to reconsider some of the once self-evident truths that underpin understandings of Saudi Arabia’s political workings

First, seniority within the ranks of the royal family has often been heralded as the primus inter pares factor underpinning the rules of succession in Saudi Arabia. The current Saudi state was united by Abdul Aziz ibn Saud in 1932 when he was 56 years old. Until today, rule has been passed among Abdulaziz’s sons. In order of their accession to the throne, Saud was born around 1902, Faisal 1906, Khalid 1913, Fahd 1921, Abdullah 1924 and Salman 1935. Saud and Faisal were in their 50s when they took power, Khalid and Fahd were in their 60s, and Abdullah and Salman were in their 70s. Unsurprisingly, age has been seen as a “preeminent qualification” in determining the order of ascending to the throne, according to Henderson’s 1994 study and repeated in his 2009 “After Abdullah.” The apparent importance of age fits with widespread understandings of the “enormous meaning” of seniority within the royal family and Saudi society.

But age is not enough. Given that Abdulaziz is reputed to have fathered around 100 children by dozens of wives, older sons have been passed overtime and again, particularly more recently. So age has been a shaping, if not a determining factor. Saudi social anthropologist Madawi al-Rasheed has gone as far as to suggest that there has long been “no serious commitment to seniority.” Nevertheless, the meteoric rise of Mohammed bin Salman to deputy crown prince is an astonishing promotion for a man so young.

The rise of the new king’s son suggests that intra-family machinations deserve more attention. Analysts Henderson, Daryl Champion, Joseph A. Kechichian and Thomas W. Lippman have pointed to the importance of the Sudairi section of the Saud family. The name stems from Hassa bint Ahmed al-Sudairi, who is often referred to as Abdulaziz’s most important wife and whose children have come to dominate Saudi politics in recent decades. There is much to support such a reading. Though King Abdullah ruled with three Sudairi crown princes (two of whom died), he represented for the Sudairis an interregnum between two Sudairi kings, Fahd and Salman. The Ministry of Defense and the Ministry of the Interior, two of the most important and influential in Saudi Arabia’s power structure, have been led by Sudairis for over 50 years. The current crown prince and deputy crown prince are both younger generation Sudairis and have centralized control of the key economic and security councils under their auspices.

What does this actually mean, though? The Sudairis are often implicitlydescribed as something approaching a unitary actor in direct, near-zero-sum competition with other groupings led by, say, former king Abdullah. Such suggestions make intuitive sense at the moment, with such a successful Sudairi full-court-press swamping key positions. But the cohesiveness of such groupings is questioned by Gause and Rasheed who frequently and persuasively frame these associations as being temporary and more “manifested in specific historical and political contexts.” The hint behind such assertions is that Sudairi cohesion is far from automatic.

A more positive spin, marketed by commentators ranging from formerambassadors to Saudi Arabia, pliant local newspapers, Washington-based Saudi Arabian lobbying organizations and, most recently, the former head of Britain’s external intelligence agency, has to do with what is being called an “embryonic embrace of meritocracy” taking hold in Saudi Arabia. The removal of Muqrin bin Abdul Aziz – who served as crown prince from January to April 2015 – might be explained by his lineage. Muqrin’s mother was a Yemeni slave, something that tended to rule him out as a potential successor as far as many Saudi-watchers were concerned before he was put in line to the throne – at which point the ever-flexible commentariat brushed off his heritage as hardly mattering at all. Nevertheless, few would disagree that his replacement with Mohammed bin Nayef is something of an upgrade in efficacy, judging by the new crown prince’s impressive domestic and international reputation. Similarly, the world’s longest serving foreign minister, Saud al-Faisal, recently shuffled out of the portfolio he held for 40 years, has been plagued by illness and hospital visits for years.

Yet, any semblance of meritocracy falls apart with the colossal (over) promotion of Mohammed bin Salman to defense minister, to head of the Economic and Development Affairs Council, chairman of Saudi Aramco’s Supreme Council and now to third-in-line to the throne. For a young man with negligible experience in these (or any other senior) roles, it is difficult to see how it could possibly be interpreted as meritocratic in nature – though his promotion may be an attempt to reflect Saudi Arabia’s youth with60 percent of the population being under 21 years of age.

What about the rules? The key institutional innovation here was the 2006 creation of a 35-member Allegiance Council to agree upon and ratify succession decisions for future monarchs. In March 2014, King Abdullah used the council to rubber-stamp Muqrin as third-in-line to the throne and the statement from the Royal Court declared that this order “shall not be amended or replaced by any means or by whomsoever.” Abdullah seemingly tried to lock in Muqrin as crown prince because Muqrin, lacking a suitable heir, would likely have nominated one of Abdullah’s sons as his crown prince, thus avoiding the taboo of nominating one’s own son.

But this potential move was checkmated and the “irreversible” decree was easily dismissed. With Salman reversing Abdullah’s edict and undercutting the Allegiance Council’s initial decision, unseating a crown prince suddenly looks curiously straightforward. The council, then, appears to function more as a public relations approval body, with the real politics being done behind the scenes. A scenario where there is genuine disagreement in the council is possible to foresee, but would most likely be overcome firstly by closed-door politics or secondly by being bypassed by royal decree.

Rules, decrees, taboos and notional Allegiance Council mandates are there, it turns out, to be broken. Similarly, issues of age and seniority can be easily brushed aside in the short term at least. A certain acknowledgement of the importance of meritocracy, mostly around the edges, is seen as desirable – perhaps a counterweight, even – to naked nepotism at the heart of the issue. The importance of the small Sudairi clique is at best a useful term to group together a subset of the Saud family who continue to play the game of family politics effectively thus far. But its unity should not necessarily be taken for granted.

While ousting Muqrin was a coup for the Sudairis, it was, perhaps first and foremost, a coup for Salman himself – but with unpredictable results. This proves a salient reminder for scholars as to the ultimately changeable nature of domestic politics in Saudi Arabia and the Gulf – and the seemingly unrestricted power that leaders can exert. The promotion of Mohammed bin Salman to deputy crown prince has removed seniority as a decisive factor in Saudi politics in the short-term at least, though Gause et al’s emphasis on the importance of seniority may be an issue that returns in the future. But in the meantime, Salman has increased the players in the game. The zero-sum promotion of a prince inevitably leaves those not selected disgruntled and widens the field with a whole new age bracket of the royal family realizing that they too – all of a sudden – have a legitimate claim on a senior role. Salman’s flouting of tradition provides such princes with extra ammunition in plotting their bids for power. The ultimate test will come when Salman, a 79-year old with significant health problems, shuffles off this mortal coil. Saudi history is not kind to sons of kings who pass away, and with Salman’s precedent-setting unpicking his predecessor’s decree and his bypassing of the Allegiance Council, Mohammed bin Salman in particular is eminently removable.

King Abdullah returns & doles out the cash 24, February 2011

Posted by thegulfblog.com in Saudi Arabia.
Tags: , , , , ,
2 comments

Saudi Arabia’s King Abdullah has returned to the Kingdom from a long period of convalescence in America. Three days of holiday have been announced to celebrate this auspicious occasion. Additionally, he has sizably increased the benefits for Saudi citizens including a 15% pay raise for lower paid workers all of which will cost some $36 billion.

I see this increase in benefits more in a Kuwait than a Bahrain model. This is to say both of these states recently increased benefits for their citizens. Kuwait did this as it was the anniversary of independence from Iraq and from the British. Bahrain did this in a desperate ploy to try to placate swathes of their citizens in a Middle East rife with revolutionary sentiment. I imagine that the Saudi King might have been tempted to do give out some cash even had Egypt and Tunisia’s regimes not fallen, though I would guess that he has increased the amounts in light of said events.

Though only fools make predictions, all I would say is that the only reason that Saudi need fear to any great degree is on the death of Abdullah. If it comes soon – he is a frail, recovering octogenarian after all – then aside the inevitable hullabaloo over Sultan being overlooked (which he would be; eventually) Naif’s reaction could be critical. If he stays true ‘to form’ then he may react harshly or at best, firmly, against any demonstrating elements. This, I fear, could then be a catalyst for wider demonstrations and – at the worse case scenario – prompt a serious challenge from another power centre in the Kingdom.

Hat tip: JK

King Abdullah in US for medical tests 22, November 2010

Posted by thegulfblog.com in Saudi Arabia.
Tags: , , , ,
add a comment

Saudi King Abdullah is currently in America undergoing further medical tests. Despite going through successful surgery last week for a herniated disk, after blood was found on his spine, he has once again given his powers (theoretically temporarily) to Prince Nayef. It is thought that he will be treated at the Mayo Clinic.

Despite official protestations that these tests are all vaguely routine and that there are no critical health issues, many fear that the 86 year old Monarch may well be on his last legs. Abdicating his role as leader of the Saudi National Guard to his son last week added to the concerns that his condition is far more serious than people previously thought.

Prince Nayef is expected to take over should Abdullah pass away. Prince Sultan, who is technically next in line, is barely lucid these days and could not reasonably be expected to take over. Having said this, this exact situation occurred in Kuwait a few years ago and they elected Saad in 2006 when he had wholly lost his mental faculties and had to be removed by Parliament within a few weeks.

Nayef is very conservative and many fear that he would roll back many of Abdullah’s reforms. There are two important caveats to this fear. First, Abdullah himself was feared to be just such a conservative candidate when he was elected yet transpired to be one of Saudi’s most liberal Kings. Second, it is difficult to understand the exigencies of the job; who knows what the pressures of actually being in charge will do. Perhaps Nayef will find himself hamstrung by the inertia of change.

Iranian media is already practically gleefully reporting his illness and suggesting (in hope rather than expectation, I think) that Saudi Arabia may well descend into a civil war of family versus family.

On Saudi succession and the new generation 18, November 2010

Posted by thegulfblog.com in Saudi Arabia.
Tags: , , , , ,
2 comments

Back in the day when interpreting the whims and mood of the Kremlin was of obvious importance the pseudo-science of Kremlinology emerged. When the Politburo went to the Bolshoi Ballet, was this a sign that all was well or a sign that they were trying to present a normal facade because everything was really going wrong or it was a triple bluff in that all was going well but they wanted to present the notion that it wasn’t and they knew…etc etc etc.

The nadir of Kremlinology was, of course, the whopping lack of predictions of the fall of the Soviet Union. (Though a stout mention ought to go to a female American scholar whose name I’ve forgotten who published a wholly bogus if well received book charting the intricate ties between the Kremlin and any and all guerrilla movements around the world, proving Soviet perfidy in a rather Robert Ludlum kind of way.)

Kremlinology of yesteryear is today concerned with the machinations of the Saudi court and the central question of who will succeed King Abdullah.

Simon Henderson is, so far as I know, the leading expert in this mysterious field. He first wrote on this topic many years ago with the monograph succeeding Fahd and has sporadically continued to this day. I’ve already commented on his latest piece which contains the sage and immutable cliché that those who know anything about Saudi succession don’t talk; those that do the talking don’t really know.

King Abdullah is an old man in his 80s, even if he is not particularly frail. Yet his recent absence from officiating over the Umrah in Mecca has sent Saudi court speculators into another bout of frenzied speculation. Here’s a (very) brief and not very informative recap.

What is of more interest (to me at least) is that King Abdullah recently named his son Prince Mitaeb as a member of the council of ministers and the head of the national guard. Previously, Abdullah himself had been its head since 1962. The guard itself is today believed to have nearly a quarter of a million (or 150,000, depending on what source you believe) well trained, well motivated, well equipped and competent soldiers. Their duty is strictly to protect the Royal family. The guard is also seen as a counterweight to the Saudi national army.

Most (if not all) Gulf States have several standing ‘armies’. They are typically led by different factions within the ruling family. Each draws on their army for support and as an obvious sign of prestige and protection.

Abdullah’s – or now Mitaeb’s – guard is a Bedouin-raised army, following in the tradition of previous Saudi Kings.

The Saudi National Army is not as highly regarded and is headed by Crown Prince Sultan and his son and Defence Minister Prince Khaled. Though Sultan is slated to assume the throne when Abdullah passes away, he is, so it seems, in far worse health than Abdullah and would be unlikely to take the throne.

It is expected that Prince Naif – no spring-chicken himself – would take over instead, having been promoted to third in line.

Yet it is the question of generational change that is the most interesting in the Kingdom. Clearly Mitaeb, Khalid and Naif’s son, Mohammed, will be among the contenders. As to how it will all pan-out, I’ll have to leave that to greater minds than mine; those that can read the proverbial tea-leaves or summon up great insight from seating-plans at Royal Saudi banquet.

Update: Simon Henderson on the week’s events.

Nayef: not good for UAE relations 29, September 2009

Posted by thegulfblog.com in Saudi Arabia, The Emirates.
Tags: , ,
add a comment

Some interesting thoughts on the possible (negative) implications for the UAE if (or rather when) Prince Nayef takes the reigns of power in Saudi Arabia.