Letter From Saudi Arabia: How the Kingdom Is Focused Inward

Letter From Saudi Arabia: How the Kingdom Is Focused Inward

Workers perform construction on a skyscraper in Riyadh, Saudi Arabia.
Workers perform construction on a skyscraper in Riyadh, Saudi Arabia. Eliot Blondet/AP

The Saudis are determined to prevent the distractions of their dangerous neighborhood from getting in the way of Vision 2030 and the rapid modernization of their country.

November 22, 2024 2:16 pm (EST)

Workers perform construction on a skyscraper in Riyadh, Saudi Arabia.
Workers perform construction on a skyscraper in Riyadh, Saudi Arabia. Eliot Blondet/AP
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Current political and economic issues succinctly explained.

Michael Froman is president of the Council on Foreign Relations.

RIYADH - This week, I joined some of CFR’s younger members on a fact-finding trip through Saudi Arabia. When we arrived in Riyadh, we couldn’t help but be impressed by the sheer amount of activity pulsing through the capital. It is one giant construction site, with scores, maybe hundreds, of cranes filling the skyline, office buildings abuzz with Saudi and foreign businesspeople, and traffic crawling to a stop.

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I didn’t see a lot of women driving. But every one of the many women we met (as well as the men) commented—almost word for word—on the remarkable social and economic changes that have come to the kingdom over the last seven years under its de facto leader, Crown Prince Mohammed bin Salman, or MBS.

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When pressed about the disappearance of the religious police (the Committee for the Promotion of Virtue and Prevention of Vice), whether conservative men were resentful of the changes, and how dissent was being managed, there was much less clarity. The Saudis we met were pleased that the religious police had been reined in, but few had insight into the extent of simmering opposition to MBS.

On human rights, they were decidedly coy, referring to “some problems” and “mistakes of the past.” A few questioned whether the kingdom had a human rights problem at all. It wasn’t hard to infer that some Saudis feared that candor would land them in trouble. We heard from some that the regime is effectively using surveillance to keep a lid on any opposition. For now, the Saudis most foreigners meet are enjoying their newfound freedoms and extolling the virtues of the regime.

And there is much to extol. Vision 2030, MBS’s plan to modernize the country and diversify its economy away from oil, is, well, visionary. But importantly, officials seem to be paying as much attention to how they are executing it as they are to how they are selling it to foreign visitors and investors. The plan is ambitious, and while some targets are already being met or exceeded, the government is almost certainly going to face shortfalls and will have to scale back.

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It seems doubtful, for example, that the kingdom will be able to achieve a reasonable return on investment from its efforts to create from scratch an electric vehicle sector at a time of global overcapacity, with none of the automotive ecosystem that exists in China, Europe, or the United States. “The Line,” a 110-mile-long smart city housed in a single building in the city of Neom, is being scaled back to a fraction of its original size, at least for now.

Still, if Saudi Arabia achieves only half of what it seeks to, it will be not only an astounding success in terms of diversifying the economy but also an important demonstration case for the rest of the region of what can be achieved with leadership and determination. Of course, as some of our interlocutors mentioned, it doesn’t hurt that the Saudis have almost unlimited resources and zero democratic constraints. Indeed, some elites expressed skepticism that democracy is the right form of government for Saudi Arabia, arguing that the kingdom could never develop as fast without authoritarian leadership.

More on:

Saudi Arabia

Development

Iran

Israel

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The Saudis are determined to prevent the distractions of their dangerous neighborhood from getting in the way of Vision 2030. Hence their U-turn on Iran, a long-time rival with which they restored ties last year. The normalization of relations with Tehran, as superficial as it might be, takes one potential distraction off the front burner. When pressed on whether Saudi Arabia would support Trump’s “maximum pressure” strategy toward Iran, one of our interlocutors noted that the Saudis would have to live with Trump for only four years but with Iran for one thousand years. Adhering to a ceasefire with the Houthi rebels they had been fighting in Yemen and participating in the peace process there removes another potential distraction. The Saudis are audibly tickled by the fact that the United States, not Saudi Arabia, is now bombing the Houthis, recognizing that Riyadh is the ultimate beneficiary.

The Palestinian issue? Despite paying lip service to it over the past several decades, the question has never been all that important to the Saudi leadership. But now, with footage of the war in Gaza playing 24/7 on television and social media, the leadership understands that the Palestinian issue is resonating with the Saudi people and cannot be ignored. Hence the recent hardening of the official position on needing to see a Palestinian state, and not just a pathway to such a state, before normalizing relations with Israel.

That said, when I pressed Saudis as to whether their country would be willing to provide security in Gaza or pay for its rebuilding, I got the distinct impression that their view was that while they might participate at some stage, this was America’s problem to solve. They argued that in not effectively disciplining Israel, the United States broke Gaza and thus should fix it.

Speaking of the United States, the Saudis remain enthusiastic about a bilateral security pact with Washington, separate and apart from a normalization of relations with Israel. Whether that is something two-thirds of the U.S. Senate is likely to ratify is another matter. China, we were told, is all over Saudi Arabia. Like many countries, the kingdom doesn’t want to have to choose between the United States and China. In an ideal world, Saudis would rely on U.S. blood and treasure to defend their country while awarding China, their chief trading partner, major contracts to develop it.

At the end of the day, the United States doesn’t need Saudi oil the way it once did, and China does. And the Saudis are perfectly happy to take Chinese state-owned firms up on their subsidized offers to construct tower after tower. The rubber will meet the road when it comes to digital infrastructure. As the United States and China engage in selective technological decoupling, Saudi Arabia, which wants to play a major role in AI, may well have to pick sides.

Naturally, the Saudis we met wanted to talk about what the incoming Trump administration will mean for their country and the Middle East in general. They were optimistic about the bilateral relationship, given Donald Trump’s affection for the kingdom, but they were puzzled by some of his announced nominees, who are among the political figures most supportive of Israeli Prime Minister Benjamin Netanyahu.

In 1972, the hawkishly anticommunist President Richard Nixon had enough political cover to get away with traveling to China to open relations with the communist government, causing commentators to quip that “only Nixon could go to China.” In the same way, Saudis hope that perhaps Trump, who has the credibility of being an unwavering Netanyahu supporter, can force Israel to accept a real two-state solution.

Maybe only Trump can go to Ramallah, but even if he never pushes for a meaningful two-state solution, as seems most likely, the Saudis will probably not make too much noise. For now, they are looking inward.

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