Saudi Prince Has Throne in His Sights. Now for the Hard Par (JMD quoted on Bloomberg)

Saudi Prince Has Throne in His Sights. 

Now for the Hard Part

By Marc Champion

June 22, 2017, 7:01 AM GMT+8 June 22, 2017, 10:39 PM GMT+8

• Mohammed bin Salman facing tough challenges at home and abroad

• Whatever setbacks are in store, the buck now stops with ‘MBS’

Saudi Arabia’s Prince Mohammed bin Salman just 

consolidated his position and power. Now he’ll need all 

the help he can get.

Shortly after dawn on Wednesday, King Salman 

announced that his 31-year-old son, widely known as 

MBS, was now heir to the throne. His older cousin, 

former Crown Prince Muhammad bin Nayef, had been 

pushed aside to make way.

The move, if not the timing, was expected. Yet bin Nayef 

also lost his post as interior minister, a powerful role in 

which he oversaw the nation’s domestic security forces 

and counter-terrorism efforts. Those areas will now be 

in the hands of a close MBS ally. The prince already has 

substantial control over defense, economic and foreign 

policy.

Power on that scale comes with a catch. The challenges 

MBS has set for himself are vast. Now that rivals have 

been sidelined, the blame for any failures or unpopular 

measures will fall entirely on him, according to Ayham 

Kamel, director for the Middle East and North Africa at 

Eurasia Group.

Until this week, “responsibility for decisions had been 

shared among different members of the ruling family,” 

said Kamel. “As Mohammed bin Salman rises, it becomes 

more difficult, if possible at all, to assign responsibilities 

to other parties.”

 

MBS accumulated so many portfolios after his father 

became king in January 2015 that Western diplomats in 

the kingdom took to calling him “Mr Everything.” So 

Wednesday’s palace maneuvering is unlikely to produce 

any sudden change to Saudi domestic or foreign policies.

The initiatives the new crown prince has taken over those 

two years have, however, been unusually ambitious on 

almost every front.

His Vision 2030 plan to wean Saudi Arabia off its near-total 

dependence on oil was well received by economists, at least 

in terms of its goals; some questioned the government’s 

ability to implement it. Investors celebrated Wednesday’s 

political moves as a sign that MBS will now be free to push 

ahead with the reforms, with the benchmark stock index in 

Riyadh surging 5.5 percent. It extended the rally on Thursday 

to post the biggest weekly gain since March 2011, the height 

of the Arab Spring.

Still, driving those plans through to a conclusion that meets 

the aspirations of the kingdom’s young and fast-growing 

population will be a Herculean task. Many citizens will have 

to accept painful changes, such as reduced subsidies and 

fewer public-sector jobs, if the plan is to succeed. It also 

requires selling up to 5 percent of Saudi Aramco, a national 

treasure -- which means opening up the oil giant’s carefully 

guarded books to public scrutiny.

‘Several Generations’

With oil prices dipping below $45 this week, the government’s 

ability to please everybody without burning through its ample 

but finite currency reserves will be limited. In a sign of how 

sensitive Vision 2030’s austerity measures can be, King Salman 

on Wednesday reversed cuts to state salaries and bonuses, 

even as he announced his son’s elevation. The government 

also gave public employees an additional week’s holiday to 

mark the end of Ramadan.

The challenges for Saudi foreign policy are equally daunting, 

and could drain the political capital MBS will need at home. 

“His ability to deliver on both fronts is still highly uncertain, 

as the country’s authorities are attempting to implement 

several generations’ worth of reforms in less than 15 years,” 

said Torbjorn Soltvedt, principal analyst for the Middle East 

and North Africa at risk consultancy Verisk Maplecroft, in a 

note.

In 2015, MBS launched Saudi Arabia’s expensively equipped 

military into a war in Yemen. The conflict has so far proved 

messy and inconclusive, and its civilian death toll has drawn 

criticism. He also raised the stakes in Saudi Arabia’s fierce 

regional rivalry with Iran, describing dialog as “impossible” 

and calling for the fight to be taken onto Iranian soil.

Most recently, the prince led a group of countries into a 

diplomatic standoff with fellow Gulf Cooperation Council 

member Qatar. That, too, looks unlikely to deliver quick 

results and risks blowback, as Turkey and Iran rallied to 

help Qatar ride out the closure of its only land border.

‘Backfiring’

None of these steps represent a fundamental change of 

policy for Saudi Arabia, according to James Dorsey, senior 

fellow for the Middle East and North Africa at Singapore’s 

Nanyang Technological University. But, he said, they’re all 

far more aggressive than the kingdom’s elderly and 

generally cautious leaders were willing to risk in the past.

The tougher approach to intractable problems in the Middle 

East appears to mesh with that of U.S. President Donald 

Trump, who met MBS in Washington in March, and again in 

Saudi Arabia in May. On Wednesday, Trump called to 

congratulate the younger leader. According to the president’s 

office, the two men discussed the “priority of cutting off all 

support for terrorists and extremists, as well as how to 

resolve the ongoing dispute with Qatar.” The prince has 

cultivated ties elsewhere in the White House, twice dining 

with his near-contemporaries Ivanka Trump and Jared 

Kushner.

Support from other parts of Washington, where the 

deposed bin Nayef was well regarded for his counter-

terrorism efforts, is less certain. On Tuesday, State 

Department spokeswoman Heather Nauert issued an 

unusually blunt criticism of Saudi Arabia and the United 

Arab Emirates for failing to produce detailed evidence in 

support of the accusations they leveled at Qatar.

MBS embarked on his campaigns against Yemen and 

Qatar “without an exit strategy,” said Dorsey. “At this point, 

those are backfiring.”