The Saudi Transformation: Part II - A Strategy Revealed

The First Move: King Salman’s plan to centralize power in his hands and his descendants after him must have been readied during the first half of his predecessor’s reign and before 2011. For in this year his closest brother, Crown Prince and Minister of Defense Sultan died, and then Prince Salman was unexpectedly appointed to the vacated defense post. Many observers expected that, in deference to Prince Sultan, the portfolio would pass to one of his sons. Simply because Prince Salman was very close to his brother and was at his bed side throughout his illness until his death. Prince Salman would therefore be expected to support keeping the defense portfolio in his brother's family. Accepting this portfolio, or most likely asking for it, indicates the existence of an ulterior motive and worthier objective, for which taking control of defense would be an essential first step. Moreover, such step would very likely be approved by the King given the latter's traditional adversarial relationship with his departed brother Sultan. (Please refer to Part I for further background on intra-family rivalries).

The Age Imperative: Within merely a year of the death of Prince Sultan, his successor Crown Prince and Minister of Interior Nayif also passed away. Prince Salman succeeded him as Crown Prince on June 18, 2012, while the King appointed another brother-Prince Muqrin bin Abdulaziz-as Deputy Crown Prince. The Ministry of Interior passed to another son of the founder, ally of the King, Prince Ahmed bin Abdulaziz, rather than to Prince Mohammad the son of the departed Nayif, an experienced and influential head of national security and close adviser to his departed father. The King however, would have been against keeping this portfolio in the family of Nayif, who was a strong adversary to him. Nayif, a close ally of the conservative religious establishment, has always opposed the King's liberal agenda and frustrated many of his reform initiatives. (Please refer to Part I for further background on intra-family rivalries).

The Positioning of the Son: The more important appointment in this transition however, and a precursor of things to come in the unfolding King Salman’s Strategy, was the appointment on November 5, 2011 of his son and adviser Prince Mohammad bin Salman (MbS) as the Minister of Defense. MbS was also appointed a member of the National Security Council and President of the Crown Prince’s Court. These appointments were early indication of King Salman’s intent at concentrating power in his family.

Prince Salman Takes the Reign: After a period of illness, King Abdullah passed away at ninety years of age, and Prince Salman, at 79 years of age, became King on 23 January 2015. He immediately set out to unravel his transformation strategy at an unprecedented pace and clockwork precision.

On 30 January 2015, he reshuffled the Cabinet, and removed Prince Bandar bin Sultan, the former long serving ambassador to the United States of America, from his posts of General Secretary of the Saudi National Security Council. He also removed the sons of his predecessor, Princes Turki and Mishaal from the governorship of the Riyadh and Mecca Regions respectively.

Streamlining Government Bureaucracy: Along with reshuffling the cabinet, the King overhauled the senior government bureaucracy by abolishing most permanent ministerial committees and councils, including the powerful National Security Council. In their place, he established two super bodies: The Council of Political and Security Affairs (CPSA), and the Council of Economic and Development Affairs (CEDA). Thus, all political, security and defense functions were centralized under CPSA. Crown Prince Mohammad bin Nayif was appointed to head this council with MbS as his deputy.

All economic and social development affairs were centralized under CEDA to which MbS was appointed as its head.

Whether this reorganization would help in streamlining government bureaucracy only time will tell. These measures however resulted in further concentration of power in the hands of the King’s son MbS. Furthermore, as a deputy head of CPSA, MbS also acquired oversight powers over security, intelligence and religious affairs, including the Virtue (religious) Police, and over the Saudi National Guard.

Instituting a New Succession Paradigm: On the 29th of April 2015, three months after taking the reign, King Salman issued an order that was nothing less than a new succession paradigm. He summarily removed Crown Prince Muqrin and replaced him with Prince Mohammad bin Nayif, his nephew and son of the late Prince Nayif. This act essentially ended the succession of the sons of the Kingdom’s Founder and moved it to his grandsons, the second generation of heirs to the throne. Simultaneously, King Salman appointed his son MbS, as Deputy Crown Prince, thus reinforcing the change in the succession process, while enhancing the stature and role of his son and positioning him closer to the reign.

Constructing a New Strategic National Vision: January 1, 2015 was the date when the 10th Five Year National Development Plan (2015- 2019), prepared by the Saudi Ministry of Economy and Planning (MEP), was to take effect. This, however, was not to be the case, for soon after the appointment of MbS to head CEDA, the 10th National Development Plan was thrashed. Furthermore, the Minister of Economy and Planning Mohammad Al Jassir was removed in April and replaced by Dr Adel Fakeih, a senior minister who previously headed the Ministries of Health and labor.

The MEP, now under the leadership of Dr Fakeih, immediately set about constructing a new social and economic vision for the Kingdom, assisted by the international consultant McKinsey & Company. McKinsey issued a Report in December 2015, which became the foundation for the Saudi Vision 2030.

REUTERS/Faisal Al Nasser

The overarching goal of the Vision 2030, officially launched in April 2016, is to instigate an economic, social, and cultural transformation of Saudi Arabia. Particularly, it aimed to diversify its economy away from its heavy dependence on oil and to liberalize its social discourse. This is supposed to be achieved by capitalizing on three main strengths of the Kingdom:

1. Its privileged position as a home for the two holiest shrines of Islam, which annually attract millions of pilgrims and visitors from all over the world;

2. Its huge financial resources and investment capacity which will drive economic growth and transformation;

3. Its strategic location as the nexus between three continents and being surrounded by two strategic bodies of water; the Red Sea and the Gulf.

Launching the National Transformation Program: Along with the Saudi Vision 2030, the Kingdom issued a National Transformation Program (NTP), which effectively replaced the former five year development plans, covering the period 2016-2021. The NTP elaborated the various policies and programs that will be implemented over the first stage of the Vision 2030. It set expected targets and specified Key Performance Indicators (KPI) for various ministries and other agencies.

Most importantly, the NTP elaborated a comprehensive economic reform agenda, including the gradual elimination of energy price subsidies, along with the introduction of a Value Added Tax (TAX). Moreover, it hinted at relaxing the social norms by lifting the segregation of sexes in various sectors such as sports and leisure.

Declaring War on Corruption: The Vision 2030 Document was unmistakably clear and direct about the need for transparency and accountability in all public and private transactions. In addition to setting KPIs for all the goals and objectives of the Vision 2030 by which public managers will be held accountable, the Document went on to warn: “We will not forgive or go easy on corruption at any level, whether financial or administrative. We will adopt the best international practices to achieve the highest levels of transparency and good governance in all sectors”. Acting on this promise, King Salman appointed a high national commission on corruption, and assigned a special prosecutor to investigate and prosecute its crimes.

Declaring an ARAMCO IPO: In a step that underlined the King’s seriousness about achieving transparency and accountability, the Saudi Crown Prince announced the Government intent to list the national oil company ARAMCO on an international stock market in 2018. The plan is to sell 5% of ARAMCO through an IPO with shares to be publicly listed. The significance of this action lies in subjecting the company’s operations and financial flows to public scrutiny. This is also destined to enhance government transparency at the highest levels, considering the monopoly that ARAMCO holds on the oil & gas sector, and the role of the latter as the source of over eighty percent of government revenues. While almost all commentaries and analysis of the IPO have centered on the valuation of ARAMCO, it is believed that the financial dimension, while important, is not the primary motive behind this decision. The significance of this measure lies in the message that it sends about the seriousness and staying power of the reforms.

Loosening the Grip of Religious Conservatives: King Salman’s transformation strategy faced two potentially serious threats. The first is a possible widespread opposition to his measures from the Al Saud family. Such opposition would be motivated by the fundamental changes to the succession process, and the excessive centralization of power in the hands of the Deputy Crown Prince. The second potential threat is active public opposition to his economic and social reforms, instigated and supported by the conservative religious establishment and other allied opposition.

REUTERS/Ahmed Masood

The first threat was mitigated by insuring that princes from all branches of the Al Saud family are given leading positions in the various agencies of government. Those appointees were predominantly young, second and third generation princes who tended to support the reforms that the King is implementing. Moreover, for the period until he removed Crown Prince Mohammad bin Nayif and appointed his son MbS in his place in mid 2017, potential opposition was mollified by the semblance of plurality in the line of succession. Since although his son was a Deputy Crown Prince, he can still be removed from this position by the future king.

The second threat, on the other hand, is being met with a multi-faceted strategy whose main objectives are:

• Build public support to the reforms: Despite subsidy reforms and other belt tightening measures that the government has adopted, the reshuffling of the entrenched bureaucracy and appointment of young managers in various agencies enjoyed strong public support. Similarly, launching the fight against corruption have been a popular measure among ordinary Saudis.Moreover, with the sharp decline in oil prices in 2014-2015 coinciding with the launch of the National Transformation Program, this has reinforced the justification for the reforms.

• Curtail the power of the religious extremists: In an act that was unthinkable but much desired by the great majority of citizens and residents, especially females, King Salman issued in April 2016 a decree stripping the Virtue Police (Mutawaa’) of their policing authorities. Under the decree, the Virtue Police can no longer arrest and detain people when carrying out its duties and enforcing its codes of behavior. This was followed by wide open debate about the role of the Virtue Police which eventually lead to stripping it of its autonomy and finally folded into the Ministry of Islamic Affairs. Furthermore, on Sept. 26, 2017 the King granted women the right to drive, reversing a decades-long prohibition. This action, along with other liberalization measures, such as ending the prohibition on movie theaters, were welcomed by the great majority of Saudi citizens and residents.

REUTERS/Faisal Al Nasser

Stirring the Opposition: The gradual unveiling of his reform agenda during 2016 and first half of 2017, the curtailment of the power of the Virtue Police, and the ensuing debates on social reforms, have triggered open opposition, whether inside the Kingdom or outside. Internally, the main platform for opposition was social media, and some commentaries from traditional media outlets controlled by interests opposed to the reforms. The moderate religious establishment however, which has been historically and traditionally subservient to the Monarchy, have publicly supported the reforms.

Externally, critics and doubters of King Salman’s reforms found their platforms in media outlets such as Qatar based Aljazeera Network and other like minded media across the Middle East. Aljazeera TV, the most influential of these outlets, is a traditional platform for the Muslim Brotherhood, who are confessed enemies of the House of Saud and the ruling families of the United Arab Emirates, among others.

It seems that the King's reforms have motivated an alliance between the Muslim Brothers on the one hand and Wahhabi extremists, on the other, which could potentially pose a grave threat to the Saudi monarchy. The role of the Muslim Brotherhood in derailing the Arab Spring of its initially secular and social-economic centric tracks is now all too obvious and well documented in how events unfolded in Egypt, Libya, and Syria. Similar dangers are now threatening what some have come to call: the “Saudi Spring”.

Recalling the Lessons of History: While the widespread domestic support on top of the open support of the moderate religious establishment are considered essential for successful outcomes, they are nevertheless insufficient. King Salman have probably realized that despite this overwhelming support, his reforms are still a heartbeat away from a possible disastrous ending. The King, a good student of history, have also learned the lessons of the not-too-distant past. His brother King Faisal was assassinated on 25 March 1975, by a young religious extremist and a family member, in protest over the King’s introduction of television broadcasting to Saudi Arabia. Also, his brother King Saud was forced to abdicate on 2 November 1964, under pressure from religious conservatives, who opposed his secular and liberal orientation.

Even King Abdulaziz, King Salman’s father and the founder of the modern Kingdom of Saudi Arabia, had to use force to subdue the ambitions of the extremist “Ikhwan Movement”. King Abdulaziz had originally created the Movement with the objective of forging a national Saudi identity that supersedes tribalism and provincialism. The Ikhwan Movement however, was radicalized by teachers brought to the Kingdom from Egypt to educate its members. Most of those teachers however, were adherents to the Islamic Brotherhood Movement, whom Egypt is its cradle and main center of influence.

The above lessons may have not dictated the next series of measures that King Salman has taken, for these are believed to have been integral to his strategy from the beginning. They most likely however, have influenced the timing, nature and scale of response to the opposition.

Moving the Saudi Monarchy to the House of Salman: On 21 June 2017, King Salman revealed his last but most consequential card by removing his Crown Prince Mohammad bin Nayif from his posts and appointing his son Prince Mohammad in his place. Notwithstanding the promise by the King that the heir to his son will not be from his decedents, the move has effectively changed the face of the Monarchy. From now on, the future monarchs of Saudi Arabia will most likely descend from the House of Salman.

A more immediate result of this measure was bringing all security and police forces under the full control of the new Crown Prince MbS by appointing a close ally to the vacated portfolio of the Ministry of Interior.

Preempting the Opposition:In a move that drew wide criticism, Prince Mohammad bin Nayif was placed under house-arrest and denied access to the outside world. This measure was aimed at denying the opposition a potential leader to rally around. Given his family’s traditional alliance with the Saudi religious establishment on the one hand, and his stature and international connections on the other, Prince Mohammad bin Nayif would have been one of few in the Saudi Royal family qualified to play such a role. Almost certainly, he would not lack personal motivation given his abrupt dismissal and the realization that he had been played.

Clamping Down on the Opposition: By appointing his son as his heir, the King substantially reduced the potential risks to his reign. His act however, was the equivalent of a last rallying cry for the infuriated opposition, whom ranks were certainly beefed up and their will strengthened by the King’s actions. These possibilities required a swift and strong response.

Almost simultaneously with the above measure, and in concert with the UAE, Egypt and Bahrain (adversaries to the Muslim Brotherhood), Saudi Arabia cut off diplomatic relations with Qatar in June 2017. They also imposed sanctions including trade and travel. The Saudi led coalition cited Qatar’s alleged support for terrorism as the main reason for this action. Dissatisfaction with the role of Aljazeera TV in fermenting opposition, and alleged material support by Qatar to opposition elements in the coalition member countries are thought to be behind these sanctions. While the crisis has not been resolved yet, it is obvious that Saudi Arabia has succeeded in relatively restraining the editorial overreach of Aljazeera TV’s coverage of Saudi internal developments, and in putting Qatar on notice against any future meddling in Saudi Affairs..

Domestically, the King took a tough stance against all kinds of opposition. The stance is reminiscent of president George Bush’s position on terror when he proclaimed to the world: ”you are either with us or against us”. This stance was apparently motivated by signs that the opposition had been organizing and planning street protests. Over the period from mid-June to early September-2017, an opposition movement took form, which came to be known later as “the 15th September Movement”. The movement called for street protests on Friday, the 15th of September, to press the authorities to “tackle poverty, increase women’s rights and release political prisoners”.

Considering that protests are normally banned in Saudi Arabia, calling for protests during such a critical period of unprecedented change and associated uncertainties, is not but an invitation to wide spread violence and instability. On the other hand, the championing of women’s rights by mostly religious fundamentalists, who have been the historical deniers of women’s rights and emancipation, is nothing but false pretension and naive opportunism.

On September 13, or two days before the scheduled street protests, the authorities conducted a swift dragnet arresting more than 20 clerics and other dissidents. Those individuals, according to security sources, were accused of "espionage activities and having contacts with external entities, including the Muslim Brotherhood."

Lacking in popular support, and due to the crackdown by the authorities, the called for Friday protests did not materialize, and the last immediate challenge to King Salman’s reforms failed.

Achieving Full Consolidation of Power: Having temporarily subdued the opposition, the King proceeded to solidify popular support and implement the remaining measures in his Strategy. On September 26, he issued an order granting women the right to drive after decades of prohibition.

Acting on the commitment to fight corruption at all levels, the Saudi authorities, in their widest sweep ever, arrested over 200 people, including dozens of princes, cabinet ministers, industry and media titans. According to Reuters, investigators also froze over 2,000 bank accounts.

Notably, the minister of the Saudi National Guard Prince Mit’eb bin Abdullah, the son of the former King Abdullah, was caught in the anti-corruption dragnet. The Commander of the Saudi Naval Forces was also arrested. Both were removed from their posts and replaced by individuals loyal to the King. By this action, the consolidation of power in the hands of Crown Prince Mohammad bin Salman was complete.

Among those also arrested were the world famous Saudi businessman and investor Prince Alwaleed bin Talal, and two media moguls who control the remaining media empires not owned by King Salman’s family.

Many of those arrested were subsequently released either for being proven innocent, or after admitting guilt and reaching a settlement with the authorities, which usually entails payment of fines. Among those who are still in custody for refusing to admit guilt is Prince Alwaleed.

End of Part II

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