DESERT MIRAGE
The fundamental reason for a dilemma among the nation-state and the
investors is that they cannot afford to sever relations with the largest economy
in the Arab world as it pursues diversifi cation to wean itself off oil income.
However, the desert kingdom’s unyielding attitude
towards its critics, both at home and abroad, have raised
concerns in a few European countries and Canada. Though
Saudi Arabia allowed women to drive whilst setting its
global public image of empowering women, many believe
that it is merely an act to attract investors and create a ‘feel
good’ factor for the kingdom that had a very bad reputation,
especially around adhering to humanitarian laws. This year,
Saudi Arabia froze all new trade investment relationships
with Canada and declared the Canadian ambassador to
Riyadh as persona non grata, giving him merely 24 hours
to leave the country. Canada, known to be one of the
staunch protectors of human rights, urged Saudi Arabia
for the release of anti-government activist Samar Badawi
who had criticized Prince Salman’s increasingly assertive
foreign policy. xivxv
Additionally, Saudi Arabia also blacklisted German
companies who were looking forward to invest in the
country as a result of the criticism in a rare case of economic
retaliation. xvi By suspending ties to nations like Canada
and even more important partners such as Germany, Saudi
Arabia seems to be ‘sending a message’ to those countries
who attempt to interfere in its internal aff airs. It now appears
that the Kingdom has adopted the Chinese approach which
is pursuing relative success in recent years to modernize the
country but on its own terms. Israel for arms supply. But countries like the UK - that has
spent more than €3 billion, on issuing license to export arms
to the kingdom - will also not, as they will have the most to
lose if an embargo is put in place. Even Australia for that
matter, despite being a signatory to the Arms Trade Treaty,
planned an expansion into arms sales, with a fourfold increase
in the number of military licenses sales to Saudi Arabia;
hence Canberra too will be economically aff ected as they do
not have an instant remedy to cope up with the revenue lose
here. In fact, French President Emmanuel Macron, on behalf
of the West, told the press that there was “no link” between
arms sales and Mr Khashoggi’s murder. xviii
It seems that the economic inter-dependency is making
these countries to go beyond scruples. Surprisingly, Canada
who previously witnessed the wrath of Saudis for interfering
in their internal aff airs, attended the summit, especially in
the wake of US-tariff imposition. While Canadian economy
is soft footing on growth, its need to improve economic ties
with Saudi Arabia is a necessity. Probably, this could be the
reason why Russia has sought to downplay Khashoggi’s case
and largely refused to go beyond acknowledging the offi cial
Saudi statement. In fact, Russia was one of the countries to
send a high-level delegation to the FII summit, including
billionaire oligarchs. Relations between Moscow and Riyadh
have strengthened over the past two years as a result of closer
co-operation between the two oil producers.
The Khashoggi Aff air
As mentioned before, though Saudi Arabia has faced a
wave of international condemnation over the Khashoggi
aff air, with many allies considering downgrading ties or
halting weapons sales, the situation will eventually boil
down due to oil and economic dependency. Major Western
countries like the US, UK and France which exports nearly
half of its arms to the war-stricken Middle East, with Saudi
Arabia consolidating its place as the world’s second-biggest
importer, will never push hard to halt the arms trade over one
man’s aff air. These countries continued to supply weapons
to Saudi Arabia, notwithstanding military intervention in
Yemen - a confl ict that led to thousands of deaths, causing
one of the worst humanitarian crisis in history. It is hence all
the more likely that they would choose to swipe this issue
under the carpet as well. xvii
For Saudi Arabia, it can always turn towards Russia or Way Forward
Need of the hour is that the Saudi government must reshape
its role inside and outside the country to better promote trade
and investment. It is also crucial for Saudi Arabia to cooperate
with the US, Turkey and other international communities over
Khashoggi's case and penalize the involved offi cials. MBS
must also ensure that Saudi Arabia’s diplomatic missions
validate their capacities to advise both the government of
Riyadh and Saudi business communities on ways to increase
trade and investment in host countries, instead of nabbing the
critics. Additionally, to accelerate the expansion of future
industries in the post-oil Saudi economy, they must work to
ease or eliminate tariff s, facilitation of market access, and
fi nd common ground on investment regulations, agricultural
subsidies, intellectual property rights, dispute settlements,
and trade in services which will require a marathon of
negotiations.
Extraordinary and Plenipotentiary Diplomatist • Vol 6 • Issue 10 • Oct-Nov 2018, Noida • 13