Saudi Arabia Challenging the Status Quo: Streamlining Power and Economics Part I

Spearhead Analysis – 16.11.2017

By Hira A. Shafi
Senior Research Analyst, Spearhead Research

Link to Part II

“Saudi Arabia has stability. The social contract and the political contract between the king, the rulers and the royal family and the ruled people in Saudi Arabia is very strong.”

-Al Waleed Bin Talal

Saudi Arabia is at a critical juncture. Soon after the issue of a royal decree against corruption, 4th of November witnessed a sudden arrest of dozens of princes, high ranking officials and prominent businessmen. It has been recently stated that nearly 201 people remain in custody and 1700 individual bank accounts have been frozen.

 Global attention has diverted towards the Kingdom. The official statements maintain that the arrests are in line with the Saudi Economic Vision 2030 – aimed at improving local transparency and accountability mechanisms.

Historically, Saudi Arabia tends to keep its internal matters strictly veiled. It is rare for social issues or critical discourses to make headlines, leave alone matters related to the Royal Family. However, owing to this age of speedy information, an endless stream of information surfaced. A prevalent view dubbed the arrests as a ‘preemptive’ measure to counter a rumored palace coup against MBS (Muhammad bin Sultan—the Crown Prince) and/or for him to consolidate his power.

These speculations gain further traction due to the fact that the exact number of arrestees, their charges and discussions on their trials remain a closely guarded secret. Unsurprisingly, prominent Saudi English newspapers cursorily touch upon the issue, and that too, in a laudatory tone.

The prelude to these seemingly recent erratic arrests appear to have been building up since 2015. The perception gaining ground that the seemingly sudden action by the Crown Prince is part of a carefully formulated strategy. The immediate result was an elimination of traditional multiple family and religious power centers to give MBS total control.

The Palace Intrigues

King Salman acceded to the throne in January 2015, following his half-brother King Abdullah’s demise. On the same day his son Prince Mohammad Bin Salman (MBS) was appointed as the Minister of Defense and Secretary General of the Royal Court. By April 2015, a royal decree was issued giving MBS control over Saudi Aramco.

Upon accession the new King streamlined the existing expansive government bureaucracy. Nearly 11 government secretariats were abolished and restructured under two bodies namely the Council of Political and Security Affairs (CPSA) and the Council for Economic and Development Affairs (CEDA). These bodies contain important and specialized directorates. Initially the task of overlooking the Council of Political and Security Affairs was delegated to Prince Mohammad Bin Nayef (MBN), and Council of Economic and Development affairs was delegated to MBS. But, after MBN’s ‘abdication’- the command of CPSA shifted to MBS.

The current King also began overhauling other key appointments. Two of his other sons, Prince Abdulaziz and Prince Khaled were brought in as Minister of State for Energy Affairs and Ambassador to the United States, respectively.

The Crown Prince after King Abdullah’s death was supposed to be Prince Muqrin bin AbdulAziz —  the father of Mansour Bin Muqrin, who was recently killed in a helicopter crash. However, on 29 April, 2015, King Salman replaced Prince Muqrin with his nephew, Prince Mohammed Bin Nayef (MBN) – as the next Crown Prince. At the same time a new National Security Centre was set up — allegedly to counter Prince Mohammed Bin Nayef’s authority at the Ministry of Interior. The position of the new National Security Advisor was taken up by Muhammad bin Salih Alghfaili who is allegedly linked to Mohammed bin Salman’s inner circle. Another alleged loyalist to the ruling House, Major General Ahmed Assiri, was appointed as Deputy Chief of the powerful General Intelligence Presidency (secret police).

Eventually, earlier this year rumors of Prince Mohammed Bin Nayef’s ‘house arrest and forced abdication’ began to surface. Health issues was the official stance and ultimately Prince Muhammad Bin Nayef was relieved of all positions by royal decree on 21 June, 2017, officially replacing him with MBS as the next in succession.

Then came the task of tackling the most formidable force, the National Guard — forged out of tribal elements loyal to the House of Saud and focused on pacifying revolts and preventing coups. Decisive control of MBS over this force and the forces ‘current loyalties’ still remains unclear because it was nurtured and led by the former King Abdullah for nearly three decades, and on 17 November, 2010, the command was passed on to his son Prince Mutaib bin Abdullah. Prince Mutaib is one of the current detainees and the command of the National Guard has been delegated to Prince Khalid bin Abdulaziz bin Muhammad bin Eyaf al-Muqrin Al-Saud.

A Brief Trail of History

The era of past Saudi Kingship is briefer than imagined. It’s innate order of succession is from father to son. So far, the sons of the First King of United Saudi Arabia — King Abdul Aziz ibn Saud- have ruled in the following order:

  • King Saud (1953- Deposed 1964) – Son of King Ibn Saud and Wadhah bint Muhammad bin ‘Aqab
  • King Faisal (1964- Assassinated 1975) – Son of King Ibn Saud and Tarfa bint Abduallah bin Abdulateef al Sheekh
  • King Khalid (1975-1982) – Son of King Ibn Saud and Al Jawhara bint Musaed bin Jiluwi
  • King Fahad (1982 – 2005) – Son of King Ibn Saud and Hussa bint Ahmed Al Sudairi
  • King Abdullah (2005- 2015) – Son of King Ibn Saud and Fahda bint Asi Al Shuraim
  • King Salman (2015- present) – Son of King Ibn Saud and Hussa bint Ahmed Al Sudairi

Ibn Saud’s sons Muhammad, Sultan, Nayef and Muqrin were crown princes but never succeeded the throne. Because Muhammad resigned from the post, Prince Sultan and Nayef passed away before the end of King Abdullah’s reign and Prince Muqrin was removed from the post. The third generation Pandora’s box has just been opened up. Power struggles are intrinsic to the House of Saud, but at the same time, the Kingdom’s chronic corruption problems at the top tiers is also a fact — the two are often deeply interlinked.

The first King Ibn Saud designed a framework to ensure that the power is passed on to his sons instead of his half-brothers and cousins. During his lifetime he chose the future King(s) Saud and Faisal as his successors. King Ibn Saud prior to his demise created a Council of Ministries and ‘office of Crown Prince to act as a Prime minister’, aimed at ensuring power distribution between the two brothers. However, the framework did not work, King Saud and Faysal remained embroiled in a bitter power rivalry over respective desired responsibilities. King Saud who acceded the throne after the demise of his father King Ibn Saud — soon abolished the crown prince’s office in attempts to politically marginalize his brother.

This backfired, and led to formation of distinct power blocs; one of which included the ruling King Saud along with his sons guarding key defense positions and the other was a broad based group led by King Faisal along with his half Sudairi brothers. Eventually, Faisal overthrew his brother Saud in 1964 in a bloodless coup while he was away on a trip.

King Faysal’s reign arguably created the most ‘broad consensus based power sharing mechanisms’ in the Kingdom’s modern history. Yet again it is noteworthy that this may have resulted partly from the ‘pre-existing trust’ he had carved out with his cousins during his years of opposition to King Saud. King’s Khalid’s era was the shortest. He carried on with several of King Faysal’s internal policies and just like his predecessor remained outward looking towards the upheavals and the challenges that had begun hitting the broader Muslim world.

Next smooth transition was experienced during King Fahad’s accession to the throne in 1982. This period was also dubbed as the ‘era of Sudairi stronghold’. The other Sudairi brothers were already involved in managing key security responsibilities.

Popular speculations of the time indicated that either King Fahad or his powerful Sudairi brothers could likely block their half- brother Abdullah (future King) from the line of succession. This did not happen, instead Abdullah (Future King), remained crown prince and retained his control over the National Guard forces during King Fahad’s reign — a position that was later passed to his son Prince Mutaib Bin Abdullah (currently arrested). Alongside, King Fahad empowered his own sons with key responsibilities while his powerful full brothers namely Prince Sultan, Prince Nayef and Prince Salman (current King) retained key defense and security authorities.

Deeper crises were brewing under the surface — these became apparent during the last ailing years of King Fahad’s rule. Those who have personally experienced the last years of King Fahad could perhaps vouch for the confusion and speculations regarding the late King’s health. There were widespread rumors at the time, that the news of his death may have been kept hidden, as the King was nowhere visible for extended times.

No one particularly desired to become the face of the House.  King Faysal’s mechanisms of power sharing took a new shape and inadvertently turned into various disconnected spheres of power. Under each, various branches of Ibn Saud were accumulating independent power, influence and wealth – this kept several factions content and busy without posing overt threats to the monarch.

Eventually King Abdullah smoothly acceded to the throne in 2005. It is believed that emergence of powerful networks of patronage, wealth and influence may have hindered some of King Abdullah’s internal reform efforts—one of which included controlling ‘the royal extravagance’. Moreover, realizing what the near future could soon reveal; King Abdullah created the Allegiance Council in 2006. This body consists of the sons and grandsons of King Ibn Saud— enabling them to cast secret ballots to choose future kings and crown princes.

The council’s mandate was to officially start after the reigns of both King Abdullah and late Prince Sultan were over. However, Prince Sultan passed away before King Abdullah, the council then chose Prince Nayef as the new crown prince – unfortunately he too passed away before King Abdullah — who soon followed him.

The power then shifted to the current King Salman of the Sudairi line in 2015. The current concerns revolve around the diminishing second generation of the ruling bloodline and at the same time there is a wide range of third generation contenders to the throne because there is the absence of a coherent consensus based framework of succession. This is deeply interlinked to the issue of ‘individualistic power-corruption nexuses’.

Conclusion:

Various power sharing mechanisms were established under different reigns. However, the effectiveness of those arrangements seemed to stem from strong elements of personal trust or ties, thus tending to fizzle out over time.

There appears to be an absence of a coherent framework of succession and clear division of responsibilities coupled with frequent lack of consensus. Several root issues of the current power struggles also appear to stem from inadvertent long term implications of the founder’s political strategy of an assortment of marriages.

What needs to be recalled and perhaps accepted is that Saudi Arabia is an absolute monarchy – the royal decree is the law. The determination of ‘right or wrong’ and the nature of proceedings, and the order of succession is legally the King’s discretionary power and perhaps the Kingdoms internal matter.

It is noteworthy that the current Crown Prince MBS is careful with his word selection, he does not make promises to reform the ‘absolutism’- he only claims to bring about ‘economic reforms’.

Attempts to ‘centralize or streamline power spheres’ is not entirely erratic because the corruption issues are not an untruth either. To name a few; it is reported that at least 10 -25 per cent of the value of government contracts are routinely skimmed, with the proceeds used to fund personal lives. Princes would routinely borrow money from banks and default on payments — this, at one point nearly caused the collapse of the National Commercial Bank of Saudi Arabia. The Ministries of Finance and Municipal and Rural Affairs, assists in transferring lands to Royals, who in turn sell it at huge profit to real estate developers.

The exact purpose behind the recent developments is yet to crystallize —- some see it purely as power play, with a hint of selective justice and consolidation of the ‘Sudairi faction’ but sons of the Sudairi brothers have also been dragged into this. On the other hand, the young prince has taken an incredibly bold step to disrupt the bloodline power nexuses and has challenged the status quo in the name of socio-economic development. One can only hope his genuine intentions are embedded in the second case – he perhaps needs to be given some benefit of doubt. 

The history and evolution of modern Saudi Arabia clearly indicates that its internal politico-economic stability is heavily impacted not only by the royal dynamics but also by its national economic policies and regional dynamics and global demands and affairs.

The crown prince claims to carry a forward looking economic vision – one that aspires to ‘open up, economically diversify and modernize Saudi Arabia’, thus in order to move forward from his recent bold anti-corruption initiatives and pacify possibilities of future political turbulence he would have to move quickly to moderate royal extravagance, create a more economically equitable social contract with the citizens, harness the advantage of the youth bulge and introduce genuine social and education reforms based on development needs, correctly align national economic policies -for locals and expats – to enhance the utility of existing industrial bases.

Lastly, the crux of his vision 2030 aims to transform a section of the Hijaz region into a futuristic, technological investment hub — the price tag of the project is massive and at the same time its success is highly dependent on the overall regional security situation. It would do him good to examine the sublime diplomacy of his predecessor – Late King Faysal – who possibly faced more daunting insecurities from the fiery Pan-Arab figures — he countered that with calls for ‘greater collective identities’. The crown prince naturally needs to take advantage of the dominant demands of collective security, combatting extremism and mutual socio-economic developments.  Taking the lead in improving regional ties would help divert some funds from the ever-swelling Saudi defense budgets and help create a space where the full potentials of the region can be harnessed.

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