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Winds of change in Saudi Arabia: Decoding Crown Prince Mohammed's corruption purge, aggressive reforms

Mohammed bin Salman, the son of King Salman and Crown Prince of Saudi Arabia, is a man in a hurry. In a disruptive power play, the 32-year-old has been rounding up his rivals in a dramatic "anti-corruption purge".

The release of Prince Miteb bin Abdullah, following a "settlement" with authorities that reportedly exceeded $1 billion, is the latest in a series of developments involving "high profile" officials and businessmen.

According to a report on Vox, Saudi police arrested an astonishing 11 princes recently at the direction of Prince Mohammed and his father. The report said experts believed what's really happening is that the crown prince and heir to the throne is "jailing potential rivals to cement his own power".

"This looks like the final step to consolidate Prince Mohammed's authority, by removing possible challengers," Vox quoted Colin Kahl, a professor at Georgetown University, as saying.

File image of Saudi Arabia Crown Prince Mohammad bin Salman. AP

File image of Saudi Arabia Crown Prince Mohammed bin Salman. AP

The purge is the latest in a series of measures by the crown prince, viewed as a move to assert power over the country and its previous leaders.

According to The New York Times, in order to speed up the decision-making process, Prince Mohammed "is reshaping Saudi Arabia — from a broad family coalition where power is shared and alternated among seven major families and decisions taken by consensus — to a state governed by a single family line". "This is no longer 'Saudi Arabia'. It is becoming 'Salman Arabia'," the report said.

Miteb's billion-dollar buyout

Saudi Arabia freed influential Prince Miteb, following a "settlement" with authorities reportedly exceeding $1 billion, more than three weeks after he was detained in a sweeping anti-corruption purge.

The former National Guard chief was among more than 200 princes, ministers and businessmen who were rounded up earlier this month, as Salman tightens his grip on power.

Prince Miteb, once seen as a contender to the throne, is the most high-profile royal to be released so far as the government appears to be striking monetary settlements with some of the detainees in exchange for their freedom.

Before his arrest, the 64-year-old son of the late King Abdullah was sacked as the head of the National Guard, an internal security force that has long been seen as a locus of tribal power.

'Settlements with detainees a power-grab'

Some analysts saw Prince Miteb's removal as an attempt by Prince Mohammed, who is also Defence Minister, to consolidate his control over the security services.

But Saudi authorities insist the purge was meant solely to target endemic corruption as the kingdom seeks to diversify its oil-dependent economy.

In an interview with the The New York Times published last week, Prince Mohammed said 95 percent of those detained agree to a "settlement" or handing over ill-gotten assets or cash to the Saudi State treasury.

"It's an attempt to resolve the situation in a manner that minimises the social fallout from the crown prince's recent move and addresses concerns over the political risk of doing business in Saudi Arabia," Kristian Coates Ulrichsen, a fellow at the Baker Institute for Public Policy at Rice University, told AFP.

Radical approach sparks uncertainty

Prince Mohammed's crackdown on corruption is just the latest in a wave of frenetic changes in the kingdom over the past two-and-a-half years. He said he's determined to remodel his conservative country into a modern State no longer dependent on oil.

"Saudi Arabia has become less predictable," Steffen Hertog, a Saudi expert was quoted by Buzzfeed as saying. "He has dared to do necessary things that were taboo. He has also taken risks that many Saudis and Saudi-watchers see as unnecessary, notably in foreign policy."

After King Salman bin Abdulaziz handed 32-year-old Prince Mohammed with more and more power over the past three years, the ambitious young leader has taken on everything from economic reforms to waging war in neighbouring Yemen.

Royal politics

Prince Mohammed's rise to power began in 2013, when he was named the head of the Crown Prince's Court, with the rank of minister. He capped his rapid rise to power in June this year by replacing his elder cousin Prince Mohammed bin Nayef, widely known as MbN, as crown prince.

A source close to King Salman said MbN's dismissal was "in the higher interests of the State" because he was incapacitated by morphine and cocaine addiction, a legacy of an assassination attempt that left shrapnel in his body.

File image of Saudi Arabia Crown Prince Mohammad bin Salman. AP

File image of Saudi Arabia Crown Prince Mohammed bin Salman. AP

Anti-corruption campaign

Salman tightened his grip on power with the start of the anti-corruption campaign, purging the kingdom's political and business elite. Many Saudis welcomed the moves as an assault on the endemic theft of public funds by the powerful. US president Donald Trump said those arrested had been "milking their country for years", but some Western officials expressed unease about the possible reaction in Riyadh’s opaque tribal and royal politics.

Yemen

Prince Mohammed launched a military campaign in neighbouring Yemen in March 2015. A Saudi-led coalition, acting on an invitation from the internationally-recognised government, has targeted the Iran-aligned Houthi movement in a war which has killed more than 10,000 people.

The war is closely identified with the prince in his role as defence minister. His image once adorned war propaganda but is rarely associated with the war now, although he has said it must continue in order to quash Iranian influence.

Even before the conflict, Yemen was the poorest country on the Arabian peninsula and now millions of people there are facing famine and a cholera epidemic. The coalition denies it blocks commercial shipments of food, medicine and fuel.

Qatar

Prince Mohammed has helped lead a diplomatic campaign to isolate Qatar, saying Riyadh's erstwhile ally backs terrorism and cosies up to Iran. Qatar rejected the accusations and said it's being punished for straying from its neighbours' backing for authoritarian rulers.

The campaign has divided Gulf Arab countries, who Washington regards as essential to its influence in the region. Qatar had initially incensed Riyadh by cheering Arab Spring uprisings against some autocratic Arab rulers.

Confrontation with Iran

Saudi Arabia's rivalry with Iran, its competitor for influence in the Middle East, has deepened as King Salman and Prince Mohammed worked to build a Sunni coalition against Tehran and its allies in the Arab world.

In May, as deputy crown prince, Prince Mohammed used unusually provocative language to rule out dialogue with Iran, which he said, was trying to interfere in Arab lands and dominate the Muslim world.

On 7 November, State media quoted him as describing Iran's supply of rockets to militias in Yemen as "direct military aggression" that could be an act of war.

Prince Mohammed has also opened a new front in the proxy war with Iran by threatening Tehran's ally Hezbollah and its home country Lebanon. The resignation on Saturday of the Saudi-allied Lebanese prime minister, Saad al-Hariri, announced from Riyadh, was widely seen as the first act on this new front.

The crown prince has also sought the help of Iraq's Shia leaders to try to reverse Iran's dominant role and shore up security on the kingdom's northern border, and has also tried to improve ties with the US under Trump, who shares his and King Salman's antipathy to Iran.

Saudi Aramco

The planned sale of about five percent of national oil company Saudi Aramco next year is a centrepiece of 'Vision 2030', Prince Mohammed's blueprint to move the economy away from what he called its "addiction to oil" and towards the private sector.

The IPO is expected to raise as much as $100 billion but investors wonder whether Aramco can be valued anywhere close to the $2 trillion figure announced by the crown prince and there has been market speculation that the IPO could be delayed beyond 2018 or shelved. He recently stated it would happen next year.

Many Saudis have misgivings about the sale, with some fearing Riyadh is selling cheaply at a time of low oil prices.

Economic reforms

'Vision 2030' has begun to reduce a big State budget deficit with austerity measures but has not yet created major new sources of non-oil growth or jobs.

The phased removal of subsidies on fuel, water and electricity has started but some austerity moves have been unpopular. Already, some have been reversed or delayed as the economy has slowed because of low oil prices.

The plan includes private investment and privatisations and building the world’s largest sovereign wealth fund. The aim is to create jobs and raise the participation of women in the workforce from 22 percent now to 30 percent by 2030.

File image of Saudi Crown Prince Mohammed bin Salman in Riyadh. Reuters

File image of Saudi Crown Prince Mohammed bin Salman in Riyadh. Reuters

Society and culture

Saudi Arabia adheres to an austere Wahhabi brand of Sunni Islam, which bans gender mixing, concerts and cinemas.

Prince Mohammed’s ascent represents a social and cultural sea change, with power set to be passed to a much younger generation seemingly more in tune with young Saudis.

In moves that reinforce that perception, women will be permitted to drive from next year and allowed to attend sports events.

The crown prince has also said the country will move to a more open and tolerant interpretation of Islam, and reforms have begun in areas once the exclusive domain of the clergy such as education, courts and the law. Saudi authorities have promoted elements of national identity that have no religious component or pre-date Islam.

Neom

Last month, Prince Mohammed announced a $500-billion plan to create a business and industrial zone extending across its borders into Jordan and Egypt, part of his efforts to reduce dependence on oil.

The 26,500 square-kilometre (10,230 square-mile) zone, known as Neom, will focus on industries including energy and water, biotechnology, food, advanced manufacturing and entertainment, and will power itself solely with wind power and solar energy.

The crown prince says the government, Public Investment Fund and local and international investors are expected to sink billions into the zone in coming years. The crown prince told Reuters Neom would be floated on financial markets alongside Aramco.

With inputs from Reuters and AFP


Updated Date: Nov 30, 2017 14:19 PM

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