The recent efforts of the PIF have been spectacularly wasteful, based on conflicting objectives and faulty premises.
The sports washing complaints in the west (for things like LIV Golf and various football team investments) routinely ignored how they were transparently value destructive investments that didn’t even achieve the reputation laundering benefits they supposedly were for.
Additionally, mega projects such as The Line were sold as ways to induce productive capacity via enormous demand. Unfortunately for the Saudis, their economy lacks productive capacity and unworkable and unproductive modern age equivalents to the Giza pyramids don’t generate it on their own.
They do not have a labor force that has the requisite skills to staff a modern economy and are very unlikely to be able to foster that after spending decades subsidizing their population into submission.
The resource curse isn't just about GDP diversification. Oil revenue let the Saudi state buy social compliance instead of building civic institutions. Vision 2030 can diversify the export basket. But the harder problem is two generations of citizens whose relationship with the state is "we provide, you comply" rather than the tax-representation bargain that creates functional accountability. Singapore built that from scratch. Saudi Arabia has to replace it while operating.
Brilliant exposition of Saudi Arabian history and geography. It's not too fanciful to equate MBS with the Prophet but arguably he faces greater challenges than local tribes. The Kingdom's foundations are stood on sand, shifting sand at that.
The article states that Saudi Arabia is the second largest exporter of oil in the world, then shows a bar chart of various countries' oil production. Is Saudi Arabia the second largest exporter, second largest producer or both?
Interesting, I did not know the Wahhabis were a regional group/tribe allied with the Saud family. I thought the Saud family was from a region that had strongly devout/literal Islamic practices, but that like most modern elites they had simply drifted away from religious literalism in personal practice.
May be true. Have you read Saudi INC? It shows a nice history in which these Arab tribes always understood that everyone has to be given money (living on credit to do so always). If that social contract breaks down, nobody knows what’ll happen.
Really crazy on the shia majority in ‘Al Sharqiyya’. I lived there for a year with lots of local friends, frequenting mosques and everything. Barely saw any shia except for the poorer areas. When I asked my friends they always said ‘Bahrain’. Which is another great read; The Peacock and the Sparrow
I have always been curious about MbS… interesting article. Curious to hear your futher sense of things. The thought of a utilitarian alliance between a high-tech Israel and a diversifying, modernizing Saudi Arabia was very interesting. I wonder if that will ever actually come to pass.
2. But it kind of doesn't matter. The KSA will have plenty of internal problems to resolve in the future and Israel isn't going to get involved unless Israel is threatened some how.
The recent efforts of the PIF have been spectacularly wasteful, based on conflicting objectives and faulty premises.
The sports washing complaints in the west (for things like LIV Golf and various football team investments) routinely ignored how they were transparently value destructive investments that didn’t even achieve the reputation laundering benefits they supposedly were for.
Additionally, mega projects such as The Line were sold as ways to induce productive capacity via enormous demand. Unfortunately for the Saudis, their economy lacks productive capacity and unworkable and unproductive modern age equivalents to the Giza pyramids don’t generate it on their own.
They do not have a labor force that has the requisite skills to staff a modern economy and are very unlikely to be able to foster that after spending decades subsidizing their population into submission.
Too much of that is unfortunately accurate
Which part? The sportswashing part?
Honestly, pretty much all of it.
We can say the tourism economy in the Gulf is now dead, too.
For now
The resource curse isn't just about GDP diversification. Oil revenue let the Saudi state buy social compliance instead of building civic institutions. Vision 2030 can diversify the export basket. But the harder problem is two generations of citizens whose relationship with the state is "we provide, you comply" rather than the tax-representation bargain that creates functional accountability. Singapore built that from scratch. Saudi Arabia has to replace it while operating.
This is one of those articles that justifies the year's subscription
I’m glad to hear! So much work into making these!
Thanks! Nice one! As for the shahada on the Saudi Arabian flag, the Arabic text and transliteration are:
لا إله إلا الله محمد رسول الله
la ilaha illa Allah, Muhammad rasul Allah
Wikipedia gives a literal (word-for-word) translation: “There is no god but God; Muhammad is the Messenger of God.”
A more accurate rendering of the intended sense is: “None has the right to be worshipped except Allah; Muhammad is the Messenger of Allah.”
Thank you!
Fascinating article, thanks!
Adds a lot of context to T.E. Laurence's book, Seven Pillars of Wisdom: A Triumph -- one of the few books I've read 3 times.
Brilliant exposition of Saudi Arabian history and geography. It's not too fanciful to equate MBS with the Prophet but arguably he faces greater challenges than local tribes. The Kingdom's foundations are stood on sand, shifting sand at that.
Great work. Fascinating read. Learnt so much. Not a single extra word.
And yet there are so many!
Thank you
Really fascinating read, I had a very surface level knowledge of some of this. Diving into the details was fun.
Excellent summary! Learned a lot!
The article states that Saudi Arabia is the second largest exporter of oil in the world, then shows a bar chart of various countries' oil production. Is Saudi Arabia the second largest exporter, second largest producer or both?
Good catch, corrected thanks!
It's the largest exporter and 2nd largest producer
Interesting, I did not know the Wahhabis were a regional group/tribe allied with the Saud family. I thought the Saud family was from a region that had strongly devout/literal Islamic practices, but that like most modern elites they had simply drifted away from religious literalism in personal practice.
Great primer, thanks
Nice visuals to contextualize the predicament of KSA.
1. Shia majority in the East is that really true? I think Dammam/Khobar is very sunni majority
2. Its history may be wahhabi but it’s people are less so. I think a lot very acceptive of the current secular drive
3. Its people are behind MBS and trust their leader
So yes a tricky predicament but maybe some nuance there
1. Look at any map!
2. Exactly, hence the issue when it can't be propped up with oil anymore
3. As long as $ flows
May be true. Have you read Saudi INC? It shows a nice history in which these Arab tribes always understood that everyone has to be given money (living on credit to do so always). If that social contract breaks down, nobody knows what’ll happen.
Really crazy on the shia majority in ‘Al Sharqiyya’. I lived there for a year with lots of local friends, frequenting mosques and everything. Barely saw any shia except for the poorer areas. When I asked my friends they always said ‘Bahrain’. Which is another great read; The Peacock and the Sparrow
Brilliant!
I have always been curious about MbS… interesting article. Curious to hear your futher sense of things. The thought of a utilitarian alliance between a high-tech Israel and a diversifying, modernizing Saudi Arabia was very interesting. I wonder if that will ever actually come to pass.
1. They already have a de facto alliance.
2. But it kind of doesn't matter. The KSA will have plenty of internal problems to resolve in the future and Israel isn't going to get involved unless Israel is threatened some how.
Very interesting, about a country I didn't know much. Thanks!