Round-up of Saudi princes, businessmen widens, travel curbs imposed

FILE PHOTO – Saudi billionaire Prince AlWaleed bin Talal looks on during a news briefing in Manama, May 8, 2012. REUTERS/Hamad I Mohammed/File Photo

The moves consolidate Prince Mohammed’s control of the kingdom’s internal security and military institutions, which had long been headed by separate powerful branches of the ruling family.

Yet many analysts were puzzled by the targeting of technocrats like ousted Economy Minister Adel Faqieh and prominent businessmen on whom the kingdom is counting to boost the private sector and wean the economy off oil.

“It seems to run so counter to the long-term goal of foreign investment and more domestic investment and a strengthened private sector,” said Greg Gause, a Gulf expert at Texas A&M University.

“If your goal really is anti-corruption, then you bring some cases. You don’t just arrest a bunch of really high-ranking people and emphasize that the rule of law is not really what guides your actions. It just runs so counter to what he seems to have staked quite a lot of his whole plan to.”

Over the past year, Prince Mohammed has become the ultimate decision-maker for the kingdom’s military, foreign, economic and social policies, championing his “Vision 2030” plan which includes subsidy cuts, tax rises, sales of state assets, a government efficiency drive and efforts to spur foreign investment.

The reforms have been well-received by much of Saudi’s overwhelmingly young population, but caused resentment among some of the more conservative old guard, including parts of the Al Saud dynasty frustrated by Prince Mohammed’s meteoric rise.

“It’s overkill – and overkill in a way that makes it harder to achieve his long-term objectives,” said Gause.

LONG-AWAITED

The line between public funds and royal money is not always clear in Saudi Arabia, an absolute monarchy ruled by an Islamic system in which most law is not systematically codified and no elected parliament exists.

WikiLeaks cables have detailed the huge monthly stipends that every Saudi royal receives as well as various money-making schemes some have used to finance lavish lifestyles.

Many ordinary Saudis have praised the round-up of princes and ministers as long-awaited and necessary to modernize the economy.

In September, King Salman announced that a ban on women driving would be lifted, while Prince Mohammed is trying to break decades of conservative tradition by promoting public entertainment and visits by foreign tourists.

He has also slashed state spending in some areas and plans a $300 billion sale of state assets, including floating part of state oil giant Saudi Aramco [IPO-ARMO.SE] on international markets.

But the prince has also led Saudi Arabia into a two-year-old war in Yemen, where the government says it is fighting Iran-aligned militants, and into a dispute with Qatar, which it accuses of backing terrorists, a charge Doha denies. Detractors of the crown prince say both moves are dangerous adventurism.

The Saudi-led military coalition said on Monday it would temporarily close all air, land and sea ports to Yemen to stem the flow of arms from Iran to Houthi rebels after a missile fired toward Riyadh was intercepted over the weekend.

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