Analysis: Canadian Pawn Takes King In Saudi Game of Thrones
Kudos to the Trudeau government for standing up to Saudi Arabian blackmail. Thousands upon thousands of Canadians paid the ultimate price during the two world wars to protect democracy and human rights, and the least our generation can do is suffer minor economic inconvenience to stand up to the repressive Saudi regime.
Crown Prince Mohammed bin Salman (MBS), the de facto leader of Saudi Arabia, appears to think Canada is a mere pawn in his Game of Thrones. Granted, the 32-year old crown prince does have guts and vision, is a master of public relations, and is one shrewd Machiavellian. But, despite pretending everything is hunky-dory in his kingdom, the long-term survival of his regime is likely no more than a fifty-fifty proposition.
MBS has shaken the oil-rich Kingdom of Saudi Arabia to its core since January 2015, when his father Salman bin Abdulaziz al Saud became king. Possibly the best example is the November 2017 shakedown of princes and other Saudi luminaries in the name of an anti-corruption drive that contributed to MBS gaining control over all three branches of Saudi security — military, internal security services and national guard. For decades these had been distributed between different branches of the House of Saud as a way of balancing power between them and to protect against a successful coup d’etat.
To his credit, MBS saw the status quo had become untenable for Saudi Arabia economically, socially and politically. The age of high price oil has likely come to an end — barring a major geopolitical event in the Persian Gulf region in which the kingdom may not benefit — given the Shale Revolution on the supply side of the world oil market equation and the global campaign against carbon emissions and the rise of electric vehicles on the demand side.
The House of Saud’s centuries old pact with the conservative Wahhabi clerical establishment, as a means to legitimize its rule in all or parts of Saudi Arabia, has morphed Frankenstein-like, with Salafists such as Islamic State calling for the overthrow of the Saudi ruling family. Saudi Arabia’s archrival, the Islamic Republic of Iran, is gaining significant power in the Middle East at the kingdom’s expense.
Based on MBS’s economic, social and political — both domestic and foreign — policies to date, as well as the supposed rationale for his recent shakedown, it appears he is attempting to make Saudi commoners the base of his power — rather than his fellow princes and the Wahhabi clerical establishment — by improving the economic prospects of his subjects, loosening the tyranny of hardline Wahhabi clerics over their everyday lives, and supercharging secular Saudi nationalism.
MBS’s primary method of stoking the embers of secular Saudi nationalism, which also appears to have provided a smokescreen for his consolidation of power in the kingdom — including over economic and social policies — have been actions that heat up the regional Cold War with archrival Iran. MBS started Operation Decisive Storm, a Saudi-led coalition against Iranian-backed Houthi rebel forces in Yemen in March 2015, two months before he was named Deputy Crown Prince. MBS, along with Bahrain, Egypt and the UAE, imposed the blockade against Qatar for having relatively amicable relations with Iran and its supposed support of terrorism in June 2017. Two weeks later King Salman promoted his son to crown prince.
The crown prince has taken a carrot and a stick approach to social policy and control, while putting the Wahhabi clerical establishment on its heels. In 2016, he stripped the religious police of their power of arrest, and has since been expanding the space for women in public life. MBS appears to be playing to youth and women in the kingdom with his modest social liberalization, while laying the foundation for women to join the Saudi workforce in greater numbers in the future.
However, at the same time, under the apparent direction of MBS, political repression has increased in Saudi Arabia during King Salman’s reign, with Shiites in the oil-rich Eastern Province especially hard hit — and sometimes by troops in armored vehicles provided by the Canadian company General Dynamics Land Systems, the export of which Justin Trudeau allowed to go ahead after much debate upon becoming prime minister in 2015.
For example, the prominent Shiite cleric, Nimr al-Nimr, was one of 47 “terrorists” put to death at the beginning of 2016. According to Amnesty International and Human Rights Watch, the human rights record of the kingdom has taken a significant turn for the worse under King Salman, with nearly 150 state-sanctioned beheadings last year alone and an increasing number of arrests of Saudi dissenters, including women rights activists.
MBS appears to be attempting to kill two birds with one very cheap stone by picking on Canada — stoke secular nationalism in his kingdom and quell foreign criticism of his repressive regime. Based on reaction to the move on Saudi social media, including the mock picture of an airplane about to crash into the CN Tower in Toronto, and the fact Britain and the U.S. — two traditional beacons of democracy and human rights — are diving for cover rather than covering our back, it appears the crown prince has hit both marks.
But just like Machiavelli’s perfect prince, Cesare Borgia, MBS appears to lack “fortuna,” luck in today’s parlance. In fact, almost everything he touches seems to turn to stone both domestically and internationally, with the most notable exception being the success of his PR campaigns during extended visits to Britain and the U.S. earlier this year.
In terms of the regional Cold War, MBS’s efforts have been thwarted by Iran and its proxies in every country in which he has attempted to challenge the influence of the Islamic Republic — Lebanon, Iraq, Syria and Yemen. As of now, he has no choice but to enlist Israel, still considered an arch-enemy by many Saudis, and the U.S. in his efforts to contain Iran.
On the economic front, McKinsey Global Institute has estimated that Saudi Vision 2030 — MBS’s economic reform plan to diversify the economy away from oil and create substantially more jobs for his youthful subjects — will require US$4 trillion of foreign and domestic capital. But the flow of foreign direct investment (FDI) into the kingdom declined to a mere US$1.4 billion in 2017, compared to US$12.2 billion as recently as 2012, despite photo ops of MBS hobnobbing with tech giants such as Mark Zuckerberg, Sergey Brin and Tim Cook.
At the same time, it has been reported Saudi businessmen have become increasingly reticent to invest in the kingdom, especially since the Saudi’s version of the Night of the Long Knives on November 4. The planned IPO of a five per cent stake in Saudi Aramco, the state-owned oil company, to help fund Vision 2030, is nowhere in sight.
To the best of my knowledge the rewarding of failure does not go down well in any society, and it appears Saudi Arabia is no different. Dissident Saudi princes living outside the kingdom — and hence, outside of MBS’s control — and a number of well-connected academics living in the West claim that this, along with the concentration of power in King Salman’s line of the royal family, is contributing to schism within the House of Saud.
According to the Political Instability Task Force, supported by the Central Intelligence Agency (CIA) to carry out country risk assessments for the U.S. government, the cohesion of ruling elites — including business elites — is the most important factor determining whether a country is prone to regime change.
In the grand scheme of things, Saudi Arabia has caused Canada minimal damage by recalling its ambassador, throwing out ours, selling Canadian assets, pulling its students from Canadian universities, and stopping the import of Canadian goods such as barley and wheat. For example, the kingdom’s central bank and sovereign wealth fund hold a “fairly small” fraction of its total US$100 billion in foreign holdings in Canadian assets according to the Financial Times, while combined trade between the two countries was roughly $4 billion in 2017 — with Saudi Arabia holding a significant bilateral trade surplus with Canada.
Now that the Trudeau government has refused to apologize to Saudi Arabia, his government must decide whether we should retaliate in kind. Canada could stop the import of Saudi crude to eastern refineries — 136,000 bbls/d in June — which accounts for the bulk of Canadian imports from the kingdom. Contrary to the opinion of one prominent energy analyst, this crude could be replaced relatively easily because whatever crude we stop buying from Saudi Arabia will find a market elsewhere, backing out similar quality crude that would become available to our refiners.
On the other hand, the Canadian government could maintain the moral high ground, continue to import Saudi crude, and simply smile, knowing Canada’s democratic government will likely be here long after MBS falls from power, and the anachronistic House of Saud as well.