The Saudi model

Abdel-Moneim Said
Tuesday 16 Apr 2024

Abdel-Moneim Said takes stock of the process of reform unfolding in Saudi Arabia

 

Until the second decade of the 21st century, not a single Arab country had performed a modern miracle of the Japanese, South Korean or “Asian Tigers” sort. The only Arab country to come close was the UAE which turned Dubai into a kind of Singapore of the Gulf, inspiring neighbours, such as Qatar, to emulate it. After their independence, most Arab countries became rentier states dependent on revenues from a single product, namely oil or gas, or, like Egypt, from a small basket of products such as oil, tourism, remittances abroad, and the Suez Canal. In the context of this dependency on rents, a social contract was established whereby the state would serve as caretaker in exchange for society’s acceptance of a centralised political system controlled by an individual, dynasty, or party. It was a formula for a minimum of political and economic equilibrium, one that averted the famines of Africa, but would not stimulate breakthroughs to excellence such as those achieved in Asia.

The “Arab Spring”, for all its ills and despite all the chaos and upheaval caused by radical Islamists manoeuvring to seize control of the Arab state, became the catalyst for a reformist current that took root and gave substance to a vision and strategy for modernising the state and catching up with the contemporary era. It is important, here, to bear in mind the distinction between “history”, “vision” and “strategy.” The first involves thousands, if not millions, of material and moral variables beyond the control of humankind. The second entails a human attempt to formulate a concept of the future and then to realise it. The third is the business of planning how to marshal the human and material resources to attain certain goals set in accordance with calculations of opportunities and risks.

Today, I will focus on the Saudi reform model, having previously discussed the Egyptian and Emirati experiences.

Saudi Arabia enjoys a unique status in the Arab world as the home to the Islamic holy cities, Mecca and Medina.  It also has a special international standing as the largest Arab economy, one of the world’s largest oil producers, and a member of the G20. None of this would have spared the Saudi state from the siege by hundreds of militants of the Grand Mosque in Mecca in 1979. The incident horrified the Islamic world and had dire effects domestically. Churchill described the tightening of Soviet control over Eastern Europe after World War II as the “Iron Curtain” alluding to its restrictions on civil liberties. The “Black Curtain” that descended in Saudi Arabia after 1979 was harsher. The restrictions it imposed on women deprived them of their humanity. But Saudi citizens, in general, were subjected to an unprecedented assault on their rights to thought, expression, and association, and to joy, innovation, and creativity. At the time, communications and transportation technologies were advancing by leaps and bounds, bringing the modern world within reach, together with its literature and creative arts. This led to a paradox: the bleak confines of the black curtain drove those behind it to flee their homeland, even though it is the place where worshipers from across the globe come to seek redemption.

The Saudi reform project was launched in 2015 with the publication of “Vision 2030”. This ambitious blueprint for comprehensive national development identified three main goals: a vibrant society, a thriving economy, and an ambitious and effectively governed nation. The track towards the first goal aims to optimise the positive aspects of Saudi society, which is grounded in the lofty and divinely ordained principles of tolerance and moderation. This goal and its spirit are advanced through programmes and activities in cultural awareness-raising, recreation and sports, urban development, environmental conservation, public health, and human resource development. The second track required a radical shift in the Saudi economy, away from its overwhelming reliance on oil which accounts for 85 per cent of total exports.  To move into the post-oil era, the government has, firstly, stimulated a greater private sector role in non-oil economic sectors; secondly, supported small and medium enterprises; thirdly, promoted the direct and indirect contribution of expatriates to the Saudi economy; and, fourthly, improving public spending efficacy while increasing non-oil revenues. Towards the third goal, efficient and effective governance, Vision 2030 aims to promote transparency, training, spending efficiency, financial balance and flexibility in public affairs management, and e-government (Saudi Arabia had ranked 34th on the E-Government Survey Index in 2014, up from 90th place in 2004, and aims to be among the top five nations by 2030).

The Saudi economic development philosophy emphasises privatisation, with a target of 40 per cent to 60 per cent of GDP. It seeks to attract investments from international firms in mining, manufacturing, and renewable energy. In addition to privatising certain public services, the government aims to indigenise military spending. The general aim is to increase the size of the Saudi economy from its current ranking as the 19th largest economy to the 15th by improving the business environment, upgrading economic cities, creating special economic zones, developing digital infrastructure, and optimising the geographical space. This is supplemented by a drive to foster regional and international economic integration projects (as exemplified by the Egyptian-Saudi bridge and investment of the land reclamation of a million acres in Sudan).

Today, nearly ten years after the launch of Vision 2030, the sweeping changes that have already taken place in the country have catapulted Saudi Arabia and Saudi society to the vanguard of the Arab reform movement. Indeed, reform revolution may be a more accurate description when we consider the progress in such areas as productivity, diversification of sources of revenue, emancipation of women, and the renovation of religious discourse.

* A version of this article appears in print in the 18 April, 2024 edition of Al-Ahram Weekly

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