Thursday, 21st September 2017

Saudi Arabia: National transition in question

Away from the breathless tones of Saudi-boosters and investors looking to make a big killing around the Saudi Aramco listing (see Energy and industry), it is easy to let the debate swirling around Crown Prince Mohammed Bin Salman (MBS)’s ruthless rise to power detract from the potential benefits of his ambitious programme to reduce the kingdom’s dependency on oil and provide a more sustainable future for its young population. The Vision 2030 initiative’s National Transformation Plan (NTP) is, after all, the most ambitious reform initiative Saudi Arabia has launched in the modern era. It is not the first: programmes of lower profile and lesser scope were pushed by King Faisal Bin Abdelaziz in the 1970s and by King Abdullah Bin Abdelaziz. These had only limited success, as steps in one direction were often interspersed with retreats: liberal changes were reversed after the Grand Mosque occupation in 1979 and first Gulf war in 1991, as the conservative forces – notably in Al-Majlis Hayat Kibar Al-Ulama (the Council of Senior Scholars) – were harnessed to bolster a monarchy confronted by extremist threats.

This history of reform and counter-reform, and the inescapable fact that many of Saudi society’s fundamental traits remain little changed despite the emergence of younger generations, suggest Vision 2030 faces a stiff challenge from a conservative society. The programme has also been criticised for displaying questionable economics (GSN 1,037/8), while its cultural element threatens a conservative backlash, even if it also gives young Saudis much more to do in the public space (GSN 1,042/6). One astute observer of younger Saudis’ behaviour observes that, particularly outside the centres of Jeddah and Riyadh, opposition sometimes comes from the very Saudi millennials that many reports say should be enthused by Vision 2030’s cultural aspects.

News that a revised, more cautious version of the NTP has been drawn up has already been leaked to The Financial Times and other media (GSN 1,043/1). Some projects will be dropped or revised, and others added in the new Vision 2030 to be published shortly. Timetables are apparently to be lengthened for some projects, and a number of potentially contentious schemes are to be transferred from MBS’s initially preferred policy vehicle, the Council of Economic and Development Affairs (CEDA), to be executed directly by ministries – at arm’s length from CEDA and the crown prince.

Some of the more difficult targets may be shuffled outside the Vision 2030 governance system so that failure in these areas wouldn’t compromise achievement of the core plan – protecting its authors against possible fallout, which happened when previous reform efforts failed. The move to an NTP 2.0, and the de-risking exercise apparently under way now that MBS has been appointed heir apparent, would assume even greater importance were he to assume the throne.

However, the primary cause of revisions to the NPT is probably the dawning recognition among MBS’s army of consultants that their proposed projects have no hope of realisation unless responsibility for delivery can successfully be transferred to the Saudis themselves. On the ground, sources in different ministries report a consistent pattern of activity as Vision realisation plans unfold. Transformation teams are working to prepare blueprints for action within their ministerial spheres of responsibility, they report. Inevitably, most ministries and organisations are looking at their own structures, to see if they are fit for the purpose of delivering Vision 2030’s radical programmes, which go beyond self-contained projects and require structural underpinning.

Already this process is encountering difficulties in ministries as the shock-troop forces of reform come head to head with a still very conservative bureaucracy. Whereas there is no shortage of sharp and well-educated Saudis to spearhead initiatives and projects, there is a distinct shortage of managers within ministries with an appetite for change, with the skills necessary to implement and embed change, or even with a basic understanding of what Vision 2030 entails. One consultant reports that very few officials within her ministry have read or understood the plan, even while most profess to support it.

Another fundamental difficulty associated with implementation is its inevitable reliance on consultants. They have been critical to the drafting of the Vision 2030 master plan, at the forefront of whom have been Boston Consulting Group, Bain & Company, Booz Hamilton, McKinsey & Company (which claims “We help our clients reinvent themselves”) and PricewaterhouseCoopers. They have also been used to begin implementation of many of the projects.

Drawing on global best practice, consultants are well-practiced at devising strategy and selling plans to clients seeking urgent solutions, but their record of implementation and adapting best practice to local environments is less distinguished – and there can be no tougher or demanding environment than Saudi Arabia’s geography, culture and resistance to change. Polling has consistently found a strong appetite for change in Saudi Arabia, but paradoxically also equally strong resistance to the type of social development that is a prerequisite for such change.

Saudi Arabia is most often thought of by outsiders to be a tightly controlled society where dissent is controlled or supressed. In reality, it has one of the world’s highest social media access rates. It is difficult to close down individual dissident bloggers on social media; whereas politics per se is a forbidden area, there is a huge and active forum in social commentary led by respected religious leaders, which inevitably is very political in character – hence the early in September arrests of prominent commentators. Further crackdowns might be expected if and when the Vision 2030 projects begin to impact on socially conservative societal norms.

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