Is Saudi sending the right signals ahead of Saudi Crown Prince’s UK US trip?
Saudi Crown Prince Mohammed bin Salman is preparing to visit both the UK and the US in March.
The Brits have a serious issue with the humanitarian crisis emerging from the Yemeni war, and will need more than business reassurances to warm up relations with Saudi.
The US will show gratitude for crown prince’s efforts towards promoting a moderate Islam in the Kingdom, as well as fighting terrorism in the region.
Regardless, Saudi leadership is leaving no stone unturned sending the right signals to the international financial community that the country is not only safe to do business in but also a modern state with all the right bells and whistles.
Are fears stemming from an anti-corruption drive that swept up prominent Saudi princes, officials and businessmen subdued?
According to a recent Washington Post report, “the anti-corruption campaign has merit, provided it is transparent and is seen to promote a rule of law that all external investors can count on.”
“At the same time, (Saudi Crown Prince) MBS also needs to hear that arresting bloggers or journalists who criticize the royal court will not create the atmosphere that fosters real innovation and creativity, but will have a chilling effect on the high-tech sector here (US).”
What’ the latest on the Saudi corruption Probe?
Blanket of mystery
Despite the high profile case involving the release of Saudi Prince Alwaleed bin Talal, there are still unknown news about Saudi construction mogul Bakr bin Laden, who’s among dozens still detained and presumably awaiting trial.
The Financial Times painted a chilling post-Ritz account of what took place inside the hotel, describing it as “Tales of broken men barely speaking since being released.”
The Financial Times spoke to more than a dozen friends and associates of those detained in the crackdown that started on November 4, 2017.
“Laws prevented the state from identifying suspects before trial. But the names were put out there [on social media] to send a message, to show the seriousness of this campaign,” a Saudi observer told FT.
“Large entities, such as contractor Saudi Binladin Group, Prince Alwaleed’s Kingdom Holding and Dubai-based Middle East Broadcasting Center (MBC) were allowed to operate normally, although their futures appeared uncertain.”
According to FT, Mohammed al-Jadaan, finance minister, has said several billions of dollars have already been recovered but details of financial settlements have been kept under wraps.
As business opportunities arise, Saudi is hoping investors will have short memories, but it sure is trying to replace negative sentiment with fresh new positive images.
Arab News reported recently that Saudi has enacted a bankruptcy law that will help attract foreign direct investment into the Kingdom.
Lack of legal clarity when it comes to contractual agreements, including bankruptcy, especially in cases when foreign companies find themselves unable to collect payments on certain projects and are forced to dissolve and liquidate assets at a discount, as no other recourse was available.
George Sadek, research analyst at Global Legal Monitor, part of the US Library of Congress, said: “The purpose of the (new law in Saudi Arabia) is to attract foreign investors and encourage small and medium corporations to grow financially … Its main goal is to provide for the operation of indebted corporations while they gradually pay off their debts.”
“It allows creditors and debtors to enter into agreements to schedule the payment of debts, a measure that will enable indebted corporations to achieve a stable financial status.”
The new law will give Saudi Arabia, for the first time, a legal infrastructure to deal efficiently with companies that get into financial difficulties.
Fatimah Baeshen, spokesperson at the Saudi Arabian embassy in Washington DC, tweeted that the new law amounted to “structural reforms to further facilitate a dynamic business environment that encourages participation — a critical variable in further developing the entrepreneurial ecosystem, investments and so much more.”
In a CNBC interview with Saudi Foreign Minister, Adel Al-Jubeir, the latter revealed that Saudi has extremely important and strategic ties with the US but the kingdom is also developing very strong relations with Russia.
“We are looking at a number of countries (around 10) that have nuclear technology for peaceful purposes. We are looking at the issue of the viability of building nuclear reactors in order to produce energy so that we can save the oil and export it in order to generate revenue,” said Al-Jubeir.
When asked about the Crown Prince’s visit to the US, and questions that would arise on Qatar boycott, AL Jubeir said “The issue of Qatar abuse will be resolved within the GCC and it will be resolved within the region.”
Of course Saudi has been announcing one startling news after the other.
Just yesterday, it was revealed that Saudi women can start their own business without the need for a male chaperon.
This follows news that Saudi is hosting its first fashion show.
Concerts are ongoing, soccer fields getting filled with screaming female fans, movie producers hiring Saudi female actors, and soon in June, Saudi ladies will get behind the wheel.
Good signals. Will it be enough?