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The strengthening economic ties between Saudi Arabia and the United States are reflected in the pledge by Saudi Crown Prince Mohammed bin Salman to invest $600 billion or more in his country across the next four years in the U.S.
The Saudi report of the announcement of moves by the two nations to align strategically reflects a growing string of cooperation of mutual interest in the economic development and political stability between them. This pledge came as President Donald Trump promised he would visit the kingdom — an indication of the ways their current realpolitik relationship is transactional, with investments as a delicate instrument of policy.
Saudi Arabia’s Crown Prince Mohammed bin Salman pledged $600 billion in investments in the US, signaling a major economic partnership.
This forms part of a larger Vision 2030 agenda of Saudi Arabia to diversify away from oil and pull in foreign investments. Putting that much work into the U.S. goes beyond just economic chance, it is Saudi Arabia stating its relationship with a pivotal ally. This is a very important relationship indeed for Saudi Arabia as it tries to navigate today’s regional tensions, day-to-day economic challenges, and its quest to be a leading player as it projects itself in the Middle East.
This pledge provides a much-needed infusion of foreign investment for the U.S. which could create jobs and drive economic growth. A simple Saudi investment into sectors like infrastructure, technology, and energy would bring great benefits to American workers and businesses, a natural dovetail of the Trump ‘America First’ policy agenda. It also is a political win for Trump, promising to bring in heavy Saudi capital and show he can help attract foreign investment to bolster the U.S. economy.
This development, however, is neither simple. The vast amount guaranteed also calls into question what its investments mean for U.S. foreign policy and domestic interests. At this level of economic engagement, American policy may become entangled with the Saudis’ priorities, putting the United States at risk in controversial matters as diverse as human rights, regional conflicts, and energy independence, critics will argue.
While Saudi Arabia’s human rights record under Mohammed bin Salman’s leadership stands as a point of contention, U.S. allies are receiving arms supplies from Saudi Arabia, at times at a greater scale than that under Bush’s presidency. Once again, the kingdom is coming under heavy criticism for the murder of journalist Jamal Khashoggi and its role in the Yemen conflict. But these problems have put a strain on relations between Saudi Arabia and a number of Western countries, and such investments may make America tacitly OK with Saudi Arabia’s policies, critics may say.
The investment promise aligns with Trump’s focus on attracting foreign funds and fostering economic ties with key global players.
It also provides further evidence that U.S. foreign policy is for sale. That suggests a quid pro quo dynamic eroding trust in U.S. diplomacy: If Trump is willing to take a bow on a visit to Saudi Arabia to seal a trade deal, one wonders how much more American diplomacy is negotiable. It is also worrying that this stokes the ethical question of how to connect state visits and diplomatic engagement to funding contributions.
The pledge is a calculated gamble for Saudi Arabia. Access to the U.S. market and the technology in it brings wealth to the kingdom, but it is also vulnerable to getting shaken by the political backlash or the limelight as it invests. Given the kingdom’s focus on the U.S. domestic and international observers could view it as an overreliance on a single partner.
In addition, this is a time when Saudi Arabia is making efforts to position itself as a global investment hub. Funded by the kingdom’s Public Investment Fund (PIF), which already has taken out a high-profile deal with the company behind the Neom mega-city project and tech giants like Uber, the investment is simply the latest step in a country with global ambitions. But efforts could be complicated by, among others, fluctuating oil prices, instability in the region, and skepticism about the pace of reforms under Vision 2030.
It can, nevertheless, best be understood as an illustration of the convergence of economics and geopolitics in current international relations. The financial benefits to the U.S. and Saudi Arabia are plain, but the long-term impacts need to be carefully thought through. The success of this partnership depends on both nations being aware of the inherent larger consequences for their domestic and international standing.
Critics argue that the move reflects transactional diplomacy, raising questions about long-term geopolitical and ethical implications.
Maintaining a balanced position between economic interest and the U.S.’s commitment to democratic values will be important for the U.S. The path for Saudi Arabia to assert itself as a credible world player will be relieving itself of its hideous human rights record and to prove the sincerity of its reform agenda. Thus, this development is both an opportunity and a challenge for the two countries, with the implication for a significant and path-dependent chapter in their relationship to unfold.
The Author is a PhD Scholar (SPIR-QAU) and has worked on various public policy issues as a Policy Consultant in the National Security Division (NSD), Prime Minister Office (PMO). Currently, she is the editor Stratheia and works for Islamabad Policy Research Institution (IPRI) as a Non-Resident Policy Research Consultant. Her work has been published in local and International publications. She can be reached at https://www.linkedin.com/in/noureen-akhtar-188502253/ and akhtarnoureen26@gmail.com She Tweets @NoureenAkhtar16