THE NEW KING

THE mantle of leadership passed from King Abdullah to the lone surviving son of the founder of Kingdom of Saudi Arabia (KSA), King Salman bin Abdel Aziz al-Saud, without a hitch. The new king has his work cut out for him. He ascends to the throne in a troubled region. A coup in the neighbourhood in Yemen is raising the political mercury to new heights. Egypt has seen the coming and going of 3 presidents in 4 years and Iran continues to play Russian roulette with the West on the nuclear question. King Salman has proved himself a capable administrator in the past, overseeing the growth of the capital that grew from a population of less than 200,000 in 1963 to about 7 million presently.

Whether he will be able to live up to the legacy of the late King is however another matter altogether. King Abdullah had played a pivotal role both at home and abroad. On the domestic front, he is best remembered for alleviating poverty, and helped establish a co-education university. Under his able leadership, KSA grew into the largest economy in the region from $163 billion in 1996 to about $77 8billion in 2014. The king helped avert the global economic meltdown by spending some $400 billion in stimulus spending to prop up the economy and will be remembered for his fight against terrorism. Indeed, we witnessed a more assertive Saudi foreign policy whereby the Kingdom has played an active role in financing and arming factions opposed to the Assad regime in Syria and armed intervention to prop up the regime in Bahrain during the Sunni unrest in that country in 2011.

The new king has ensured succession of the house of Saud by appointing Mohammed bin Nayef, grandson of KSA's founder as Crown Prince. Salman is not an altogether unknown quantity. He has been involved in foreign policy for more than a few decades. The new king was part of the financial regime that helped manage the flow of funds to the Mujahideen fighting the Soviets and hence he is well known to the American establishment. As stated by Rachel Bronson, a Senior Fellow at the Chicago Council on Global Affairs in a recent article: “In one of his more high profile roles he played a key part in funneling significant amounts of cash to Pakistan and Afghanistan during the Afghan war, which aligned with US policy and defined interests. In terms of energy policy, Salman has publicly declared his support for oil minister Ali-al Naimi's decision to allow oil prices to drop without decreasing Saudi production to urge prices up. It would be surprising if Salman made any sudden changes regarding this controversial policy. On the economic and foreign policy front, King Salman is therefore likely to pursue policies similar to his half-brother King Abdullah.” That said the new King is not young (around 79 presently) and it not without surprise that the Crown Prince was appointed perhaps a day before the US president landed at Riyadh. As pointed out by Ms. Bronson, the new king is setting up a smooth plan of succession with the aim of letting Washington know his plans in advance.

While the domestic front seems to be following a set pattern that ensures smooth continuity on a number of important fronts including energy and foreign policy, the regional balance of power is more volatile and less easily managed. The rise of ISIS and a civil war in Syria that has more or less ground to a stalemate remain problem areas. The Iran “question” remains the greatest worry as the new king will have to come to terms with the possibility of an Iran-West deal on the nuclear issue in the foreseeable future. Closer to home, the new king faces an unsettled Yemeni population of nearly 30 million. The Houthi takeover has not pleased Riyadh as it is seen as an extension of Iran's sphere of influence into the Saudi backyard. Tackling the Yemen situation will be the first real test for the new king, but he will have support from Washington.

On the revenue front, King Salman will have more pressing worries. The plunge of the price of barrel to around $50 can be weathered by the kingdom's more than $700 billion in reserves. It serves the purposes of crippling Iran's economy and hurting Russia, which in turn, hurts the Assads in Syria who count on continued Iranian and Russian military and economic aid. However, a prolonged depression in the international oil market will not be to the kingdom's advantage. Some analysts believe that with the introduction of US shale gas and oil, the market will flatten out, and with Opec working hard not to let the price of oil hit $100 per barrel, the threat of the American oil boom will be difficult to counter. As efficiency improves and costs are cut, Daniel Yerginjan's prophecy in his article in New York Times, titled 'Who will Rule the Oil Market,' may come true: “Even at prices well below $100, American shale oil producers will find ways to drive down costs and output will start rising again. And the world's new swing producer will find itself back in the swing of things.”

The writer is Assistant Editor, The Daily Star.