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Fleeting moments

November 30, 2017
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Changes in the kingdom

Opinion

November 30, 2017

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Fleeting moments
In democratic countries, changes occur gradually and they are usually predictable. But in countries ruled by kings and their lineage, the changes are mostly abrupt. This is what happened in Saudi Arabia when Crown Prince Salman ordered the arrest of many princes as well as hundreds of serving and former ministers, military officials, and businessmen.
During midnight raids at their homes, the dignitaries were rounded up and whisked away to be lodged at the Ritz-Carlton Hotel in Riyadh where they were, according to reports, made to sleep on the floor of the hotel.
Among the arrested is one of the world’s richest men, Prince Al-Waleed bin Talal, who had been debating with Forbes over his net worth. Prince Talal had claimed in 2013 that Forbes had underestimated his worth by $9.6 billion. At the end of the two-year tussle, Forbes and the prince mutually agreed to his net worth of $17.9 billion, declaring him the 45th richest man in the world. The prince may have to part with some of his fortunes to earn his freedom.
Now, the Saudi authorities, according to the Financial Times, have asked the detainees to pay for their freedom by parting with 70 percent of their possessions in net worth and in real estate. The government thinks that what it is likely to extract out of the allegedly corrupt gentry will make up for the $79 billion deficit that the kingdom faced in last year’s budget because of the falling oil prices. In other words, it’s an arrangement that is akin to the plea bargains that NAB makes with the corrupt in Pakistan before letting them off the hook to enjoy the remaining share of their plundered wealth.
Maybe Saudi Arabia also has a similar accountability apparatus that springs into action when the corrupt cross the red line. After all, we are two brotherly countries entwined in many respects.
However, drastic changes are likely to take place in Saudi Arabia. The newly-anointed Crown Prince Mohammed bin Salman vows

to modernise the Kingdom of Saudi Arabia. One of the major steps that he announced was to ensure the emancipation of women in the kingdom by allowing them the permission to drive. This would meet two requirements. First, women would gain the freedom to move about alone. Second, it would reduce the cost of hiring the usually expat drivers who chauffeured them around.
Another step that the crown prince announced is to develop an open economy and reduce the dependence on oil. Now, the diversification of the economy is a significant move that will have repercussions on society as a whole. As we know, the Saudi people are not used to hard work as compared with the people of other nations. For instance, let’s consider how a foreign businessman cannot establish his business there without arranging for a local sponsor, a kafeel.
The kafeel never has to work but he shares the profits that the company makes, without investing in it. An expat businessman cannot appear in the courts to settle their disputes without their kafeel. The mandatory requirement for foreign businessmen to have a kafeel is essentially meant to ensure a steady income for the Saudi people and keep them happy. It has worked so far. But the situation may change now.
To diversify the economy further, the Saudi government plans to establish a new economic zone, which is being called a ‘liberal hub’ on the pattern of Dubai on the coast of the Red Sea. To some extent, the plan may help create jobs for the nearly five million young Saudis under the age of 30 who are about to enter the job market.
Innovatively, the Saudi government has already levied a 100 Saudi riyal fee for expat-holders of residential permits (akama). It includes children and families of expats. The fee amount will progressively increase by 100 Saudi riyals each year until 2020. As a result, expats have started sending their families back to their countries. However, the change envisaged in the Saudi economy will affect us as remittances by Pakistanis working in Saudi Arabia have been a reliable source of Forex earning, especially in the time of declining exports.
The writer is a freelance columnist based in Lahore.
Email: [email protected]

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