In October 2017, the Saudi Investment Fund launched the Future Investment Initiative as an annual event in which the trends of the (2030) vision launched by Crown Prince Mohammed bin Salman crystallize, which aims to transform the Kingdom from merely an oil producer into a destination for foreign investments in all fields. At the opening event of this initiative, the Saudi Prince announced what was supposed to be the most important and largest of the vision’s projects and investments, which is (NEOM).. the city in which he promised that the number of robots in it would be more than the number of humans, and in which the means of transportation would be self-driving cars and drones, and it would even be the city of “coexistence with the world and the elimination of extremism.”Dherar Al-Tayeb — Al-Khabar Al-Yemeni:Since that time, the Saudi Investment Fund has pumped huge amounts to accomplish the (NEOM) project, and nine editions of the Investment Initiative conference have been held, which later acquired the name (Davos of the Desert) to express its importance that emulates the importance of the World Economic Forum held annually in the Swiss city of Davos, and attended by many of the world’s top leaders, officials, heads of giant companies and institutions, and wealth funds, to explore and discuss investment opportunities and conclude huge deals.It is said that the last edition of the Saudi conference attracted more than 9,000 delegates from 90 countries, and witnessed the signing of agreements and investment pledges worth more than 50 billion dollars in several sectors that included artificial intelligence, advanced technology, and clean energy.Even after it became clear (belatedly) that the giant projects of the (2030) vision, including (NEOM), were simply “unrealistic” and drained huge amounts of money without result, the dream of economic transformation was still pursuable, and only needed to abandon showmanship and wrong policies, and therefore the Saudi wealth fund announced a plan to move away from giant projects, and head toward increasing revenues through tourism, entertainment, industries, logistics services, and other tracks.That is why holding the Future Investment Initiative conference this year was extremely important to revive the vision again, and to show the Kingdom’s ability to rise and correct the situation, especially after the repercussions of the Iran war that directly hit Saudi Arabia in the backbone of its economy, represented by oil exports on which dependence had increased significantly, contrary to the goals of the “Vision.”But only three months ago, the truce on which the Saudis had relied heavily with Sana’a collapsed, when they decided to bomb Sana’a Airport to prevent the landing of a flight carrying an official delegation returning from Tehran, and a few days before the date of the conference, Sana’a decided to respond by closing Riyadh Airport, which not only made the arrival of foreigners to the conference difficult, but placed them before the fact that Saudi Arabia is not safe.Saudi Arabia Is Not Safe for Investment:Saudi Arabia’s insistence on holding the conference on its date, despite the wave of cancellations that hit many events and conferences following the closure of Riyadh Airport, reflects the importance of this event in particular and its status in the economic transformation plan that has become, with the passage of years, a strategic challenge that transcends the issue of reducing dependence on oil (in which it failed), as the image of Saudi Arabia as a global destination has become the image that Crown Prince Mohammed bin Salman feels the necessity of linking to the identity of the Kingdom itself.. Even if talk about Saudi Arabia is present in any political, economic, or security context, everyone immediately remembers this image.Since the giant projects failed spectacularly to embody this image, the hope was largely pinned on (Davos of the Desert), for even the name gives you a clear impression of the extent to which this event reduces the political, cultural, and economic identity that Bin Salman wanted to create for the Kingdom, as well as the reasons for this reduction, among them the raging competition with the UAE, and the repeated stumbles that made the Saudi Prince in need of a real achievement that supports the story of the “renaissance” to which he linked his rise to power, the story that the robots were supposed to be narrating to the residents of (NEOM) by now!But in the end, (Davos of the Desert) was nothing but a title, and so was the “renaissance” identity associated with it, because the postponement of the conference in the end didn’t happen for reasons beyond everyone’s will, but was the result of wrong strategic estimates reflecting Saudi Arabia’s inability to be the destination that Mohammed bin Salman wanted. For although Sana’a proved its ability to strike Saudi facilities precisely for weeks, and succeeded in choking the “Yanbu” oil exports in the Red Sea, Riyadh simply insisted on continuing the war, reassured that it could manage the risks, something investors never take lightly.As the (Agence France-Presse) agency quotes an advisor to the Saudi government itself, the Kingdom now faces a profound threat represented in that “corporate boards begin to classify Saudi Arabia as part of an active conflict zone,” adding that “if this perception becomes entrenched in risk models and insurance premiums, it will take many years to get rid of it.”The (Semafor) website mentioned that the cancellation of the (Davos of the Desert) conference came after senior executive officials on (Wall Street) conveyed their security concerns to the organizers, foremost among them the head of the Saudi Investment Fund, Yasser Al-Rumayyan, which means that Saudi Arabia didn’t even take the initiative to contain the situation early, but waited for the fears of the foreign companies themselves to escalate and for them to ascertain the fact that Riyadh is “unsafe,” which investors will remember when they hear any additional reassurances or promises if the conflict continues, especially since this “trap” has been repeated many times. The Saudis insisted on reassuring the airlines about the status of Riyadh Airport, ignoring the risks, and the result was the fall of many victims, and now after they issued notices of resuming operations at the airport (on condition of obtaining prior permits), no airline showed any interest in that.. As for the shipping companies, they avoided the trap of relying on the Saudi reassurances early, because they know in advance Sana’a’s ability to impose maritime sanctions.Perhaps risk is something some investors appreciate, but not when it comes to lives and the infrastructure itself, and therefore the cancellation of the (Davos of the Desert) conference with the scenario that happened will have effects that transcend the media image, because the security risk is not ambiguous and can’t be covered up with any organizational terms, as the international companies in the towers of the King Abdullah Financial Center and “Kingdom Center” evacuated their offices, and Sana’a is still volunteering to provide more evidence that there is no protected place in the Kingdom, including its most sensitive facilities, as Yemeni missiles destroyed the management tower of the (Aramco) company, which houses the office of the CEO, Amin Al-Nasser.What strengthens the investors’ conviction regarding the fragility of the security situation in the Kingdom is what the consultants and Saudi officials say in some reports regarding that the recent events represent a “loyalty test for business leaders” to determine “who shows up in difficult times and deserves the reward.” This logic has limits even among the actual partners, so how about those who are supposed to be attracted to explore the opportunities.. They were promised (Davos), but they found nothing but the “desert” that requires harsh tests and sacrifices.Moreover, the investors whom Saudi Arabia seeks to “test their loyalty” instead of attracting and enticing them, all know that the Kingdom’s capital in creating a safe environment for investment is “American protection,” and the events have shown enough evidence that there is a large gap in this protection, and therefore perhaps Riyadh should test the loyalty of the White House first!The performance of the Saudi stock market was more than clear in affirming the position of foreign investors toward the situation in the Kingdom, as the data showed that they sold Saudi shares at about two billion dollars from the beginning of September to the middle of October, including 227 million dollars of Saudi shares in the week that followed the closure of Riyadh Airport. Even the giant (Aramco) company, which was achieving gains due to the rise in oil prices, didn’t escape the share-selling operations, because it was subjected to attacks that reached its main headquarters, which was emptied of employees indefinitely.The investors’ need for a safe environment can’t be bypassed or circumvented, and even if Saudi Arabia currently wants imaginary investors who ignore reality and promote an activity that does not exist in exchange for generous “rewards,” it will still need a level of security to support that propaganda, and that will not be available as long as the Yemen war is open.The Saudis say that their country has faced similar challenges and overcome them, and they mean by that that the periods of escalation come and go, but this isn’t enough to create the investment environment that the economic transformation plan and the title of (Davos of the Desert) need. The calm that may be reached after the destruction of vital infrastructure will not mean that stability has simply been achieved, especially if this calm isn’t the result of a sustainable peace, which has not been available to Saudi Arabia for years. Even after the 2022 truce with Sana’a, the calm was always described as “fragile,” and the situation became much more difficult after October 7, 2030, when the entire region became ablaze and there are no longer clear borders for the conflicts.The promise that things will improve in the future has no meaning when it comes to efforts to attract investments. Rather, Western analysts say clearly today that the value of this promise is determined by Sana’a, because “the Saudi vision has become a hostage to the Houthis.”The task was simple and implementable: convincing investors to come to the Kingdom to explore the promising opportunities in it, but the decision to bomb Sana’a International Airport last July made it an impossible task, as investors now have to come by cars under missile and drone strikes to prove their loyalty first, and they have to blindly trust the current and future Saudi plans to deter the Yemeni Armed Forces and eliminate and deal with the threats from Iran and Iraq.. This isn’t an investment environment.
Why Is the Postponement of the (Davos of the Desert) Conference Considered a Major Setback for the Saudi Economic Transformation Plan? first appeared on الخبر اليمني.
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