Tuesday, October 23, 2018
Associated Press
DUBAI, United Arab Emirates
Saudi Arabia is moving ahead with plans to hold a glitzy investment forum, despite some of its most important speakers pulling out in the global outcry over the killing of Saudi journalist Jamal Khashoggi.
The Future Investment Initiative, which kicks off today, was intended to draw leading investors who could help underwrite Crown Prince Mohammed bin Salman’s ambitious plans to revamp the economy. But after the wave of cancellations, it could instead highlight the kingdom’s growing isolation and the damage inflicted on the prince’s reputation – as well as potentially his political future.
The forum is the brainchild of the crown prince, whose lofty vision for the Saudi economy hinges on his ability to attract foreign investments and create enough jobs for the millions of young Saudis who will be entering the workforce in the coming years.
The prince, who is set to inherit the throne from his father, faces steep challenges. More than 4.5 million new working-age Saudis will be searching for jobs by 2030.
One estimate from consultancy McKinsey and Co. says the kingdom needs some $4 trillion in investment to create as many as 6 million new Saudi jobs by then. That’s almost three times as many jobs as Saudi Arabia created in the decade leading up to 2013, when oil prices soared.
Without a comprehensive economic overhaul underpinned by trillions of dollars in investments, the unemployment rate for Saudi nationals could exceed 20 percent, McKinsey has warned.
As unemployment rises, household income would fall – two key triggers that contributed to public fury and revolts in other Arab countries nearly eight years ago.
Unemployment in Saudi Arabia has edged up this year to 12.8 percent. Currently, a third of Saudis seeking employment are between 25 and 29 years old. That number is expected to grow in coming years with half the population under 25.
The crown prince’s ability to shepherd the Saudi economy is now in peril after the killing of Khashoggi – a Washington Post columnist who had been critical of the crown prince – in the Saudi Consulate in Istanbul on Oct. 2.
After insisting for weeks that Khashoggi had safely left the consulate on his own despite mounting evidence from Turkish authorities that he was killed by Saudi agents, Saudi authorities acknowledged his death last weekend, saying he had died in a “fistfight” with officials sent to convince him to return to the kingdom.