Saudi Arabia & The US: Business As Usual?
Saudi Arabia and the relation with America
America’s relationship with Saudi Arabia is decades old. After achieving recognition in 1931, the US and Saudi Arabia established full diplomatic relations in 1940. The long-standing bilateral relationship between the two nations is one built on oil exports, Saudi Arabia’s influence in the Islamic world, it’s strategic location, and a common interest in maintaining stability and security in the Gulf region. The US is also the largest supplier of arms to Saudi Arabia, with over $100 billion in active foreign military sales (FMS). In more recent times this relationship has come under major scrutiny – the killing of Saudi journalist Jamal Khashoggi in 2018 did not go unnoticed by the international community – resulting in key players of industry refusing an invitation to Davos in the Desert of that same year. During his campaign trail Biden was tough on Saudi Arabia, saying that his administration would turn the repressive kingdom into a global “pariah.” But campaign declarations are rarely met and when Biden did come into power, he soon found himself confronted with the reality of the situation: the US needs Saudi Arabia to see its objectives in the Middle East realised. It’s nothing new, the US has often practised selective morality in dealing with regimes – personified through its use of realpolitik.
American Realpolitik
Realpolitik is a specific foreign policy that chooses practicality and principles of self-interest over moral or ideological concerns. A real master of realpolitik was Henry Kissinger, who during the Nixon administration, was instrumental in forging diplomatic relations between China and the US. At the time, Nixon who was anti-communist, wanted to use the US ties with China to exploit a growing rift between it and Russia – but the foundation was laid. These days the US retains its occasionally rocky relationship forged all those years ago by Kissinger, despite China’s persistent persecution of Muslim minority groups. American realpolitik has also been used in South America to “protect” the Americas from communism. After the 1959 Cuban Revolution, the US regularly interfered in the political affairs of Central and South American countries, backing dictators who in turn tortured and killed their citizens. The communism angle always worked in favour of the US, whose real motives were spurred on by big business, economic interests and ideology. The sale of advanced military equipment to Latin American countries had rippling effects on the US stock market where contractors were listed. It’s not the first that world events having an effect on Forex markets has occurred.
Why does Saudi Arabia matter?
Prior to the alleged assassination of Jamal Khashoggi, Saudi Crown Prince Mohammad bin Salman was painting himself as a moderate reformer. The 35-year-old did indeed implement noteworthy changes in the traditionalistic Arab kingdom. Under his watch there’s been a lessening of the powers of the religious police, a tougher stance on corruption, and women have been allowed to drive. The movement in the country for women’s rights have improved – they may now be granted a passport without the permission of a male guardian, although approval is still required for marriage, certain medical procedures and to leave prison. The countries petroleum exports, its wealth and its strategic Middle East location makes its relationship with the US a vital one. During his tenure as president of the US, Barack Obama visited Saudi Arabia four times – that’s more than any of his predecessors – to discuss everything from oil to Iran.