Mohammed bin Salman, the Crown Prince of Saudi Arabia known universally as MBS, offers offers from multinational companies that include a 50-year tax holiday to move to the capital Riyadh, while trying to rehabilitate as a professional modernizer the disastrous reputational damage of the state-sanctioned assassination of Jamal Khashoggi.
However, the task of filling some of the 59 skyscrapers of the King Abdullah business complex in Riyadh with its prestigious finance and IT companies has largely failed.
Companies such as Google and Siemens appear willing to maintain their regional centers in the United Arab Emirates (UAE), despite being the target of the initiative, the program called HQ, according to a report published in London Financial Times. The HQ program is part of MBS ’ten-year master plan to drive the country from oil revenues, Vision2030, which also includes building a large $ 500 billion pleasure city to try to rival Dubai as a hub tourist.
Despite the failure to attract a star company so far, some large companies are increasing their presence in Saudi Arabia, opening or expanding offices in the park.
For example, Google Cloud last month agreed with Saudi Aramco, the state-owned oil company, to provide cloud computing infrastructure services, which will make the technology company open its first office in the kingdom. Alibaba and Western Union also reportedly increased their footprint in the country and opened larger offices.
Influential Saudi officials have been tasked with the difficult task of delivering MBS wishes by attracting companies from neighboring jurisdictions such as Dubai and Abu Dhabi. These UAE city statutes are far more cosmopolitan and liberal than the ultraconservatives of Saudi Arabia, where alcohol is still totally banned, any resemblance to Western social life is non-existent, and women are second-class citizens.
MBS’s response to these social and gender constraints, which are included in the Wahhabi-influenced culture of Saudi Arabia, has been to start working in a $ 500 billion tourism and leisure city called NEOM. NEOM will be 1,000 miles from Riyadh in the Red Sea and forbidden Western pleasures will be allowed. The tourist city will have a parallel legal system, presided over directly by MBS. While this is supposed to make foreigners feel safe, it can have the opposite effect given their killer reputation.
Justin Scheck, co – author of Blood and oils, the best-selling biography of Mohammed bin Salman, told The Daily Beast: “The biggest challenge MBS has to rebuild the Saudi economy is to get foreign companies to invest in Saudi Arabia. Even before Khashoggi, the way foreign business leaders wanted to do business with him was different from the way he wanted to do business with them. They just wanted me to give them money. He wanted them to invest in Saudi Arabia. Despite all these incentives, it has not happened.
Scheck says there are business doubts about the country’s ethical standards and that the Khashoggi affair has made it “harder than expected” to capture large companies. Even Uber, in which the Saudis have a 5.3% stake, has condemned the country and its leadership over the 2018 assassination of Khashoggi.
MBS has only made gestures of transparency about the murder: eight unidentified officers received prison sentences of seven to twenty years for the murder of Khashoggi in a secret trial. MBS has not accepted responsibility for ordering the murder, although the CIA and a UN investigation concluded it was guilty. Saudi authorities have never said what happened to Khashoggi’s remains after his body was cut with a saw of bones at the country’s Turkish embassy.
A new film, an Oscar-winning documentary The dissident, will make it even more difficult for Saudi Arabia to continue the money laundering. The film’s director, Bryan Fogel, enters the room where Khashoggi was killed and reports that his body was probably transported to the Saudi consul’s home and burned in a tandoori kiln.
Scheck points out that even for those corporations prepared to leave behind the flagrant and flagrant human rights abuses of the country, the small population of Saudi Arabia is an important factor why many Western companies are not interested in accepting invitations from MBS investment, no matter how many taxes they have. breaks or special sizes from local laws it offers.
“The only thing you can’t fix is that, as rich as the country is, it has a population the size of Mexico City. So why do you want to go build a car factory there? The local market isn’t big enough, ”says Scheck.
Understanding this demographic destiny, MBS is now urgently trying to attract international headquarters to fill the gap and help Saudi Arabia become a normal tax economy rather than one financed by increasingly depleted oil wealth.
For MBS, delivering this transition is now a deeply personal mission and one in which it has opted for its reputation, so the personnel departments of foreign companies are making sure that their staff will be able to leave their hair in NEOM. While strategy documents released last year included plans for a huge artificial moon, bright beaches and taxis with flying drones, the reality so far is that the project is just another troubled Saudi construction site, sunk. in allegations of corruption. , death and bad practice.
One of the expats living in Saudi Arabia told The Daily Beast that after the 2017 “Sheikhdown”, in which hundreds of prominent Saudis were detained at the Ritz-Carlton Hotel and in some cases were beaten and tortured until they signed confessions of corruption and delivered the government with large chunks of fortune, there was little appetite to criticize MBS: “Many people believe that NEOM will be an unmitigated disaster. It looks like a city drawn by a small child. But no one will say. MBS could put you in jail just for disagreeing with him. “
Scheck says this criticism simply causes MBS to double its moon plans. “For MBS, its legitimacy as the country’s future monarch is tied to the success of Vision 2030. When people criticize things like NEOM, it just goes in.”
It seems likely that small successes in attracting tenants will be generously packaged as a regional triumph and revealed during the annual investor conference of the Public Investment Fund, the sovereign wealth fund chaired by MBS, and which will begin on January 27th.
An executive told the FT he believed the kingdom hoped to use the conference to brand agreements with companies that had provisionally agreed to make the change from Dubai to Riyadh.
A Saudi government adviser reported on the plans and said, “It’s about attracting key international anchored tenants.”
Incentives on offer include a 50-year tax holiday, waiver of quotas for Saudi employment, and guarantees of protection against future regulations.
Another source close to many senior Saudis who have been jailed by MBS or who are currently languishing under house arrest told The Daily Beast: “Saudi royals are very used to making their way. The vast majority of people in prison or arrested are not threats to him; he simply cannot tolerate the possibility of disagreement. “
The source points to the recent imprisonment of Loujain al-Hathloul, 31, the activist who led the campaign’s success in allowing women to drive. In December it was announced that she would be sentenced to five years in prison. Your monkfish leaf? “Calling for Change.”
The source says: “It is not credible that large American companies are allying with such a regime. They may get some lower feeders. But companies with a public stake in the culture of canceling? They will run a mile.