Saudi weekly digest. XXX
Let’s begin our review of last week by noting that...
Saudi Arabia is scheduled to host peace negotiations next month involving Western nations, Ukraine, and emerging economies like India and Brazil. This effort is a testament to Europe and Washington’s drive to gather global backing for Ukraine’s peace aspirations.
Next is Business & Economy
The International Monetary Fund (IMF) has downgraded Saudi Arabia’s GDP growth forecast for 2023 to 1.9%, a significant drop from the 3.1% predicted earlier in May. The adjustment is attributed to the ongoing cuts in oil production.
Saudi Arabia is expected to extend a voluntary oil output cut of 1 million barrels per day for another month to include September, five analysts said, to provide additional support for the oil market. In June, OPEC+ agreed on a broad deal to limit oil supply into 2024 and Saudi Arabia pledged an additional voluntary cut for July. On July 3, Saudi Arabia said it would extend the cut for another month to include August, adding that it could be extended further.
By 2030, artificial intelligence (AI) is anticipated to infuse $135 billion into Saudi Arabia’s economy, establishing the Kingdom as the primary recipient of AI benefits in the Middle East. The technology could potentially contribute $320 billion to the region’s economy, representing 11% of its GDP.
Saudi Crown Prince Mohammed bin Salman is investing $750 million to construct the world’s most expansive water park in Riyadh. The park, set to be two and a half times larger than The Pentagon, will significantly outsize Noah’s Ark water park in Wisconsin.
There were also multiple hints regarding the Saudi Israeli normalisation prospects.
First, US National Security Adviser Jake Sullivan held discussions with Saudi Arabia’s Crown Prince Mohammed bin Salman in Jeddah, discussing, among other topics, the potential normalisation of relations between Saudi Arabia and Israel. Despite the challenges, the US is committed to facilitating this historic agreement.
Second, US Secretary of State Antony Blinken indicated that while establishing diplomatic ties between Saudi Arabia and Israel is a complex process, it is not impossible. The US is actively working towards normalising relations between the two nations.
Third, President Joe Biden has suggested that a potential agreement with Saudi Arabia might be in the works following discussions aimed at normalising relations between Saudi Arabia and Israel. The specifics of the possible deal, however, remain undisclosed.
Some E2E thoughts
Just a couple of weeks ago, as discussed in a recent E2E piece, the signals from the US were that the Saudi Israeli normalisation is far from being a reality. Last week’s report provided contrary insights from the White House representatives. Actions, which we haven't so far, speak louder than words and words so far have been plenty and inconsistent.
Speaking of words, in a first-of-its-kind Al Arabiya interview, Israeli prime minister Benjamin Netanyahu said that he believes in open covenants that are achieved secretly. Reading between the lines, one could suppose that there are indeed discussions happening behind closed doors, though there's little to no clear information about their current status.
It will be exciting to see when the plentiful words turn to actions.