Wednesday, February 23, 2011

KSA regime buying time

In the US we call it targeted spending:
Saudi King Abdullah returned home on Wednesday after a three-month medical absence and unveiled benefits for Saudis worth some $37 billion in an apparent bid to insulate the world's top oil exporter from an Arab protest wave.
Mahmoud Sabbagh, 28, said he and 45 other young Saudi activists had sent the king a petition advocating more profound change, not just economic handouts. He listed the group's demands as "national reform, constitutional reform, national dialogue, elections and female participation."

Saudi Arabia holds more than $400 billion in net foreign assets, but faces social pressures such as housing shortages and high youth unemployment in a fast-growing population.

"Housing and job creation for Saudis are two structural challenges this country is facing," said John Sfakianakis, chief economist at Banque Saudi Fransi, who put the total value of the king's measures at 140 billion riyals ($37 billion).
He said some benefits were one-off and others were already budgeted.
Read it all.

As I've asked when Mubarak tried this strategy, why were you holding back? Where's the money coming from -- or better, who's pocket is it not going to?

KSA produces less than 10 million barrels a day. Today the price of a barrel of oil reached $100. In short, on a good day they take in $1 billion (costs are small). $37 billion would be nothing to sneeze if it were new recurring and recurring spending.

Given that it's not, how much time is the handout buying? Enough for the revolution fervor to pass?



Anonymous Heather said...

The Saudi king has an advantage as far as the possible revolution in Saudi Arabia is concerned because he can now better predict the outcome and prepare a number of corrective measures. But the question is whether it is not too late to resist the pressure of the Saudi Arabians.

3:20 PM  
Anonymous Noelle said...

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6:04 PM  

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