Global business leaders are meeting in Saudi Arabia on Tuesday for a lucrative investor forum, as conflict has rocked the region and cast doubt on the Gulf kingdom’s most ambitious development projects. The Future Investment Initiative (FII) was launched in 2017 as a demonstration of de facto ruler Crown Prince Mohammed bin Salman’s dream of diversifying the economy of the world’s largest crude exporter away from oil.
This year’s three-day event is expected to attract more than 7,000 delegates, including TikTok CEO Shaw Zi Chew and the chief executives of Citigroup and Goldman Sachs.
For the second year running, conflicts in the Middle East are likely to shape the panel discussions and side meetings.
Last year’s FII came just weeks after the war in Gaza erupted following Hamas’ unprecedented attack on southern Israel, with high-level speakers warning about economic turmoil if fighting escalates in other countries.
A year later, those fears have been realized, as Israel continues a campaign against Hezbollah in Lebanon and carries out tit-for-tat attacks with Iran.
Robert Mogielnicki of the Arab Gulf States Institute in Washington said, “I suspect attendees will seriously consider the difficult nature of the Israel-Gaza war, a new offensive in Lebanon and ongoing concerns over region-wide conflict escalation.”
“The Saudis have so far been effective in shielding their country from the worst effects of regional conflict, but it is very difficult to find a silver lining in such an ongoing conflict in the Middle East region.”
FII Institute CEO Richard Attias said at a news conference in Riyadh this month that the gathering was not intended to focus on “politics” and instead should focus on large-scale investing “to build a better world.”
“We are an independent forum and we do not want to be polluted by any political events,” said Attias, a former producer of the World Economic Forum in Davos, Switzerland.
“I’ve been hosting shows for 35 years now, and I’ve learned one thing: the show must go on.”
‘Doubters beware’
This year’s FII, sometimes dubbed “Davos in the Desert”, also comes as Saudi officials attempt to demonstrate progress on signature elements of Prince Mohammed’s Vision 2030 reform agenda.
Authorities have reportedly lowered the 2030 size and population targets for NEOM, a planned futuristic megacity in northwestern Saudi Arabia that will include a ski resort and 170 kilometers (105 mi) tall twin skyscrapers.
On Sunday, NEOM announced the opening of its “first physical showcase”, a luxury Red Sea island known as Sindalah, featuring restaurants, hotels and yachting berths.
“There was so much skepticism about NEOM in the Western media that the Saudis had to do something to demonstrate their commitment,” said Jim Crane of Rice University’s Baker Institute.
“The early opening of NEOM is probably designed to embarrass adversaries by letting the world know that Saudi Arabia is moving ahead. It is a ‘doubters beware’ message.”
Saudi Finance Minister Mohammed al-Jadaan said in May that “setbacks” including the war in Gaza were prompting officials to “re-prioritize” some aspects of Vision 2030.
In a briefing with journalists in December last year, Zadan said officials had decided to extend the deadline for some key projects beyond 2030, although he did not give details and also said that others would be accelerated.
Saudi Arabia has imposed a series of oil cuts through 2022 to prop up prices and is currently producing about nine million barrels per day, well below the declared capacity of 12 million bpd.
Last month, the Finance Ministry, citing increased government expenditure and lower oil revenues, had said that it estimated the budget deficit to be 2.3 percent of GDP in 2025.
Meanwhile additional spending commitments are mounting for events such as Expo 2030 and the 2034 World Cup, for which Saudi Arabia is the sole bidder.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
