As business comes to rule in Saudi Arabia, Makkah and Madinah are now open to foreign capital
Saudi Arabia will allow foreign capital to invest in Islam’s two holiest cities. Foreigners will be able to buy shares (up to 49 per cent) but direct ownership of real estate is excluded. Jordanian scholar Al Sabaileh told AsiaNews that with Mohammed bin Salman, the country is experiencing a "total change" with the economy dictating foreign and domestic policy choices. Peace with Israel would be a “gigantic step”.
Milan (AsiaNews) – Saudi Arabia has to allow foreign investments in Makkah and Madinah, including from the West. Such a “decision is part of a process of development and change" centred on the economy, meant to overcome, or at least mitigate, “past religious restrictions,” this according to Amer Al Sabaileh, a Jordanian university professor and geopolitical analyst, an expert on Middle Eastern issues, international security and peace process policy in crisis areas.
With the rise to power of Crown Prince Mohammad bin Salman (MbS), "Saudi Arabia is experiencing a total change" in which "the economy is becoming more and more of a priority" and has become the basis for decisions "in domestic and foreign policy,” he said, speaking to AsiaNews.
Born in Amman and a graduate in Modern Languages and Literatures, the scholar collaborates with several international and domestic newspapers, including The Jordan Times.
“Recent social changes were instrumental in preparing the ground for an economic revolution,” he noted.
The crown prince took on an ambitious role and his decision to open Islam’s two holiest cities is part of his vision, which began with the ambitious Neom project. “This was reason enough to undertake social changes,” which now touch upon “religious orthodoxy”.
“These sacred places (Makkah and Madinah) were forbidden to non-Muslims,” but now they can make investments, hold stocks and shares, but for them, “it is not yet possible to acquire property.”
At the same time, this shows "that the country is now open to business" regardless of where “investments come from. I believe it represents the development of bin Salman’s vision and policy.”
Saudi leaders recently gave the green light to foreign investments in listed companies that own properties and assets in Makkah and Madinah. This is historic in many respects.
Such a move would “stimulate investment, enhance the attractiveness and efficiency of the capital market and strengthen its regional and international competitiveness while supporting the local economy,” said Saudi Arabia’s Capital Market Authority (CMA).
However, foreign investment "in companies owning real estate within the boundaries of Makkah and Madinah will be limited to shares of these Saudi companies listed on the Saudi capital market, convertible debt instruments, or both." And non-Saudi ownership cannot exceed 49 per cent.
Saudi Arabia, the leading Sunni Muslim power (opposed to Iranian-led Shia Islam), has the most important economy in the Middle East and is the main exporter of crude oil in the world.
For years, it has been engaged in a vast reform programme, focusing, among others, on tourism and major sporting events, like the 2034 World Cup, as part of the crown prince’s Vision 2030 plan.
Makkah welcomes millions of Muslim pilgrims every year, but the city is undergoing massive development with the aim of attracting 30 million by 2030, but non-Muslims are banned from entering it.
A project dubbed Masar, financed by the kingdom's Public Investment Fund, foresees 40,000 new hotel rooms in Mecca.
The annual hajj and umrah pilgrimages generated an estimated billion for Saudi Arabia in 2019, the last year of mass travel before the COVID-19 pandemic.
Neom has been "the pillar of the socio-economic change project,” said Al Sabaileh, chairman of Triage,[i] a think tank, and president of Security Languages-Council for counter-terrorism studies, a study centre.
Bin Salman’s vision can overcome "social and religious restrictions" and arrive “slowly to impose itself across the country.” This "has had no effect or impact on religion" and does not imply, at least for now, opening the kingdom to other religions or faiths, even though the crown prince “has managed to give a new, less radical dimension" to the religious sphere.
Still, the policy "has already brought about some change”. Some topics "that were once considered taboo” are now discussed, and this is taking place very rapidly.
The crown prince has managed to “introduce an interreligious culture" that makes it possible to "create fertile ground for investment, draw attention and international capital to this country, which is now unsurprisingly also a cultural hub.”
Politically, the kingdom is playing an increasingly important role on regional and global chessboards, even more so since Donald Trump came back to the White House after his second inauguration on 20 January as president.
“It is no coincidence that we saw [Saudi] diplomacy very active in Lebanon, Syria, to fill the void left by Iran,” becoming more and more “the US’s number one political and economic ally.”
The journey that began with the Abraham Accords, according to the vision of the US president, has to be completed with a “gigantic step, the greatest: regional peace between Saudi Arabia and Israel".
Some projects seem to be restarting “behind which are many economic ambitions,” dictated by a more pragmatic approach to Trump's policies.
From Neom, through Makkah and Madinah, across borders, Saudi Arabia "is already prepared to play the most important political and economic role in the region, both in Sunni Islam, and the Arab world.”
[i] Triage duepuntozero Istituto di ricerca sui rischi geopolitici (Research Institute on Geopolitical Risks).
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08/05/2021 11:06
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