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Saudi Arabia under Muhammed Bin Salman: Crisis, Reform, or Stagnation?

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This discussion paper aims to analyse the limitations of Mohammed bin Salman’s reforms by historically examining the modernisation process in Saudi Arabia and the potential trajectories of the current project of transformation.

Modernisation has been a huge issue for the Saudi monarchs for years, and many reform projects have been initiated, most of which have remained ineffective and superficial. Crown Prince Muhammed bin Salman labelled himself as a reformer and came with the same promises in the form of Vision 2030 in early 2016. Vision 2030 promised further projects which would diversify the economy, “Saudisation” in the Kingdom’s employment sector, and social liberalisation in Saudi society. Although the Kingdom made progress in some of these in the following period, many projects have fallen behind schedule, and the aim of diversifying the Saudi economy has been impeded. He has also seen to have been behind a number of regional crises, and crackdowns against activists and potential rivals within and outside the royal family. Ultimately, just like his predecessors, Muhammed bin Salman used the language of reform mainly as a means of concentrating power in his hands, instead of enacting substantial changes in the Kingdom. This discussion paper aims to analyse the limitations of Muhammed bin Salman’s reforms by historically examining the modernisation process in Saudi Arabia and the potential trajectories of the current project of transformation.

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Can politics change the fact that Arab tourists love Turkey?

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Arab visitors to Turkey, especially from Gulf nations, have steadily increased in recent years as have tensions between Turkey and some Gulf countries. So far it hasn’t bled into the tourist scene, but there have been attempts to link the two.

Turkey has been a popular holiday destination for Middle Eastern residents for a long time. The number of Arab visitors has increased over the last fifteen years. There are political and social reasons behind the spike in visitors and Turkey is looking to maintain this edge despite numerous challenges over the past few years.Turkish image and hotspot destinations

The Arab tourists’ journey to Turkey started almost two decades ago and coincided with the export Turkish TV series’ to the Middle East. A piqued interest to learn Turkish and experience the country’s culture gradually grew among young Arabs, which culminated in a desire to visit Istanbul and experience the location where these popular series were filmed.

At the same time, debates over the impact of Turkish ‘soft power’ in the region started appearing. Many experts state that those TV series introduced Turkey to the Middle East, and consequently boosted Turkey’s soft power over the region.

Another component of Turkish soft power in the region was growing political and economic ties with Arab countries, especially those in the Gulf. The 2000s were fruitful for the rapprochement between Turkey and the Gulf nations, both politically and economically, as the latter was accompanied by an increasing number of tourists coming from these countries to Turkey.

The number of tourists coming from the Gulf Cooperation Council (GCC) countries was 44,222 in 2002, in 2017, the number reached 1,089,614 according to Border Statistics of the Turkish Ministry of Culture and Tourism.

Saudi Arabia led the list with 651,170 tourists to Turkey in 2017, but there has also been increase of Kuwaiti and Qatari tourists in the same period. In 2002, the number of Kuwaiti and Qatari tourists was 824 and 6,989 respectively, and in 2017 those numbers surged to 48,764 and 255,644.

Whereas Istanbul has always been a hotspot for Arab tourists, new destinations have started taking on as well. With their cool weather and scenic beauty, Trabzon, Ordu and Rize provinces of the Black Sea region have seen a greater influx of Arab tourists, especially from the Gulf.

In these provinces, locals have enjoyed a stimulated economy and new job opportunities to satisfy the increased tourism. Car rental companies and travel agencies are in demand, new hotels and gift shops have been built, and new restaurants launched, even offering menus with Arab cuisine. Street signs with Arabic script have started to pop up as well.

Moreover, since Turkey provides halal-friendly tourism activities such as restaurants without alcohol, easily accessible prayer halls, and segregated swimming pools and beaches, Arab visitors feel comfortable and at home in Turkey. Some have even purchased real estate in Trabzon.

Turkey, on the other hand, aware of the importance of the tourism sector has been implementing comprehensive reforms in the country. One of them is the Tourism Strategy of Turkey – 2023, published in 2007 as a part of the 2023 Vision. If this strategy is completed by 2023, tourism in Turkey will become more sustainable, environmentally-friendly, and participatory.Challenges and responses

Despite these improvements, tourism in Turkey took a hit after the failed coup in July 2016, and a number of terror attacks followed. In 2017, regarding the security problem in Turkey, the UN World Tourism Organization’s previous Secretary-General Taleb Rifai highlighted during his visit in Istanbul, that Turkey has various must-see destinations, and visiting Turkey is the best response to terrorism.

In a similar vein, Turkey offered fuel subsidies for airlines and helped hotels obtain capacity, and hotels provided discounts for early bookings to lure tourists again in 2017. In 2018, the numbers started to rise again despite political tensions between Turkey and some Arab countries (mainly Egypt, the United Arab Emirates and Saudi Arabia) in the last couple of years.

Interestingly after the Qatar Crisis the number of tourists from blockading countries—mainly from Saudi Arabia and the UAE—did not decrease but instead increased in the summer of 2018 despite Turkey’s alliance with Qatar. Ankara is looking to further increase tourism in the years to come. Recently, the Turkish Minister Culture and Tourism announced a new program for developing tourism in Turkey which promises “70 million tourists with $70 billion revenue” in 2023. The program aims to bring new works of art and shoot trailers on tourism in Turkey alongside a modern social media campaign.

Nevertheless, in 2018, anti-Turkey stories have spread, especially in Saudi Arabia and the UAE. The Dubai-based MBC Group which is a private broadcaster with significant influence over the Arab world announced that they would no longer broadcast Turkish TV series. Also, one Saudi-based newspaper asserted that Turkey is not safe for travel. The same newspaper frequently blames Turkey for the Jamal Khashoggi murder. The Saudi government has confessed that Saudi officials were responsible for the murder of Jamal Khashoggi.

As of 2019, the question is whether, despite these changes in attitude from Saudi Arabia and the UAE, can Turkey manage to continue to be an attractive destination for the Arab tourists?

Entente Cordiale: Exploring Turkey–Qatar Relations

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In the past two decades, Turkey has broadened its diplomatic horizons and improved its relations with Middle Eastern countries.

In the past two decades, Turkey has broadened its diplomatic horizons and improved its relations with Middle Eastern countries. During the 2000s, such a strategy led to a rapprochement between Turkey and the Gulf Cooperation Council (GCC) countries. After the Arab Spring and the Syrian civil war, Turkey-Qatar relations became stronger, especially in times of crises, such as the 15 July coup attempt in 2016 in Turkey and the blockade of Qatar in 2017. These major milestones provided a solid framework for strengthening this important partnership, which culminated with the signing of significant agreements in the economic and military domains.

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Is OPEC falling apart?

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On December 3, 2018, Qatar announced that it would withdraw from the Organization of the Petroleum Exporting Countries (OPEC) in January 2019 to focus on its natural gas production.

From a purely economic standpoint, it is evident that Qatar can no longer benefit significantly from OPEC since it is one of the smallest oil producers (ranked ninth oil producer among the members in 2017) within the organisation. Due to its enormous natural gas reserves, however, Qatar has been leading the liquefied natural gas (LNG) market for a long time.

Nevertheless, in November 2018, Australia beat Qatar and became the largest LNG exporter in the world. Thus, Qatar needs to make additional efforts to boost its LNG infrastructure and production.

On the political side, Qatar’s Energy Minister claims that this decision has nothing to do with the Saudi-led-blockade against Qatar which started in June 2017. However, many observers still make the connection, especially that in the same speech, the Minister also labelled OPEC as “an organisation managed by a country,” which is a thinly veiled criticism of Saudi Arabia.

The latter is considered the “de facto leader of OPEC” due to its large oil reserves. Riyadh’s economy heavily relies on petroleum exports and ranks as the largest exporter of petroleum in the world. Since the early days of OPEC, Saudi Arabia managed not only to direct oil prices and production levels but also – and more worryingly – began using OPEC to further its political agenda.

On many occasions, OPEC has become a battleground for the rivalry between Saudi Arabia and Iran. One example from 1977: an increase in oil prices was Iran’s only hope to deal with its financial crisis, however, Saudi Arabia opposed any increase in prices, worsening Iran’s financial outlook.

Compared with Saudi Arabia, small players’ impact within OPEC was limited, to say the least. With the rise of Crown Prince Muhammed Bin Salman (MBS) Riyadh and his ensuing aggressive policies in the region, Qatar could see the storm on the horizon.

However, nothing prepared Doha for the abrupt and bellicose crisis that unfolded in the spring of 2017, when Saudi Arabia and its close allies subjected Qatar to a merciless blockade.

Subsequently, Saudi Arabia closed its border with Qatar, restricted airspace, and cut all diplomatic ties with Qatar. This caused enormous problems for Doha as the country’s entire supply chain was threatened and a food crisis was on the cards were it not for the efforts undertaken by the Qatari government with the help of its key allies, such as Turkey.

The blockade destroyed relations between Qatar on the one hand, and Saudi Arabia, the United Arab Emirates, Egypt and Bahrain on the other side. Lately, despite the invitation from Saudi Arabia, Qatar’s Emir did not attend the 39th GCC Summit in Saudi Arabia in December last year, and just a few days before the summit, Qatar announced its decision to quit OPEC.

In short, Qatar’s decision was a clear indication that Doha’s reservoir of patience with MBS had run thin. Moreover, the Saudi domination of oil production has been challenged in recent years. Due to increasing energy production in the US, the latter’s dependence on oil imports reduced. Consequently, the US, which is one of the world’s top oil consumers has also become one of the biggest energy producers besides Saudi Arabia and Russia.

To add insult to injury, the Saudi leadership, which was eager to make more overtures towards Russia, has made moves to please Moscow without care for differing views within OPEC. In 2018, the cooperation between Russia and Saudi Arabia reached new heights when they agreed to increase oil production without informing other OPEC members.

After the murder of Jamal Khashoggi in November 2018, the Trump Administration announced that they would not let this murder affect their relations with Saudi Arabia. In return, Saudi Arabia lowered oil prices, and Trump thanked Saudi Arabia for this.

In truth, Qatar’s decision to quit is not expected to affect the oil market due to its small production outputs, so the choice is a symbolic one. However, after Qatar’s announcement, the IranianOil Minister stated that the reasons for Qatar’s decision should be examined, and added, “OPEC has big problems from some oil producers which Qatar is not a part of.”

Qatar’s decision has many ramifications. Many have started to question the unilateral decisions made by Saudi Arabia in the oil market. Additionally, the NOPEC bill might seriously affect OPEC members moving forward. While Qatar’s decision is in sync with its intentions to focus more on LNG production, many questions remain whether other members will follow Qatar’s path.