BY GEORGE HAY

If Saudi Arabia’s Future Investment Initiative was 2017’s must-attend conference, its sequel looks anything but. Trekking to Riyadh for the so-called “Davos in the Desert”, to be held in two weeks, was already a tricky call given various human-rights abuses in the kingdom in past year. Now Turkish officials have told Reuters they think Jamal Khashoggi, a prominent Saudi journalist, was killed in the country’s Istanbul consulate. Though Riyadh’s story is different, Khashoggi’s disappearance takes those concerns up a notch. Morality aside, the economics of going mostly appeal to bankers – and then just barely.

Mohammed bin Salman, the Saudi crown prince known as MbS, was recovering some of the initiative lost by the stalled initial public offering of the kingdom’s Aramco oil behemoth. He told Bloomberg last week the listing would still happen by 2021, and that he’d repeat the $45 billion due to be invested in the SoftBank Vision Fund in the second installment of Masayoshi Son’s tech investment bonanza. High oil prices mean Saudi’s economy is in good shape, MbS has the friendship of President Donald Trump, and the $100 billion hole left in the Public Investment Fund by Aramco’s delayed IPO will be filled by leveraging the oil company to buy chemicals group Sabic.

Even so, the detaining of hundreds of fellow royals and businessmen in the same Ritz-Carlton hotel that had just hosted last year’s FII had already taken some of the fizz out of the first event. The kingdom may have allowed women to drive more recently, but it has also prosecuted diplomatic spats with Qatar and, more bizarrely, Canada. If Saudi has been involved in the murder of a prominent critic in another country, then questions about MbS’s commitment to any kind of opening up will grow.

Last year, the list of speakers at the FII neared 200. Even if this year can muster something similar, its backbone could well be representatives of the biggest American banks. They argue privately they have to be there, given their participation in Aramco’s debt financing as they hang around for an eventual IPO. If the Saudi brand becomes toxic, more conference attendees and the recipients of Saudi money may decide that it is to be kept at a distance rather than embraced.

First published Oct. 8, 2018

(Image: Bandar Algaloud/Courtesy of Saudi Royal Court/Handout via REUTERS)