What to Expect from the Saudi King’s Historic Visit to Russia

04.10.2017

In order to achieve real agreements and have them carried out, the Russian government and business community will have to talk to the Saudis from a position of strength, drive the hardest bargain even on issues that appear inconsequential, while at the same time considering the cultural and psychological peculiarities of their partners. The tiniest show of weakness or miscalculation could easily destroy the “axis of love” that is being talked about in the Gulf monarchies, instantly returning Russian-Saudi relations to the previous low level.

Ahead of the historic first visit of the King of Saudi Arabia to Russia, a number of experts said that this event may be delayed, as has already happened a number of times since June 2015, when President Putin invited King Salman to visit Russia. These worries were fuelled by the near complete absence of articles on the topic in Saudi media. At the time of this writing, direct contacts with the Kingdom’s business circles allow me to say that the visit will happen. The Saudi business community is preparing a powerful “landing party” for Russia, of up to 700 people, in hopes of creating new and developing existing ties with Russian companies.

The initial invitation to visit Moscow was given to then-monarch Abdallah during the first-ever Russian presidential visit to Saudi Arabia in February 2007. The repeated delay of the planned visit can be seen as an indication of problems that existed in the two countries’ relations.

The root of these problems goes back to the Soviet War in Afghanistan, when Soviet troops were confronted by armed groups, sponsored, among others, by Saudi Arabia. Today, some members of the Saudi elite are convinced that their state defeated the Soviet Union, and in their eyes, Russia continues to be the defeated side. This is also the reason why Saudi leaders see their country as a “great power” without any irony. During the 1990s and 2000s, various foundations in the Persian Gulf, including in Saudi Arabia, actively and generously aided insurgents in the Northern Caucasus. This recent history does not aid trust and the creation of a positive atmosphere in bilateral relations.

After the conflict in Syria began in 2011, relations between the two countries were de facto suspended until 2015, when King Salman assumed the throne and sent Crown Prince Muhammad bin Salman to meet the Russian President in June of the same year. Since then, one could observe a certain warming of bilateral relations. Among factors that influenced the rapprochement of Russia and Saudi Arabia, the most significant is the successful Russian Aerospace Forces operation in Syria. It is obvious that the turning of the tide in this country and the return of 85% of territory to government control is forcing Saudis to speak of “common goals” of Russia and Saudi Arabia not only in Syria, but also in Iraq, Yemen and Libya. Russia’s victories noticeably increased the authority of Russia in the region, including in Saudi Arabia. Nevertheless, the war in Syria remains the main source of contradictions between Moscow and Riyadh. It must be recognized that the foreign policy of Gulf monarchies is rather reflective and depends on the changing situation. Today, they appear to have come to terms with the failure of this project and are ready to coordinate their actions with Moscow. The Russian leadership is also meeting them halfway, recognizing the new opportunities and trying to take advantage.

Both states recognize the role and significance of each other geopolitically. Russia engages closely with Turkey and Iran, and not only on Syria, but also on Central Asia with the latter. Both states are rivals of Saudi Arabia in the region. In recent months, there was also the Qatar crisis, during which, both of Russia’s tactical allies took the side of the disfavoured state. For the ruling House of Saud, it is important to strengthen political and economic ties with Moscow to weaken its movement toward Tehran and Ankara. In an interview with the Washington Post, Muhamman Bin Salman rather earnestly formulated the goals of Riyadh in relation to Moscow, saying, “The main objective is not to have Russia place all its cards in the region behind Iran.”

Saudi Arabia also attaches great significance to strengthening ties with Russia in the context of relations with the US, whose Middle East policy has been perceived negatively in recent years by both the ruling elites of the Gulf monarchies and their people. The Russian leadership is trying to take advantage of a good moment to soften Saudi positions on Syria and end the support of Islamist groups from non-profit foundations and private donors in the Gulf countries.

Riyadh has increased difficulties not only internationally, but also internally, as growing budget deficits and unemployment threaten to cause an explosion of social unrest. Because of that, the economic factor plays a significant role in rapprochement between Moscow and Riyadh. Mutual interest in supporting oil prices and preventing their fall helped overcome disagreements and agree on reducing oil output in December 2016. Information is also being leaked on Russian-Saudi cooperation in the oil sector, regarding Rosneft, Sibur, Transneft, Lukoil and other companies’ participation in completing megaprojects in Saudi Arabia and Saudi Arabia’s participation in Russian projects on the Arctic shelf.

These prospects are part of the modernization program Vision 2030 enacted last year. Saudi businesses are ready to consider any sectors of cooperation that make possible the localization of production, transfer of Russian technologies and profitable investments into the manufacturing of products that are in demand in both Saudi Arabia and the Middle East as a whole. It is no accident that hundreds of Saudi entrepreneurs are following King Salman to Russia.

Russia is counting on money from Saudi funds. Saudi Arabia is actively investing collosal funds that it accumulated in previous decades. In June 2016, Saudi Aramco Chairman and Saudi Oil Minister Khalid A. Al-Falih, together with the Russian Direct Investment Fund declared that they intend to create a joint $1 billion investment fund. This is a more delicate approach than direct offers to give up pursuing an active policy line in the Middle East in exchange for investments in the Russian economy, made by a Saudi prince in 2013. However, it should be understood even today that the volume of investments will change proportionally to the state of bilateral relations.

It is no question that it has been and remains difficult for our two countries to negotiate, but the possibility exists, which recent experience confirms. Moscow and Riyadh supported the transition of power in Egypt in 2013, while Cairo’s purchases of Russian weapons were only possible with financial aid from Saudi Arabia. Of course, the greatest success in bilateral relations was the agreement to reduce oil output.

In conclusion, it is necessary to mention that to achieve real agreements and have them carried out, the Russian government and business community will have to talk to the Saudis from a position of strength, drive the hardest bargain even on issues that appear inconsequential, while at the same time considering the cultural and psychological peculiarities of their partners. The tiniest show of weakness or miscalculation could easily destroy the “axis of love” that is being talked about in the Gulf monarchies, instantly returning Russian-Saudi relations to the previous low level.

Views expressed are of individual Members and Contributors, rather than the Club's, unless explicitly stated otherwise.

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