Saudi Arabia’s Prince Mohammed Bin Salman has replaced his cousin as crown prince, a sudden announcement that puts the 31-year-old next in line to the throne of the world’s biggest oil exporter. Prince Mohammed has become the face of Saudi Arabia on the international stage and the architect of its plans to overhaul the economy. The decision settles what many analysts had described as a power struggle with his 57-year-old cousin, Prince Muhammad bin Nayef.
1. Was this a surprise?
Although many Saudi watchers speculated that this move would come, the timing took most by surprise in a conservative kingdom. The young prince, known as MBS, has been steadily building influence after assuming roles overseeing the economy, oil and defense in 2015 after his father ascended to the throne and appointed his cousin as crown prince.
2. Who is Prince Mohammed?
He is seen as a bold and ambitious reformer on a mission to modernize the economy and move it beyond its oil dependency. His critics worry that his risky foreign-policy endeavors have the potential to upend stability in the kingdom, and beyond. With a bachelor’s degree in law from King Saud University, the prince started his political career as a special adviser to his father in 2009. After his father became king, he gained unprecedented control over key state entities and began to overshadow his cousin. At the heart of his efforts is a plan to sell shares in the state-owned oil company Aramco in what may become the biggest initial public offering in history. He also intends to turn the Saudi sovereign wealth fund into the world’s largest.
3. What’s the political backdrop?
In his various government roles, Prince Mohammed was already grappling with challenges including a budget deficit following the collapse of oil prices. There’s the country’s young population, its double-digit unemployment, and the lack of jobs outside government, which employs two-thirds of Saudi workers. Beyond its borders, Saudi Arabia is locked in a bitter battle for influence with its arch enemy Iran. The two are fighting a proxy war in Syria, while a protracted military campaign in Yemen drags on with no clear outcome in sight.
4. What will markets think?
Saudi stocks reacted positively, as the decision settles uncertainty about succession and signals that reforms so far enacted will stick. The government is also restoring a raft of benefits for state employees that gives consumers more cash to spend.
5. What does this mean for Saudi Arabia?
Settling the question of succession will give the prince a free hand to implement his reforms and could even speed them up in a traditionally slow-moving country. Given his age, Prince Mohammed may go on to become one of Saudi Arabia’s longest-ruling monarchs. He’s been making an effort to loosen restrictions on entertainment and address demands for openness by a young population increasingly exposed to the world through social media. As well as his foreign policy, he’s faced criticism for centralizing power and for some of his reforms, including cutting subsidies.
6. How is the change likely to impact the region?
Allied with Abu Dhabi’s crown prince, he has pursued a more assertive foreign policy aimed at strengthening influence across the region -- and countering Iran’s. In addition to the military campaign in Yemen, the Saudis took a leading role in cutting ties with neighboring Qatar this month in a crisis that appears far from resolution. Prince Mohammed’s public criticism of Iran is a signal that tensions, and those proxy wars, are unlikely to end any time soon.
The Reference Shelf
- A QuickTake on Saudi Arabia’s plans for a post-oil future.
- A Bloomberg Businessweek profile of the prince.
- Another QuickTake on royal succession in the Persian Gulf.
- A QuickTake Q&A on the Qatar crisis.
- Bloomberg TV: Why This Saudi Prince Is Known as ‘Mr. Everything’.
- Bloomberg Editor-in-Chief John Micklethwait discusses his interview with Prince Mohammed in April 2016.