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‘Saudi First’: Why kingdom’s bailouts of allies now carry a price tag

Since its oil wealth blossomed in the 1960s and ’70s, Saudi Arabia has played an almost paternal role as a financier and safety net for Arab and Muslim states. Responding mostly to simple need, an often-forgiving Saudi Arabia has rushed in dozens of times to throw lifelines to crisis-hit allies, doling out billions with zero conditions and few questions. The Saudi billions didn’t even ensure friendly governments.

Yet as Saudi Arabia sought to build a non-oil private sector from the ground up in recent years, it imposed taxes on its citizens for the first time in generations and undertook a deep rethink of its cash bailout policies.

Why We Wrote This

For decades, Saudi Arabia served as Arab and Muslim nations’ go-to destination for emergency bailouts. But as the kingdom moves toward a post-oil economy, it’s adopting a more transactional approach to aid.

Today Saudi Arabia is replacing its policy of providing unconditional cash aid to allies with targeted investments instead. It’s part of a “Saudi First” foreign policy that puts the interests of the kingdom and its citizens ahead of the geopolitical and domestic interests of its allies – whether they be the United States or fellow Arab countries.

“Investments and economic deals are the way forward,” farmer Abu Nayef says. “Brothers are brothers and business is business. If we give out billions, we as Saudis want to see some return at the end. It’s unfortunate, but economic growth is what drives the world today.”

Abu Nayef remembers a time when, if an Arab country was in trouble, they knew whom to call right away.

“The Kingdom of Saudi Arabia,” says the 60-year-old date farmer. “When any Arab or Muslim state needed financial help, we were always there to fill that need.”

But in 2023, that role has taken on a more self-interested, transactional edge.

Why We Wrote This

For decades, Saudi Arabia served as Arab and Muslim nations’ go-to destination for emergency bailouts. But as the kingdom moves toward a post-oil economy, it’s adopting a more transactional approach to aid.

Today Saudi Arabia is replacing its policy of providing unconditional cash aid to allies with targeted investments instead. It’s part of a “Saudi First” foreign policy that puts the interests of the kingdom and its citizens ahead of the geopolitical and domestic interests of its allies – whether they be the United States or fellow Arab countries.

“Investments and economic deals are the way forward,” Abu Nayef says. “Brothers are brothers and business is business. If we give out billions, we as Saudis want to see some return at the end. It’s unfortunate, but economic growth is what drives the world today.”

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