American Founding Father Benjamin Franklin is famously quoted as saying that in life nothing is certain except death and taxes. It’s indeed a truism even for the autocratic Kingdom of Saudi Arabia, with interesting developments of late.
From $110 a barrel in 2014 to less than $30 today, tumbling oil prices are currently pushing the leading Arab nation to reconsider its fiscal positions. The government has in the past relied for up to 90% of its revenues on the black gold fossil, financing a cornucopia of subsidies, sinecures and extravagant royal lifestyles. However, the new normal in oil markets has led Saudi Arabia to swelling budget deficits, as high as 15% of GDP, and severe deterioration in foreign reserves.
To reverse the fiscal misfortunes, the House of Saud is pushing for an overhaul of its tax system and other economic reforms combined with a vigorous clampdown on dissent (e.g. carrying out the largest mass execution in the country since 1980, putting 47 men to death on January 2).
Death and taxes, indeed.
Ironically, the spectre of death also hovers over the octogenarian King Salman, taxing the ability of the royal family to safe sail though turbulent times — and letting seditious conspiracies run high.
In a Shakespearian move, Saudi Arabia’s highest Islamic cleric Grand Mufti Sheikh Abdulaziz al-Sheikh recently issued a haram (religious condemnation) on the game of chess. According to the cleric, “it causes enmity and hatred between people“– and who knows, it might give wrong ideas about toppling the King as well…
The truth is that, as the low-hanging dividends of its vast oil reserves dwindle, Saudi Arabia’s rulers will need to reconsider their oppressive autocratic regime. And that includes a more efficient and responsive government management. Otherwise — with or without chess — maintaining the status quo could be a checkmate on the Saudi regime itself.