Khashoggi crisis may tip Middle East power balance towards Turkey

Agencies
November 3, 2018

Istanbul, Nov 3: The murder of journalist Jamal Khashoggi could alter the power dynamic in the Middle East by strengthening Turkey's influence at Saudi Arabia's expense as they compete for leadership of the Islamic world, analysts say.

This certainly appears to be the goal of Turkish President Recep Tayyip Erdogan, the main regional supporter of the Muslim Brotherhood, which Saudi Arabia and its allies Egypt and the United Arab Emirates consider a terrorist group.

The killing inside the kingdom's consulate in Istanbul by a team sent from Riyadh on October 2 has already severely tarnished Saudi Arabia's global reputation.

But it is the potential involvement of Crown Prince Mohammad bin Salman, the oil-rich Gulf nation's de facto leader known by his initials MBS, that could permanently damage Riyadh's influence in the region.

After initially insisting Khashoggi left the consulate unharmed, then saying he died in a brawl, the Saudi regime finally stated he was killed by a "rogue operation" and arrested 18 suspects, some with links to the crown prince.

Analysts say Erdogan could use the ensuing crisis to weaken the 33-year-old prince, even potentially leading to the royal family removing him from power -- though that seems unlikely.

"The killing of Khashoggi has proven to be a golden opportunity for President Erdogan to pressure Saudi Arabia and work towards presenting Turkey as the new leader of the Muslim world," said Lina Khatib, director of Middle East and North Africa Programme at Chatham House.

"The Khashoggi crisis is a big geo-political gamble for Turkey and so far it looks like it is playing the game masterfully. But Turkey alone will not be able to push for the removal of MBS. The ball lies in the American court," she added.

For Erdogan, promoting the Muslim Brotherhood — which Saudi Arabia has sought to marginalise in the Arab world and which was ousted from power and brutally repressed in Egypt in 2013 by current President Abdel Fattah al-Sisi — is at the heart of this power struggle.

The Turkish leader could also try to extract concessions from Riyadh for its ally Qatar, facing a Saudi blockade backed by the United Arab Emirates, Bahrain, and Egypt since 2017.

"I think that Erdogan sees this as an opportunity to push back against a triple entente in the Middle East that opposes his policies. That triple entente is composed of MBS, MBZ's (Crown Prince Sheikh Mohammed bin Zayed Al-Nahyan) UAE and Sisi's Egypt," said Soner Cagaptay, director of the Turkey Research Program at the Washington Institute.

"These three countries, all Arabs, oppose Erdogan's policies of supporting the Muslim Brotherhood. Now Erdogan sees a golden opportunity because MBS is vulnerable."

But Sinan Ulgen, president of the Centre for Economics and Foreign Policy, said "it remains to be seen whether Ankara can continue to leverage this conjuncture and turn it into a permanent advantage raising Turkey's regional influence to the detriment of Saudi Arabia".

Nicholas Heras, an analyst at the Center for a New American Security, said the Khashoggi case was the "latest chapter in Turkey and Saudi Arabia's ongoing contest over which country is better" to lead the Muslim world.

"Erdogan clearly seems to believe that he can use the Khashoggi crisis as a way to cut Prince Mohammad bin Salman, and by extension, Saudi Arabia, down to size," Heras added.

By not directly pointing the blame at the crown prince over Khashoggi, Erdogan is seeking to keep him under pressure, according to Karim Bitar of the Paris-based French Institute for International and Strategic Affairs think-tank.

"Erdogan knows that he still has ammunition that could weaken MBS in the international arena so basically he is rolling the dice these days trying to figure out how to maximise his profit after this huge Saudi blunder," he told news agency.

While the Muslim Brotherhood is important to Turkey, the West -- especially the United States -- is wary of the group and wants to focus any pressure on the crown prince towards ending the Yemen war and lifting the blockade on Qatar, the experts said.

"I expect the blockade on Doha will likely come to an end in the near future and the Saudis find a way to support the UN's efforts in Yemen," said Steven Cook of the Council on Foreign Relations.

Bitar noted that the US administration relies on Prince Mohammed's support for any possible peace plan for the Israel-Palestinian conflict as well as containing Iran, long a Saudi foe.

Washington could also push the crown prince towards "a rapprochement with Israel and to maintain a hawkish line towards Iran", Bitar added.

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News Network
March 23,2020

Dubai, Mar 23: All inbound, outbound and transit passenger flights to and from the United Arab Emirates – home to one of the world’s busiest hubs – are to be suspended for two weeks.

The UAE’s National Emergency Crisis and Disasters Management Authority (NCEMA) and General Civil Aviation Authority (GCAA) has announced that passenger flights to, from and through the country will be suspended from 25 March for a period of two weeks, in order to “curb the spread of the Covid-19”.

Freight and emergency evacuation flights will still be permitted to operate.

The suspension affects major global hubs in Dubai and Abu Dhabi. Dubai-based Emirates has already announced that it will suspend most of its passenger flights from 25 March.

“Additional examination and isolation arrangements will be taken later should flights resume, in order to ensure the safety of passengers, air crews and airport personnel and their protection from infection risks,” state the NCEMA and the GCAA.

Dubai International Airport was the third-busiest airport in the world in 2018, handling 89 million passengers.

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News Network
March 11,2020

Mar 11: Energy giant Saudi Aramco on Wednesday said it plans to raise its crude production capacity by one million barrels per day to 13 million bpd as a price war with Russia intensifies.

"Saudi Aramco announces that it received a directive from the ministry of energy to increase its maximum sustainable capacity from 12 million bpd to 13 million bpd," the company said in a statement to the Saudi Stock Exchange.

The decision comes a day after the world's top exporter, Saudi Arabia, decided to hike production by at least 2.5 million bpd to a record 12.3 million from April.

The Saudi moves come after the collapse of an oil production reduction agreement between OPEC and non-OPEC producers, including Russia.

The deal proposed by Saudi Arabia called for additional output cuts of 1.5 million bpd to cope with the severe economic impact of the coronavirus which has sharply reduced world demand for crude.

Boosting production capacity normally takes a long time and requires billions of dollars of investment.

Several years ago, the kingdom had shelved plans to boost its crude production capacity beyond 12 million bpd after demand for OPEC oil declined in the face of stiff competition from North American shale oil and other sources.

Russia on Tuesday said it was open to renewing cooperation with the OPEC cartel even as its kingpin Saudi Arabia escalated a price war with Moscow by announcing it would flood markets with new supplies.

The oil price war broke out after OPEC and a group of non-member countries dominated by Russia -- the world's second largest producer -- on Friday failed to agree on production cuts.

Saudi Arabia responded by announcing unilateral price cuts. This prompted the oil price to plummet and fuelled huge falls on stock markets around the world on Monday.

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Agencies
June 18,2020

New Delhi, Jun 18: Reliance Industries Ltd on Thursday said it has sold a 2.32 per cent stake in its digital unit to Saudi Arabia's Public Investment Fund (PIF) for Rs 11,367 crore, taking the cumulative fund raising to about Rs 1.16 lakh crore in two months.

Starting with Facebook Inc on April 22, Reliance has sold almost 25 per cent of equity in Jio Platforms - the maximum reports suggest the company intends to dilute to financial investors.

The investment by Saudi sovereign wealth fund is "at an equity value of Rs 4.91 lakh crore and an enterprise value of Rs 5.16 lakh crore", the company said in a statement.

With this investment, Jio Platforms has raised Rs 115,693.95 crore from some of the leading global investment powerhouses at a time when the world is deeply impacted by the coronavirus pandemic, resulting in a recession kind of environment for the global economy.

"With the addition of PIF's investment, Jio Platforms has established partnerships with a marquee set of global financial investors, who will contribute to establishing the Digital Society vision for India," the statement said.

Jio Platforms houses India's biggest telecom firm by subscribers, Reliance Jio. With more than 388 million users, Jio has forced out several rivals and driven consolidation in the sector since entering the market in 2016 with free voice services and cut-price data.

Over the past two months, billionaire Mukesh Ambani's oil-to-telecom conglomerate has announced the sale of about $14 billion of assets, completed a Rs 53,124 crore rights issue and slowed the run rate of new investment by a quarter.

These will help Reliance meet its target of paying off Rs 1.61 lakh crore of net debt by the end of the year.
This is PIF's largest investment into the Indian economy to date.

Ambani, chairman and managing director of Reliance Industries, said, "We at Reliance have enjoyed a long and fruitful relationship with the Kingdom of Saudi Arabia for many decades. From oil economy, this relationship is now moving to strengthen India's New oil (data-driven) economy, as is evident from PIF's investment into Jio Platforms."

Yasir Al-Rumayyan, governor of PIF, commented: "We are delighted to be investing in an innovative business which is at the forefront of the transformation of the technology sector in India. We believe that the potential of the Indian digital economy is very exciting and that Jio Platforms provides us with an excellent opportunity to gain access to that growth."

"This investment will also enable us to generate significant long-term commercial returns for the benefit of Saudi Arabia's economy and our country's citizens, in line with our mandate to safeguard and grow the national wealth of the Kingdom," he said.

The transaction is subject to Indian regulatory and other customary approvals.

Morgan Stanley acted as financial advisor to Reliance Industries and AZB & Partners and Davis Polk & Wardwell acted as legal counsels.

Prior to this deal, Reliance had sold 22.38 per cent of Jio Platforms to investors including Facebook Inc, securing Rs 104,326.95 crore in eight weeks.

Facebook kicked off the party, investing Rs 43,573.62 crore for a 9.99 per cent stake on April 22. This was closely followed by a further Rs 60,753.33 crore in investment.

Silver Lake - the world's largest tech investor - bought a 1.15 per cent stake in Jio Platforms for Rs 5,665.75 crore on May 4. It invested another Rs 4,546.80 crore for additional 0.93 per cent stake on June 5, taking its total holding to 2.08 per cent
Private equity KKR and Vista Equity Partners have taken 2.32 per cent stake each for Rs 11,367 crore apiece. KKR invested in Jio Platforms on May 22 while Vista invested on May 8.

Abu Dhabi sovereign wealth fund Mubadala Investment Co picked up 1.85 per cent in Jio Platforms for Rs 9,093.60 crore on June 5. Abu Dhabi Investment Authority on June 7 invested Rs 5,683.50 crore for a 1.16 per cent stake in Jio Platforms.

On May 17, global equity firm General Atlantic picked up 1.34 per cent stake in Jio Platforms for Rs 6,598.38 crore.

Global investment firm TPG on June 13 picked up 0.93 per cent for Rs 4,546.80 crore while L Catterton bought 0.39 per cent for Rs 1,894.50 crore.

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