What has changed in Saudi Arabia’s policy of providing financial assistance to foreign countries?
Tashkent, Uzbekistan (UzDaily.com) -- For decades, Saudi Arabia has channeled billions of dollars in financial assistance to its allies and partners to strengthen its position as an Arab power and leader of the Muslim world, Timesofisrael (Israel) reports.
However, today a sharp decline in demand for hydrocarbons has led to a reduction in oil revenues and the KSA is rethinking old alliances that use financial assistance from Riyadh, offering little in return. The KSA’s quest for regional supremacy clashes with the interests of its rivals - Iran, Turkey and Qatar.
Currently, the double economic impact - the pandemic and low oil prices - has forced Riyadh to restructure and rationalize its aid. KSA is trying to end the perception of itself as an "ATM".
Saudi Arabia can no longer pay billions to Beirut where Hezbollah operates. This situation is no longer compatible with the new foreign policy of the KSA. Riyadh is also disappointed with the actions of its long-time ally, the IRP, in persuading the KSA to take a firm position on the Kashmir issue and attempts to raise this issue in international and Muslim organizations. This is unpleasant for the Kingdom, which considers itself the leader of the Muslim world.
Pakistani elites take the KSA’s support for granted, given what Riyadh has done for the IRP for decades. In this regard, the KSA recently withdrew US$1 billion from the US$3 billion loan from the IRP, and the expired multi-billion dollar oil loan to Islamabad was not renewed.
In addition to the IRP, Egypt, another hugely supported ally, has refused to support the KSA-led military campaign in Yemen against the pro-Iranian Houthi forces.
The Saudis are unhappy with the behavior of their allies. Thus, in the future, to traditional recipients, including Jordan, Lebanon and the Palestinians, financial assistance to the KSA can be frozen, reduced or terminated.