Sunday, March 19, 2017

Saudi king's Asia visit is about much more than oil

Tour hammers home how economic futures of region and Middle East are inextricably linked

Robert A. Manning     

NIKKEI ASIAN REVIEW - March 18, 2017

Saudi King Salman's monthlong tour of Asia highlights the growing economic nexus between the region and the Middle East. The trip has multiple aims that go well beyond oil: In addition to reinforcing religious, political and energy ties with Sunni Islamic-majority states -- namely Indonesia, Malaysia and Brunei -- the king was seeking investment and support for a bold, transformational plan to modernize the Saudi nation.  On King Salman's Southeast Asia swing, he made several investments in oil refineries in Malaysia and Indonesia to lock in Saudi market share and shore up the Sunni bond.  As for Japan -- Riyadh's second-largest economic partner, with $57 billion in two-way trade -- the Saudi visit followed Prime Minister Shinzo Abe's three trips to the Middle East since 2012. For Tokyo, King Salman's arrival presented an opportunity to both enhance energy security and to capture large infrastructure investment opportunities in Saudi Arabia, including an agreement to explore setting up special economic zones.