Arabian Post Staff -Dubai
As Trump embarks on his first Middle East tour of his second term, his administration is focusing on securing substantial trade and investment agreements with Gulf allies, including Saudi Arabia, Qatar, and the United Arab Emirates. The centerpiece of this initiative is the Saudi-U.S. Investment Forum in Riyadh, where Trump is accompanied by a delegation of prominent U.S. business leaders from sectors such as technology, finance, and defense. Notable attendees include Amazon CEO Andy Jassy, Nvidia CEO Jensen Huang, Citigroup CEO Jane Fraser, BlackRock CEO Larry Fink, Tesla’s Elon Musk, and Palantir’s Alex Karp.
The forum aims to foster partnerships in strategic sectors like artificial intelligence, energy, and manufacturing. Several U.S. companies, including Amazon Web Services, Google, IBM, and Groq, have already announced significant investments in Saudi Arabia to bolster AI infrastructure and capabilities.
However, the kingdom’s focus on its own economic diversification, under the Vision 2030 initiative led by Crown Prince Mohammed bin Salman, presents a complex backdrop. This ambitious plan seeks to reduce Saudi Arabia’s dependence on oil by investing in various sectors, including tourism, entertainment, and technology. Key projects under this initiative include Neom, a planned $500 billion futuristic city; the New Murabba project, aimed at developing a new downtown in Riyadh; and the Jeddah Central development, which is expected to contribute significantly to the non-oil GDP.
These domestic projects are capital-intensive. For instance, Neom alone is projected to cost around $500 billion, while the New Murabba and Jeddah Central projects are expected to require substantial investments. The cumulative cost of these initiatives is estimated to approach $2 trillion, posing potential constraints on the kingdom’s ability to commit to large-scale foreign investments.
The geopolitical landscape adds another layer of complexity. The ongoing conflict in Gaza has strained Saudi-Israeli relations, with Saudi Arabia insisting on a ceasefire and a roadmap to Palestinian statehood as prerequisites for normalization. This stance has led to a decoupling of the normalization issue from broader U.S.-Saudi discussions on defense, economics, and nuclear cooperation.
Trump’s efforts to expand the Abraham Accords face resistance, particularly from Israeli Prime Minister Benjamin Netanyahu, who has shown reluctance to end the conflict. This impasse hampers progress on regional integration and complicates the broader strategic objectives of the U.S. administration in the Middle East.
Trump’s acceptance of a $400 million luxury Boeing 747-8 from Qatar, intended to serve temporarily as Air Force One, has drawn criticism and legal scrutiny. Ethics experts argue that the gift may violate the Constitution’s Foreign Emoluments Clause, which prohibits federal officials from accepting foreign gifts without congressional approval. This controversy underscores the delicate balance Trump must maintain in navigating foreign relations and domestic legal frameworks.