Saudi Prince's Death to Open Tense Succession Contest
Saudi Arabia’s Crown Prince Nayef bin Abdulaziz, the half-brother of King Abdullah and heir to the throne, passed away at the age of 78 while undergoing medical treatment in Geneva on Saturday. It comes less than eight months after the death of Sultan bin Abdulaziz, the previous Crown Prince, and again brings to the fore the ambiguous issue of succession.
The monarchy in the world’s top oil exporter, which has survived several tumultuous periods in the surrounding political landscape since it was founded in 1932, is home to succession that passes among brothers. As the generation of mostly octogenarians grows older and becomes increasingly fragile, clarifying what happens next is quintessential to preserving stability in investor sentiment and, by extension, global energy markets.
Like his predecessor, Crown Prince Nayef came to embody the institution he served for over 30 years. As Minister of Interior he was at the helm of policy responses following spikes of internal turmoil, ranging from the Grand Mosque Seizure in 1979 to the more recent wave of domestic terrorism that intensified with the turn of the millennium.
There is rarely disagreement in day-to-day discussions among Saudis about who will be the new Crown Prince. Most observers believe that Saudi Arabia’s current Minister of Defense, Salman bin Abdulaziz, is next in line to take the post. Prince Salman, who is 77 years old, also served as the Governor of the Riyadh Province for almost half a century.
May Yamani, a scholar of Saudi politics and author of "Cradle of Islam," argued that many Saudis were becoming fatigued by the enduring lack of certainty and perceived the regime as “being on life support.”
“Abdullah’s octogenarian line of successors recalls the final years of the Soviet Union, when one infirm leader after another succeeded to power for a brief period of inert rule,” she wrote in an article for Project Syndicate after the passing of the previous Crown Prince.
Jump to Next Generation
The 88-year-old King Abdullah, who ascended the throne in 2005, was hospitalized on several occasions last year. Given the age of the current succession line-up, the jump to the next generation is moving closer and widely seen as a tenser, more contested process.
This is where the “Allegiance Council” - a 34-member body set up by King Abdullah to select successors - is meant to fulfill its purpose. Each member represents a family of a son of the country’s founder, King Abdulaziz Al Saud. It was put to the test for the first time last October when it confirmed Prince Nayef as the new Crown Prince.
The customary formal announcement of the new Crown Prince will come from the Royal Court in the next few days.
Meanwhile, the Saudi stock market, the region’s largest and most liquid, has taken the event in stride, and edged marginally lower in early trade. Regulators are close to finalizing a law that is to make access for foreign investors easier, although no timetable has been given.
Since the advent of the Arab Spring and buoyed by higher oil prices Saudi authorities have significantly ramped up government spending. The International Monetary Fund (IMF) said in its annual review that growth was likely to moderate from 7.1 percent last year, to 6 percent.
Yousef Gamal El-Din is CNBC's Middle East Correspondent and contributes to the channel’s flagship shows, as well as analysis for CNBC.com.
Stay in touch with him on Twitter at http://www.twitter.com/youseftv @youseftv