President Donald Trump's visit to Saudi Arabia could be a boost for the big ambitions of Saudi Arabia's young deputy crown prince, who is trying to steer the kingdom's fortunes away from oil.
For Mohammed bin Salman, the U.S. brings an arms deal worth $350 billion over a decade, while affirming its decades long support as Saudi Arabia's regional power struggle with Iran intensifies. For Trump, it's a reset of what was a less friendly U.S.-Saudi relationship under President Barack Obama, and a show of Saudi support for the U.S. in the fight against ISIS.
"I think Trump will relish spending time in a country that is absolutely thrilled with his election. MBS will be looking for assurances that we will work alongside the Kingdom in rolling back Iran's regional ambitions," said Helima Croft, head of global commodities strategy at RBC.
Bin Salman's Vision 2030 will get U.S. endorsement on his home turf. The 31-year old son of King Salman, known as MBS, is behind the program aimed at transforming Saudi Arabia into a more diverse economy. As part of that arrangement, Softbank announced on Saturday that it had pulled in $93 billion in committed capital for a planned technology fund, fueled in large part by Saudi investment.
His longer term plan is to create thousands of jobs in industries, such as tourism and technology. The program also includes the funding of a giant sovereign wealth fund, with the proceeds of the the IPO of state oil company Saudi Aramco, expected sometime next year.
"Vision 2030 is the signature initiative of MBS, but it is facing quiet opposition at home and disbelief in international financial circles. Trump's support in the White House statement for it when MBS was in D.C. were helpful to MBS. He is likely to mention it again this time. Such support also helps MBS in his ambition to be the new face of Saudi Arabia. But succession politics in the royal family are complicated, so the U.S. needs to be cautious," said Simon Henderson, Baker fellow at The Washington Institute and director of the Institute's Gulf and Energy Policy Program.
Trump also visits Saudi Arabia just ahead of Thursday's OPEC meeting where the kingdom will lead the cartel in a decision on extending its production cuts. Saudi Arabia has suggested production cuts lasting nine month instead of six months as previously expected. There also was talk that OPEC is considering expanding the current 1.8 million barrels a day cut, but it's not clear whether there would be support for that.