When senior Saudi officials took the podium this week at the kingdom’s glitzy annual investment forum, there was barely a mention of the war unsettling the Middle East for more than a year now.
Instead, at the forum nicknamed “Davos of the Desert,” Gulf leaders sought to reassure the gathered foreign investors and policymakers that the conflicts in Gaza and Lebanon will not threaten business as usual with the region’s economic powerhouses.
While the Gulf has so far been spared direct involvement in the hostilities, there are fears that a further escalation could seriously impede the region’s plans to diversify its economies. The Gulf states worry that they cannot thrive in a region marked by persistent conflict, especially one that threatens to engulf Iran — the state backing many of the groups now fighting Israel.
Khalid Al-Falih, the Saudi investment minister, only obliquely referred to the war when he addressed the conference on Tuesday, mentioning human suffering and disruptions to shipping in the Red Sea. But “the tailwinds are much stronger than the headwinds,” he said of the Gulf’s economic prospects.
Saudi Arabia, under the leadership of Crown Prince Mohammed bin Salman, has set out in recent years to diversify its economy away from near-total reliance on oil, knowing that even its vast resources are finite. At the same time, the crown prince has loosened the country’s tight social and cultural strictures.
And a few years before the latest war broke out with the Oct. 7, 2023 Hamas attack on Israel, the United Arab Emirates normalized relations with Israel — a move that many observers saw as motivated, at least in part, by the desire to remove obstacles from the path toward economic development in the Gulf.
