Jaap Jansen

The Economist states that 🇸🇦Saudi Crown Prince Mohammed bin Salman (MBS) is facing an “annus horribilis” as three of his core, long-term strategic gambles fail simultaneously: his military campaign against the Houthis, his economic transformation via Vision 2030, and his reliance on 🇺🇸Donald Trump as a reliable ally. MBS’s decade-old gamble that he could easily defeat the Houthi movement in 🇾🇪Yemen has severely backfired. The Houthis have launched devastating drone and missile attacks directly into Saudi Arabia, targeting infrastructure including Riyadh’s International Airport, which was effectively shut down following deadly strikes. A truce brokered in 2022 broke down completely during the summer of 2026, exacerbated by broader regional conflicts involving US and 🇮🇷Iran. The Houthis have seized additional territory, leaving Riyadh with only poor alternatives: enter a bloody ground war, continue ineffective air strikes, or sign a deal that permanently cements Houthi rule on their border. The economic crisis amid the Iran war is stalling MBS’s so called “Vision 2030” which was supposed to pivot the Saudi economy away from oil. While IMF initially projected the Saudi economy to grow by 4% in 2026, it is now expected to contract by 3.3%. Another MBS idea for “Davos in the Desert” was cancelled after Western executives grew nervous over Houthi threats and governments issued travel warnings. Annual foreign direct investment (FDI) has plummeted to roughly 1/3 of MBS’s $100 billion target. Megaprojects are being shelved as public finances face immense strain, and local wages are failing to keep pace with soaring inflation. But probably the most significant of all is the failed bet on Donald Trump. MBS heavily aligned Saudi security and diplomatic strategy with the Trump Administration, investing heavily in US and executing controversial financial deals with the former first family to buy influence. However, this partnership has failed to yield the ironclad security umbrella Saudi Arabia expected. Instead, US confrontations with Iran have escalated the regional proxy warfare, leaving the Kingdom highly vulnerable and exposed without an adequate American protection. Is the unraveling of these interconnected MBS bets culminating in a severe geopolitical and financial crisis for Saudi Arabia: A) Yes; B) No?