Saudi Arabia Versus Globalization

There seems to be something special about oil. As an energy source, it is one of the key drivers behind globalization.

Cheap transportation allows people to travel more often and farther from their homes than their grandparents would have ever dreamed of. This allows them to see — and learn from — the differences between cultures and countries.

And yet, the key producer of this commodity — Saudi Arabia — is one of the few countries in the world that has decisively turned its back on such interaction. Saudi Arabia is famous for battling any outside cultural influence mightily.

The Saudis must ultimately decide whether doing business with the world — and thus both supporting and depending on globalization — really fits with their goals.

In defense of their position, Saudis argue that they support globalization on an economic level. Cultural and political globalization, however, is opposed by different groups — and for different reasons.

In a strange twist, both the cultural and political form of globalization are primarily viewed as Americanization.

For the ruling elite, in Saudi eyes, political globalization translates into the menace of an open society, less hierachy — and more democracy.

Such ideas do not go down well in a country that has no elections and where the king can appoint his ministers — that is, his clan members and allies — as he pleases.

For the average Saudi, the potential loss of political power — of which they don't have much to begin with — is not such a big concern.

They mainly view cultural globalization as threatening to their faith and undermining their morals.

Many commoners reduce "globalization" to a distorted idea that mostly consists of alcohol imports, online gambling, sexual promiscuity and Internet pornography.

This attitude — which, by the way, suits the autocratic regime just fine — translates into a broad popular resistance to outside political, social or cultural influences.

But without a certain degree of openness, Saudi Arabia — which is thought of as a western ally and a stabilizing force in the region — will increasingly be torn between its internal close-mindedness and the integrating world economy.

This aversion to outside influence is deeply rooted in the country's history. Back in the early 1920s, Saudi Arabia was conquered by a particular faction of Islam. The Saud family adhered to a strict form of the religion.

They additionally enjoyed quasi religious authority as sharifs, their male line being direct blood descendents of the prophet Mohammad.

One cannot imagine a country benefitting more from global markets less committed to integration with the rest of the world than Saudi Arabia.

That meant essentially that Arabia’s rulers were not interested in much interaction with the rest of the world.

Its stance toward the information age continues to reflect the Wahhabi strain of Islam — the same set of religious beliefs Afghanistan’s Taliban adhered to — that is always suspicious of the outside world (including more worldly Muslims in places like Cairo and Tehran).

And the country’s strict censorship extends not just to imported magazines and newspapers, where foreign residents are long used to receiving their copies of Time or the International Herald Tribune with pictures or entire pages sliced out.

The Kingdom also has an ambitious program to block “undesirable” Internet content — ranging from pornography to online gambling to anything critical of the Kingdom or the royal family.

But, regardless of the desires of its Imams, Saudi Arabia is a veritable linchpin of global integration. It accounts for one-quarter of the world’s oil reserves, and 11% of the world’s current oil production.

Its $50 billion worth of oil exports accounts for 90% of all export receipts, 32% of the Kingdom’s GDP — and 75% of government revenues.

Iran, even as an Islamic theocracy, does not so easily reject foreign ideas. For example, the Iranians are quite willing to hold athletic competitions for women — which would surely be forbidden in Saudi Arabia — as long as the conditions are adapted to their interpretation of Islamic law.

And Indonesia, yet another oil producer with a majority Muslim population, is more likely to welcome, rather than reject, cultural and economic influences from abroad.

All of that underscores just how ironic the Saudi dominance of global oil production really is. Oil is one of the key commodities of global transportation.

Fully 57% of all transportation around the world was powered by oil in 1998 — and that is up from 42% in 1993. Airliners, ships and motor vehicles all increasingly depend on this commodity.

And lower costs of transportation are, of course, one of the key driving forces behind global integration. Without Saudi oil, Chinese trade with Argentina or Canadian tourist travel to Finland, would be more expensive, less common — and the world would be less integrated.

That leaves important questions for both sides of this troubled transaction. The Saudis must ultimately decide whether doing business with the world — and thus both supporting and depending on globalization — really fits with their goals.

Do they wish to continue to earn large amounts of money from selling oil to the rest of the world?

Ultimately, this means that, regardless of their current claims, they are acquiescing in — and even supporting — global integration, and not just in economic terms. The question must also be whether this convenient form of separation really works.

As hard as the Saudis are trying, they won’t be able to stop this integration movement at their own border in all too narrowly prescribed ways. You cannot seriously want to benefit from the economic side of globalization — but reject the rest.

Or, do they want to remain true to their Wahhabi values which essentially reject the outside world? Wouldn’t they then be better advised to give up the very considerable profits to be made from pumping oil?

How can global integration continue when one of its key commodities is prominently controlled by those that are hostile to the very idea?