Middle East

Khashoggi fallout: The ‘Davos in the desert’ no-shows as Saudi scrambles to host event

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Saudi Arabia is scrambling to prepare for an investment summit after a string of cancellations.

The head of German conglomerate Siemens joined a slew of corporate chiefs and politicians in pulling out of an investment conference this week in Saudi Arabia, over the murder of Saudi journalist Jamal Khashoggi.

Starting on Tuesday, the three-day Future Investment Initiative (FII) was meant to project the historically insular petro-state as a lucrative business destination as it seeks to diversify and set the stage for new ventures and multi-billion dollar contracts.

But the summit, nicknamed "Davos in the desert", has been overshadowed by growing global outrage over the murder of Khashoggi inside the kingdom's consulate in Istanbul.

The chief executive of German industrial conglomerate Siemens Joe Kaeser was the latest among dozens of global executives to withdraw from the summit, hosted by the kingdom's sovereign wealth fund.

"It's the cleanest decision but not the most courageous one," Kaeser wrote in a post on social network LinkedIn of his choice not to attend FII.

"For now, the truth must be found and justice must be served."

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CCTV shows men at Saudi consulate burning papers.
CCTV shows men at Saudi consulate burning papers.

Ministers from the United States, Britain, and France, which have huge defence deals at stake with Saudi Arabia, have already pulled out of the summit.

Corporate honchos from JP Morgan to carmaker Ford and ride-hailing app Uber, as well as media powerhouses like Bloomberg, CNN and the Financial Times have also scrapped plans to attend.

Organisers have taken down a list of speakers from its website and on Monday refused to confirm the number of attendees.

One government source said the list of speakers and moderators was not yet finalised as many continued to drop out at a "rapid pace".

International Monetary Fund's Christine Lagarde will not be attending the Future Investment Initiative.
International Monetary Fund's Christine Lagarde will not be attending the Future Investment Initiative.
AAP

And in a fresh setback, the forum's website went down on Monday after an apparent cyberattack.

There was no immediate claim of responsibility.

Investor uncertainty

Many Western firms have too much at stake to abandon the Arab world's biggest economy, and some are preparing to send lower-level executives to the summit.

Senior investment bankers from HSBC and Credit Suisse are planning to attend the conference even though their chief executives have cancelled their attendance, Bloomberg News reported.

Companies from China and Russia have shown little interest in withdrawing from the event, an organiser said.

Although several Western leaders like International Monetary Fund chief Christine Lagarde and US Treasury Secretary Steven Mnuchin have pulled out, Pakistan's Prime Minister Imran Khan will attend the forum as Islamabad continues to seek funding to plug its deteriorating finances.

Portraits of Saudi King Salmanand, right, and his son Crown Prince Mohammed bin Salman (MBS) can be seen in Riyadh ahead of the summit.
Portraits of Saudi King Salmanand, right, and his son Crown Prince Mohammed bin Salman (MBS) can be seen in Riyadh ahead of the summit.
Getty Images

But a wider Western boycott of the conference suggests rising political risks in Saudi Arabia that could cast a shadow over foreign direct investment, which a UN body said plunged last year to a 14-year low.

"Despite talk of reform, FDI inflows into Saudi have stayed low and the (Khashoggi) scandal will only increase investor uncertainty," said research firm Capital Economics.

The no-shows

Politics/International Institutions

- US Treasury Secretary Steven Mnuchin

- French Economy Minister Bruno Le Maire

- British International Trade Secretary Liam Fox

- Dutch Finance Minister Wopke Hoekstra 

- International Monetary Fund chief Christine Lagarde 

Finance

- HSBC chief executive John Flint

- Credit Suisse CEO Tidjane Thiam

- MasterCard CEO Ajay Banga

(HSBC, Credit Suisse and MasterCard are listed alongside Siemens among the eight "strategic partners" of the conference.)

- BNP Paribas chairman Jean Lemierre

- Societe Generale CEO Frederic Oudea

- JPMorgan Chase CEO Jamie Dimon 

- BlackRock chief Larry Fink

- Blackstone CEO Stephen Schwarzman

- Standard Chartered CEO Bill Winters

- London Stock Exchange CEO David Schwimmer

Industry/Technology 

- Ford chairman Bill Ford 

- Uber CEO Dara Khosrowshahi 

- British billionaire Richard Branson 

- Thrive CEO Ariana Huffington 

- Google Cloud CEO Diane Greene

Media 

- Viacom CEO Bob Bakish.

In addition, multiple media groups have withdrawn executives or journalists who were due to take part in the conference, including CNN, Bloomberg, The Economist, The New York Times, CNBC and the Financial Times.

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