Saudi Crown Prince MBS in Pakistan to sign economic development agreements
Saudi Arabia’s Crown Prince Mohammed bin Salman (MBS) will arrive in Pakistan today, where he is expected to sign eight economic development MOUs over the coming 48 hours, including a $10 billion Saudi investment in an oil refinery at the port city of Gwadar.
The crown prince’s visit comes as Pakistan’s economy faces major risks. In particular, imports outweigh exports by $7.89 billion—down from a high of $18 billion last year in June. This creates a current account deficit, a recurring problem for the Pakistani economy because, among other issues like currency depreciation, it reveals the lack of long-term viability of export industries.
For Prime Minister Imran Khan, Riyadh’s oil refinery deal and other investments—for example in liquefied natural gas plants—will not solve the current account issues per se. However, Saudi financial clout could attract other global investors to Pakistan’s export sector and balance the current account deficit in the long-term.
For MBS, today’s visit is an important step to resuscitate an image battered by reports that he ordered the killing of Washington Post journalist Jamal Khashoggi. Unlike others who have boycotted MBS financial aid—like Morocco’s King Mohammad VI—Khan’s economic problems mean ever closer ties with Saudi Arabia, regardless of MBS’ controversial reputation.
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