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13th October 2005: "Fiefdoms and Bureaucrats: Building the Saudi State 1953–1980s" – Lecture given by Mr Steffen Hertog to the Saudi–British Society.

My presentation dealt with the interplay of personalities and institutions in the history of the Saudi state and bureaucracy since the 1950s. It had three essential aims:

  • to explain how early conflicts and deals between senior players "congealed" into institutional constellations which have shaped the kingdom until today,
  • to explain how the Saudi bureaucracy developed a certain degree of segmentation, i.e. the tendency of various institutions to be little "states within the state", which can result in very efficient bureaucratic islands, but can also lead to failures of coordination, and
  • to compare the extreme social mobility offered by an expanding state with the relative immobility of a mature system in which all stakes have been "parceled out", both in business and the bureaucracy.

Although King Abdalaziz had inherited some modern bits of administration in the Hijaz, the modern Saudi nation state started its evolution only in the early 1950s, when the first functionally differentiated, formal ministries and agencies were created and the Council of Ministers was set up in 1953.

The fact that much of the early state–building was already based on oil income led to several idiosyncrasies in the creation of modern institutions. As the income came from abroad and hit Saudi society unprepared, there was much leeway for the leadership to determine the shape of new ministries. Little pressure was brought to bear on the government to systematically use or administer funds for specific developments – as far as there was any pressure, it came from Aramco and the US embassy.

This meant that institutional design was largely a product of elite politics, i.e. negotiations between senior princes, influenced by a limited number of commoner advisors. Ministerial design hence reflected specific balances of power, and ministries were "granted" to specific factions, i.e. the Ministry of Defense to Prince Mansour and his full brothers and the governorship of Riyadh to Sultan and then Naif. More strikingly, institutions were structured so as to reflect the seniority of their heads, as when the Ministry of Air Force was allocated to Defense so as to avoid too much authority to accrue to Communication under Talal. This does not mean that ministers were not interested in good administration, but it led to some interesting jurisdictional constellations which are still with us today, as well as a certain "fiefdom" character of a number of institutions long controlled by specific players.

Trusted commoners would also be to design institutions according to their interests, as in the case of the Ministry of Finance under Abdallah Sulaiman, who used his sprawling bureaucratic empire to further his own business interests and rear a whole stratum of business partners (including the Sharbatli family, who reportedly first endeared themselves to his brother and deputy Hamad Sulaiman through a gift of fruit). However, the minister also used his discretion to help with the setting up of the Saudi Arabian Monetary Agency, which was designed by American advisors and subsequently proved to be one of the best central banks in the Middle East. This shows the great degree of voluntarism in the early history of the Saudi bureaucracy, when increasing state revenue could be used for quite different purposes, with very different long–term consequences.

Changing institutions also reflected elite politics during the years when the distribution of authority between King Saud and Crown Prince Faisal was unclear. Each of them promoted different institutions: Faisal used the formal bureaucracy and the Council of Ministers to solidify his rule, whereas Saud relied on the traditional royal court to bolster his following. Strikingly, Saud would also try to promote modern institutions – like a 120–member Majlis Ash–Shura which never came into being – to further his own interests. Conversely, Faisal would be reluctant to give up the traditional post of Hijazi viceregent. It was, however, in the area of defense administration that a constant fluctuation of status and institutional attachment of Royal Guard and National Guard most vividly reflected the balance of forces of the day.

Elite politics fluctuated much less once Faisal had emerged as the main figure in Saudi politics. The set–up represented by the October 1962 cabinet under him was one which should define Saudi politics thenceforth: "sovereignty ministries" under senior princes – from maternal branches which should keep these institutions until today –, and most technocratic posts for commoners: a feature which has made Saudi Arabia an exception in the GCC. Institutions and implicit rules of distribution became "locked in".

The 1970s oil boom was the last phase in which the Saudi state would expand rapidly and in which new institutions could be relatively freely designed. It was Prince Fahd in particular who pressed for rapid development, and the 1975 cabinet with six new ministries reflected a strengthened technocratic orientation. It was the last time that large numbers of young, Western–educated Saudis would be able to make quick and stellar bureaucratic careers. Figures like Hisham Nazer, Abdulhadi Taher or Abdalaziz Al–Quraishi, sometimes reaching senior posts in their late 30s, were given considerable administrative leeway and left their marks on the institutional landscape. In an impressive feat of co–optation, Fahd managed to recruit several leftist–oriented, but bright scions of important Saudi families into the technocracy, where within 10 years they would help to bring the Saudi administration to a level of competence unrivaled in the GCC.

While much was accomplished, the concentration of authority in a few senior players made for the "island" character of specific ministries, whether controlled by commoners or royals – an enduring feature which has come to complicate the Saudi business environment today. It remains to be seen whether new integrative and "transversal" institutions like the Majlis Ash–Shura can force the sometimes self–absorbed bureaucracy towards more integrated planning and policy implementation. The signs under the new king are encouraging. But a large bureaucracy, in the kingdom as everywhere else in the world, has a momentum of its own, and a distribution of authority that was shaped in a momentous and fluctuating history, but through its growth has attained more than a modicum of permanence.

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