The Future Investment Initiative, the annual "Davos in the desert" summit in Riyadh scheduled to begin October 26, was postponed on October 19 after weeks of Houthi missile and drone attacks on the Saudi capital. The airport has been effectively shut since a Houthi missile killed 13 people on October 10, and many Western governments have warned citizens against travel to the kingdom.
According to an analysis from The Economist, the postponement symbolises a broader reversal of the bets Prince Mohammed made as he rose to power a decade ago: that he could defeat the Houthis, reshape the Saudi economy, and rely on Trump as an ally. All three have gone awry.
The kingdom failed to defeat the Houthis, and a ceasefire agreed in 2022 began to unravel amid America's wider war with Iran. The Houthis have seized additional territory in Yemen and battered Saudi Arabia. People close to the crown prince see only bad options: a ground war, an ineffective air campaign, or a deal that cements Houthi rule.
A long conflict would derail Prince Mohammed's economic program, which was already sputtering. Big projects have been shelved, wages have not kept pace with inflation, and annual foreign direct investment is only about one-third of the crown prince's US$100 billion target. The IMF now expects the Saudi economy to contract by 3.3 per cent in 2026, after earlier forecasting 4 per cent growth.
The kingdom had sought influence over Trump by promising vast investments in America, paying Trump-owned golf courses to host Saudi-funded tournaments, and investing US$2 billion with Jared Kushner, the president's son-in-law. "He's not loyal to anyone for long," one well-connected Saudi told The Economist.
Since the deadly airport strike, Prince Mohammed has been largely invisible, leaving ministers to visit victims. Western commentators have begun asking whether the year poses an existential threat to his rule, but diplomats in Riyadh consider such talk overblown. "He was in a much tougher place seven or eight years ago," one Western envoy said.
Democratic Senator Chris Murphy, who met the crown prince this month, acknowledged the shift: "I do understand that this is a different moment than 2018 or 2020. They are facing these Houthi advances and Houthi rocket attacks."
The biggest decisions are now out of Prince Mohammed's hands. He has urged Trump not to escalate the war with Iran. Saudi officials fear that if the president resumes bombing after the November midterm elections, the kingdom will take blows from the south, north and east, with limited air-defence interceptors to protect a country four times the size of France.