In Saudi Crown Prince’s Crackdown, Echoes of Xi’s China - Bloomberg

In Saudi Crown Prince’s Crackdown, Echoes of Xi’s China

By Keith Zhai and David Tweed

November 8, 2017, 10:04 PM GMT+10

Two leaders round up rivals in the name of economic reform

Campaigns tap into public frustration with ruling elite

How Xi Jinping Went From Feeding Pigs to Ruling China

How Xi Jinping Went From Feeding Pigs to Ruling China

If Saudi Crown Prince Mohammed bin Salman’s bid to speed economic reforms by rounding up rivals in graft raids sounds familiar, that’s because China has been doing it for years.

The arrest of princes, billionaires, ministers and retired officials in Saudi Arabia last weekend bore resemblance -- in both scope and stated mission -- to Chinese President Xi Jinping’s five-year-old anti-corruption campaign. And they may also have similar side benefits: pacifying the ruling elite and consolidating power around one man.

Such crackdowns have proven a reliable tool for governments from Brazil to Russia seeking to remove rivals and build legitimacy. Like Xi’s, the anti-graft campaign by the 32-year-old Prince Mohammed, who’s known as MBS among journalists and diplomats, appeals to a public increasingly concerned that the rich and powerful feel above the law.

“I certainly see similarities between the two leaders -- they are both consolidating power through the guise of reforms,” said Lydia Khalil, a research fellow at the Lowy Institute in Sydney and a Middle East specialist. “The reforms that MBS and Xi may be proposing may be popular and reasonable among some -- in fact many -- but the manner in which reforms are enacted are as important as the reforms themselves.”

Khalil warned that power grabs carried out under the guise of reform, without transparency and due process, risked a country’s long-term stability.

Wealthy Targets

There are important differences between the crackdowns. Xi’s campaign unfolded slowly over months and initially focused on retired officials, while Prince Mohammed struck immediately at rival power centers. Xi launched his effort after formally securing power in late 2012, while Prince Mohammed is still the heir-apparent.

Still, the similarities abound. Those detained included billionaire Prince Alwaleed bin Talal, the country’s richest man and an investor in companies such as Citigroup Inc. and Twitter Inc. King Salman, the crown prince’s father, told state TV that the most sweeping crackdown yet of his reign “will be applied on those big and small, and we will fear no one.”

In China, Xi has made similar pledges to make his country a place where “nobody dares to be corrupt.” The campaign has ensnared more than 1.5 million “tigers and flies,” including the country’s retired top general, former security chief and one-time presidential contender.

The effort has also extended to the business elite, with Wu Xiaohui, the founder of Anbang Insurance Group Co., China’s third-largest insurance company by premiums, missing since June amid reports that he was taken away for questioning.

Reform Cudgel

The ever-looming threat of prosecution has provided Xi a cudgel to push through policies. In a speech last month, he affirmed promises to improve the value of Chinese goods and pledged to restore the country to what he sees as its rightful place as a global power.

“The success of China’s anti-corruption campaign could be a good example to all authoritarian regimes,” said Zhu Lijia, a public affairs professor at the state-run Chinese Academy of Governance in Beijing. “It could maintain the political status of the ruling body while at the same time win public support and push forward the reforms they want.”

While investors wait to see whether Xi’s economic goals come to fruition, the political benefit to the president has been undeniable. He emerged from a twice-a-decade leadership reshuffle last month more powerful than any Chinese leader in decades.

At the ruling Communist Party’s congress in Beijing, Xi avoided naming a successor while installing numerous top allies in senior leadership posts. He got his name written into the party charter, giving him a status on par with Mao Zedong.

Public Support

While reliable polling is hard to come by in China, support for the crackdown appears broad. Some 83 percent of Chinese people surveyed by the Pew Research Center last year described corruption as a bigger problem than any other issue. At the same time, 64 percent said they believed the situation would improve over the next five years.

There’s also a risk of a backlash as Prince Mohammed consolidates power and moves to counter critics, according to Raihan Ismail, an associate lecturer at the Centre for Arab & Islamic Studies at the Australian National University in Canberra. She cited the arrests of intellectuals and clerics who have been critics of his war in Yemen and blockade of Qatar.

“What he is trying to do is to eliminate royal detractors and critics to consolidate power within his family,” Ismail said. “Companies are going to be nervous. Already we have the Gulf crisis. And that’s not helpful either.”