Editor's Note:

For your consideration we present an interview with Engineer Usamah al Kurdi, a member of the Consultative Council of Saudi Arabia.  Last year SUSRIS was pleased to bring you our first interview with him where he shared his insights on reform and developments in Saudi-US relations.  SUSRIS has also published his presentations at various conferences and symposia (see below for more).

We were fortunate to hear Engineer al Kurdi and Doctor Ghassan al Suleiman, Chairman of the Jeddah Chamber of Commerce and Industry, last month in Washington.  At a forum organized by the National US-Arab Chamber of Commerce in cooperation with Meridian International Center, the Middle East Policy Council and the Middle East Institute, they talked on the topic "Opportunities for Economic and Political Reform in Saudi Arabia."  Their presentation as well as an interview with Doctor Ghassan will be provided separately in SUSRIS.

This interview was conducted in Washington, DC on August 12, 2005.

SUSRIS: Thank you for taking time to talk about developments in the Kingdom and the state of Saudi-US relations. Last year when you were in Washington you spoke with us about reforms in the Kingdom. Can we start with an update on developments in this area?

Al-Kurdi: Well I am happy to report that since we spoke a year ago, reform in Saudi Arabia is continuing. The emphasis on job creation and business opportunities is continuing. The attention to social reforms, addressing social ills, is continuing. Overall, I can say reform in Saudi Arabia is healthy and proceeding.

New reform steps have been taken this year with an important one among them, in my opinion, being Resolution 120. It provides for the government to address the well being of women of Saudi Arabia. This resolution included the creation of a national committee for women. It also included special attention to services provided to women, business opportunities for women and, of course, job opportunities for women.

On another front -- the relationship between the US and Saudi Arabia -- I’m glad to have seen the dramatic success of the Crawford Summit between King Abdullah and President Bush in April. There were many significant areas of mutual interest addressed in the summit joint statement. In my view a very important part is the plan to continue cooperation in the area of education -- opening the doors of American universities to Saudi students.

The educational component of the US-Saudi relationship has always been important and this step ensures that it will not be damaged. I was happy to see that the leaders addressed this area.

Generally speaking, the summit and the resolution removed a lot of psychological uncertainties about where the relationship was going. It made clear to everyone around the world how each side values the relationship.

As I have been heard saying many times in the past we have no choice but to have a good relationship. This is good for the world. It is good for the Muslim countries. This is good for the Arab countries. This is good for the causes of both Saudi Arabia and the United States.

SUSRIS: The substance of the summit discussions and the joint statement, as you pointed out, served to strengthen the strategic relationship between the US and Saudi Arabia on a variety of issues. However, the focus of press reports surrounding the meeting was squarely on the issue of gas prices. Why do you think there is such attention given to this single issue when there are so many important items on the bilateral agenda?

Al-Kurdi: Unfortunately, where oil is concerned many people think in terms of the 1980s and early 1990s. They recall an era where Saudi Arabia, and even OPEC for that matter, was able to dramatically influence the price of oil. Those days have changed.

The controlling factors no longer include OPEC. In my opinion, they include the fact that oil is a freely traded commodity on the open market. They include the fact that refining capacities around the world are less than what they should be. They include the fact that production capacities have been unable to keep up with the increased demand --and I must say that Saudi Arabia is working hard on boosting production.

So, as far as both Saudi Arabia and the United States are concerned the idea is to cooperate, to put controls on the market so that there are no spikes in the price as well as the level of production. Saudi Arabia is working -- and has announced this -- to increase its production capacity because it is becoming clear, in my opinion, that this is the single most important factor influencing the market. We have, at great expense, installed additional production capacity in Saudi Arabia. We have seen new oil fields opening in Saudi Arabia. Yet, despite making huge investments in the area of additional production capacity in Saudi Arabia, we are not seeing similar efforts to meet demand from other countries, including the US, as far as increasing refining capacity.

Less than a year ago, when our Minister of Oil visited the United States, he made an offer for the Saudi oil companies to build two refineries here. In my opinion that would have helped ease the high price of gasoline in the US.

I think the high price of oil is not in the interest of Saudi Arabia. Higher prices reduce consumption. Higher prices make it more economical to find alternatives to oil. What I would like to have seen in the latest energy bill passed by Congress was more emphasis on curtailing consumption so that oil will last longer. In the end we will clearly have to find alternatives but we must all use energy wisely for everyone’s benefit.

SUSRIS: The perception of the Saudi-US relationship among Americans seems to never stray far from the oil question, especially criticism over price manipulation. Does it bother you that most Americans don’t know the full scope of reasons for a strong relationship?

Al-Kurdi: Actually it does bother me because the people who are in the know are not telling the people who are not in the know that the situation has dramatically changed.

We are not in the 1980s or the 1990s. We are in a period of time during which production capacity and refining capacity are the issues that impact the price of oil. The people who do not know the facts insist that Saudi Arabia wants to emphasize the high price of oil. These people need to be told by us and other people in the know that this is not true.

SUSRIS: How important are other factors in the United States’ relationship with Saudi Arabia, such as the strategic geographic position of the Kingdom at the crossroads between Europe and Asia, the influence that Saudi Arabia has as the custodian of the holy places, its leadership in the Islamic world?

Al-Kurdi: You have just listed very important reasons, and there are more, as to why Saudi Arabia and the US must have excellent relations. I don’t say “good,” I say “excellent” relations.

The fact is that Saudi Arabia is an important country in the Middle East and the Islamic world and our close relationship supports US interests in that regard. Those are things that people should understand. They should know that the US is the number one trading partner for Saudi Arabia. They should know the important role that both countries play in the international arena. People should know about all these things, not just the energy component of the relationship.

SUSRIS: There have been obvious strains on the relationship from both sides since 9-11. Some Americans are concerned about Saudi Arabia’s commitment to fighting terrorism. Meanwhile some Saudi Arabians are opposed to elements of American foreign policy. Can you tell us what policies of the United States concern Saudi Arabians?

Al-Kurdi: Let me first tell you that a very important part of the relationship stems from the efforts of both countries to fight terrorism. It is extremely important that we cooperate together to fight terrorism, including going after money laundering that serves to finance terrorism.

Earlier this year we organized an international conference to coordinate international anti-terrorism efforts. We have proposed an international center for fighting terrorism and we have even proposed financing it. It is clear that Saudi Arabia and the United States are in close cooperation in the war on terrorism.

Now let’s go back to the issue of policies of the US that are not popular in Saudi Arabia. It would be difficult for me to find a policy of the US that if it is not popular in Saudi Arabia, is unpopular only in Saudi Arabia. You will find it is the case not only in Saudi Arabia but in many countries, and not only in the Middle East, but in many different countries around the world.

In general, the policies regarding military bases in the Middle East and in other parts of the world; regarding Afghanistan; regarding Iraq, of course; and regarding Palestine are the issues. At this moment the situation in Iraq is especially of concern.

They generate resentment from many people around the world, and from Saudis. The war in Iraq has damaged the US image. The support that is provided to the occupation of Palestinian land by Israel does not generate a positive view. The same thing applies to Afghanistan. So it is important for the US -- and I am glad to see there are some efforts in that direction -- to improve its image not only in Saudi Arabia and in the Middle East but also in many countries around the world.

In the year that followed the unfortunate events of September 11 my travels took me to many different countries in the world: in Europe, in South America, in Africa and in Asia. I was surprised to see how many friends America had lost. Instead of gaining friends as a result of being victims of September 11, they have lost a lot of their friends. Again, I am happy to see that there are efforts in the US to improve its image.

SUSRIS: Many Americans find it difficult to understand those feelings from other members of the international community. They see the invasion of Afghanistan as having been necessary after 9-11 because that’s where the terrorists operated from, and they see that Americans fought to free the country and assist the Afghan people. Similarly in Iraq, Americans invested billions of dollars and lost almost 2000 troops fighting there. What would you tell Americans who see what is happening in Iraq not as an occupation but rather as spending American blood and treasure to give the people of Iraq a future?

Al-Kurdi: I would say that getting rid of Saddam and the current war in Iraq are not two sides of the same coin. While many people in the Middle East are glad to get rid of Saddam, many are not happy about the way it was done. The same applies to Afghanistan.

Many Americans share that view as well. They have the same concerns. Everyone has seen the movements here demanding a withdrawal of American forces from Iraq.

You and I may understand the overall situation but the point here is the image America has in the Middle East and in other parts of the world. One needs to spend a lot of time and effort explaining these situations. This is why I say I am happy to see planning to do this in the United States.

SUSRIS: Wrapping up your assessment of the Saudi-US relationship, are you optimistic or pessimistic?

Al-Kurdi: Oh, very optimistic. I am very optimistic we are going in the right direction. I believe we are complementing the world community by cooperating together, and I am glad to see the results of the Crawford Summit are actually taking place.

SUSRIS: Turning to the transition in Saudi Arabia from King Fahd to King Abdullah. King Abdullah has been the de facto ruler since 1996 and clearly was involved in government policies and directions. How should Americans view the transition?

Al-Kurdi: Well as I have said before, Saudi Arabia is a country of institutions. I also said before that to continue on the path of reform in Saudi Arabia, public support is important. When a decision is made in Saudi Arabia you are certainly able to detect the consensus that was created in support of that decision.

People are under that impression that decisions in Saudi Arabia are made by the stroke of a pen. In fact, we have our own democracy. The exchanges of dialogue that take place before a decision is made, might not be on the pages of the newspapers all the time. Yet, the issues are certainly discussed and decisions are reached based on hearing the arguments of all the parties. The institutions in Saudi Arabia will continue to perform, I believe, as they have always been planned to perform.

The Basic Law of government in Saudi Arabia, that was issued 13 years ago, clearly addresses the issue of succession. So we were following a law when Prince Abdullah took over after the death of King Fahd, God bless his soul. There was a law that was applied. So the change was not an arbitrary one.

I will place all my bets on the continuing stability of Saudi Arabia and the continuity of reform. With the creation of the National Dialogue Center I think that reform in Saudi Arabia will improve, and might even come faster, depending on public support and consensus. But I see us continuing what we have been doing in this regard, especially in light of the very positive economic situation in the country. The reforms will continue.

SUSRIS: Can you elaborate on the concept of reaching consensus before decisions are made, especially the role of the Consultative Council? Can you give us an example of how the process works?

Al-Kurdi: Important decisions go through a process so each and every decision is an example. But let me give you a specific example of a decision involving the Consultative Council.

There was the case of the issuance of the New Companies Law. The first draft of the law was prepared by the government and forwarded to the Shura Council, the Consultative Council. We looked at it for a very long time. We looked at each and every item, each and every article of that law. We made quite a few changes.

There was a new Minister of Commerce appointed and he made a request to the council, that it not be passed until he had another look at it. So it went back to the Minister of Commerce and it came back to us with a few changes.

We made changes to it, passed it. Then we asked to have the law applied which says when the consultative council passes a law it brings it to the attention of the King. He also received the opinion of the Council of Ministers and the government and if there were any differences in the two opinions it should be brought back to the Shura Council.

So it was brought back to us because there were some disagreements between the government and the Shura Council. We looked at the draft of the law, and agreed with the government that some of the changes were necessary. We sent it back to the King and it’s waiting to be issued. I know this sounds very complicated but it gives you an idea of the level of consultation and consensus that goes into decision making in Saudi Arabia.

SUSRIS: What do you foresee in the coming months in the transition of Abdullah from Crown Prince to King?

Al-Kurdi: Continuity and stability is what I can tell you.

SUSRIS: Included in the Crawford Summit joint resolution was the creation of a commission headed by Secretary of State Rice and Foreign Minister Saud al-Faisal. What is your impression of this initiative?

Al-Kurdi: Well I am happy to see that this commission was reorganized. I think, as I have seen with other countries, these types of commissions meet once, twice, sometimes three times a year.

I am delighted to see that this has been reactivated and to see the Ministers of Foreign Affairs and the Secretary of State heading the commission. That tells me the importance of this commission. I hope that the commission will meet very often so that issues can be addressed before they become problems.

SUSRIS: Building bridges between Saudi Arabians and Americans, including business connections, was discussed in the Crawford Summit joint resolution. What is your assessment of the business-to-business component of the relationship?

Al-Kurdi: I said earlier that the summit in Crawford was a major milestone in developing, increasing, improving relations between Saudi Arabia and the United States. In the past few months we have seen serious efforts from the business communities both in the US and Saudi Arabia to improve relations.

There was a major trade mission from Saudi Arabia in May and I understand that business organizations in the States are planning visits to Saudi Arabia. As many people know there have been visits by business delegations from the US after the summit. I have seen the mood in the business community in both countries improve remarkably which is encouraging because the business connections are an important part of the relationship. I’m sure it will continue.

I’m glad to say that overall the mood is positive. The relations are improving. Business communities are interested and reform in Saudi Arabia is proceeding.

You know I may have painted a rosy picture about the relations and the reform in Saudi Arabia. That was intentional but I would also like to say there is still quite a way to go. We need to develop a lot of the aspects of life in Saudi Arabia. Likewise we must all continue to work to improve the relationship between Saudi Arabia and the United States. But I am glad to say that the a strong foundation between Americans and Saudis are already in place.

SUSRIS: Thank you for sharing your insights and views on these important issues with us today.

Al-Kurdi: It was my pleasure.

Usamah Al-Kurdi is President of Alagat, a business-consulting firm based in Riyadh and a member of Saudi Arabia’s Consultative Council (Majlis Al-Shura). He serves as a Board Member of Saudi Arabian Airlines and an Executive Committee member of the national U.S. Arab Chamber of Commerce.

From 1990-2001, Mr. Al-Kurdi served as Secretary General of the Council of Saudi Chambers of Commerce, as well as Vice President of Saudi Consulting House, a forerunner of the Saudi Arabian General Investment Authority (SAGIA). He has also served on the Boards of Saudi Arabia’s National Industrialization Committee and the Royal Commission on Jubail & Yanbu (industrial cities).

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