Yet, this data is puzzling because other indicators show that the economy remains in good health. Non-oil growth has slowed, but at 3.7% in the third quarter of 2025 it was hardly weak. Meanwhile, indicators of employment from other sources suggest that job creation for Saudi nationals has continued at a reasonable clip. The Labor Force Survey data seems disconnected from most other economic indicators. This raises the possibility that the survey is providing misleading signals about the current state of the Saudi labor market.

A Closer Look at Saudi Labor Market Data

The key variables in the Labor Force Survey are the unemployment rate, labor force participation rate, and employment-to-population ratio. The unemployment rate is the number of people who are unemployed as a share of the labor force (defined as the total of all those who are employed and unemployed). The labor force participation rate is the labor force as a share of the working age population (defined as those aged 15 and above). The employment-to-population ratio is the number of employed people as a share of the working age population (again defined as those aged 15 and above).

Data on the unemployment rate, labor force participation rate, and employment-to-population ratio come from Saudi Arabia’s quarterly Labor Force Survey. As the name suggests, this data is based on a survey of a sample of the population (nationals and expatriates) in which respondents are asked a series of questions about their labor market activities. Employment data is also collected in the survey, but it is not published. Rather, the published employment data comes from the administrative records of the General Organization for Social Insurance and the Ministry of Human Resources and Social Development. This data is often referred to as “administrative” or “register-based” labor market data.

There are significant definitional differences between the Labor Force Survey and register-based data. The latter is a narrower measure of employment, as people working in the military and security services and those who are not registered with the General Organization for Social Insurance (which could include the self-employed and freelancers) do not feature. In mid-2024, the “register-based” data showed that 3.9 million Saudis were employed, while the author’s estimate is that the (unpublished) Labor Force Survey measure showed 6.2 million Saudis as employed. It is not clear why the statistics authorities do not publish the employment data from the survey – if there are concerns about its quality, these concerns would equally apply to the other data from the survey that is published.

The Labor Force Survey shows that the unemployment rate among Saudi nationals hit an all-time low of 6.3% in the first quarter of 2025 but subsequently increased to 6.8% in the second quarter and 7.5% in the third quarter. While this rate is still low by historical standards – as recently as the third quarter of 2022, it was over 10% – the 1.2 percentage point increase over two quarters is large and defies the usual seasonal pattern whereby the unemployment rate drops in the second quarter.

Source: General Authority for Statistics

The declines in the labor force participation rate and employment-to-population ratio for Saudi nationals in the second and third quarters were also unusually large. Both indicators have been on an upward trend in recent years but fell by over 2 percentage points from 51.3% to 49% and 48% to 45.3%, respectively, between the first and third quarters of 2025 (with most of the decline in the second quarter). In the third quarter, the indicators were at their lowest levels since mid-2021 and mid-2022 respectively.

In contrast, the employment of Saudi nationals remained on a positive trend according to the register-based data. Employment increased by a total of 76,000 in the second and third quarters of 2025 compared to a 52,000 increase in the same two quarters of 2024. Continued  employment growth is consistent with the results of the Riyadh Bank purchasing managers’ survey that shows that companies are still feeling optimistic about hiring.

A Difficult Circle to Square

A higher unemployment rate, a lower participation rate and employment-to-population ratio, and continued job creation are difficult to square with each other. There are two possible explanations. The first is that there has been a substantial acceleration in the growth of the working age population. The second is that there has been a divergence between the register-based and Labor Force Survey employment data.

A rapid increase in the working age population could be consistent with a drop in the employment-to-population ratio at a time of rising employment, a decline in the participation rate (as those aged 15-24 have a lower participation rate given many are in school or college), and an increase in the unemployment rate if employment does not grow sufficiently quickly to absorb the new entrants to the labor force. During 2023-24, the working age population grew by an average 3.2% per year. Looking at the age structure of the population in the 2024 population statistics, there is no reason to believe the growth rate of the working-age population would have significantly accelerated in 2025. Yet, to generate the observed movements in the unemployment, participation, and employment rates between the first and third quarters of 2025, the working age population would have had to increase by 6%. This is not realistic.

It therefore seems that the (unpublished) employment data from the Labor Force Survey must be telling a different story from the register-based data. Differences between the two data sources are not unusual. From mid-2022 to mid-2024, the register-based and survey data both showed increasing Saudi employment, but the estimated increase from the Labor Force Survey was nearly twice as large as from the register-based data – 560,000 new jobs created compared to 290,000. The author’s estimates suggest that employment in the survey data would have had to decline by around 90,000 over the past year to be consistent with the reported decline in the employment-to-population ratio (in the absence of population estimates for 2025, this estimate assumes growth in the working age population of 0.8% a quarter, in line with recent experience). This compares to an increase of 155,000 jobs in the register-based employment data over the same period, which seems easier to rationalize given current economic conditions.

Sources: General Authority for Statistics; author’s calculations.
Note: Data shows the change in employment over the previous four quarters. The Labor Force Survey series is estimated.

Tread With Care

Given the emphasis that Vision 2030 places on increasing employment for Saudi nationals, having data that accurately tracks the trends in the labor market is essential. Unfortunately, at present, the published labor market data is difficult to interpret and does not seem to tell a consistent story across key variables. The decline in employment that seems to be implied in the Labor Force Survey is particularly difficult to rationalize given current economic conditions. This raises the question of whether the survey is accurately reflecting current conditions in the Saudi labor market.

Concerns about the quality of the Labor Force Survey data are not new. There has been considerable quarter-to-quarter volatility in the data in the past even during periods of relative economic calm. The reason for this volatility is unclear, but it could potentially be due to low survey response rates or sampling issues, as households are rotated in and out of the survey sample. Concerns are magnified by the fact that the labor market module of the 2022 Population Census, a key input for the survey, has still not been published more than two years after the initial round of census data was released. Improving the quality of the labor market data should be a high priority, as good data is the basis for good economic policymaking.

The post Should Saudi Policymakers Be Concerned About Rising Unemployment? appeared first on AGSI.

The STC’s December gamble, at least on the surface, made a lot of sense. The Presidential Leadership Council, the eight-member body that represents what passes for Yemen’s internationally recognized government, was in disarray and riven with infighting. The economic situation in the South was a disaster and looked to be growing worse. Plus, the STC seemed to have the acquiescence if not the active encouragement of the UAE. The STC was formed in 2017 with the explicit goal of forming an independent Southern state in Yemen. By late November and early December 2025, all it needed was a spark, which it got when a local commander in Hadramout deployed troops around an oil field in an attempt to secure more revenue. The STC responded with a military offensive, quickly taking much of the oil-rich governorate of Hadramout as well as Mahra, Yemen’s easternmost governorate on the border with Oman. Within days the STC had control of much of Southern Yemen, and it looked as if all that was missing was an official declaration of independence.

On December 26, Rashad al-Alimi, the head of the Presidential Leadership Council, called on Saudi Arabia to intervene militarily in Yemen to reverse the STC’s military gains. For many, Alimi’s request echoed the one made a decade earlier by then Yemeni President Abd Rabbu Mansour Hadi, who called on Saudi Arabia and the UAE to use military force in Yemen to expel the Houthis from Sanaa. That intervention exacerbated a conflict in Yemen that still hasn’t ended.

Despite that history, however, Saudi Arabia quickly signaled that it was willing to intervene militarily in Yemen, even against ostensible allies. This is likely because, as analyst Maysaa Shuja al-Deen pointed out, the STC offensive upended the “implicit power-sharing arrangement” that had held for much of the past several years. “UAE backed forces dominate coastal areas and islands and maintain strong influence in Aden, while Saudi-backed forces control land borders and oil facilities.”

The day after Alimi’s request, Saudi Minister of Defense Khalid bin Salman posted a statement on X calling for the STC to withdraw. When that didn’t work, Saudi Arabia carried out an airstrike on an Emirati shipment of arms and vehicles that was destined for the STC, though the UAE denied the shipment included weapons. Worried about the implications of a Saudi-Emirati conflict in Yemen, the UAE announced that it was withdrawing all of its remaining forces from Yemen, which effectively left the STC exposed without air cover. After that, Saudi Arabia and its allies on the ground made quick work of the STC, carrying out a few airstrikes and forcing the units that had advanced with such optimism a month earlier to retreat. In some cases, STC fighters were forced to flee the area in buses after their military vehicles were destroyed.

On January 2, Aidarous al-Zubaidi, the head of the STC and a member of the Presidential Leadership Council, attempted to save face by announcing what he termed a “constitutional declaration,” basically laying out a two-year transitional period for an independent Southern state. Saudi Arabia responded by summoning several members of the STC, who also sit on the Presidential Leadership Council, in an apparent attempt to divide the movement from within.

What comes next in Yemen is likely to be messy and chaotic. Already there has been looting in Hadramout and Mahra as well as calls for reform and transition within the STC. Whether it survives in its current form or is able to implement its two-year constitutional transition toward independence are both open questions as is what role the UAE will play in Yemen moving forward. Will it continue to support the STC to the degree it did before, or will it look to diversify and increase support to other proxies, such as Tariq Saleh, who are not tied to dreams of Southern independence? One thing is certain, the withdrawal of UAE troops from Yemen does not mean the end of the UAE in Yemen.

Beyond the immediate implications for the STC, however, are broader ones for Yemen. After nearly 15 years of protest, revolution, chaos, uncertainty, and war, the country seems more divided than ever. The STC, despite its vision of an independent Southern state, never had the type of popular support across the South that could make that dream a reality. Instead, it is and was largely a regional movement, with much of its leadership and backing coming from Dhala and Lahj, which are close to Aden but far from Hadramout, where the STC was pushing to take over. Meanwhile, Hadramis prize their own regional identity, and even a few independent Hadrami state flags have popped up on X recently. The same could be said about Mahra and Socotra, both of which have distinct languages, although neither has the economic resources of Hadramout. Local allegiances over a national identity, a handful of competing militias none of which are strong enough to compel others to bend to their will, and meddling outside powers, taken together, constitute a recipe for continued conflict.

The STC’s failed attempt at independence likely means that Yemen won’t split along North and South lines. There will be no return to pre-1990 borders, at least not anytime soon. Instead, Yemen appears headed for a future in which no one party will manage to achieve superiority. The country will be divided along regional lines with local warlords, backed by outside powers, seizing as much territory as they can hold and administering as they see fit. There may be a veneer of national government, but its power won’t stretch much beyond the capital. Such a country will continue to spread insecurity – from Houthi threats to Red Sea shipping and a still active al-Qaeda threat to drug smuggling and a refugee problem, Yemen’s challenge to the region is only going to grow.

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2021: A Bad Year for Gulf-Lebanese Relations

In 2021, Lebanon’s relations with the Gulf states spiraled. Hezbollah maintained its grip on Lebanese politics both through its mafia-like enforcement of order and its long-standing relationship with then-President Michel Aoun and his Christian party, the Free Patriotic Movement. This monopoly cast a large shadow over Lebanese politics and decision making, particularly as it pertained to Lebanon’s relationship with its neighbors.

George Kordahi, who served as Lebanon’s minister of information at the time, made disparaging comments about the Saudi-led intervention in Yemen, calling it “futile and pointless” and said that the Houthis were “defending themselves against an external aggression.” This came six months after then Lebanese Foreign Minister Charbel Wehbe used derogatory terms to describe the Saudis. Many Gulf Cooperation Council countries were convinced that Lebanon was pursuing a pro-Iran foreign policy that was intended to undermine the Gulf’s agenda.

Meanwhile, media accounts reported that Hezbollah was smuggling disassembled weapons into Yemen and conducting training for Yemen’s Houthi fighters. There have even been unconfirmed reports that Hezbollah’s leadership may have influenced Houthi financial and military operation decisions.

Moreover, in April 2021, Saudi authorities discovered a shipment of 5.3 million smuggled Captagon pills in pomegranate crates at the Jeddah airport. The Gulf states viewed Hezbollah’s sway in Lebanon, involvement in Yemen, and effort to corrupt Gulf society through the sale of drugs as a war being waged against them.

Lebanon’s Economic Crisis

In response, Saudi Arabia in October 2021 expelled Lebanon’s ambassador, banned all Lebanese imports, and recalled its ambassador to Lebanon. In solidarity, Bahrain, Kuwait, and the UAE recalled their ambassadors as well. (These Gulf ambassadors have since returned to Beirut). Then, in early 2022, Saad Hariri, Lebanon’s former prime minister and leader of the Sunni community in Lebanon, announced that he would suspend all his political activities in advance of that year’s parliamentary elections. The announcement was linked to tensions between the Saudi royal family and Hariri. Even the Emiratis, who agreed to host Hariri, emphasized to him that he would be allowed to conduct his business affairs in the UAE on the condition that he suspend his political activities.

As Lebanon’s relationship with the Gulf was deteriorating, it suffered the effects of one tragedy after another. In 2019, Lebanon endured a severe economic collapse, as its gross domestic product fell by nearly 40% in real terms, its currency lost 98% of its value, and depositors were not allowed to access their funds held at local banks. In August 2020, during the height of coronavirus pandemic restrictions, an estimated 2,750 tons of unsafely stored ammonium nitrate exploded at Beirut’s port causing the largest nonnuclear blast in modern history, resulting in hundreds of deaths, thousands of injuries, and billions of dollars in damage.

Rather than bringing relief from such tragedies, Iran’s support to Hezbollah has only added to the suffering of the Lebanese people, including the largely pro-Hezbollah Shia population in the south. Hezbollah used its sway to block for more than two years the election of a president that it viewed unfriendly to the group’s agenda, leading to political gridlock and paralysis. It was not until Israel’s attacks in 2024 in southern Lebanon, weakening Hezbollah, that the group realized it could no longer stand in the way of electing the president. And with Joseph Aoun’s election as president in January, the gridlock ended.

What Does Lebanon Need To Do?

In June 2023, the International Monetary Fund issued a report with economic reform recommendations to stabilize the Lebanese economy. The reforms included enhanced governance transparency, a strengthened anticorruption framework, improved performance among state owned enterprises, debt restructuring, a unified exchange rate, and protection for small depositors. It is generally accepted within Lebanon and among international observers that the country’s political elite are deliberately blocking much-needed reforms to protect their financial interests.

Between 1963 and 2022, Gulf states gave Lebanon an estimated $9 billion in grants, excluding loans and investments. But they have stressed that that era is over. Gulf capitals have linked any new financial packages to reforms, such as combatting corruption and restoring confidence in the banking system as proposed by the IMF, and, crucially, disarming Hezbollah. Saudi commentator Ali Shihabi said that Saudi Arabia “does not want to invest in a black hole.”

Like other Gulf states, Saudi Arabia generally frames its position on Hezbollah’s disarmament in terms of support for state control of weapons and in the context of adherence to relevant United Nations Security Council resolutions (which include provisions on disarmament). How a relatively weak Lebanese central government, with armed forces outgunned for decades by Hezbollah, would accomplish such disarmament without prompting significant internal instability remains unclear. However, as the Lebanese government and the international community continue to make progress on the question of Hezbollah’s weapons, it is widely expected that the mafia state created by the militia will no longer be able to survive, and the much needed and long-awaited economic reforms called for by the Gulf states and others will finally be enacted.

In August, U.S. Special Envoy for Syria – and U.S. Ambassador to Turkey – Thomas Barrack announced a plan to disarm Hezbollah by the end of 2025. It outlines an economic strategy for Lebanon that combines regional investment with security reforms. This plan also includes Saudi Arabia and Qatar investing in an economic zone in southern Lebanon to create job opportunities for former Hezbollah members who agree to lay down their weapons. Media accounts indicate that the plan for disarming Hezbollah will rely on persistent Israeli military pressure on the group, which could prolong the depopulation of some border villages and lead to a more militarized southern Lebanon.

Prospects for Gulf-Lebanon Ties

Given the key to any Gulf-Lebanon rapprochement is Hezbollah surrendering its weapons, the path to get there is going to be filled with landmines both figurative and literal. This does not mean that steps can’t be taken to move toward this goal. The first big hurdle was the election of Aoun and the appointment of Prime Minister Nawaf Salam. Lebanon now has a leadership that seems ready to bring the country back into the Arab and Western fold.

In March, Aoun was the first Lebanese head of state in eight years to visit Saudi Arabia, where he met Crown Prince Mohammed bin Salman. During the visit, the two leaders discussed taking steps to resume Lebanese exports to Saudi Arabia and have Saudi citizens once again travel to Lebanon, according to the Office of the Presidency. In the months that followed, Aoun also visited Kuwait, Qatar, and the UAE to present Lebanon as “open for business.” Saudi Arabia has responded positively and, in November, announced plans to boost commercial ties to Lebanon after reports that “the Lebanese government and security forces demonstrated efficacy in curbing drug exports over recent months,” according to a senior Saudi official.

Accounting for more than 19% of GDP prior to the economic collapse in 2019, tourism has emerged as the fastest route toward restoring ties to Gulf countries and reviving the economy. “Tourism is a big catalyst, and so it’s very important that the bans get lifted,” said Laura Khazen Lahoud, Lebanon’s tourism minister. Shortly after Aoun’s visit, the UAE officially lifted its travel ban on UAE nationals visiting Lebanon, according to the UAE Ministry of Foreign Affairs. Bahrain, Kuwait, and Saudi Arabia are considering similar moves. Qatar never imposed a travel ban, so Qatari nationals have continued to travel to Lebanon.

Emirati and Gulf interests in Lebanon are likely to include investments in the energy sector and development of the gas fields in the eastern Mediterranean. The UAE may also be willing to contribute by providing equipment and training to universities and hospitals and by rehabilitating key infrastructure, particularly the Beirut port and the country’s road and bridge networks.

Remittances in Lebanon in 2025 are expected to reach $7.31 billion, with an annual growth rate of 4.5% over the next several years. Before the rupture with the Gulf, the majority of Lebanese expatriates in the Gulf were in Saudi Arabia with more than 300,000, the UAE was close behind with nearly 200,000, and Kuwait had around 42,000. From 2020-22 alone, more than 80,000 Lebanese moved to the Gulf in search of jobs. Remittances from the Gulf remain a critical component of the Lebanese economy.

Approaching the end of the year, Saudi Arabia has already made another strong gesture of support to the Lebanese government. Along with the United States and France, Saudi Arabia announced on December 18 that it will host an international conference early in 2026 in support of the Lebanese army. Aoun expressed his heartfelt gratitude and emphasized his commitment to ensuring that the money will be used in a transparent and responsible manner to help Lebanon resume its rightful place as a member of the Arab nations.

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Riyadh’s Strategic Motivations

One year after the collapse of Bashar al-Assad’s regime, relations between Riyadh and Damascus have undergone a dramatic reversal. The transformation has been driven by overlapping geopolitical shifts, economic ambitions, and Saudi Arabia’s determination to shape a new regional order that privileges Arab leadership over Iranian influence and channels cooperation with Turkey to constrain any outsized regional ambitions.

For over a decade, Saudi Arabia was one of Assad’s fiercest adversaries, supporting opposition forces and viewing Damascus as a conduit for Iranian expansionism. Assad’s abrupt collapse in December 2024 – toppled by Hayat Tahrir al-Sham, led by Ahmed al-Sharaa – upended that paradigm. The kingdom quickly moved to engage the new leadership, calculating that early outreach could prevent Syria’s descent into renewed chaos or Iranian reentrenchment.

At the core of Riyadh’s post-Assad strategy lie three imperatives: security containment, geopolitical balancing, and economic opportunity. First, Saudi Arabia seeks to preempt the resurgence of transnational jihadism and disrupt the narcotics economy – particularly the Captagon trade – that has corroded Syrian institutions and flooded Gulf markets. A stable, cooperative Damascus is seen as essential to shielding Saudi borders and domestic stability.

Second, Riyadh seeks to reassert Arab primacy in the Levant by weakening Iranian networks while keeping Turkish ambitions in check. In Syria – the Levant’s center of gravity – Saudi financial leverage and Turkish military weight make cooperation necessary, even as their complementary roles sharpen Riyadh’s wariness of Ankara’s regional aspirations. By exploiting Turkey’s dependence on Saudi and broader Gulf capital, Riyadh can work with Ankara when interests align while still constraining its bid for dominance.

Third, Syria offers economic opportunity. Syria’s reconstruction, which the World Bank estimates will cost at least $216 billion, offers a vast arena for Gulf investment. Saudi official statements and bilateral agreements point toward the use of sovereign capital and private enterprise to rehabilitate infrastructure, energy grids, and transportation corridors, with the apparent aim of gradually integrating Syria into a Gulf-linked regional economic ecosystem centered on Saudi capital. Development, in this calculus, becomes an instrument of influence.

Saudi Arabia and Syria are discussing data cables linking the kingdom to Europe as part of a regional artificial intelligence and digital hub initiative, and the Saudi Telecom Company submitted a proposal for the project. Saudi renewable energy leader ACWA Power is also among Saudi companies poised to invest in Syria. In parallel, an International Monetary Fund team has already been in Damascus to support efforts to strengthen the capacity of Syria’s central bank, ensuring it can perform its essential functions and serve as a stabilizing anchor for the national economy.

Politically, Sharaa’s emphasis on nationalism and state restoration over ideological militancy resonates with Gulf sensibilities. His pragmatic willingness to distance Syria from Iran and Islamist movements has given Riyadh a rare opportunity to cultivate a partner that, while fragile, shares the Saudi preference for stability through state authority rather than revolutionary ideology.

With this in mind, Sharaa appears to have concluded that the surest route to Western goodwill runs through deepening alignment with Saudi Arabia, one of Washington’s primary Arab partners. Taken together, these moves signal Damascus’ recognition that Saudi Arabia – not Iran or Russia – is now the indispensable gateway to postwar normalization and economic reintegration. This calculation reflects a broader strategic shift, namely that Syria’s long-term sovereignty and economic recovery now depend less on ideological alignments and more on embedding the country within a Saudi-led, Western-endorsed framework.

In essence, Saudi Arabia views Syria’s transition not simply as regime change but as a geopolitical reset, a chance to entrench Gulf leadership across the northern Arab tier and to demonstrate that Arab reconstruction, not Iranian patronage or Turkish leverage, will determine the region’s future.

Milestones in a Rapid Rapprochement

The speed of normalization since late 2024 underscores Riyadh’s strategic urgency. The reopening of the Saudi Embassy in Damascus in September 2024 symbolized Syria’s reentry into the Arab system. Sharaa’s reciprocal visit to Riyadh in February 2025, his first foreign trip, sealed the personal rapport underpinning the political thaw.

Diplomatic efforts unfolded rapidly. A January summit in Riyadh gathered foreign ministers from the Gulf Cooperation Council states, Syria, the United States, and the European Union – signaling consensus on Syria’s reintegration and underscoring Saudi Arabia’s emergence as the principal convener of postwar diplomacy.

The pace accelerated further in March, when a Saudi-mediated border demarcation agreement between Syria and Lebanon, overseen by Saudi Defense Minister Khalid bin Salman, established mechanisms to curb militancy and cross-border smuggling, issues central to Riyadh’s security agenda.

Economic engagement quickly followed the political thaw. After the administration of President Donald J. Trump lifted select sanctions in mid-May – marking a successful lobbying effort by the Saudi crown prince – Saudi Arabia, together with Qatar, settled Syria’s $15 million arrears to the World Bank and later they jointly pledged $89 million to help maintain vital public services and cover state salaries. The Syrian-Saudi Investment Forum in Damascus in July concluded with a $6.4 billion Saudi investment pledge and the signing of a slew of agreements covering infrastructure, banking, energy, and real estate, alongside feasibility studies for a Syrian stock exchange and new power-generation projects. The two countries also concluded a bilateral Investment Promotion and Protection Agreement and established a Saudi-Syrian Business Council.

Building on this momentum, Sharaa doubled down on the strategy he apparently believed would secure Western backing, visibly tying Syria’s recovery narrative to Saudi capital, regional leadership, and reformist branding. Addressing the Future Investment Initiative in Riyadh in late October, Sharaa underscored Saudi Arabia’s “key role” in rebuilding postwar Syria while courting global investors. He cast Syria as an emerging trade corridor and noted that it had already attracted more than $28 billion in pledged foreign investment. In mid-November, the Saudi tanker Petalidi delivered the first crude-oil grant shipment to help stabilize refinery operations and bolster Syria’s wider economic recovery.

For Washington, this alignment fits neatly within its broader posture of “strategic minimalism,” supporting a Gulf-led stabilization effort that limits Iran’s influence, contains Russia’s footprint, and avoids the costs of direct U.S. engagement. Russia’s muted presence in this phase of Syria’s transition – shaped by bandwidth constraints from the war in Ukraine and an implicit recognition that Gulf financing will dictate Syria’s future political economy – further underlines the shifting balance of power.

Politically, Saudi Arabia has sought to recast Syria as a stabilizing pillar rather than a flashpoint. It has condemned Israeli airstrikes on Syrian territory and championed respect for sovereignty in United Nations and Arab League forums, situating Damascus within a Gulf-led security narrative. Riyadh has approached the integration of former HTS members into local governance pragmatically, focusing on stability and effective administration rather than rigid ideological scrutiny. It remains to be seen whether the December 13 killing of two U.S. military personnel and one civilian interpreter, at a site near Palmyra in central Syria, will upend some of the assumptions for the integration of HTS by Riyadh, Damascus, and Washington. The incident may also test the viability of Washington’s preference for engagement in Syria through strategic minimalism.

Riyadh’s proactive posture may also reflect lessons from its past hesitations – particularly in Yemen and Iraq – where delayed engagement arguably contributed to Iran entrenching itself deeply before Saudi Arabia acted. Its early, front-loaded engagement in Syria is thus best understood as a preemptive strategy to shape conditions before rival actors can fill the vacuum.

The Expanding U.S.-Saudi-Syrian Triangle

All these developments suggest the Syria file is now embedded within a broader U.S.-Saudi strategic compact. Congress’ repeal of the 2019 Caesar Syria Civilian Protection Act under the National Defense Authorization Act removes the broadest sanctions constraining engagement with Syria. In place of automatic snapbacks, Washington has installed a four-year conditional oversight framework tied to security and governance benchmarks. For Riyadh, the move lowers legal exposure and shifts investment decisions decisively toward managing Syria’s political and security risks rather than sanctions risk.

Within that newly permissive – but still conditional – framework, for Riyadh, this partnership confers immense strategic dividends. It amplifies Saudi Arabia’s diplomatic weight, aligns its regional ambitions with Washington’s minimalist engagement model, and cements its image as the indispensable Arab interlocutor between Damascus and the West. For Syria, it offers political rehabilitation and economic lifelines.

Persistent Fault Lines and Risks

Yet beneath the momentum lie vulnerabilities that could unravel the project. Domestically, Syria remains deeply fragmented. Violence has erupted intermittently in Suwayda, and while the March bloodshed in coastal Alawite areas has not repeated, underlying sectarian divisions and tensions remain pronounced. Recent parliamentary appointments hint at inclusivity, but social reconciliation remains nascent at best. The political step that builds on inclusivity, the prospect of some level of representative governance, remains only a contested, notional concept. These domestic fractures, if unaddressed, could compound external pressures and erode the foundations of Riyadh’s stabilization strategy.

Externally, Syria sits at the intersection of rival power projections. Relying on the goodwill it amassed in helping HTS develop and eventually overthrow the Assad regime, Turkey continues to occupy northern territories with troops and through proxy militias, pursuing a problematic buffer-zone agenda that is likely to eventually cause friction with Damascus. By some accounts, remnants of Iranian proxies continue to operate in Syria. Israel’s repeated airstrikes on Shia militias and Hezbollah’s logistical corridors and weapons depots perpetuate volatility. Geir Pedersen, warned in August before his resignation as U.N. special envoy for Syria that the country’s “transition remains on the knife-edge.”

Economically, accelerating sanctions relief is critical, but formal repeal of the Caesar Act does not eliminate all hurdles. Even after formal removal, major investors are likely to wait months before committing substantial capital, given lingering challenges, including Syria’s fragile political governance, persistent security problems, weak infrastructure, and volatile currency.

Smuggling and narcotics trafficking could undercut progress. Saudi efforts to strengthen border enforcement through trilateral coordination with Syria and Iraq remain embryonic and easily disrupted by political shifts or corruption.

The Kurdish question compounds these strains. The U.S.-backed Syrian Democratic Forces still control much of the northeast, including the country’s oil production and agriculture, and the process for integrating these forces into the national army has stalled. Ankara’s hostility toward Kurdish autonomy and Damascus’ reluctance to share power make compromise elusive. A senior SDF commander, Sipan Hemo, recently warned of renewed conflict if negotiations fail, underscoring the volatility of this fault line – his hard line a reminder that tough rhetoric is a part of the negotiations process. Any escalation could derail reconstruction and test Riyadh’s diplomatic agility.

Saudi Postconflict Statecraft

Saudi Arabia’s embrace of the Sharaa government and orchestration of Syria’s regional and international reintegration represent a defining experiment in postconflict statecraft. Using financial leverage, diplomatic pragmatism, and coordination with the United States, Riyadh aims to forge a Gulf-led regional order that prioritizes Arab sovereignty and stability over ideological or proxy-driven agendas. If the strategy succeeds, it will further cement Saudi Arabia’s position as a key regional power.

Success could reshape Syria’s trajectory and the broader Middle Eastern security architecture, positioning Gulf states as both financiers and guarantors of order. Yet domestic fragmentation, residual militancy, competing foreign interests, and uncertain Western politics threaten to derail the project. For now, the Saudi-U.S. partnership stands as a symbol of strategic interdependence, with Riyadh providing capital and regional legitimacy, while Washington offers diplomatic and security backing. Whether this experiment proves a model for Gulf-led stabilization and reconstruction or a cautionary tale of the limits of external engineering will shape the region’s political landscape for years to come.

The post Recasting Syria After Assad: Saudi Arabia’s Bid to Shape a Gulf-Led Regional Order appeared first on AGSI.

As the protests spread nationally, the list of demands grew. Economic demands were high on the list – with the youth unemployment rate topping 35%, protesters called for more jobs as well as higher wages and lower prices and higher subsidies for basic goods. At the same time, they called for lower expenditures on the 2025 Africa Cup and 2030 World Cup. They demanded improvements in education, health care, housing, and public transit. They called for the release of detained protesters and effective measures against corruption, including the removal of corrupt political parties from the governing coalition. Interestingly, they also called for the adoption of English over French as Morocco’s second national language after Arabic, and, notably, most protest signs were in English – relatively few were in Arabic, with almost none in French. Increasing numbers of young Moroccans prefer English over French, replacing “colonial” French with the preferred language of international commerce and communications.

The protests brought to mind the Arab Spring protests of 2011, which resulted in significant political changes in Morocco. The resonance with the earlier protests was enough to spark a reaction and support, albeit modest, from fellow monarchies in the Gulf. Moroccan King Mohammed VI’s regularly scheduled address to the Parliament on October 10 signaled his refusal to accede to the most forceful demands, notably the removal of the prime minister. Still, the protests have been a reminder both that ties among fellow monarchs persist and that youth ambitions in the region have not been fully met. Typically, protests in Morocco trigger cabinet reshuffles and, at times, prime minister replacements, institutional mechanisms that insulate to some degree but also serve as a proxy for direct criticism of the monarch.

Morocco in the Gen Z Protest Wave

Morocco was the 22nd country swept up in a global wave of protests that peaked in September following well-publicized Gen Z protests in Nepal and Madagascar. Previously referred to as the “Asian spring,” worldwide Gen Z protests began earlier in Sri Lanka and Iran (following the death of Mahsa Amini) in 2022; continued in 2024 in Kenya, Bangladesh, Mozambique, and South Korea; and, in 2025, spread to Turkey, Mongolia, Nepal, Timor-Leste, Madagascar, Serbia, Indonesia, Togo, the Philippines, France, Italy, Switzerland, San Marino, the Maldives, Peru, Paraguay, and Morocco.

What ties these global youth protest movements together, other than the ubiquitous skull and crossbones flag and meme (from the Japanese manga series “One Piece”), are concerns over inequality, reductions in standards of living, corruption, democratic backsliding, and increasing authoritarianism. Another common thread has been the important roles of rappers, both in providing protest anthems and as “martyrs” when arrested. Morocco was no exception. Prominent Moroccan rappers in the movement included Don Bigg, Dizzy DROS, ElGrande Toto, and Khtek, and the movement also spawned the viral rap freestyle challenge #FreeKoulchi (Free Everyone).

While some of these protests have toppled governments – for example in Nepal and Bangladesh – others have been more reformist in nature, such as those in Turkey, Indonesia, and Morocco. Young Moroccans presented their demands to Mohammed VI in an October 2 letter that called for the removal of the prime minister, the dismissal of the government, and a plethora of reforms and new policies. A second letter by 60 prominent artists and intellectuals condemned the government’s initial lack of concessions and called for the same reforms and the release of those in detention.

Solidarity From the Gulf States

The Moroccan state’s predicament prompted a series of gestures of support by Gulf Cooperation Council countries. Saudi Prince Turki bin Mohammed bin Fahd bin Abdulaziz, minister of state and member of the Council of Ministers, personally delivered a message to Mohammed VI on October 6 on behalf of Saudi King Salman and Crown Prince Mohammed bin Salman. On the same day, the Saudi crown prince’s plane was spotted in Marrakesh, prompting unsubstantiated media reports that Mohammed bin Salman personally participated in the Saudi show of solidarity. In addition, a high-level Saudi delegation visited the capital, Rabat, to discuss increasing cooperation in a wide range of strategic sectors, including bilateral efforts to boost employment. Anwar Gargash, advisor to the president of the United Arab Emirates, issued a statement of solidarity. Al Jazeera covered the protests but significantly softened its tone relative to its coverage of the 2011 Arab Spring protests in Morocco, amid a widely reported reorganization of its senior staff and concomitant shifts in its editorial line.

Morocco and the GCC states have a long history of supporting each other in times of need. Following a serious oil spill off Morocco’s coast in 1989 by an Iranian tanker, Saudi Arabia sent Morocco $50 million for the cleanup. When ocean winds and currents unexpectedly pushed the spilled oil offshore and out of harm’s way, the money was used to create Al Akhawayn University, which quickly became the country’s most prestigious institution of higher learning. Morocco famously sent 1,200 troops to defend Saudi Arabia in 1991 following Iraq’s invasion of Kuwait despite strong populist headwinds in Morocco. GCC countries made a series of strong gestures during and after Morocco’s large Arab Spring protests, leading to the 2013 establishment of a $5 billion development fund. Morocco joined Saudi Arabia’s military action in Yemen in March 2015, and Moroccan soldiers stayed for nearly four years. When Morocco cut ties with Iran in 2018, it cited Iran’s 2011 interference in Bahrain as one of the reasons.

These gestures of solidarity have accompanied a deepening of economic and business ties. The first Morocco-GCC summit was held in 2016. And, in March, Morocco and the GCC established a joint action plan for 2030. The fifth Moroccan-GCC Investment Forum was held in early November. Increased GCC investment has been and will be critical in helping Morocco weather the current storm.

The King’s Response and a “Victory” for Youth

Mohammed VI responded to the protests in his October 10 address to the new session of Parliament. He called for job creation, improved services, and a reduction in regional inequities and directly criticized the Parliament for inefficiency, but he also – indirectly – criticized protesters for questioning “flagship” projects. These include the construction and refurbishing of seven stadiums for the World Cup, which he argued were no less important to national development and pride than other local infrastructure projects. For example, the new stadium in Casablanca is planned to be the largest in the world, with a capacity of 115,000 spectators. However, the most prominent slogan of Morocco’s protests was “Stadiums are there, but where are the hospitals?” Another was: “At least the FIFA stadium will have a first aid kit! Our hospitals don’t.”

The Moroccan government introduced both economic and political reforms following the protests. On the economic side, it announced a 16% increase in health and education spending amounting to $15 billion. These reforms are slated to create 27,000 jobs in those sectors, build new university hospitals, renovate 90 other hospitals, and expand teacher training and preschool education. On the political side, Morocco introduced bills to increase youth participation in politics, including the easing of candidate eligibility requirements and subsidies of up to 75% for young candidates’ electoral campaigns. “Gen Z 212” responded somewhat tepidly that “these measures must be accompanied by firm measures against corruption and conflicts of interest.”

Then something extraordinary happened: Morocco upset a heavily favored Argentinian team at the 2025 FIFA U-20 World Cup, the youth soccer World Cup, in Chile. Morocco defeated Spain, Brazil, South Korea, the United States, and perennial top seed France to get to the final. Argentina was the only undefeated team and had won the trophy six previous times. On October 19, the young Moroccans beat the offensively and defensively capable Argentinian team 2-0.

Suddenly, many of the same young Moroccans lamenting new stadiums joined the delirium in favor of another huge Moroccan soccer success. Morocco had been the first African or Arab team to reach the Men’s World Cup semifinals in 2022. Its women’s team was reaching new heights as well by unexpectedly qualifying for knockout stages of the 2023 World Cup, the first Arab and North African team to do so. This filled Moroccan youth with pride and is likely to serve to further dampen criticism of soccer stadium construction and refurbishment. But as the monarch and Moroccan youth seem to agree, the country’s political and economic success will depend to a significant degree on greater investment in job creation and services beyond what World Cup success will provide.

The post Friends in Need: Morocco’s Gen Z Protests and the GCC Response appeared first on AGSI.

This apparent retreat has sparked predictable reactions. Critics see vindication for their skepticism, citing the project’s immense cost, technical improbabilities, and utopian detachment from reality. A recent Financial Times investigation detailing floating marinas, suspended stadiums, and the sheer impossibility of building a 105-mile mirrored city has reignited the charge of folly. Yet such judgments miss the deeper significance of The Line and what it began.

The Line was never merely a construction project; it was a statement of intent. Emerging from the earliest years of Saudi Vision 2030, it sought to announce that Saudi Arabia’s future would be measured not only in barrels of oil but in ideas. Its architectural audacity – the notion that 9 million people could live in a zero-carbon vertical corridor through the desert – was inseparable from a wider cultural awakening. It invited the world to see the kingdom not as a latecomer to modernity but as a laboratory for reimagining it.

There was, of course, a deliberate element of spectacle to command attention. It inserted Saudi Arabia into a global dialogue about the future of urban life – about density, sustainability, and the relationship between humans and their environment. It forced a discussion around whether a new model of urbanism could emerge from one of the world’s harshest climates, where conventional notions of mobility and comfort no longer applied.

Yet the tension between utopia and reality was present from the start. To live in The Line was to inhabit a diagram – a place of perfect geometry but uncertain humanity. Without streets, plazas, and other informal spaces where life unfolds, could it ever become a true city? Its mirrored surfaces promised a world of reflection but risked a world without depth. The city as machine, however efficient, could never replace the city as organism.

The project’s contraction may therefore arguably represent not failure but evolution. Grand visions rarely survive their first encounter with reality intact. Modernist architects developed masterplans for the capital of Brazil, Brasília; Chandigarh, the capital of the northern Indian state of Punjab; and even Dubai – the earliest masterplans for all these cities began as abstractions that had to yield to the pragmatic demands of daily life. Saudi Arabia is now undergoing a similar reckoning – not with its aspirations but with their scale. By paring back The Line, the kingdom may be rediscovering the human dimension of its own modernity.

This shift reflects a larger maturation within Vision 2030. The early years were defined by monumental gestures – new cities, megaprojects, gigaplans. They were necessary to break the decades of inertia and announce that change was irreversible. But as the transformation takes root, the emphasis has begun to move toward livability, inclusion, and continuity. Across Riyadh, programs of “humanization” are introducing shaded walkways, public parks, and urban greenery. In Al-Ula and Diriyah heritage is being reinterpreted not as nostalgia but as a living urban fabric. These initiatives embody, in quieter form, the very ideals that The Line once dramatized: sustainability, integration, and the balance between progress and tradition.

Critics might still ask whether the vast sums invested in The Line – estimated at tens of billions of dollars – could have been better spent on social housing, education, or public infrastructure. It is a fair question, but it assumes that imagination and practicality are mutually exclusive. Ambition is itself a social resource. The energy that The Line unleashed – among architects, planners, and young Saudis who, for the first time, saw their country at the forefront of innovation – cannot be measured in financial return alone. The project demonstrated that Saudi Arabia was willing to experiment, take risks, and confront global challenges not with hesitation but with vision.

Indeed, some of The Line’s most important legacies are invisible: the research into renewable energy systems, modular construction, and digital design; the cross-pollination of ideas among local and international experts; and the cultivation of a generation of Saudi professionals who have now worked on one of the most complex urban experiments in history. These capacities will endure long after the last mirror panel is installed.

The more pressing question is what comes next. If The Line represented the kingdom’s leap into the future, its scaling back could signal a pivot toward grounded modernity – urbanism that is socially responsible, environmentally sensitive, and culturally resonant. The lesson is not to abandon boldness but to align it with the everyday realities of Saudi life: the need for affordable homes, equitable access, and cities that nurture community as much as they showcase innovation.

In this light, The Line was not a mistake but a constructive exaggeration – a provocation that stretched the boundaries of the possible so that the plausible might emerge. Every utopia performs this function. By imagining a world that cannot exist, it reveals what must change in the one that does. If the project helped shift the kingdom’s urban imagination from the static sprawl of the 20th century toward denser, more sustainable models, then its purpose has already been fulfilled.

Perhaps it is fitting that the story of The Line ends not with collapse but with reflection – on the meaning of ambition, limits of technology, and enduring power of dreams. Saudi Arabia’s transformation has never been linear; it moves by leaps and recalibrations, by trial and adaptation. What remains constant is the determination to redefine what an Arab city can be in the 21st century.

The mirrored wall across the desert may never stretch to the horizon, but its idea will continue to resonate – in Riyadh’s parks, Al-Ula’s restored landscapes, and the small-scale experiments that privilege people over spectacle. The end of The Line is, in that sense, not an ending at all. It is an inflection point – a moment when vision meets humility, and when the pursuit of the extraordinary begins to give shape to the possible. And as a Riyadh-based urban planning expert said about The Line: “I think as a thought experiment, great. But don’t build thought experiments.”

The post Beyond the End of The Line: Rethinking Saudi Arabia’s Urban Future appeared first on AGSI.