Saudi purge evokes pragmatism and fear

BriberyThe arrests of as many as 500 people in Saudi Arabia as part of an anti-corruption initiative have divided investor opinion. The detentions, which some are calling a purge, are seen as an effort to consolidate the power of crown prince Mohammed bin Salman. The crown prince is the leader of the newly formed Saudi Anti-Corruption Committee, which has detained princes, politicians and businessmen in an effort, it says, “to root out corruption”. “This is the latest act of concentration of power in Saudi,” said Hasnain Malik, global head of equity research at Exotix Capital. “As unprecedented and controversial as it may be, this centralisation might also be a necessary condition for pushing the austerity and transformation agenda, the benefits of which very few investors are pricing in.” The UAE central bank has reportedly asked local institutions to provide information on the accounts Saudi citizens caught up in the detentions. The Saudi authorities say they want to confiscate the assets of detained citizens as part of an effort to recover what they say are misappropriated funds. Despite his optimistic view, Malik admitted that some may see the purge as “populist ruthlessness”. The purge is reminiscent of the anti-corruption measures of Chinese president Xi Jinping, who used his assault on graft to consolidate his power. ©2017 funds global mena

Executive Interviews

INTERVIEW: Protecting the investment

Nov 23, 2017

Rasmala’s trade finance fund recently passed $100 million in assets. Doug Bitcon, head of credit strategies, explains why he has to be hands-on.

EXECUTIVE INTERVIEW: A natural interest in the topic

Mar 08, 2017

Since 2016, Guillermo Ortiz has been a chairman of Latin America’s BTG Pactual. The former central banker of Mexico talks to Nick Fitzpatrick.


ROUNDTABLE: Charting the pace of reform

Nov 23, 2017

Saudi Arabian index inclusion, the onset of taxes and the Dana Gas controversy were among the issues discussed by our cross-industry panel. Chaired by George Mitton in Dubai.


Mar 08, 2017

The move to a three-day settlement cycle, the appearance of new stock exchanges, and recent rules on hedge funds were discussed by our panel in Cape Town. Chaired by George Mitton.