The appointment this week of a new crown prince, and the most likely heir apparent, Prince Salman, has again revived the talk about Saudi Arabia's stability (see previous post). At first glance, things are looking good. The royal family has crushed the home-grown Al Qaeda threat and nipped in the bud any attempt to emulate the anti-government protests shaking the region's old order.
Saudi government dispensed no less than 130 billion of extra social spending in 2011, aimed at buying the citizens' loyalty. While some European governments struggle to keep their public sector employees from striking, King Abdullah simply hires more, doubles the salaries, and offers them more benefits.
However, we can count at least five long-term challenges to stability in Saudi Arabia, which even the world's top oil exporter can't fix with money alone.
Photo by Getty Images.
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