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Saudi Arabia: Background and U.S Saudi Arabia: Background and U.S. Relations Christopher M. Blanchard Analyst in Middle Eastern Affairs June 14, 2010 Congressional Research Service 7-5700 www.crs.gov RL33533 CRS Report for Congress Prepared for Members and Committees of Congress Saudi Arabia: Background and U.S. Relations Summary The kingdom of Saudi Arabia, ruled by the Al Saud family since its founding in 1932, wields significant political and economic influence as the birthplace of the Islamic faith and by virtue of its large energy reserves. Since 2005, King Abdullah bin Abd al Aziz Al Saud has sought to strengthen Saudi relations with European and Asian counterparts and has worked to build and lead an Arab consensus on regional security issues such as Lebanon and the Israeli-Palestinian conflict. Domestic reforms under King Abdullah have codified royal succession rules, begun restructuring the justice system, and updated some educational curricula and practices. An Al Qaeda-inspired terrorist campaign inside the kingdom appears to have ebbed as security improvements and anti-extremism campaigns have been implemented. However, Saudi authorities remain focused on the threat of a resurgence in domestic terrorism. In March 2010, officials announced the arrest of over 110 individuals suspected of continuing involvement in Al Qaeda activities. Robust energy export revenues in recent years strengthened the kingdom’s regional and global economic position and are now providing Saudi leaders with resources to meet investment needs and fiscal challenges posed by the global economic downturn. A close Cold War-era relationship between the United States government and the ruling Al Saud family was built on shared interests in securing Saudi oil production and in combating global Communism. Since the end of the Cold War, the emergence of the Al Qaeda terrorist threat and volatile regional security conditions in the Middle East have tested U.S.-Saudi relations. The direct participation of 15 Saudi nationals in the terrorist attacks of September 11, 2001, and the identification of several Saudi nationals and entities as alleged supporters of terrorism have called into question Saudi Arabia’s reliability as an ally for some U.S. observers. Increased official counterterrorism cooperation and shared concerns about Iranian foreign policy have provided a new strategic logic for U.S.-Saudi security relations since 2003. Long-standing defense ties remain intact, and U.S. arms sales have continued, with over $18.7 billion in potential Foreign Military Sales to Saudi Arabia approved by the executive branch and Congress since 2005. While security cooperation has improved since 2003, the United States and Saudi Arabia continue to face a core challenge identified by the 9/11 Commission in its final report: defining a broader bilateral relationship that “leaders on both sides are prepared to publicly defend.” The Obama Administration has continued to hold high-level consultations with key decision makers in the Saudi royal family on issues of mutual concern, including energy policy, finance, Israeli-Arab peace, Iran, trade, and counterterrorism. In conjunction with a May 2008 visit by President Bush to Saudi Arabia, the previous Administration announced new agreements relating to nuclear cooperation, infrastructure security training, and visas. The Obama Administration has signaled its intention to engage the Saudi government as a strategic partner in efforts to promote regional stability and to defeat Al Qaeda. The 111th Congress has considered foreign assistance requests for Saudi Arabia and prohibited the use of FY2010 funds for assistance to Saudi Arabia, subject to a national interest waiver authority granted to the Secretary of State. The Obama Administration is requesting $360,000 in border security assistance and $10,000 in International Military Education and Training (IMET) funding for Saudi Arabia in FY2011. This report provides background information about Saudi Arabia and analyzes current issues in U.S.-Saudi relations. Congressional Research Service Saudi Arabia: Background and U.S. Relations Contents Recent Developments..................................................................................................................1 Background ................................................................................................................................4 Saudi Arabia’s Political Development....................................................................................4 Saudi-U.S. Relations, 1931-1991...........................................................................................5 Saudi-U.S. Relations, 1991-2001...........................................................................................7 September 11, 2001, and its Aftermath ..................................................................................8 The 9/11 Commission Report ..........................................................................................9 Saudi Responses .............................................................................................................9 Recent Assessments ............................................................................................................10 Terrorist Financing Concerns ........................................................................................10 Toward a New Relationship?............................................................................................... 11 Recent Bilateral Agreements .........................................................................................13 Recent Congressional Interest in Saudi Arabia...........................................................................14 U.S. Foreign Assistance to Saudi Arabia and Congressional Prohibitions.............................15 International Military Education and Training (IMET)...................................................15 Counterterrorism Assistance..........................................................................................16 Prohibitions on Foreign Assistance................................................................................17 FY2010 Appropriations Debate.....................................................................................18 U.S. Arms Sales to Saudi Arabia .........................................................................................19 Background ..................................................................................................................19 Criticism and Action in the 110th Congress ....................................................................20 BAE Corruption Inquiry................................................................................................22 Current Issues in U.S.-Saudi Relations ......................................................................................23 U.S.-Saudi Military Cooperation.........................................................................................24 U.S. Military Training Mission in Saudi Arabia (USMTM) ...........................................25 Saudi Arabian National Guard Modernization Program (PM-SANG).............................25 Office of Program Management Ministry of Interior – Facilities Security Forces (OPM MOI-FSF) .......................................................................................................26 Counterterrorism.................................................................................................................26 Al Qaeda in the Arabian Peninsula ................................................................................27 Combating Extremism ..................................................................................................28 The Arab-Israeli Conflict.....................................................................................................30 Saudi-Palestinian Relations ...........................................................................................31 Saudi Peace Proposals...................................................................................................31 Iraq.....................................................................................................................................33 Saudi Policy Priorities in Iraq........................................................................................34 Saudi-Iraqi Diplomatic and Economic Relations............................................................34 Economic Relations and Trade ............................................................................................36 U.S.-Saudi Trade...........................................................................................................36 U.S. Oil Imports and Saudi Policy.................................................................................36 U.S.-Saudi Foreign Direct Investment ...........................................................................37 Saudi Boycott of Israel and WTO Membership .............................................................38 Human Rights, Religious Freedom, and Political Reform ....................................................39 Political Reform Debates and Elections.........................................................................40 Leadership and Succession............................................................................................41 Social Reform Debates and Recent Leadership Changes................................................42
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