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Saudi Arabia's Role in Revitalising Post-Pandemic Economies in Yemen and Beyond

Annaliese Hawkins | Middle East Fellow

Crown Prince and Defence Minister of Saudi Arabia Mohammad bin Salman Al Saud. Image sourced from Russian Presidential Executive Office via Wikimedia Commons.


Detected late in 2019, the Coronavirus (COVID-19) pandemic locked down cities, oppressed health services and plunged economies into disarray. It starkly revealed the lack of cohesion within the international community as nations struggled to coordinate a unified response. This was especially evident in the Middle East, where vaccine rollouts exposed deep disparities in wealth and healthcare access between countries. While Gulf countries like Saudi Arabia and the United Arab Emirates (UAE) continue in 2024 to steadily recover, Yemen, Lebanon, and Syria struggle to regain stability.

 

The pandemic underscored long-standing inequalities in the Middle East where wealth disparities have impacted recovery efforts. Affluent Gulf states such as Saudi Arabia and the UAE have successfully leveraged their resources in the pandemic’s aftermath, developing innovation-focused strategies such as Saudi Arabia’s Vision 2030. However, countries impacted by ongoing war - Yemen, Lebanon and Syria - remain mired in instability which was compounded by limited vaccine access and fragile healthcare systems. Collaboration between regional leaders and international actors is critical in addressing socio-economic divides to secure prosperous futures for the whole region.

 

The pandemic continues to have a profound impact exacerbating existing economic, social, and political challenges. Oil-dependent economies like Saudi Arabia and the UAE faced sharp declines in revenue with estimates indicating that Dubai’s oil prices were to decline by nearly 40 per cent in 2020. Lockdowns and social distancing measures disrupted tourism, trade, and labour markets, leading to widespread unemployment, with a spike from 13.55 per cent in 2019 to 15.18 per cent witnessed in Syria. Saudi Arabia’s economy dramatically declined during the pandemic as a result of the collapse in oil prices, reduced tourism for pilgrimage, rising unemployment and healthcare strain. In 2019, Saudi Arabia generated $12 billion USD from Umrah and Hajj making up to 20 per cent of their ‘non-oil GPD’, highlighting the severe economic impact in 2020 when restricted arrivals for pilgrimage further worsened the downturn. Amid this economic upheaval, healthcare systems were also buckling under strain brought on by the pandemic.

 

Countries affected by active conflicts such as Yemen and Syria saw their fragile health systems forced to the verge of collapse. Syria was particularly hard hit as over 70 per cent of healthcare workers had already fled the country. COVID-19 further compounded these issues. For example, only 212 ICU beds were reportedly available for 4 million people in Northern Syria. In these countries, vaccine rollouts were reported to be far below the global average while Gulf states soared with up to 98 per cent vaccine coverage. The pandemic thus clearly highlighted disparities in healthcare access, further deepening regional inequality.

 

Other countries in the region emerged in far better condition. In 2020, Saudi Arabia’s magnum opus, Vision 2030, was already being formulated. Vision 2030 intends to reduce dependence on oil revenue and move towards greener initiatives – one project being a city set to house nine million residents without producing any emissions. However, many continue to question whether the project aims to silence critics of the monarchy's invasive surveillance and crackdown on dissent, and concerns about greenwashing continue to linger. While Vision 2030 faces several challenges, it represents a significant and commendable shift toward economic diversification, technological innovation, and sustainable development in the post-COVID era.

 

Saudi Arabia’s success post-COVID was largely owed to the Kingdom’s wealth. One of the key factors enabling Vision 2030’s ambitious scope is the country’s substantial financial resources, largely driven by the wealth and influence of Crown Prince Mohammad bin Salman. Government spending on infrastructure boosted occupancy in the country from 2021 to 2022 alone, while investment in airport smart gates may have played a part in the success of nearly reaching pre-pandemic levels of tourism in 2023. Access to wealth continues to play a major role in post-COVID life. However, there is reason to suggest that Saudi Arabia’s initiatives could provide a model for other countries in the Middle East. They have the potential to support less wealthy neighbouring nations in pursuing similar paths of modernisation and resilience in the face of post-COVID economic uncertainties.

 

Investment in regional economies could give Saudi Arabia an opportunity to showcase its commitment to regional development and stability, in line with Vision 2030’s broader goals of fostering economic diversification and reducing reliance on oil. One of the countries that could particularly benefit from such assistance is Yemen. Severely impacted by the pandemic, Yemen's already fragile economy and healthcare system were pushed to the brink. Saudi Arabia's involvement in Yemen is not new. However, a post-pandemic shift in focus towards humanitarian aid, healthcare infrastructure, and economic recovery could not only help stabilise the country, but also improve regional security. Countries like Lebanon and Syria, which also face severe post-COVID challenges, could look to the Saudi-Yemen model as an example of how, with external aid, targeted investments in healthcare and infrastructure can revitalise economies.  In turn, a more stable and prosperous region could reduce the socio-economic disparities exacerbated by the pandemic, fostering growth and integration that benefits the region as a whole.

 

COVID-19 exposed deep disparities across the Middle East, highlighting uneven healthcare access. Saudi Arabia’s Vision 2030, successful pandemic response, and wealth could drive regional transformation and stability, with benefits extending beyond its borders. Realising this future would require sustained collaboration and investment across the Middle East – both of which are sorely needed in the already transformed post-pandemic world.



Annaliese Hawkins is the Middle East Fellow for Young Australians in International Affairs. She holds a Bachelor of Arts degree from the University of Melbourne, majoring in Politics and International Studies, with a minor in French. During an exchange semester at Sciences Po in France, she earned a Certificate of Social Sciences and Humanities. Her studies focused on Middle Eastern and South Asian politics. As a participant in the YAIA Fellowship program, Annaliese is excited to bring her background and skills to new projects and discussions.

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