Will the protests spread to Saudi Arabia?

When we talk about the protests in the Middle East and North Africa we often wonder how much further they will spread. Many worry that the demonstrations and overthrows will spread to Saudi Arabia. The country sits atop a fifth of the world's oil reserves so any political unrest could make today's gas prices look cheap.

Although there are some grumblings by the people of Saudi Arabia, the king there is very popular. King Abdullah on Wednesday opened up the kingdom's pocket book by announcing a 135 billion social welfare package. This package is an attempt to calm people who might protest over inequality.

from this Associated Press article that we found at the San Francisco Chronicle, writer Tarek El-Tablawy describes the package to us.

The total cost was estimated at 135 billion Saudi riyals ($36 billion), but this was not largesse. Saudi Arabia clearly wants no part of the revolts and bloodshed sweeping the already unsettled Arab world.

Saudi officials are "pumping in huge amounts of money into areas where it will have an obvious trickle-down by addressing issues like housing shortages," said John Sfakianakis, chief economist for the Riyadh, Saudi Arabia-based Banque Saudi Fransi. "It has, really, a social welfare purpose to it."

The most prominent step was the injection of 40 billion riyals ($10.7 billion) into a fund that provides interest-free loans for Saudis to buy or build homes. The move could help reduce an 18-year waiting list for Saudis to qualify for a loan, Sfakianakis said.

Another 15 billion riyals ($4 billion) was being put into the General Housing Authority's budget, while the Saudi Credit & Savings Bank was to get 30 billion riyals ($8 billion) in capital. The bank provides loans for marriage and setting up a business, among other things, and is supported by the Saudi government.

Other measures included a 15 percent cost of living adjustment for government workers, a year of unemployment assistance for youth and nearly doubling to 15 individuals the size of families that are eligible for state aid. The government also will write off the debts of people who had borrowed from the development fund and later died.

While Saudi Arabia has been mostly spared the unrest rippling through the Middle East, a robust protest movement has risen up in its tiny neighbor, Bahrain, which like others around the region is centered on calls for representative government and relief from poverty and unemployment.

Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2011/02/23/international/i105855S35.DTL#ixzz1EuQ0q4el

NPR has this analysis on why revolt in Saudi Arabia is possible but unlikely. Writer Kevin Beesley says that many people see King Abdullah as a reformer.

NPR correspondent Deborah Amos is in Saudi Arabia and says the reason is simple: "The king is extremely popular, among young people and with reformers, too, unlike [former President Hosni] Mubarak in Egypt, and [former President Zine El Abidine] Ben Ali in Tunisia, who were deeply, deeply hated. They see [the king] as a reformer, and the changes he's introduced in the last two years have been startling."

The reasons behind the unrest that led to successful revolutions in Tunisia and Egypt and protests in Libya, Bahrain and elsewhere, vary from country to country. But there are three fundamental factors that nearly all have in common: economic deprivation, youth unemployment and political frustration.

Saudi Arabia has all those problems, and more. With its massive oil wealth, the kingdom is one of the world's richest countries, but the money is not distributed evenly. There are many wealthy Saudis and an estimated 6,000 royal princes, but the average national income is around $20,000 a year and many Saudis live on the poverty line.

"Inflation has hit Saudis hard," Amos says. "There have been sharp increases in food prices, and you need two salaries to get by."

Most estimates put unemployment in Saudi Arabia at around 10 percent. But like nearly all Arab countries, Saudi Arabia is experiencing a massive "youth bump" in its population — about two-thirds of the population is younger than 29 — and the unemployment rate for young people is thought to be around 40 percent.

Like the other oil-rich Gulf states, Saudi Arabia has invested billions in education, including sending students to universities in the United States, England and Australia. Now all of these graduates, especially an entire generation of well-educated young women, are looking for ways to use their education — and there are limited opportunities for them.