Saudi crown prince Mohammed Bin Salman promised to usher in a new era of innovation, prosperity and modernity when he became the kingdom’s de facto ruler a decade ago.
With his ambitious ”Vision 2030“ project, he hoped Saudi Arabia would soon rival Dubai as the regional business hub in the Middle East, attracting Western talent and enabling his influence to spread beyond the Kingdom’s borders.
But with just four years before his self-imposed deadline, those plans have been suddenly plunged into uncertainty. Earlier this week, Saudi air defences downed several Iranian drones and cruise missiles, while a strike on the Ras Tanura oil refinery temporarily halted operations.
In just a few days, the illusion of safety in the Gulf appeared to be shattered.
Did war ruin the Gulf’s reputation for safety?
Many countries deemed safe havens in the Middle East, including the United Arab Emirates (UAE), have been hit by Iran in retaliation for US and Israeli strikes launched a week ago, which killed Iranian supreme leader Ayatollah Ali Khamenei.
Numbeo’s ranking of the UAE as the safest country in the world for the second year in a row in 2026 now seems absurd as images pour in of stranded tourists and residents in Dubai sheltering from missile fire emerged earlier this week.
Even as Gulf countries rushed to assure citizens they were safe, experts say the entire region is facing severe reputational damage due to the insecurity created by the war.
Dania Thafer, executive director of Gulf International Forum, told The Independent that the “normalisation of volatility” was a risk for Saudi Arabia as it seeks economic expansion.
“Mohammed bin Salman’s transformation agenda is not predicated on absolute security – it rests on the credibility of long-term predictability,” she said.
“Vision 2030 assumes that global investors, multinational firms, and expatriate talent will see Saudi Arabia as a stable environment for capital, innovation, and lifestyle. That assumption becomes harder to sustain if the Gulf is no longer viewed as the oasis of Middle East stability but as an active frontline.”
Any prolonged instability in the region would complicate the “transformation narrative” in the Gulf and “weaken the safe hub for business model that both Dubai cultivated and Saudi Arabia now seeks to emulate”, she added.
The Kingdom is facing a struggle to attract talent
A key element of Prince Mohammed’s plan was his megaproject Neom, the most ambitious vision for a city in human history.
As part of the project, more than £363bn would be pumped into the construction of a mountain ski resort, several coastal resorts and an industrial zone along the coast of the Red Sea, while a 170km megacity called The Line would be built.
But less than a decade on from the announcement, the Saudi government appeared to have admitted defeat. After a series of delays and ballooning costs, it was reported earlier this year that the project would be scaled back.
After this setback, experts say a long war in the Middle East would severely hamper his ability to attract Western talent and multinationals.
Dr Neil Quilliam, from Chatham House, said: “The issue for Saudi Arabia beyond the immediate crisis is the impact it will have on the country’s ability to attract and retain expatriate senior executives, persuade international businesses to establish their regional headquarters in Riyadh and continue to implement Vision 2030.”
Could Saudi Arabia fare better than Dubai?
While experts believe that Saudi Arabia’s reputation may suffer, both Dr Quilliam and Ms Thafer argue that the kingdom may not be as badly affected as the UAE.
Ms Thafer said: “Reputationally speaking, Saudi Arabia has less to lose as it was not its main brand to the same degree as it was for Dubai. Historically, Saudi Arabia has been attacked far more frequently and at a greater scale than the UAE in terms of missile, drone, and cross-border strikes linked to Iran or Iran-backed groups.
“However, Saudi Arabia’s vast geographic size and dispersed population centres make individual attacks less concentrated and therefore less immediately disruptive to daily life than it would be for the UAE.”
Dr Quilliam said that Saudi Arabia had one key advantage over the UAE for its recovery: its scale.
“The country is the size of Western Europe and has so far been less affected than the UAE. It has not experienced the same concentration of missile strikes. Furthermore, domestic flights have continued throughout the conflict, and most expatriates leaving the UAE are doing so overland into the kingdom.”
He was confident Saudi Arabia’s economy would “bounce back” from the war, albeit likely slowly.
He said: “While the targeting of Saudi Arabia in the current conflict will undermine short-term investor and expatriate confidence in Saudi Arabia, it will bounce back –probably slowly, given the scale of its national transformation project and buoyed up for a time on the back of high oil and gas prices.”
Dr Omar Al-Ghazzi, associate professor at The London School of Economics and Political Science, suggested Iran’s attacks could “backfire” entirely as they will trigger a discussion about security in the Gulf.
Previously, both the UAE and Saudi have had a competitive, tense relationship. Now they both have a mutual interest in avoiding Iranian attacks.
“On the economic level, Iranian attacks have been damaging, particularly for the UAE, as Dubai is the most globalised and economically successful city in the region. Dubai has long been the symbol of Gulf prosperity. In general, Saudi Arabia has been less targeted. For instance, Saudi air travel is less affected,” he said.
“But, in the long run, regional relations and the economic damage sustained depend on how the war will unfold and how long it will last. Iran knows that its attacks are damaging, and they are hoping that that would propel Gulf countries to pressure the US to stop.
“It is a gamble as it also may backfire, bringing Arab Gulf countries closer to each other and to the US.”
