Baker Institute expert: ‘Iranian protests ought to serve as a warning’ to Saudi Arabia

EXPERT ALERT

David Ruth
713-348-6327
david@rice.edu

Baker Institute expert: ‘Iranian protests ought to serve as a warning’ to Saudi Arabia

HOUSTON — (Jan. 10, 2018) — While Saudi Arabia may be publicly gloating over the recent anti-government protests in longtime adversary Iran, the country could face similar protests in the future, according to an expert at Rice University’s Baker Institute for Public Policy.

Jim Krane, the Wallace S. Wilson Fellow for Energy Studies, outlined his insights in a new op-ed for Forbes.com and is available to discuss the economic issues that sparked the protests in Iran and explain how Saudi Arabia, like Iran, is reducing subsidies and raising energy prices for its citizens.

“Saudi authorities are in the midst of an important restructuring of the economy in face of growing budget deficits in a low oil-price environment,” Krane wrote. “Besides winding down subsidies, Riyadh is selling off a piece of Saudi Aramco and pushing unemployed citizens into the private sector.

“Iran’s subsidy retractions in the past led the way for the Saudi reforms,” he wrote. “Iran has not achieved full success, but the Islamic Republic slashed its subsidy tab from 25 percent of gross domestic product in 2010 to less than 4 percent last year, a major achievement. Give the Saudis credit for understanding the merits of Iran’s reforms and having the nerve to copy them, despite the discomfiture of taking policy cues from a rival. The Iranian protests ought to serve as a warning to Riyadh that reforms must be phased in gracefully. Shock therapy won’t work in an autocracy. And gloating won’t help.”

Krane said unpopular measures like subsidy reforms are particularly tough for centralized governments because everyone knows who’s to blame. “While it’s important for Saudi Arabia and Iran to reduce their domestic demand for oil — and raising prices is the best medicine — they need to find alternate ways to keep people happy,” he said.

Krane, a member of the Baker Institute’s Center for Energy Studies, specializes in energy geopolitics and energy consumption in Saudi Arabia and the Middle East.

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For more information or to schedule an interview with Krane, contact David Ruth, director of national media relations at Rice, at david@rice.edu or 713-348-6327. The Baker Institute has a radio and television studio available.

Related materials:

Krane bio: www.bakerinstitute.org/experts/jim-krane

Follow Krane on Twitter @jimkrane
Follow the Baker Institute on Twitter @BakerInstitute.
Follow the Center for Energy Studies via Twitter @CES_Baker_Inst.
Follow Rice News and Media Relations via Twitter @RiceUNews.

Founded in 1993, Rice University’s Baker Institute ranks among the top five university-affiliated think tanks in the world. As a premier nonpartisan think tank, the institute conducts research on domestic and foreign policy issues with the goal of bridging the gap between the theory and practice of public policy. The institute’s strong track record of achievement reflects the work of its endowed fellows, Rice University faculty scholars and staff, coupled with its outreach to the Rice student body through fellow-taught classes — including a public policy course — and student leadership and internship programs. Learn more about the institute at www.bakerinstitute.org or on the institute’s blog, http://blogs.chron.com/bakerblog.