King Fahd of Saudi Arabia, who has died at the age of 83, lived long enough to see the bulwarks of his 20-year reign brought under massive strain following the September 11 terrorist attack on the US in 2001. In the wake of the attack, his kingdom’s long-standing relationship with the US and his family’s role at the centre of Saudi Arabia’s theocracy came in for such heavy criticism as to call the future of both into question.

It was a messy end to a reign that had its share of achievements. Despite large-scale corruption and despite his own reputation in the west for being over-fond of luxury and soft living, Fahd was regarded by many as the father of his kingdom’s modernisation.

A talented administrator with a vision for his country’s future, Fahd initiated and followed through the country’s massive oil and gas-based industrialisation. He chaired the Supreme Petroleum Council, and the Royal Commission for Jubail and Yanbu, the body responsible for building the two big industrial cities on the Gulf and Red Sea coasts. He was also largely responsible for the development of a free, nation-wide education system that ensured the education of Saudi girls for the first time.

In government for more than 50 years as minister, crown prince and king, Fahd brought in a team of highly educated technocrats, notably the ministers of finance and industry. He also introduced limited constitutional reforms, the most striking being the setting up in 1993 of a Consultative Council the Majlis as-Shura as a first tentative step towards wider public participation in the country’s government.

His flaw was that he failed to stem corruption in his kingdom. It did not start under Fahd. His elder half-brother King Saud had been deposed in 1964 because his corruption and misrule had bankrupted the kingdom. Yet the plundering of the country’s wealth under Fahd was on a massive scale. It was the start of the oil-fuelled development boom which brought unprecedented amounts of cash into the economy and Fahd was in a perfect position to exercise ministerial patronage.

Only a comparatively small number of royal princes were involved but they included members of Fahd’s own close family. The impact was to undermine the authority of royal rule. And Fahd, who even in his prime did not like confrontation, never seriously addressed the issue. Throughout the 1990s criticism of the greed and corruption of the ruling Al Saud family mounted.

It was in the 1980s that the failings of Fahd’s foreign policies were exposed. Against a background of falling oil revenues, the king spent billions supporting Iraq’s Saddam Hussein in his war against Iran - only for Saddam to invade Saudi’s ally, Kuwait. The invasion exposed the ineffectiveness of Saudi’s costly defences and Fahd had to accept American help - to the dismay of his critics at home. The presence of foreign “infidels “ on Saudi soil helped turn some Saudis into virulent, anti-monarchist militants. It was one of the supreme ironies of his reign that the king himself had played a part in the emergence of militant Islamists. More than a decade earlier, after the Soviet invasion of Afghanistan in 1979, Fahd’s support for the mujahideen resistance against the invaders helped indirectly - and quite unintentionally on the king’s part - to radicalise young Saudis who in the 1980s had gone to work in the refugee camps on the Afghan/Pakistan border. This helped fuel what soon became Islamist terrorism directed against both the monarchy and the foreigner. Criticism, this time, came not only from home but from Saudi’s ally, the US.

Yet before the 9/11 attacks, the blows aimed at Fahd seemed to leave him unmoved. Until the terrorist assault on the two towers in New York, Fahd seemed well protected by his family’s tentacles of power, strengthened by inter-tribal marriage and pervasive internal security. Despite deteriorating health, notably after his second stroke in early 1996, Fahd maintained appearances according to the best traditions of an absolute monarch.

In his youth, Fahd’s high living, high spending tendencies had been legendary. Born Fahd bin Abdul-Aziz al Saud in 1920, he was the eighth of the 36 recorded sons of Ibn Saud, the founder of Saudi Arabia. He was the eldest of the Sudairy Seven, the seven sons of the redoubtable Hassa Bint Ahmed al-Sudairi, the favourite among Ibn Saud’s 22 wives - he married her twice.

It was through his mother’s drive that he received a good education, spending four years at the princes’ school in Riyadh and then being taught by tutors. Fahd understood English well, even if he was reluctant to speak it. Like many of his peers Fahd went through a youthful delinquent period in the 1950s when he indulged himself to the full, drinking, womanising and gambling. On one occasion he reportedly lost £6m at the gaming tables in Monte Carlo.

Called to heel by his father, Fahd was put in charge of his country’s education system in 1953. He became involved in the struggle between the feckless King Saud and the stern, disciplined crown prince Faisal who replaced Saud as king in a palace coup in 1964. The crisis made the al-Saud family realise that the worst threat to their survival was a split in their own ranks. Since then arguments in the family have been conducted behind closed doors. Fahd himself had a comparatively restrained family life with only five wives, six sons and four daughters.

Made Minister of Education in 1953 and Minister of the Interior in 1962, it was the traumatic year of 1975 that saw his real rise to power. In March that year, Faisal was assassinated by an embittered nephew. Faisal’s half brother Khaled succeeded to the throne and Fahd became Crown Prince and deputy Prime Minister. Although he did not formally assume the throne until 1982, Fahd was in effective day-to-day control from 1975 on because King Khaled was a sick man. Under the Saudi system, the succession goes to the brother who is considered best for the job and when King Khaled died in 1982 there was no dispute that Fahd should take over. A somewhat distant man, notably unpunctual even with fellow heads of state, and bored by detail, Fahd had one crucial quality: the ability to keep his nerve in a crisis.

He had shown his mettle early. In 1979 when he was Crown Prince, the Shah of Iran was overthrown and replaced by a virulently anti-monarchist, republican Islamist regime. Saudi Arabia became the prime target for the invective which Iran began hurling at Gulf Arab monarchies. The attacks were damaging enough but worse was to come. The new climate of Islamist militancy inspired a rising by home-grown Saudi dissidents who seized the Grand Mosque of Mecca.

With King Khaled still ill, Fahd played a crucial role in bringing the rebellion under control. In great secrecy to disguise the Saudi government’s inability to deal with the militants on its own, French special forces were brought in to clear the insurgents. The bid to overthrow the Royal Family failed.

Even before the warren of tunnels beneath the Grand Mosque had been cleared of rebels, there came a further blow: the Soviet Union invaded Afghanistan. Fahd was instrumental in what appeared to be a brilliant manoeuvre helping to support the Afghan Mujahideen resistance fighters. The move, backed by the US and Pakistan, gave Fahd kudos among his own people.

Yet it was to rebound horribly on the Saudis and their allies. Many of the young Saudis who volunteered to help the Afghans often by working in the refugee camps became radicalised. Among them was Osama bin Laden. It was Osama and the “Afghan Arabs” who would later sponsor political extremism and lead terrorist attacks against the Saudi authorities and against the west - including the 9/11 assault on the twin towers in New York.

The early years of Fahd’s reign were dominated by the Iran-Iraq war. For six years the Saudis worried that the Iraqi army would crack and that the Iranians would be able to instal a revolutionary Islamist republican government in Baghdad. To forestall this, Fahd, backed by most of the Western powers, “lent” the Iraqi regime some $20bn to bolster its war effort. The war ended in stalemate - though Iraq was seen as having stopped the Iranian mullahs’ plan to export their revolution to the rest of the region. Yet far from showing gratitude to the Saudis for their help, the Iraqi leader, Saddam Hussein, invaded Kuwait in August 1990.

The move was embarrassing and shocking for Fahd partly because of the financial support he had lavished on the Iraqi regime and partly because he was forced to invite the US and her allies to come to the aid of Kuwait and Saudi. After US Defense Secretary Dick Cheney flew out and showed Fahd photographs of Iraqi units deployed for an advance into Saudi Arabia, the King agreed to a multinational force of more than 500,000 men, including many Americans, being based in Saudi. The move exposed the depth of Saudi and Gulf arab military weakness and the hollowness of official claims to self reliance.

Many Saudis felt unhappy about the presence of foreign armies on their territory and were angry that their government had so little to show for the billions of dollars it had been spending on defence. In February 1991 the US-led international force liberated Kuwait, but at home Fahd’s government faced growing pressures from two divergent constituencies: liberals on the one hand and the potentially more dangerous groups of conservatives and Islamists on the other.

From 1991 onwards, criticism flowed over the conduct of some of the Al-Saud princes, a few of whom were consuming quite extraordinary amounts of revenue. Some of the most senior princes diverted oil revenues into their own bank accounts, often because Fahd had allowed them to control the award of infrastructure and defence contracts.

In 1994, discontent appeared on the streets and in the next two years there were terrorist attacks on US installations in the kingdom. Many Saudi and western analysts came to believe that the US, on which Saudi depended for its external defence, became a liability in terms of domestic Saudi security because of perceived US support for Israel.

The crisis became acute after the 9/11 attacks. The US continued to regard Saudi as an important ally, though in practice many US officials blamed the kingdom for incubating terrorism and Islamic fundamentalism, not least because 15 out of 19 of the hijackers involved in the 9/ll attack had been Saudis. At the same time Islamic clergy stepped up public criticism of the Saud family’s dependence on the US.

On the domestic front, many regarded Fahd as a moderate among autocrats. As well as pioneering the majlis-as-Shura consultative council, he introduced in 1992 the Basic Law, a kind of secular constitution partly directed against unruly Islamist militants. It stated that people’s houses could not be entered without the owners’ permission and that the zakat, a religious tax, would in future be levied by the government, not the mosque, and paid to legitimate recipients. The aim was to discourage funding of private revolutionary groups.

Economically, the great test for Fahd was the rapid decline of Saudi oil production that started falling almost from the month he assumed power. Exports dropped from the previous level of 9m barrels a day to under 2m barrels in 1985 - at which point the King ordered his oil Minister, Ahmed Zaki Yamani, to abandon the OPEC formula and sell oil at market prices. The decision led to a collapse of prices in 1986 with the price of Arabaian Light - then the marker crude - going from some $32 to under $9 a barrel. From then on the Saudi government was forced to run a series of budget deficits financed initially from reserves and after 1990 by borrowing.

Whereas under Khaled the thrust of economic policy had been finding ways of spending oil revenues - in particular how to distribute them to the people - under Fahd it was encouraging the private sector to take up the running of the kingdom’s developments. Yet Fahd failed to persuade his people to lower their expectations and, given the non-confrontational character of the King and his family, until the last two years his government never quite managed to balance the books.

Fahd’s own preoccupation throughout his reign was the rebuilding of the great mosques of Mecca and Medina. The projects, which were managed by the bin Laden family construction group, cost billions of dollars and proved an important drain on the Saudi budget, but Fahd regarded the work as the most important achievement of his life.

In his last decade sickness rendered him progressively unwilling and unable to focus on mounting economic and social problems and this had potentially serious effects on the country’s long-term development. Analysts suggest it would have been better if Fahd had abdicated in the late 1990s in favour of his half brother, Crown Prince Abdullah. Abdullah has tentatively initiated political and economic reforms but his full brothers have regarded him as too much of a reformer. It suited them to keep Fahd on the throne as long as possible. That way they would deprive Abdullah of the authority, which emanates from the King alone, to push through reforms against the wishes of conservatives inside the royal family and the bureaucracy.

Fahd, in short, stayed as monarch too long.

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