U.S. Treasury Secretary Mnuchin Withdraws From Saudi Investment Conference

The U.S. on Thursday gave Saudi Arabia more time to investigate the disappearance of journalist Jamal Khashoggi

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U.S. Treasury Secretary Steven Mnuchin speaks during a news conference at the G20 meeting of Finance Ministers and Central Bank governors in Buenos Aires, Argentina, July 22, 2018.
U.S. Treasury Secretary Steven Mnuchin speaks during a news conference at the G20 meeting of Finance Ministers and Central Bank governors in Buenos Aires, Argentina, July 22, 2018.Credit: Gustavo Garello, AP

U.S. Treasury Secretary Steven Mnuchin on Thursday said he would no longer attend next week's investment conference in Saudi Arabia.

"Just met with @realDonaldTrump and @SecPompeo and we have decided, I will not be participating in the Future Investment Initiative summit in Saudi Arabia," Mnuchin wrote on Twitter.

The United States on Thursday gave Saudi Arabia more time to investigate the disappearance of journalist Jamal Khashoggi as Turkish investigators searched Riyadh's consulate in Istanbul for a second time in a hunt for clues.

U.S. President Donald Trump met for less than an hour with Secretary of State Mike Pompeo, who gave the president an update on his talks this week with Saudi and Turkish officials about the Khashoggi case amid concern that the journalist was killed in the consulate after entering it on Oct. 2.

Pompeo told reporters after his talks with Trump that he made clear to the Saudis in his visit to Riyadh that "we take this matter with respect to Mr. Khashoggi very seriously."

"They made clear to me that they too understand the serious nature of the disappearance of Mr. Khashoggi. They also assured me that they will conduct a complete, thorough investigation of all of the facts surrounding Mr. Khashoggi and that they will do so in a timely fashion," Pompeo added.

Pompeo said he told Trump that "we ought to give them a few more days to complete" their investigation in order to get a full understanding of what happened "at which point we can make decisions about how - or if - the United States should respond to the incident surrounding Mr. Khashoggi."

"I think it's important for us all to remember to, we have a long - since 1932 - a long strategic relationship with the Kingdom of Saudi Arabia," Pompeo added.

French mixed signals

France pulled its finance minister out of a Saudi investment conference on Thursday in response to the unexplained disappearance of a journalist but voiced confidence that relations between the allies would not be hurt.

Turkey says Jamal Khashoggi, a Washington Post columnist who was critical of Crown Prince Mohammed bin Salman, was killed by Saudi agents in Riyadh's diplomatic mission in Istanbul on Oct. 2 and his body cut up. Saudi Arabia denies the allegation.

Paris and Riyadh enjoy close diplomatic and commercial relations spanning energy, finance and weapons. But France, which considers Riyadh a bulwark against Iranian influence in the Middle East, now faces a delicate balancing act in its response to the incident.

President Emmanuel Macron last Friday sought to downplay the importance of relations with Riyadh, saying the kingdom was not a major client of France. But Defence Minister Florence Parly told lawmakers on Wednesday that arms sales to Saudi were crucial for French jobs.

On Thursday, Finance Minister Bruno Le Maire added his name to a growing list of government ministers, prominent business executives and leaders of international institutions who have cancelled their attendance at a high-profile Saudi investment conference due to unease over Khashoggi's disappearance.

"No, I will not be going. The allegations are serious"." Le Maire told Public Senat TV.

Saudi authorities needed to explain what had happened to Khashoggi after he went to the Saudi consulate, the last time he was seen in public, he said.

When asked if the move might jeopardise relations between the two countries, Le Maire replied: "Absolutely not."

Arms sales

Saudi Arabia is France's largest market in the Middle East, even without arms sales. French exports to the Gulf nation were totaled almost 4 billion euros ($4.61 billion) between September 2017 to August 2018, according to economy ministry data.

That figure does not include deals with French firms worth $12 billion that Saudi state-oil giant Aramco's announced in April, including a $5 billion petrochemicals complex with oil giant Total.

French defence ministry data shows that from 2008 to 2017, Saudi Arabia was the second biggest purchaser of French arms, with deals totalling more than 11 billion euros ($12.67 billion). In 2017 alone, licences potentially worth 14.7 billion euros to Saudi were approved. "Our industrial and defence base increasingly needs these weapons' exports," Parly told a Senate hearing on Wednesday. "We can not totally ignore the impact that all this has on our defence industries and our jobs."

Macron has shied away from publicly criticising Crown Prince Mohammed despite international concerns over a crackdown on dissidents and unease over the high number of civilian casualties from Saudi Arabia's military intervention in Yemen.

However, in talks with humanitarian groups in September, Macron said he was sceptical of Prince Mohammed's social reform agenda. 

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