At the time of the Tunisian leader's departure from office, Arab leaders met at the Egyptian town of Sharm el-Sheikh at a pre-planned Arab League economic summit and agreed to the formation of a US$2bn fund, to be used to aid the poorest countries by specifically targeting assistance to small businesses. Saudi Arabia and Kuwait pledged US$500m apiece toward the fund. Such large aid monies have been promised before, but events appear to have concentrated minds on the part of Saudi Arabia and some of its fellow energy-rich Arab leaders on the need to address popular discontent over economic problems.

Events closer to home suggest that, for Saudi Arabia, a firm attachment to the status quo in fellow Arab states and perhaps a generous handout may be its approach going forward. Although press reports have filtered out of demonstrations in Oman in late January over the previous cutting of food subsidies and over joblessness, Saudi Arabia will be keeping an especially close eye on neighbouring Bahrain. Bahrain has long been prone to popular instability in response to a sense of political injustice and economic discontent on the part of a Shia majority living under a Sunni hereditary leadership. Should the situation deteriorate rapidly in Bahrain, the Saudi leadership will be hugely concerned at the potential knock-on impact on its own small Shia population largely located in Eastern Province (and, potentially, the prospect of Bahrain falling under Iranian influence). At the time of going to production, events have thus far been muted in Bahrain. However, Saudi Arabia, which deployed its National Guard in the neighbouring country at a time of upheaval in 1995, will be considering possible future options, in addition to its normal pattern of bolstering the ruling Al Khalifa family financially. Elsewhere, Saudi Arabia will also be closely monitoring recent anti-government protests in Yemen, although its commitment to the presidency of Ali Abdullah Saleh is probably negotiable and, in any case, instability in Yemen is hardly a new phenomenon. Inside Saudi Arabia, regional events may encourage a more aggressive approach to tackling structural weaknesses such as the large number of foreign nationals performing jobs that Saudis, both men and women, are in effect being subsidised not to do.