Saudi mega investment summit postponed amid Houthi attacks as Crown Prince's grand plans face mounting pressure
This year is steadily becoming harder for Saudi Arabia's Crown Prince Mohammed bin Salman. Attacks by Yemen's Iran-backed Houthis, the shockwaves of the US-Iran war, economic pressure and the risks of depending on US President Donald Trump — together, several crises have converged on his grand plans at once.
The clearest symbol of the crisis is the postponement of the country's annual investment conference, the Future Investment Initiative (FII). The conference was due to begin in the capital, Riyadh, on October 26. Known as 'Davos in the desert', the event draws heads of state, economists and major investors from around the world, and the Crown Prince usually uses it as a major platform to attract investment into Saudi Arabia.
This time, however, the situation is entirely different. Yemen's Iran-backed Houthis have been firing missiles and drones at Riyadh for several weeks. After deadly attacks, airport operations have effectively ground to a halt. Citing security risks, many Western governments have advised their citizens not to travel to Saudi Arabia, and officials from various organisations grew anxious about hotels and the conference venue. In the end, on Monday, the organisers decided to postpone the conference until next year.
In the decade since rising to the centre of power as crown prince, Mohammed bin Salman had placed several big bets — that the Houthis could be defeated, that the Saudi economy could be radically transformed, and that Donald Trump would stand beside him as a reliable ally. But all three assumptions are now facing major challenges, and the postponement of the investment conference has become the emblem of a difficult year for him.
On the Houthi question, Saudi Arabia has tried for a long time but failed to defeat them. Through the 2022 ceasefire, Riyadh had hoped the Houthi threat could be kept under control. But under the impact of America's wider war surrounding Iran, that ceasefire began to collapse this summer. In the meantime, the Houthis have seized more territory in Yemen and intensified their attacks on Saudi Arabia.
According to people close to the Crown Prince, Saudi Arabia now has no easy path. It could send in ground forces and become entangled in a long and bloody war; or it could continue airstrikes whose success is in doubt. Another path is a settlement with the Houthis — but that could further strengthen their rule in Yemen.
A prolonged war could deal a major blow to the Crown Prince's economic reform programme. Yet this pressure is not new — his ambitious plans had already slowed before 2026. Growing pressure on government finances has forced the suspension of several mega projects, and people's wages have not kept pace with inflation.
The investment picture also lags far behind target. Against the Crown Prince's goal of attracting 100 billion dollars a year in foreign investment, actual investment stands at roughly one-third of that. A year ago, the International Monetary Fund (IMF) forecast 4 percent growth for the Saudi economy in 2026; the fund now fears a contraction of 3.3 percent.
Whether the economy recovers in 2027 depends largely on the return of peace to the Middle East. And Trump could play a major role in establishing that peace — a dependence that has now itself become another risk for Riyadh.
Saudi Arabia had believed it held considerable influence over Trump. Riyadh tried to draw him close with promises of massive investment in the United States. Business ties have also developed with the Trump family — Saudi-funded golf tournaments have used Trump-owned golf courses, and a Saudi-linked fund invested 2 billion dollars in the firm of Trump's son-in-law, Jared Kushner.
Yet those ties and investments could not stop Trump from entering a war that this analysis describes as disastrous. In the words of one person with close contacts to Saudi Arabia, Trump does not remain loyal to anyone for long.
All told, Riyadh now faces a difficult equation: on one side the Houthis' military threat, on another the blow to investment and the economy, and on a third the unpredictable behaviour of its American ally. The announcement postponing the investment conference is the most public sign of that pressure — and the pace of the Crown Prince's plans in the days ahead will be determined by how far he can contain these crises.
