Journalist Jamal Khashoggi walked into the Saudi Consulate in Istanbul Oct. 2 to obtain documents for his upcoming wedding and
hasn't
been seen since.
Khashoggi is highly critical of Saudi Arabia and has authored articles calling out the kingdom and its officials.
Saudi Arabia is very aware of the journalist’s criticism, and Khashoggi had been living in self-imposed exile prior to his
disappearance.
On Wednesday, Turkish news media published details from audio recordings that allegedly document Khashoggi's murder inside the
consulate, according to The New
York Times.
Numerous individuals and corporations have been pulling out of upcoming Saudi events and deals in the wake of the journalist's
disappearance. This backlash has cost the country at least $1 billion in investments from the following key people and
corporations:
- Virgin Group: In a blog post, founder Richard Branson announced that Virgin Galactic and Virgin Orbit
will suspend business deals with the Public Investment Fund of Saudi Arabia. The deals were worth at least $1 billion.
- Harbor Group: The lobbying firm terminated Saudi Arabia as a client, severing an $80,000-per-month
deal.
- Glover Park Group: Glover is another lobbying firm that cut their ties with the kingdom; they've yet to
comment on their decision. Saudi spent $27 million in 2017 on U.S. lobbying firms.
- Uber CEO Dara Khosrowshahi: The kingdom is a large investor in Uber, but Khosrowshahi has chosen to not
attend the Future Investment Initiative conference at the end of October.
- JPMorgan: CEO Jamie Dimon said he will not make an appearance in Riyadh.
-
Ford Motor Company (NYSE: F): Executives at the automotive giant decided against attending the Future
Investment Initiative conference.
-
Alphabet Inc (NYSE: GOOGL) (NYSE:
GOOG): Google said the head of its cloud computing
business will not attend the Saudi conference. Another Alphabet exec, Dan Doctoroff, pulled out of the $500-billion Neom
megacity project.
-
New York Times Co (NYSE: NYT) - The Times
was a sponsor of the FII event, commonly referred to as "Davos in the Desert." The newspaper is pulling out of the event;
columnist Andrew Ross Sorkin said that he was “terribly distressed” by Khashoggi’s disappearance.
- CNN: The 24-hour cable news channel also pulled out of "Davos in the Desert."
- Viacom, Inc. (NASDAQ: VIA) CEO Bob
Bakish: The CEO of Viacom announced that he has cancelled all plans to attend the FII
conference.
At the time of publication, Saudi has lost over $1 billion in investments from Virgin Group, over a dozen speakers and sponsors
for its Future Investment Initiative conference and key members from its Neom project, a plan to build a smart megacity.
Other companies are also considering ending their business relationships with Saudi along with Virgin Group. The media
conglomerate Endeavor considering the termination of a $400-million deal with the Saudi Public Investment Fund.
What It Could Mean
President Donald Trump said Saudi Arabia deserves “severe punishment” if it is responsible for Khashoggi's death. The Saudi
stock exchange fell 7 percent on Oct. 14.
Saudi Arabia has already threatened “punishment” for any sanctions imposed against the kingdom, and said if it “receives
any action, it will respond with greater action, and that the kingdom’s economy has an influential and vital role in the global
economy,” according to the Saudi Press Agency.
“The kingdom affirms its total rejection of any threats and attempts to undermine it, whether by threatening to impose economic
sanctions, using political pressures or repeating false accusations."
If oil production is used as a pushback during the dispute, the kingdom could disrupt multiple countries at once.
Saudi is a heavy investor in Silicon Valley, creating a dilemma for tech companies in need of capital that also have concerns
about the kingdom's human rights abuses.
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