Commentary by Michael Ratney
Mohammed bin Salman (MBS), the crown prince of Saudi Arabia, took home an impressive haul from his November visit to Washington. Beyond the sheer warmth of his White House reception, MBS got a long-sought deal on advanced U.S. chips to fuel Saudi Arabia’s ambitions to be a global hub for artificial intelligence.
He got a strategic defense agreement and was designated a major non-NATO ally, which together ought to ease some of the frustrating impediments to U.S. defense sales to the kingdom. Saudi Arabia was offered the F-35, one of the most sophisticated pieces of hardware in the U.S. arsenal, and signed agreements on critical minerals and civil nuclear cooperation. So, for Saudi Arabia, it was a productive visit. But how did the United States do?
What President Trump Wanted in Return
Beyond offering MBS that warm welcome, President Trump seemed to care mostly about two things: extracting a Saudi agreement to normalize relations with Israel, and a commitment to a whole lot of foreign direct investment (FDI) into the United States.
Normalization with Israel: A Stalemate
On normalization, he got little satisfaction. Trump reportedly believes that because he “ended” the war in Gaza, the time is right for Saudi Arabia and Israel to move ahead with mutual diplomatic recognition. Publicly, MBS certainly didn’t rule out normalization—in his appearance with the president, he said “we want to be a part of the Abraham Accords.
But he made clear that normalization remains linked to a credible path to statehood for the Palestinians. In other words, the Saudis didn’t budge, and given the Israeli prime minister’s unyielding opposition to Palestinian statehood, normalization will most likely have to wait for the post-Netanyahu era.
The Trillion-Dollar Investment Question
On investment, the kingdom is already a significant source of FDI in the U.S. economy. But what Trump wants is new investment in areas such as factory construction and modernization, for which he can take credit. The pressure was clearly on for MBS to announce a gargantuan number, and in the November 18 Oval Office press event, MBS got into the spirit, suggesting that an earlier Saudi commitment to invest $600 billion would grow to “almost one trillion.
His language, however, was more ambiguous than the White House fact sheet would later suggest. While the White House announced that “Saudi Arabia will be increasing their investment commitments in the United States to almost $1 trillion,” MBS only said that the agreements signed during the visit would amount to “almost $1 trillion of investment, real investment and real opportunity . . . in many areas” that “will create a lot of investment opportunities.”
To state the obvious, a trillion dollars is a lot of money, even for Saudi Arabia, and especially at a time when oil prices are trending lower. And “creating investment opportunities” doesn’t necessarily mean actual investment in the U.S. economy. Plus, MBS said nothing about the time frame. So, what Trump extracted from the crown prince was mainly a trillion-dollar soundbite—not just a big number, but a number so large it’s difficult to take seriously, particularly in the absence of any defined time frame.
Strategic Gains That Come with Complications
To be fair, even as the Saudis left Washington the net winner, what they got also ought to be good for the United States. The United States now has an additional customer for some of the highest-value American chips—a customer with the investible capital, cheap energy, and unregulated land to deploy U.S. technology at scale. The U.S. government also bolstered a defense partnership that could prove critical in the event of a regional conflagration and gained a new customer for a major U.S. defense export, the F-35. But neither of these achievements is so straightforward.
Chips, China, and Strategic Contradictions
Yes, these are high-value American semiconductors that need trustworthy and deep-pocketed customers. But the strategic argument for U.S. AI partnerships goes beyond commerce, and has at least in part been related to China. Countries like Saudi Arabia have major AI ambitions, and it’s safe to say they will act on them with the United States or without it.
If they don’t deploy U.S. products, they will turn to China, and in the process drive the Chinese innovation against which U.S. industry is trying to compete. The strategic benefits of partnering with a country like Saudi Arabia are vitiated when the United States immediately turns around and offers China its advanced chips. And that is exactly what the Trump administration inexplicably did just a few weeks after the MBS visit.
The F-35 Offer and Its Real Value
Regarding the F-35, a good question is whether the announcement that the Saudis could buy the aircraft was all they really needed. The F-35 is extraordinarily expensive, and the White House announcement comes at a time of declining oil prices, when Saudi Arabia is carefully prioritizing its biggest-ticket expenditures.
Beyond a sticker price that easily reaches the tens of billions of dollars, an F-35 acquisition would make the Saudis even more dependent on unpredictable foreign supply chains and foreign contractors to maintain their aircraft at a time when their goal is the development of their own defense industry and indigenous capabilities.
And despite Trump’s comments about Saudi Arabia deserving the “top of the line,” it seems likely that Israel will try to obstruct a top-of-the-line sale to other countries given its expectation (and the U.S. statutory requirement) that Israel maintain a “qualitative military edge” over others in the region.
Even without an actual F-35 sale, Trump’s announcement already sent a powerful message to Iran, Saudi Arabia’s principal regional adversary, that the kingdom could have access to the most advanced American defense technology. And the Saudis did that without spending a dime.
Decoupling Benefits from Normalization
In fact, MBS got from Trump much of what he would have sought as part of a broader normalization deal, effectively decoupling many of these “deliverables” from the establishment of diplomatic relations with Israel. The big prize MBS didn’t get was a mutual defense treaty—for him the ultimate long-term insurance against an Iranian attack. MBS knows that a treaty could only come as part of a larger package that would include normalization.
The Missing Defense Treaty and the Long View
If discussions of a treaty were ever to resume, MBS knows it would require U.S. Senate ratification, and that means support from both Democrats and Republicans. Not surprisingly, Trump seemed keen to use the Oval Office meeting to cast the bilateral relationship as less U.S.-Saudi, and more MBS-Trump.
That is more partisan than the relationship ought to be. Asked by Trump who has been the best U.S. president for Saudi Arabia (other than Trump, of course!), MBS cited Roosevelt and Reagan, a Democrat and a Republican. That was an astute response, and the Saudis would do well to continue looking beyond the immediate and consider how they can cement a long-term partnership with the United States that transcends presidents and politics.