A son of the late King Faisal, the prince is one of the leading figures in the third generation of direct descendants of the Kingdom's founder, Ibn Saud. While he speaks cautiously, he's more candid than most members of the royal family. Recently, he sat down with BusinessWeek London Bureau Chief Stanley Reed at a Riyadh foundation dedicated to his father's memory. Edited excerpts from their conversation follow:
Q: Why did you step down as head of intelligence recently?
A: After 24 years as head of intelligence, I felt I could not give as much as required of me, so I asked to be relieved.
Q: What about reports that Saudi money has been flowing to Osama bin Laden in recent years?
A: When the jihad in Afghanistan ended [after the Soviet Army was driven out in 1989], two things happened. Any Saudis who were contributing were told that jihad is over, and if we were going to make contributions they would be to help other causes. Because of outflows going to Afghanistan, a set of rules was established to allow the government to be able to trace whatever was going, and the set of rules has been in operation since then.
There is pretty much awareness of where money goes and where it doesn't. In addition, [in the past] anyone could put a note in a mosque saying: Please contribute this support. Even that has been regulated, and no one can do that without permission from the government.
We have wealthy people in the Kingdom. They do charity work all over the world. Wherever there is a financial institution, there are one or two Saudis with money there. They could be contributing from there.
Q: Is the royal family adapting rapidly enough to modern times?
A: I should hope so. You have a microphone here. I use a computer sometimes.
Q: But there is a perception in the West that the [Saudi] leadership is a handful of elderly men unable to make decisions.
A: The Al Saud are human beings. Of course they adapt. For God's sake, these people have a track record. They do things day-to-day as rulers. They take decisions for the welfare of the country.
You have your own institutions in your country and other Western countries. We have our institutions. The people [in Saudia Arabia] come and talk to us directly. You have seen how the Crown Prince meets with people and talks to them. He is very direct.
It is a misperception that we do not take tough decisions and that the leadership is incompetent and things like that. We have been through crises. One was the financial crisis [of two years ago]. We did something about it. We tightened spending by a quarter -- which for us was enormous.
We deal with tough decisions. We sometimes take our time, but we do. It is not a practice of the King to just issue orders.
Q: Can the strains in U.S.-Saudi Arabian relations be repaired?
A: [U.S.-Saudi] relations are based on mutual benefit and interest and although we may go through crises that affect both countries, our interests will keep us together for a long time to come. We have developed in the Kingdom an innate friendship with the U.S. We have gone through crises before.
Remember in 1973, as a result of the oil embargo and so forth, people in the U.S. and its government actually talked of invading Saudi Arabia and taking over the oil fields. Crises have come and gone. Friendship and mutual benefit have remained.
Q: Are you concerned about the stability of the Kingdom?
A: As far as the stability of the Kingdom is concerned, go around the country. Do you see any armored vehicles on street corners or armed forces deployed on the streets? Even the police are going about their normal business. This is what distinguishes the Kingdom from the rest of the region. The security of the Kingdom has always been pride of government -- pride and honor. As far as stability, there is no reason to worry.
Why so many of the terrorists came from the Kingdom I can't tell you. Al Qaeda was founded by an ex-Saudi. He recruited Saudis. He probably came to depend on them because they were Saudis and he was a Saudi. They were more loyal than others.
You shouldn't take [the numbers of Saudi hijackers] as a reflection on the Saudi people's inclinations or intentions. There are thousands and thousands of young Saudis who lead normal lives and go about their business.
Q: But isn't the participation of Saudis worrying?
A: Of course it is worrying. There will be a backlash on that. Families who were lax in looking after their children are going to be more careful than they were before. It was a shock to many Saudis that Saudis undertook such abhorrent activities.
Q: Will there be changes in education?
A: I should hope so. We have been calling for that for 20 years. I have never visited a country that wasn't unhappy with its education system and wanting to change it.
I don't think these people are the result of the Islamic education system. In all holy books such as the bible there are verses [such as those that say go into battle against the Philistines and others that say Muslims should treat non-Muslims generously]. Our education system definitely does not teach our schoolchildren to be terrorists or extremists.