FOR evidence that a new era has dawned in Saudi Arabia, look no further than the cabinet. Out are the stodgy old princes; in are the (relatively) youthful reformers. Since assuming the throne last year, King Salman has installed a new generation of ministers closely aligned with his son, 31-year-old Muhammad bin Salman, the deputy crown prince. On October 31st the king completed the reshuffle by replacing Ibrahim al-Assaf, the old finance minister (in place for the past 20 years), with Muhammad al-Jadaan, head of the country’s Capital Markets Authority.

The change comes as Prince Muhammad tries to implement an ambitious set of reforms, known as “Vision 2030”, aimed at weaning the kingdom off oil by curbing public spending, diversifying the economy and attracting foreign investment. The kingdom’s new leaders, many of whom are former businessmen or bankers, are expected to boost that effort. Mr Jadaan, for his part, oversaw the cautious opening of the Saudi stockmarket to big foreign investors last year.

But it will take more than new management to convince analysts that the kingdom is serious about reform. “They’ve been talking about this stuff for 30 years,” says a diplomat in Riyadh, the capital. He points to the King Abdullah Financial District (KAFD), a cluster of gleaming skyscrapers in the northern part of the city. When laying the foundation stone a decade ago, the late King Abdullah envisioned the district as a pillar of the non-oil economy. But KAFD is a flop. Banks and other businesses looked past the towers and saw a closed economy and stifling social restrictions, which never changed.

Today the government is more focused on enacting its bold plans, says Muhammad al-Tuwaijri, the former boss of HSBC’s Middle East and north Africa division, who is now deputy minister of economy and planning. “Believe me, this is discussed every week,” he says. Progress reports are required from each ministry. For doubters, KAFD is still a useful barometer. Prince Muhammad hopes to salvage the project by making it a “special zone” with light regulations, a more flexible visa regime and a direct connection to the airport. None of that has happened yet.

Smaller steps have already been taken that show progress, but also a lack of touch. In September, for example, the government slashed salaries and benefits for public-sector employees, who make up two-thirds of Saudi workers. But the move was made with little warning, contributing to a collapse in consumer confidence. Earlier in the year, cuts to generous subsidies led to a spike in water bills and an outcry on social media. The veteran minister for water and electricity was duly fired and replaced by a former businessman. “He took the blame for a policy that wasn’t thought through,” says John Sfakianakis of the Gulf Research Center, a think-tank.

A bigger problem is that the vision itself is fuzzy. Prince Muhammad commands an army of Western consultants, but his National Transformation Programme, the follow-up to Vision 2030, is both oddly specific and frustratingly vague. It includes benchmarks for such things as the issuing of halal certificates, but fails to explain how the government intends to achieve more important goals, such as more than doubling foreign-direct investment by 2020. Many of its objectives are still “under study”. The reformers have prioritised the “low-hanging fruit”, admits Mr Tuwaijri. More complicated initiatives, such as his own effort to privatise public companies, will follow in due course, he says.

Business-minded ministers are eager to promote private investment, but other reforms are making this work more difficult. A sevenfold hike in business-visa fees will probably deter foreign firms. Local companies that depend on cheap inputs are suffering. Almarai, a big dairy, has said its earnings will decline by over $130m due to the government’s austerity measures. There has also been a rise in public arrears to construction firms, which has led them to cut staff and withhold salaries. Some foreign labourers have been left stranded without pay in desert camps.

Before the collapse in oil prices, two large Saudi contractors—the Saudi Binladin Group and Saudi Oger—were responsible for most of the kingdom’s infrastructure projects. But state spending cuts have left both firms mired in debt. Saudi Oger is owed billions of dollars by the government, most for work it has completed. It, in turn, owes billions to banks (and still more to contractors, suppliers and workers). The Binladin Group also complains of unpaid contracts. Neither firm is known for its efficiency, so the government may be trying to set a new tone. But its actions have unsettled the Saudi banking system and the wider economy.

Local motion

Businesses have also been vexed by the government’s efforts to make private firms replace relatively cheap foreign workers with more expensive Saudi nationals, a policy referred to as “Saudisation”. The mobile-phone industry was ordered to employ only locals by September. The government has provided training for locals and now pays some of their salaries. But in general Saudis lack the skills that employers want. Schools stuff young heads with religion, but neglect more practical subjects such as maths and science. Few Saudis are willing to take entry-level or blue-collar jobs. To meet the government’s quotas, some companies simply pay locals to stay at home.

The IMF recently cut its economic growth forecast for the kingdom’s non-oil sector this year to 0.3%, from 1.6%, on account of the government’s austerity. But it is expected to rebound next year. “The majority of the necessary public-spending cuts have already happened,” says Capital Economics, a consultancy. A successful $17.5bn international bond sale, the largest ever from an emerging market, has already allowed the government to resume paying contractors, and investors’ enthusiasm for snapping up the paper is a good sign.

But the reforms envisioned by Prince Muhammad and his team run much deeper than mere austerity. Investors are still waiting for more meaningful changes, such as the promised listing of shares in Saudi Aramco, the gigantic national oil company. “This is the medium-hanging fruit that the world will be watching to see if the reform project will be successful,” says Mr Sfakianakis.