Why Saudi Arabia matters

Over the course of just two weeks, Saudi Arabia's Future Investment Initiative conference (aka "Davos in the Desert") has transformed from an event probably not on your radar...to one of the global business flashpoints of the year.

But it's not about who is going. It's about who isn't.

Yesterday, U.S. Treasury Secretary Steven Mnuchin joined a long list of powerful business execs who've backed out of the event. Just to name a few...

• JPMorgan CEO Jamie Dimon
• BlackRock CEO Larry Fink
• Uber CEO Dara Khosrowshahi
• LA Times owner and biotech billionaire Patrick Soon-Shiong
• The CEOs of several other major companies, including Blackstone, MasterCard, and Viacom.

Remember: This all stems from the disappearance of journalist Jamal Khashoggi, who entered the Saudi Consulate in Istanbul on Oct. 2 and was presumably killed inside. U.S. intelligence agencies are "increasingly convinced" Saudi Crown Prince Mohammed bin Salman was involved. Saudi Arabia has denied wrongdoing.

Why Saudi Arabia matters

When you look at the A-listers who've backed out, it really makes you think: why were people like Dimon and Fink going in the first place? It's not like Saudi Arabia, a country blanketed by desert and with a population less than greater Tokyo's, is exactly around the corner from Park Ave.

But what Saudi Arabia lacks in rainfall, it makes up for in economic influence.

• Oil: Saudi Arabia is one of the world's largest oil producers. And state-owned oil behemoth Aramco is gunning for the title of "biggest IPO ever" in the next few years.
• Tech: Either through direct investments or via SoftBank's Vision Fund, Saudi Arabia is the largest single funding source for U.S. startups, per the WSJ.
• Military: Saudi Arabia is the biggest customer for U.S. weapons, and the rest of the pack isn't particularly close.

Zoom out: In the past few years, some U.S. corporate leaders have taken on a new set of responsibilities. Per Andrew Ross Sorkin of the NYT, "Over the coming weeks, there almost certainly will be more pressure for companies to distance themselves from the kingdom. Executives better get used to their new role as de facto diplomats."