|Saudi Prince Saud al-Faisal who oversees the Saudi Arabian General Investment Authority about Vision 2030 poses for a photo ahead of talking to the Associated Press alongside the Annual Investment Meeting in Dubai, United Arab Emirates, Monday, April 3, 2017. The Saudi prince tasked with attracting foreign investment says U.S. President Donald Trump's pro-business administration can be a good thing for the kingdom as it overhauls its economy and prepares to publicly list shares of state-owned oil giant Aramco. (AP Photo/Kamran Jebreili)|
DUBAI, United Arab Emirates (AP) — The Saudi prince tasked with attracting foreign investment said Monday that U.S. President Donald Trump's pro-business administration can be a good thing for the kingdom as it overhauls its economy and prepares to publicly list shares of state-owned oil giant Aramco.
Prince Saud bin Khalid al-Faisal, the acting governor of the Saudi Arabian General Investment Authority, pointed to last month's visit to Washington by Deputy Crown Prince Mohammed bin Salman, who is second-in-line to the throne and leading a nationwide push to limit Saudi reliance on oil exports.
Prince Saud said the visit was characterized as a "reset" in the U.S.-Saudi relationship, which had cooled under the Obama administration. A White House statement after Trump's meeting with Prince Mohammed emphasized the need to strengthen economic and commercial ties between the two countries, including embarking on joint initiatives in the energy, industry, infrastructure and technology sectors, with opportunities worth more than $200 billion.
"The new administration being a pro-business administration I think will realize that business in Saudi Arabia will create benefits in the U.S. in terms of job creation," said Prince Saud.
"Investment is generally a win-win situation for both countries," he said, speaking in an interview with The Associated Press on the sidelines of the Annual Investment Meeting in Dubai.
The Saudi government is preparing to list less than 5 percent of Aramco next year on the Saudi stock exchange and an international exchange. It is gearing up to be the largest flotation in history, with officials valuing Aramco at more than $2 trillion.
The flotation is part of a broad effort to raise Saudi Arabia's profile and boost government revenues after a sharp drop in oil prices impacted its ability to pay for large infrastructure projects, subsidies that have citizens have come to rely on and public sector wages. It also spends heavily on defense, ranking as the world's third largest military spender with billions of dollars in purchases from U.S. manufacturers.
Prince Mohammed, 30, and Prince Saud, 38, represent a younger, newer generation of royals seeking to diversify Saudi Arabia's oil-addicted economy. More than half of the population of Saudi Arabia is under 25-years-old and 70 percent are under 35, representing a large potential consumer market, but also a massive challenge for the government to keep up with job creation and affordable housing.
Prince Saud said Saudi Arabia's majority young population should encourage investors.
"There's a lot of potential in terms of retail and the demand is there for goods and services, ranging from pots and pans to building material and everything in between," he said.
Amazon last week announced it purchased the Middle East's biggest online retailer Souq.com, which is based in Dubai. Souq.com's main market is Saudi Arabia, however. Prince Saud said the kingdom worked with Amazon last year to introduce them to the region.
While Saudi Arabia is courting companies in Silicon Valley, it has invested there too. Last year, Saudi Arabia's Public Investment fund pumped $3.5 billion into the San Francisco-based ride-sharing firm Uber.
"I think the perception of Saudi Arabia has changed in Silicon Valley and a lot of the misconceptions have been addressed," said Prince Saud, who said he was in Silicon Valley earlier this year.
Saudi Arabia plans to transform its Public Investment Fund into a nearly $2 trillion fund, making it the world's largest sovereign wealth fund. Other key targets include creating 450,000 new jobs outside the public sector and raising non-oil state revenue from around $44 billion to $141 billion by 2020.
Saudi Arabia is already a member of the group of 20 nations, though it aims to be among the world's 15 largest economies.