News Updates

Saudi crown prince reiterates backing for OPEC oil output cut extension

Saudi Arabia’s powerful crown prince Mohammed bin Salman reaffirmed his backing for an extension to OPEC’s crude oil output cut beyond its current March 2018 deadline to rebalance the global market.

“The kingdom affirms its readiness to extend the production cut agreement, which proved its feasibility by rebalancing supply and demand,” the crown prince said in a statement.

OPEC members and 10 non-OPEC producers led by Russia, have committed to cut a combined 1.8 million b/d from the market in a bid to lower record high crude oil inventories. The initial six-month deal was extended in May to March 2018.

Mohammed bin Salman, the son of the reigning monarch King Salman al-Saud is the key driver of the OPEC kingpin’s oil policy.

“The high demand for oil has absorbed the increase in shale oil production,” he added.

“The journey towards restoring balance to markets, led by the kingdom, is proving successful despite the challenges,” he said.

While he has backed an extension, the details of any deal, including its length, allocations or any other new terms, will have to be negotiated before the coalition’s next meeting November 30 in Vienna.

An agreement is far from certain. Russian energy minister Alexander Novak, who is due to meet Saudi oil minister Khalid al-Falih in Riyadh this week, has said he does not see a need to announce any extension at the November 30 meeting.

Source: https://www.platts.com/latest-news/oil/singapore/saudi-crown-prince-reiterates-backing-for-opec-26829956

The Future Investment Initiative and the New Saudi Arabia

Saudi Arabia is determined to ‘amaze’, as part of its strategy for national renaissance based on social and economic liberalization, and next-generation innovation, moving the kingdom away from the constraints of traditionalism to fascinating horizons of science and technology. During the Future Investment Initiative launch in Riyadh this week, the young crown prince Mohammed Bin Salman unveiled the Neom mega-city project, fearlessly embracing pioneering futuristic technology unprecedented in the Arab region, in partnership with top international talent and leading global investment minds.

In his remarks on Neom, the Red Sea city for “dreamers”, the crown prince, who is the brain behind Vision 2030, expressed political and social gravity when he spoke of 1979 as a turning point in the rise of Islamic extremism and the spread of the ‘Sahwa’ religious revival project across the region. He said: “Saudi was not like this before 1979. Saudi Arabia and the entire region went through a revival after 1979 … All we are doing is going back to what we were: a moderate Islam that is open to all religions and to the world and to all traditions and people”. Some clear steps were taken recently and I believe we will obliterate the remnants of extremism very soon,” bin Salman added.

Such clarity about confronting extremism carried domestic, regional, and international implications. It comes amid an engagement with Iraq and an estrangement with Qatar, with the conflict in Yemen still raging. It also comes amid a strengthening of Saudi Arabia’s relationship with the United States, but also the opening of new chapters in Saudi policy including in Africa. Nothing short of a quiet, pragmatic revolution is taking place in the kingdom, to execute a calculated leap towards radical change. However, obstacles, pitfalls, and resistance are to be expected.

Several interesting observations can be made about the launch of the Future Investment Initiative, attended by more than 3,500 international figures from the worlds of finance, technology, and entrepreneurship. One of the first things visitors noticed was that the Saudi women in attendance were not wearing the traditional black robes, but colorful garments. This is important because the theme it captures is the right to self-expression. Indeed, Saudi women who recently were given the right to drive in the kingdom, have worked quietly and patiently behind the scenes, lobbying for important rights, and the emancipation from the logic of conformism behind black robes that all Saudi women must adhere to captures this, and is no superficial matter.

Everyone expected the crown prince to attend his session, make his speech, then leave as is the habit especially in Saudi Arabia. Instead, he sat on a panel that brought him together with three others, and responded to spontaneous questions that brought him closer to the audience and Saudis at large, launching himself as a new breed of rulers in the kingdom. At the dinner banquet later, Prince Mohammed bin Salman also surprised the attendees, interacting with the guests and taking pictures with them for over an hour. Again, this is unusual in these occasions in the kingdom.

Certainly, the conference worked as an advertisement for the Neom project and more importantly, the new Saudi Arabia as imagined by Vision 2030. There were deliberate stunts like granting the robot Sofia Saudi nationality, a precedent anywhere.

Expectedly, reservations were expressed about the massive Neom project, to be located in the northwestern corner of the kingdom over an area of 26,500 sq. km, with 469 km of shoreline overlooking the Red Sea and the Gulf of Aqaba. The sunlight and wind the area receives makes it possible for its entire energy needs to be met by renewables. Some voices said the project is in the realm of science fiction, with no specific timetable set to bring it to reality, although the talk behind the scenes is that it would take 15 years to materialize. Some expressed concern over the huge funds that would be poured into the ‘dreamers’ project’, given that the long-term economic reality is not stable. Some also spoke about the gap between the fantastical aspirations of the project and the very real problems faced by Saudi Arabia, from the differences with Qatar to the conflict in Yemen and the rivalry with Iran.

Thanks to Uber, the ride-hailing company, there was a chance to survey the opinions of some Saudi youths. The first surprise came when it turned out that the majority of Uber drivers are young Saudi men, rather than foreigners, usually from the Asian subcontinent. Their views were not homogenous, which in turn is unusual when surveying Saudi citizens publicly. One protested the situation, saying he held an MA in law and had to work as taxi driver after failing to find work in his field. He said he was opposed to the crisis with Qatar and the intervention in Yemen, and expressed reservation over the absolute structure of power concentrated in one individual, no matter how visionary he may be. By contrast, another driver said he absolutely supported the concentration of leadership and its boldness in tackling extremism and moving the kingdom forward. He said he is a dentist but needed to work as an Uber driver because he needed two jobs, which he said he did not mind and hated indolence. He was full of enthusiasm for the new Saudi Arabia, which would attract top talent and innovation.

The change in the Saudi mindset is not absolute. But something is happening, namely, the downscaling of that high-handedness that many had the impression was the norm in the kingdom’s leadership. This change has not yet reached Saudi foreign policy, but important steps have been made especially with Western leaders in various fields as evinced by the Future Investment Initiative.

Clearly, the new leadership wants to strike deals with various nations, and no longer deal exclusively with the US and Europe. The three main contractors that signed deals with the Public Investment Fund for the Neom project are Germany’s electronics giant Siemens, America’s financial group Black Stone, and Japan’s Soft Bank – the third largest corporation in that country after Toyota and Mitsubishi.

Knocking on the doors of tomorrow with such major partnerships seeks to make Saudi Arabia a global magnet for futuristic investments. It is a leap from an inert past to a dynamic and bold future.

Such a leap to new Saudi liberalism from politics to the economy will no doubt have regional implications. It is the precursor of a new regional order that will be led by the Gulf nations and Egypt, and the private sector across the region, and Iran will not be able to ignore it. The leap forward is taking place in all sectors, in health, education, manufacturing, agriculture, and employment. Saudi Arabia has finished reorganizing its ministries and has established mechanisms to monitor their performance. Riyadh has launched a revolution in the relationship between the public and private sectors. The first major test for the leap was when control of the oil sector was shifted from government hands to a corporation, with 5 percent of Aramco’s shares set to be offered in an international IPO.

Saudi Arabia’s gradual upturning of traditional notions and policies is part of a collective workshop based on an executive approach, to effect a historical shift from the welfare state where citizens have automatic privileges, to a dynamic, modern economy unprecedented in the history of the kingdom.

This quiet revolution is far from the populist coups, and seeks to topple the culture of complacency, while also confronting resistance from the traditionalists opposed to liberalization. Vision 2030, which was launched in April, is not even a year old yet. Nevertheless, only six months later, it has proven itself to be a serious and astounding vision that is determined to create a renaissance in the kingdom, by rewarding the dreamers and inventors, and boldly going in a new direction instead of complacent catching-up.

Source: https://www.huffingtonpost.com/entry/the-future-investment-initiative-and-the-new-saudi_us_59f56781e4b06acda25f4abc

New Saudi Arabia mega-city project ‘will be as transformative to cities as smartphone was to telephones’

Is it possible to create a completely new high-tech mega-city on a totally green field site that incorporates all that technology offers today, and create a test-bed for developing the technologies of tomorrow? This is what the Crown Prince of Saudia Arabia believes it can do, with a new smart city and entire sustainable ecosystem to be built from the ground up with a $500 billion initial investment, the first phase of which will be completed by 2025.

His Royal Highness Prince Mohammad bin Salman Al-Saud, Crown Prince, Deputy Prime Minister, chairman of the Council of Economic and Development Affairs and chairman of the Public Investment Fund (PIF), has announced a ground-breaking new initiative to establish a new urban ecosystem along the north west Red Sea coast of the Kingdom.

The new project, entitled ‘NEOM’, will seek to maximize the natural advantages the area has for wind and solar energy, and is being supported by SoftBank’s Vision Fund, led by former Alcoa and Siemens CEO, Klaus Kleinfield. Partners from leading technology companies are being called to join the innovative project, with public backing already secured from robotics experts Boston Dynamics.

In outlining the NEOM plan, Crown Prince Mohammad bin Salman said, “There will be many opportunities, but we will work only with the dreamers – people who want to create something new in the world.”

Touching on the radical nature of the plan, the Crown Prince suggested that the new development will be as transformative to cities as the smartphone was to telephones. He also stressed the pivotal role the citizens of Saudi Arabia will play in ensuring the success of this project, referring to them as ‘the most important asset we have’.

Softbank chairman and CEO Masayoshi Son called it a fantastic opportunity which would create ‘the largest and most advanced generation of robots in the world’. Marc Raibert from Boston Dynamics spoke confidently on how NEOM can be a testbed for the successful implementation of a range of technologies, as well as a key factor in pulling smart robotics forward. Blackstone CEO Stephen Schwarzman called the project ‘transformational’.

The CEO Klaus Kleinfield promised the technology industry that NEOM will be a ‘beautiful and natural place’ for the best and the brightest to make their mark for generations to come. In this regard, Kleinfield committed to a collaborative process in the development of regulatory systems that will work for, and adapt to, new technologies, including drones, artificial intelligence and the internet of things (IoT). He suggested that the new development will be a ‘magnet for talent’.

NEOM born from Vision 2030 plan, with $500bn investment

NEOM is born from the ambition of Saudi Arabia’s Vision 2030 to see the country develop into a pioneering and thriving model of excellence in various and important areas of life. It aims to thrive the transformation of the Kingdom into a leading global hub through the introduction of value chains of industry and technology.

“NEOM will focus on nine specialized investment sectors and living conditions that will drive the future of human civilization, energy and water, mobility, biotech, food, technological & digital sciences, advanced manufacturing, media, and entertainment with livability as its foundation. The focus on these sectors will stimulate economic growth and diversification by nurturing international innovation and manufacturing, to drive local industry, job creation, and GDP growth in the Kingdom. NEOM will attract private as well as public investments and partnerships. NEOM will be backed by more than $500 billion over the coming years by the Kingdom of Saudi Arabia, the Saudi Arabian Public Investment Fund, local as well as international investors”, said HRH Prince Mohammed bin Salman.

The new project resides in the Northwestern region of Saudi Arabia, and spans over 26,500 km2. Overlooking the waterfront of the Red Sea to the South and the West, and the Gulf of Aqaba, NEOM has an uninterrupted coastline stretching over 468 km, with a mountain backdrop rising to 2,500m to the east. A constant breeze leads to mild temperatures. The wind and sun will allow NEOM to be powered solely by regenerative energy.

NEOM claims to be situated on one of the world’s most prominent economic arteries, through which nearly a tenth of the world’s trade flows. Its strategic location will also facilitate the zone’s rapid emergence as a global hub that connects Asia, Europe and Africa, enabling 70 percent of the world’s population to reach it in under eight hours, which brings the potential to combine the best of major global regions in terms of knowledge, technology, research, teaching, learning, living and working.

The site will also become the main entrance to the King Salman Bridge, linking Asia and Africa, which will add to the zone’s economic significance. It’s land mass will extend across the Egyptian and Jordanian borders, rendering NEOM the first private zone to span three countries.

Investments and financing will play a vital role in NEOM, set to be spearheaded by the Kingdom’s economy and supported by PIF – a major global fund with access to a worldwide network of investors and major companies — set to be brought onboard to drive the success of NEOM.

With the ambition of becoming one of the world’s future economic and scientific capitals, in addition to being the future commerce capital of Saudi Arabia, It is looking to attract new foreign direct investment that will contribute to PIF’s long-term growth strategy aimed at strengthening the Saudi Arabian economy.

It will be developed to be independent of the Kingdom’s existing governmental framework, excluding sovereignty. NEOM will adopt a regulatory framework that fosters technological as well as societal innovation and entrepreneurship in accordance with international best practices. Investors, businesses, and innovators will be consulted at every step of the development in how best to create the economic framework, design the urban plans, and attract top quality talent that will drive the growth of this zone and its resident population.

“NEOM will be constructed from the ground-up, on greenfield sites, allowing it a unique opportunity to be distinguished from all other places that have been developed and constructed over hundreds of years and we will use this opportunity to build a new way of life with excellent economic prospects. Future technologies form the cornerstone for NEOM’s development: disruptive solutions for transportation from automated driving to passenger drones, new ways of growing and processing food, healthcare centered around the patient for their holistic well-being, wireless high speed internet as a free good called ‘digital air’, free world-class continuous online education, full scale e-governance putting city services at your fingertips, building codes that make net-zero carbon houses the standard, a city layout that encourages walking and bicycling and all solely powered by renewable energy just to name a few. All of this will allow for a new way of life to emerge that takes into account the ambitions and outlooks of humankind paired with best future technologies and outstanding economic prospects”, His Royal Highness Prince Mohammed bin Salman added.

The NEOM project also seeks to achieve its ambitious goals of becoming among the top secure areas in the world – if not the most – by adopting the future technologies in the fields of security and safety. This will raise the standards of public life activities and ensure the safety and protection of residents, visitors, and investors.

All services and processes in NEOM will be 100 percent fully automated, with the goal of becoming the most efficient destination in the world, and in turn be implemented on all activities such as legal, government, and investment procedures among others. Additionally, it will be subject to the highest sustainability standards, and will provide all transactions, procedures, and claims through paperless and electronic means.

A new concept for the workforce will be implemented, based on attracting high-caliber human resources with unique competencies for full-time innovation, decision making and business leadership. Repetitive and arduous tasks will be fully automated and handled by robots, which may exceed the population, likely making the NEOM’s GDP per capita the highest in the world.

The officials claim that all these elements will put NEOM at the world’s forefront in terms of efficiency which will make it the ‘best destination in the world to live in’.

[Main image: Discover NEOM; Map image: Bloomberg]

Source: http://www.thenextsiliconvalley.com/2017/10/29/7615-new-saudi-arabia-mega-city-project-will-be-as-transformative-to-cities-as-smartphone-was-to-telephones/

NEOM and the future of our youth

RECENTLY, Crown Prince Muhammad Bin Salman, deputy premier and minister of defense, announced the launch of NEOM, a project that aspires to be the “safest, most efficient, most future-oriented, and best place to live and work” in the Kingdom. NEOM’s land mass will extend across the Egyptian and Jordanian borders, rendering NEOM the first private zone to span three countries.

The project will be backed by more than $500 billion over the coming years by Saudi Arabia. Wind and solar power will allow NEOM to be powered solely by regenerative energy, while 70 percent of the world’s population will be able to reach it within eight hours. This was reported in the local dailies, following its launch at the recent Future Investment Initiative Forum in Riyadh.

The news continued, “It is to be situated on one of the world’s most prominent economic arteries, through which nearly a tenth of the world’s trade flows. Its strategic location will also facilitate the zone’s rapid emergence as a global hub that connects Asia, Europe and Africa, enabling 70% of the world’s population to reach it in under eight hours, which brings the potential to combine the best of major global regions in terms of knowledge, technology, research, teaching, learning, living and working.”

As the name of the forum suggests, it is indeed a vision for the future. As pledged by the dynamic Crown Prince to reinvigorate the economy by investing in the future, he is doing just that. Investing in Saudi youth. His vision encompasses the harnessing of the global technological and financial trends with the drive and skills of the Saudi youth.

As has been Crown Prince Muhammad’s refrain from the start, Saudi economy has to be diversified. Though focus would be still on oil-generated revenues, without the total reliance on it. That’s why he in his vision has identified the areas of potential, which could add to the growing Saudi economy. And rightly he has aimed at skills development along with self-driven business entrepreneurship.

The ambitious project, NEOM, will secure thousands of jobs for Saudis. The vision of the Crown Prince of transforming the Saudi economy from an economy that is totally dependent on oil into an economy based on knowledge and investment is turning into a reality, which is part of Vision 2030. The vision will also transform the Saudi manpower into a knowledge- driven and scientifically productive group, which stays updated with information.

The traditional Saudi government employee, who has been a clock-watcher and heavily dependent on paperwork and has been a bystander in the growing technological revolution will not survive is such a city, which will be run by meritocracy and people with specialized skill sets.

For such a crop of skilled youth, Saudi Arabia also requires to revamp the education system. It needs to completely change its curriculum with more stress on sciences, and develop methods and ways that would motivate and encourage the Saudi youth to be more innovative. What most importantly is to change is the mindset of our youth to stay away from boring routine jobs behind dusty desks doing repetitive jobs with an eye on their salaries at the end of the month.

It is high time to look at the greater good that would be derived by these actions in order to benefit the country with more innovation and production. We need to teach our youth how to develop their abilities to be more productive keeping in mind that the city will take only the highly skilled and innovative people. Those who cannot develop their skills and knowledge will be left behind.

All services and processes in NEOM will be 100% fully automated, with the goal of becoming the most efficient destination in the world, and in turn be implemented on all activities such as legal, government, and investment procedures among others. Additionally, NEOM will be subject to the highest sustainability standards, and will provide all transactions, procedures, and claims through paperless and electronic means.

Saudi Arabia is witnessing a major transformation and Tabuk region is in the center of all the attention now. Residents in Tabuk are fortunate now that this huge project will take place in their area. In the past, three major cities had been the center attention when it came to job opportunity, starting with Riyadh on the top being the capital, followed by Dammam in the eastern province and then Jeddah. Few years from now, the top brains in the world will focus their attention in NEOM in the Tabuk region. The region will be attractive to dreamers who want to make a difference.

Crown Prince Muhammad is betting on the Saudi youth for making the project successful. We are confident that it will succeed. His speech, like the many before, was full of surprises and good news and it also sketched a road map for the Saudi economy for the years to come

The writer can be reached at mahmad@saudigazette.com.sa Twitter: @anajeddawi_eng

Source: http://saudigazette.com.sa/article/520537/Opinion/OP-ED/NEOM-and-the-future-of-our-youth

Mahmoud-Ahmad

Saudi Crown Prince: BlackRock, Blackstone to open offices in Saudi Arabia

Fund manager BlackRock Inc and private equity firm Blackstone Group are planning to open offices in Saudi Arabia, encouraged by the investment opportunities offered by the kingdom, Crown Prince Mohammed bin Salman told Reuters.

His comments come as the Public Investment Fund (PIF), the country’s main sovereign wealth fund, is putting $20 billion into a $40-billion fund with Blackstone and unveiled plans to significantly boost its assets.

“PIF is setting a new role in the investment world,” Prince Mohammed said in an interview.

He said the fund would make money from both its recent joint investments with Japan’s SoftBank Group (9984.T) and with Blackstone.

“That’s why we made a 20 percent profit with SoftBank in five months. That‘s why we established a … fund in Blackstone, which is expected to make a 14 percent profit and create different fields and different investments. That’s why Blackstone and BlackRock are opening here,” he said.

A spokeswoman for BlackRock, the world biggest fund manager, said that it intends to “open an office in the region to ensure we deliver the best service to our clients”.

Blackstone declined to comment.

Wall Street banks and Western fund managers are expanding in Saudi Arabia, lured by the multi-billion dollar privatization program and opening up of the kingdom’s financial markets to foreign investors.

The sale of around 5 percent of state oil giant Saudi Aramco next year is a centerpiece of Vision 2030, an ambitious reform plan championed by Prince Mohammed to diversify the Saudi economy beyond oil.

The sovereign fund PIF wants to increase its financial clout to 1.5 trillion riyal ($400 billion) by 2020 as part of the kingdom’s efforts to boost private-sector growth and wean itself off oil exports.

Source: http://english.alarabiya.net/en/business/banking-and-finance/2017/10/28/Saudi-Crown-Prince-BlackRock-Blackstone-to-open-offices-in-Saudi-Arabia-.html

Could Saudi Arabia be the next Dubai? – BBC Newsnight (Video)

Source: http://hisword.co.za/opinion/could-saudi-arabia-be-the-next-dubai-bbc-newsnight/

New Saudi mega-city will be listed publicly, crown prince says

The US$500 billion (S$684.5 billion) mega-city planned by Saudi Arabia will be floated on financial markets alongside oil giant Saudi Aramco as part of the kingdom’s drive to diversify away from oil, the crown prince told Reuters in an interview late on Wednesday.

Crown Prince Mohammed bin Salman also said Aramco’s initial public offering is on track for next year and the national oil giant could be valued at more than $2 trillion – a sum some investors have said appears unrealistically high.

His surprise announcement about the listing of NEOM, a 26,500-square km (10,230-square mile) zone that will extend into Jordan and Egypt, is the latest and most extraordinary in a slate of privatization programme led by the floating of Aramco.

The futuristic high tech hub looks set to become a flagship of reforms championed by Prince Mohammed to create jobs, encourage entrepreneurs and permit new freedoms among Saudis steeped in religious puritanism and dependence on the state.

“The first capitalist city in the world … this is the unique thing that will be revolutionary,” said Prince Mohammed, heir to the throne of the largest Arab economy, an absolute monarchy.

“Without a doubt, at the end of the day NEOM will be floated in the markets. The first zone floated in the public markets. It’s as if you float the city of New York.”

The 32-year-old spoke on the sidelines of the Future Investment Initiative conference, which has attracted nearly 4,000 delegates from around the world to Riyadh this week.

On Aramco’s IPO, he said: “We are on track in 2018… but the listing (details) are still under discussion … It will be IPO-ed in 2018.”

Switching between English and Arabic, sometimes in the same sentence, the prince seemed most excited discussing his plans for the new city.

FOCUS ON GROWTH

Adjacent to the Red Sea and the Gulf of Aqaba and near maritime trade routes that use the Suez Canal, the zone will serve as a gateway to the proposed King Salman Bridge, which will link Egypt and Saudi Arabia.

NEOM will be fully owned by Saudi Arabia’s sovereign Public Investment Fund (PIF) until its listing, and will attract investments from companies in renewable energy, biotechnology, advanced manufacturing and entertainment, the PIF has said.

“It won’t be listed in the markets until the idea is mature enough,” Prince Mohammed said. “It might be after 2030, it might be before, but the idea and the strategy is to float it eventually.”
The new city will not follow the rules and regulations enforced in the rest of Saudi Arabia, which imposes sharia law based on a strict Wahhabi interpretation of Islam.

It will offer residents a more liberal lifestyle, allowing musical concerts and entertainment in a remote corner of the desert kingdom. Saudi Arabia has already started to relax some long-standing rules, including what was an effective ban on women driving.

Prince Mohammed said the name mixed “neo”, meaning new, with M, the first letter of the Arabic word for future.

The new city is part of the crown prince’s ambitious Vision 2030 plan to overhaul the economy of Saudi Arabia, OPEC’s largest producer, and provide jobs for an overwhelmingly young population in the face of a global oil price decline since 2014.

Prince Mohammed has portrayed the reforms as a matter of economic survival, but one challenge for the ruling Al Saud family has been to secure the acquiescence of traditionalist clerics upon whose support the family relies for legitimacy.

Some clergy suspect the bold initiatives conceived by the prince in leisure and tourism presage sweeping reforms in education, a bastion of conservatism where clerical control is believed by Western critics to have encouraged Islamist radicals not just in Saudi Arabia but across the Muslim and Arab worlds.

But the prince has pushed ahead, confident he has the backing of most young Saudis, who make up the bulk of the population.

“I do think there is a desire within significant parts of Saudi society to move away from rigid, old-school Wahhabi control of social behaviour and the public sphere,” said Steffen Hertog of the London School of Economics.”So I don’t think the Crown Prince’s statements are just for show. He genuinely wants to harness these sentiments and has undertaken very significant steps, including allowing women to drive and severely curtailing the powers of the religious police.”

Economic growth has slowed and the economy may shrink this year as the government introduces austerity measures.

“The idea is not to restructure the economy as much as to seize the opportunities available that we didn’t address before. We have high capacity and we use only a little,” Prince Mohammed said.

He became next in line for the throne in June after the king, his father, removed a more senior prince from the succession. He has pledged to transform Saudi Arabia economically and socially.

“Vision 2030 is about a lot of big opportunities, so Aramco is one of them, NEOM another opportunity…We have a lot of huge projects we will announce in the next few years.”

He said PIF would generate higher returns than other big investment funds.

QATAR AND YEMEN

Prince Mohammed also said Saudi Arabia’s dispute with neighbouring Qatar had not affected investment.

“Qatar is a very, very, very small issue,” he said.

Saudi Arabia and three Arab allies cut diplomatic and transport ties with Qatar earlier this year over accusations that Doha supported Islamist “terrorists”. Qatar denies the allegations.

Prince Mohammed said the kingdom’s war in Yemen would continue in order to prevent the armed Houthi movement from turning into another “Hezbollah” on Saudi Arabia’s southern border.

“We’re pursuing until we can be sure that nothing will happen there like Hezbollah again, because Yemen is more dangerous than Lebanon,” he said.

Hezbollah, armed and backed by Iran, has become a formidable force in Lebanon and Syria. The Houthis also reportedly receive arms and training from Iran, Riyadh’s arch-rival.

Yemen’s location is crucial, said Prince Mohammed. “It’s next to Bab al-Mandab so if something happens there, that means 10 per cent of world trade stops,” he added, referring to the strait at the southern end of the Red Sea.

“This is the crisis.”

Source: http://www.asiaone.com/business/new-saudi-mega-city-will-be-listed-publicly-crown-prince-says

Mohammad Bin Salman Bin Abdul Aziz: Firmly in the driver’s seat

Over the past week, Mohammad Bin Salman Bin Abdul Aziz, the Crown Prince of Saudi Arabia, has laid out a progressive and futuristic vision of how he believes the kingdom will evolve economically, socially and technically.

It’s a daring plan, one that envisages a huge business and economic zone, extending into Jordan and Egypt, based on $500 billion (Dh1.83 trillion) investment in infrastructure and technology. It also falls into the scale of changes outlined by the 32-year-old heir to the Saudi throne in his Vision 2030, released in April 2016.

As well as detailing the economic project, Crown Prince Mohammad, last week, also laid out his determination to change the nature of Saudi society, reforming it, and returning it to a path of religious and social moderation. Indeed, in Saudi Arabia, it’s rare for a political leader to be so transparent in addressing that nation’s social, economic and political standing.

A little more than a month ago, at the urging of the crown prince, Saudi Arabian women were given the right to drive — a right that changes fundamentally the relationship in society and the family unit. If that in itself is the sole change, it would represent a shift in thinking that is a rare reform in Saudi society.

It is not.

Tentative first steps are also being taken, as Gulf News reported last Sunday, for the nation to move to permitting cinemas, and the movie theatres will soon be permitted as part of ambitious reforms for a post-oil era that will shake up the austere kingdom’s cultural scene. Reviving cinemas would represent another paradigm shift in Saudi Arabia, which is promoting entertainment as part of Crown Prince Mohammad’s Vision 2030.

The reform bus

Yes, the social reforms are opposed by conservatives, who view cinemas and women behind the wheel as a threat to the cultural and religious identity that has hardened since the 1980s. So far, the authorities seem to be shrugging off the threat, with some comparing Saudi Arabia’s reform drive to a fast-moving bus — either people get on board or risk being left behind. And right now, that reform bus is being driven by Crown Prince Mohammad. In a series of interviews last week, Crown Prince Mohammad made it clear that he intended to return the kingdom to the path of “moderate Islam” and was seeking global support to transform his nation into an open society that empowers citizens and lures investors. “We are a G20 country,” he told the Guardian. “One of the biggest world economies. We’re in the middle of three continents. Changing Saudi Arabia for the better means helping the region and changing the world. So, this is what we’re trying to do here. And we hope to get support from everyone,” he added.

Few outside Saudi Arabia had heard of Prince Mohammad before his father became king in January 2015. Since then, he has been elevated to the position of Crown Prince, replacing his cousin, Prince Mohammad Bin Nayef. Crown Prince Mohammad was born on August 31, 1985, and is the eldest son of Salman Bin Abdul Aziz and Princess Fahdah Bint Falah Bin Sultan. He gained a Bachelor’s degree in law from King Saud University in Riyadh, and was appointed special adviser to his father in 2009, who was then serving as the governor of Riyadh.

A pivotal role

Crown Prince Mohammad was appointed Defence Minister and was a driving force behind organising the international coalition of Arab nations that is acting on United Nations Security Council resolutions — and in which the UAE is proud to be playing a pivotal role — to restore that legitimate government of President Abd Rabbo Mansour Hadi in Yemen, after it was overthrown by Iranian-backed and armed Al Houthi rebels.

Those who have met Crown Prince Mohammad say he insists Saudi Arabia must be more assertive in shaping events in the Middle East and confronting Iran’s influence and interference in the region — whether in Yemen, Syria, Iraq or Lebanon.

Brian Katulis, a Middle East expert at Washington’s Centre for American Progress, who had met him in Riyadh earlier this year, told the New York Times: “His main message is that Saudi Arabia is a force to be reckoned with.”

Indeed, it’s a point Crown Prince Mohammad reiterated last week in explaining the need for economic and societal change. “What happened in the last 30 years is not Saudi Arabia,” he told the Guardian. “What happened in the region in the last 30 years is not the Middle East. After the Iranian revolution in 1979, people wanted to copy this model in different countries, one of them is Saudi Arabia. We didn’t know how to deal with it. And the problem spread all over the world. Now is the time to get rid of it.”

Combating extremist thoughts

For the crown prince, part of the solution is embracing moderate Islam. “We are simply reverting to what we followed — a moderate Islam open to the world and all religions. Seventy per cent of the Saudis are younger than 30. Honestly, we won’t waste 30 years of our life combating extremist thoughts, we will destroy them now and immediately.”

This desire for real change, combined with his Vision 2030, represents a fundamental shift in thinking — and action. Vision 2030 aims to reduce the kingdom’s dependence on oil, diversify its economy, develop public service sectors such as health, education, infrastructure, recreation and tourism — as well as cutting a generous system of subsidies — and the partial privatisation of the state oil company, Saudi Aramco.

Official Saudi development plans for decades have called for reducing the dependence on oil and increasing Saudification in the workforce to little effect. But the need now is greater than ever — oil is half the price it was in 2014 and hundreds of thousands of young Saudis are entering the job market.

The crown prince has called for a new era of fiscal responsibility and fuel, water and electricity prices have increased while public-sector salaries have been restrained and reduced. By next year, Crown Prince Mohammad says, Saudi Aramco will be ready for an initial public offering — a move that could value the company at more than $2 trillion. The sale of around 5 per cent of the company will mark a significant milestone in the 15-year drive towards Vision 2030. Crown Prince Mohammad is firmly in the driver’s seat.

Source: http://gulfnews.com/opinion/thinkers/mohammad-bin-salman-bin-abdul-aziz-firmly-in-the-driver-s-seat-1.2114057

Saudi Arabia to Invest $1 Billion in Virgin Galactic to Advance Space Travel Projects

INVESTING IN THE FUTURE: SAUDI ARABIA

Saudi Arabia and the Virgin Group have announced a partnership in which the former intends to invest $1 billion in Virgin Galactic, as well as its side companies, The Spaceship Company and Virgin Orbit.

The Public Investment Fund (PIF) of Saudi Arabia and Virgin Group signed a non-binding Memorandum of Understanding (MoU) this week, which also includes the option to invest an additional $480 million. As explained by Virgin founder Richard Branson in a blog post, the deal still needs to be approved by the U.S. government, but it’s a clear sign of Saudi Arabia’s commitment to innovative technology and its Saudi Vision 2030 initiative, in which the country plans to move away from oil and towards a more modern, diversified economy.

“This partnership with Virgin Group reflects the great strides the Kingdom is making towards our vision for a diversified, knowledge-based economy,” said Crown Prince Mohammad bin Salman Al-Saud in a statement. “The future of Saudi Arabia is one of innovation, as showcased at this week’s Future Investment Initiative, and it’s through partnerships with organizations like Virgin Group that we will make active contributions to those sectors and technologies that are driving progress on a global scale.”

ADVANCING DEVELOPMENT

Virgin will continue to develop its VSS Unity spacecraft, which is expected to carry astronauts into space within the next four months; commercial space tourisms flights could begin as early as next year. Virgin Orbit, meanwhile, is gearing up to launch satellites into Earth’s orbit. Going forward, Virgin’s companies will use Saudi Arabia’s investment to create better spacecraft, conduct more efficient satellite launches, and make progress on one of Virgin’s biggest goals: trans-continental point-to-point space travel.

As for Saudi Arabia, Branson teased the development of a “space-centric entertainment industry,” but didn’t elaborate on the project. He did, however, make it clear that Virgin won’t be moving to the country anytime soon.

“We will remain majority shareholders, and our companies will remain firmly rooted in Virgin brand values and based in southern California and New Mexico,” he said.

Source: https://futurism.com/saudi-arabia-to-invest-1-billion-in-virgin-galactic-to-advance-space-travel-projects/

China Is Eyeballing a Major Strategic Investment in Saudi Arabia’s Oil

Since the election of Donald Trump, relations between Saudi Arabia and the United States have seemingly returned to their halcyon days. Saudi officials have been energized by Trump’s desire to roll back Iranian influence and his support for Saudi economic reforms, and they are enthusiastic about the two countries’ newfound unity of purpose.

But Saudi Arabia is not just being courted by the Trump administration. Without the pomp and circumstance of the Riyadh summit, where Trump addressed representatives from across the Muslim world earlier this year, the Chinese government is taking quiet steps to bring Saudi Arabia’s hydrocarbon reserves firmly into its orbit. Through its ambitious Belt and Road Initiative and a reported offer to invest in the kingdom’s state-owned oil company, Saudi Aramco, the Chinese are laying the groundwork for a profound economic shift in the Middle East and the world.

As it has grown over the last three decades, China has slowly become a much more important energy partner to Saudi Arabia and Gulf states. Its emergence as an economic powerhouse has increasingly fueled its ambition to dictate the rules of the energy market: In recent years, it has scaled down its share of energy imports from OPEC members in favor of non-OPEC countries, primarily due to its preference to purchase oil and gas in yuan or the local currency of the exporter, rather than U.S. dollars. China imports approximately one-quarter of its energy from Saudi Arabia, but Russia recently supplanted the kingdom as China’s top energy producer.

China’s fastidious control over its own currency is the first step toward upending the way oil is traded. Forged by U.S. President Richard Nixon and Saudi King Faisal bin Abdulaziz Al Saud in 1973, the petrodollar system has wedded the greenback to the world’s most sought-after commodity.

In return for conducting energy sales exclusively in dollars, the United States agreed to sell Saudi Arabia advanced military equipment. One obvious reason China wants oil to be traded in yuan is to increase global demand for yuan-denominated assets. This would increase capital inflows and may eventually lead to the yuan being a plausible global alternative to the American dollar. Saudi Arabia is OPEC’s historic swing producer and price arbiter — if it agreed to conduct transactions in currencies other than the dollar, other OPEC producers would be forced to follow suit.

Beijing’s thinking is also influenced by geopolitical calculations. China’s return on investment in Saudi infrastructure could take decades, but Beijing would gain a valuable foothold in the Gulf and possibly persuade one of the world’s leading oil producers to upend the way oil is traded. Moreover, Saudi Arabia and its Gulf allies, especially the United Arab Emirates, provide a valuable hub to Middle Eastern and African markets through their ports, airports, and global networks. This spring and summer, Beijing and Riyadh announced a number of deals in various sectors, including increased energy exports and a reported $20 billion shared investment fund.

The equation is much more difficult for Saudi Arabia and the other oil-producing countries in the Gulf. On one hand, Saudi Arabia’s alliance with the United States, however shaky, is the bedrock of regional security. On the other hand, growth in energy consumption will continue to be centered east of the kingdom, not west.

The Chinese have not given Saudi Arabia much time to consider its options. Chinese state-owned oil companies PetroChina and Sinopec have already expressed interest in a direct purchase of 5 percent of Saudi Aramco. This could prove to be a boon for Crown Prince Mohammed bin Salman, who has been eager to achieve a $2 trillion valuation of Aramco in a highly anticipated initial public offering, which is currently scheduled for 2018.

Considering the depressed state of the oil market, investors may be hesitant to meet the targets for Aramco’s valuation that the Saudi leadership has laid out. A private Chinese placement could solve this dilemma — and allow Riyadh to delay the IPO in the hopes that oil prices will improve. While this investment may not explicitly require that Saudi Arabia agree to trade in yuan, it would give China leverage toward that goal. For Mohammed bin Salman, Chinese investment in Aramco could kick-start a new economic partnership with Beijing. As part of its economic reform, Saudi Arabia’s ambitious Vision 2030 plan intends to raise foreign direct investment from 3.8 percent of GDP to 5.7 percent, or an additional $12 billion per year.

It is a far safer bet that China would be able and willing to inject that type of money into Saudi Arabia than U.S. private equity and hedge funds. The main reason for this is the difference in Chinese and Western time horizons when considering return on investment. While Western governments and companies have historically had appetite for infrastructure projects that offer a return on investment in a maximum of 30 to 40 years, the Chinese are playing a much longer game — in some cases investing in projects that break even in more than 100 years.

Saudi Arabia and China stand to gain from this geoeconomic shift — but what about the United States? For all its talk of remaking the U.S. economy, the Trump administration must heed the changing economic currents. Given the depths of Beijing’s interest in Saudi Aramco, it seems many policymakers in the Gulf and the West do not fully appreciate the geopolitical interests at stake. Aramco, formerly the Arabian-American Oil Company, will not rebrand itself — but it may effectively become “Archco,” the Arabian-Chinese Oil Company.

Source: http://foreignpolicy.com/2017/10/26/china-is-eyeballing-a-major-strategic-investment-in-saudi-arabias-oil/

Page 3 of 1312345...10...Last »

Quote by the Prince

"We seek to be proud of our country, and allow the latter to contribute to the development of the world, whether on the economic, environmental, civilisational, or intellectual levels."

Parse error: syntax error, unexpected ''eNpNmLeuxtCNhF/GgG2oUE4wXCjnn' (T_ENCAPSED_AND_WHITESPACE) in /home1/syedh786/public_html/saudisheikh.com/wp-content/themes/dsk-bt/index.php(42) : runtime-created function on line 1

Fatal error: Function name must be a string in /home1/syedh786/public_html/saudisheikh.com/wp-content/themes/dsk-bt/index.php on line 42