Saudi Arabia Hosts Yet Another Successful Chapter of Future Investment Initiative
Saudi Crown Prince Mohammad Bin Salman has been working day in day out to ensure the Kingdom’s transformation away from being an oil-dependent economy in line with Saudi’s Vision 2030. Dubbed as the ‘Davos in the Desert’, the first edition of the Future Investment Initiative (FII) was a link in the chain of Kingdom’s economic reforms. One year later, the second edition of the event has yet again proved that MBS is determined more than ever, despite the complex diplomatic ties and propaganda against the Crown, to transform the Kingdom’s fortunes.
— ﮼ج﮼ (@gborye) October 22, 2018
Mega Deals Signed Worth $50 Billion
A number of mega deals amounting to $50 billion were signed at the grand Ritz-Carlton hotel in Riyadh at the event which was attended by dignitaries from across the globe. Saudi state oil company Aramco signed a major chunk of the deals totaling $34 billion with mega companies from eight companies including the United States, Russia, and France. $16 billion deals were signed in different sectors other than oil, which highlights Saudi Arabia’s focus to wean off the country from oil dependence in the coming years.
Some of the major players partnering with Aramco include different companies based in China, Japan, United Arab Emirates (UAE), France’s Total, US’s Air Products (APD), Baker Hughes (BHGE), Schlumberger (SLB), Halliburton (HAL) to name a few. Despite the dropouts of some dignitaries, the event proved to be a huge success for the Kingdom as a part of MBS’s vision.
?? Saudia Investment Authority: The volume of licenses granted to foreign companies increased by 90% compared to the same period last year
– 499 new foreign companies
– Companies from 50 countries . pic.twitter.com/GWCYcj3Ndt
— ?️h_ ?ziiz (@azz_z) October 22, 2018
The country is on the verge of modernizing and diversifying its economy and the FII is being held annually to highlight the Kingdom’s efforts in this regard and to attract businessmen from across the globe to invest in different initiatives and play their role in the historic transformation. JP Morgan and HSBC haven’t boycotted the event, sending in their representatives to negotiate deals and explore the potential markets offered by Saudi Arabia.
— حسن سجواني ?? Hassan Sajwani (@HSajwanization) October 17, 2018
The importance of Saudi Arabia, especially in the energy and oil sector, cannot be undermined and the big players are not willing to give up massive potential business deals with MBS based merely on an incident, which may or may not have any direct association with the Crown Prince. Having said that, the world business leaders proved that they want to work with the Kingdom to further strengthen their ties and play a pivotal role in the much-anticipated transformation.
#MBS on stage with Lebanon PM Hariri. MBS says Hariri is in Saudi Arabia for two days and jokes he hopes there will be no rumors Hariri was kidnapped. Hariri responds: "I have complete freedom". Laughter, big fun. pic.twitter.com/gY0Y8iUdK8
— Mathieu von Rohr (@mathieuvonrohr) October 24, 2018
Pakistan Continues to Support its Close Ally
Pakistani delegate was also present at the event on the special invitation of H.E. King Salman to show their support for their closest ally in the hour of need. The Crown has stood by Pakistan ever since its inception and MBS wants for further strengthen the bilateral ties when it comes to peace and security, trade and energy along with a number of other disciplines.
#FII2018: #Pakistan PM Imran Khan says has spoken to #Saudi Crown Prince Mohammed bin Salman about boosting investment ties between countries. Follow our coverage of the @FIIKSA: https://t.co/NiHQAdPDbg pic.twitter.com/RHng6jWEwQ
— Arab News (@arabnews) October 23, 2018
As a part of a Memorandum of Understanding (MoU) signed between the two finance ministers, Saudi Arabia will be setting up an oil refinery in Gwadar Pakistan along with cooperation in mineral development with the government of Balochistan, Pakistan.
Russia Stands with the Kingdom
Russia has vastly improved its ties with Mohammad Bin Salman in the past few years thanks to the visionary approach of the Crown Prince. One of the biggest overseas delegates to attend the all-important business summit was from Russia. A 30-member team of Russian Direct Investment Fund including the top entrepreneurs, business leaders, and experts attended the event while expressing the desire to work even more closely with the Kingdom. Any deals between the two countries would be mutually beneficial and would greatly impact the economies.
RDIF CEO Kirill Dmitriev highlighted the importance of the Saudi-Russia relationship in the context of the top huddle for business leaders. He said:
“We appreciate the constructive dialogue and are happy to share experiences, identify new joint projects and discuss promising areas for the development of comprehensive cooperation between a wide range of partners from Russia, Saudi Arabia, and other countries”.
China Proves its Close Friendship with Kingdom Yet Again
A number of high-profile deals were signed between the Kingdom and China which ensures that Mohammad Bin Salman is well on his way to achieving his Vision 2030 despite the obstacles in the way.
Three different MoUs were signed on the third day of the event which bode well not just for Saudi Arabia, but China as well which is looking to strengthen its footprints across the globe in all sectors especially infrastructure and economic activities.
— Future Investment (@FIIKSA) October 25, 2018
Mohammad Bin Salman
The Crown Prince has shown his satisfaction over the successful organization of the grand event. He is confident that his economic dream would not only survive but Saudi Arabia would be open for business for everyone around the globe. His Vision 2030 focuses on diversifying the economy and attract foreign direct investment in different areas including tourism, boosting the private sector while obliterating unemployment. While there were speculations of less participation from the big players, however, only a couple big names missed out this time around while a majority of the business leaders attended the event. The world business leaders are well aware of the fact that the Kingdom is a big center for business, especially in the coming years as MBS plans to shift away from an oil-driven economy.
Saudi Prince shared the stage with the Prime Minister of Lebanon and the Crown Prince of Bahrain along with dignitaries from UAE and other countries on the first day of the event.
Earlier, the event promised to bring the countries together for great business opportunities for the future. Public Investment Fund head Yasir Al-Rumayyan told the audience that the fund is expecting a $2 trillion portfolio by 2030. With oil demand expecting to reach 120 million barrels per day, Saudi Arabia could potentially produce 1-2 million barrels a day, boosting its crude productions big time. He asserted that the first chapter of the event was a big hit, but this year’s conference will have its impact which will last for the next century.
#FII2018: World #oil demand to hit 120 million barrels a day in next few decades, says #KSA Energy Minister Khalid Al-Falih. Follow our coverage of the @FIIKSA: https://t.co/NiHQAdPDbg pic.twitter.com/mZHLndCLhB
— Arab News (@arabnews) October 23, 2018
Saudi Arabia would like to focus more on attracting tech giants to work in close collaboration with the Kingdom as there is a significant room for technological advancement in not just KSA but the greater Middle East as well. This was highlighted by Mohamed Alabbar who is a leading Emirati investor. However, the Kingdom’s IT Minister Abdullah Al-Sawahah, while talking to the audience at the event, pointed out that KSA is doing everything in its capacity to make it the technological hub of the region and it would realize its dream sooner or later.
Prince Salman was greeted with cheers from the audience when he entered the grand hall with Jordanian King Abdullah. While MBS did not address the audience on the first day – which is a bit of a downside as it was an opportunity for him to take into confidence the business leaders and representatives from different countries regarding the alleged killing of Jamal Khashoggi – however, his message was loud and clear.
“The kingdom is going through a transformation of unprecedented proportions and the transformation journey will not stop”, was the message Mohammad Bin Salman had for the investors, business leaders, tech-giants and representatives from different countries. The message further read “Those partners who are here today to continue the journey with us are certainly going to look back at how the kingdom is committed to its partners that stayed the course”.
The summit holds critical importance for Saudi Arabian future development projects, as it is an economic agenda to boost the Kingdom’s economy and reduce its reliance on oil. The depleting oil reserves are a big threat to the future economy of Gulf states and the investment of other countries in Saudi Arabia is a win-win situation for the Royals as well as the involved parties. In this summit, GEMS Education announced an $800 million deal for Saudi School Networks, which will strengthen the Education sector in many ways. NMC Health is a healthcare network and distribution business in the UAE which signed an agreement to rejuvenate the health sector of the country. The signing of a number of major deals, the attendance of key global leaders and business experts and the Crown Prince’s continued efforts to realize his Vision 2030 are pointing to the direction that the Kingdom would be a huge force to reckon with in terms of the economic activity by 2030.