Mohammed bin Salman weakens Saudi investments and economy
Observers unanimously agree that Crown Prince Mohammed bin Salman is weakening the investment base and economic planning in his decisions regarding the Kingdom’s economy and its major companies.
Observers highlight that bin Salman makes random individual decisions and does not rely on strategic studies to confront the Kingdom’s internal problems, in addition to not paying attention to citizens.
For example, there are no economic statistics and reports that show the Saudi citizen where the Kingdom is going, and he knows nothing but delay and anaesthesia, and that what does not succeed in 2020 will succeed in 2025, and if this does not happen, we will wait until 2030.
Despite all the wealth owned by Saudi Arabia and the frequent talk about investments, the Kingdom has been suffering an unemployment rate of about 12% for seven consecutive years.
It also suffers from a fragile infrastructure for all projects, and poor urban planning, as there are still villages and cities that have not received electricity, and some citizens still think that the Internet is a fantasy, and some of them have never heard of it.
The last of bin Salman’s arbitrary decisions came to the announcement that the Saudi Public Investment Fund, headed by Mohammed bin Salman, had acquired 4% of the shares of the Aramco oil company, valued at about $80 billion, to support the Fund’s work to diversify the economy.
The Bloomberg Agency commented that “the Saudi government is transferring $80 billion from Aramco to the kingdom’s sovereign wealth fund, and the deal is considered a transfer of money from one government pocket to another, to obtain financial liquidity.”
The agency referred to a statement by Aramco, in which it says that the deal is a private transfer between the government and the sovereign wealth fund, and Aramco is not a party to the transfer of funds and has not entered into any agreements, nor received any proceeds from the transfer.”
For its part, the Saudi Press Agency said that “4% of the shares of the Saudi Arabian Oil Company (Aramco) have been transferred to the Public Investment Fund, adding, quoting the Crown Prince, that the move is “part of the Kingdom’s long-term strategy aimed at supporting the restructuring of the economy.”.
The transfer of shares came after reports of the Kingdom’s intention to sell a small percentage of the giant Aramco shares to a foreign entity.
Bin Salman claimed that “the transfer of these shares is part of the Kingdom’s long-term strategy aimed at supporting the restructuring of the national economy, in line with the Kingdom’s Vision 2030, and also contributes to supporting the Fund’s plans to raise the volume of its assets under management to about 4 trillion Saudi riyals by the end of 2025. “.
He added that the company’s shares will “contribute to strengthening the fund’s strong financial position and high credit rating in the medium term, as the fund relies in its financing plan on the value of assets and investment returns from assets under management.”
At the end of 2025, the Financial Investment Fund aims to pump up to one trillion Saudi riyals into new projects locally, according to the Crown Prince. The latter added that the Fund also aims to “increase its contribution and its subsidiaries to the local content, to reach 60%, in addition to creating more direct and indirect jobs directly into the local labour market.
It is noteworthy that Aramco was listed on the Saudi Stock Exchange in December 2019, after the most extensive initial public offering globally, which amounted to $29.4 billion in exchange for the sale of 1.7 per cent of its shares.
Aramco is the largest company in the Kingdom and the second-largest listed company globally. The Saudi government owns it, and it produces under normal conditions 10 million barrels per day.
