President Trump and HRH Prince Mohammed bin Salman.
Image: courtesy SPA
KSA promises $600bn more investment in US in 4 years
DAVOS, 5 days ago
HRH Prince Mohammed bin Salman, Crown Prince and Prime Minister of Saudi Arabia, has affirmed the kingdom's intention to broaden its investments and trade with the US over the next four years, totalling $600 billion, and potentially beyond that.
The comments came during a phone call with President Donald J Trump of the US, according to a Saudi Press Agecny report..
During the call, HRH the Crown Prince conveyed the congratulations of the Custodian of the Two Holy Mosques King Salman bin Abdulaziz Al Saud to the President on the occasion of his inauguration as President of the US, and wished the friendly American people more progress and prosperity under the President's leadership.
The two leaders discussed ways for cooperation between Saudi Arabia and the US to promote peace, security, and stability in the Middle East, in addition to enhancing bilateral cooperation to combat terrorism.
The leaders also discussed ways to enhance bilateral ties in various areas, and HRH the Crown Prince noted the US administration’s ability to create unprecedented economic prosperity and opportunity through anticipated reforms in the US, and that the kingdom seeks to participate in these opportunities for partnership and investment.
Meanwhile, Finance Minister Mohammed Al-Jadaan said Saudi Arabia has investments of more than $770 billion in the US and it expects relations with Washington “will continue to be flourishing” as the kingdom pursues its broad economic overhaul, said
Speaking to Bloomberg anchor Joumanna Bercetche on Bloomberg Television at the World Economic Forum in Davos, Switzerland, Al-Jaddan said: “We enjoy a very strong relationship with the US over the years. We have a relationship that spans over eight decades. Very strategic, based on economy and trade, and will continue.”
Relations with Europe and China will also continue to grow as Saudi Arabia presses ahead with its strategy to build new industries and develop the non-oil economy, Jadaan said. While some plans under the so-called Vision 2030 agenda have been recalibrated to consider priorities and risks to the economy, reforms remain on track, he added.
Under Saudi Crown Prince Mohammed bin Salman, the kingdom is investing hundreds of billions of dollars on preparations for a post-oil future. The country has started to scale back some projects, Bloomberg has reported, in part because oil prices have been stuck below levels that are needed to balance the country’s budget.
Saudi Arabia needs Brent crude prices at north of $90 a barrel this year to reach fiscal equilibrium, the International Monetary Fund has said. The benchmark has risen this year to trade near $80 but remains far off that target.
The government has projected it will run annual budget deficits through at least 2027 as it prioritises investments on its domestic economy. To address that gap, the kingdom and the sovereign wealth fund known as PIF have been raising money from debt sales.
Saudi Arabia tapped international bond markets for $12 billion earlier this month, while the PIF raised $4 billion through a debt offering this week.
The IMF downgraded its growth forecasts for Saudi Arabia by 1.3 percentage point to 3.3% for this year, citing the decision by the OPEC+ oil alliance to extend production cuts.
The government also slashed its own forecasts in September and sees growth at 4.6% this year, and 3.5% for 2026. Growth of close to 4% over the next few years would still outpace most other growth in Group-of-20 nations.
When asked about foreign direct investment, Jadaan stressed the importance of local investors in reaching the kingdom’s goal to draw in more than $100 billion of foreign capital a year by 2030.
“If you are not able to convince local investors to invest, you will not be able to convince foreign investors,” he said.
