Despite crisis, Riyadh conference generates billions in investments

Deals signed at the conference included agreements between oil giant Saudi Aramco and 15 international firms.
Sunday 28/10/2018
A Saudi man walks past a sign at the start of the Future Investment Initiative (FII) in Riyadh, on October 23. (AFP)
Looking ahead. A Saudi man walks past a sign at the start of the Future Investment Initiative (FII) in Riyadh, on October 23. (AFP)

LONDON - Despite the uproar created by the Jamal Khashoggi case, Riyadh hosted its second Future Investment Initiative (FII), also known as “Davos of the Desert.” The 3-day event generated more than $56 billion in investment deals tied to 12 megaprojects.

However, the conference could not escape ramifications of Jamal Khashoggi’s killing in the Saudi Consulate in Istanbul. Saudi Crown Prince Mohammed bin Salman bin Abdulaziz, in his first public statements about the case, described the death of Khashoggi, a Washington Post columnist and Saudi government critic, as a “heinous crime that cannot be justified.”

“First of all, the incident that took place is very painful for all Saudis, especially ordinary Saudi citizens and I believe it is painful for any human in the world,” Crown Prince Mohammed said October 24 at the conference.

“It is a horrible incident that is totally unjustified. Today, the kingdom of Saudi Arabia is taking all legal measures to investigate and complete investigations jointly with the Turkish government to reach results and bring those guilty to justice.”

Crown Prince Mohammed sounded optimistic regarding the kingdom’s economic future, saying non-oil revenues had tripled in the last three years and that this year the kingdom’s annual budget was the biggest in its history and that next year the budget would exceed $266.5 billion.

He pointed out difficulties the government faced in implementing economic reforms, including increased capital spending and a higher employment rate while budget allocations for wages declined. This has been “a very big challenge,” he said.

Many Western companies, individuals and media partners cancelled or downgraded their attendance at the FII because of Khashoggi’s death and the government’s initial reaction to it.

US Treasury Secretary Steven Mnuchin did not go to the conference but did have a one-on-one meeting with Crown Prince Mohammed. The two “agreed on the importance of the strategic partnership between Saudi Arabia and the United States and the future role of this partnership in line with Vision 2030,” Saudi state news agency SPA said. Vision 2030 is Saudi Arabia’s plan to diversify its economy from the energy sector.

Saudi Energy Minister Khalid al-Falih told Al Ekhbariya TV that companies that pulled out of the conference apologised for missing the event and promised “to apply to open offices (in Saudi Arabia) during the coming weeks and restore relationships to their norms.”

“The United States will remain a key part of the Saudi economy because the interests that tie us are bigger than what is being weakened by the failed boycotting campaign of the conference,” he added.

Deals signed at the conference included agreements between oil giant Saudi Aramco and 15 international firms, including US companies Halliburton and Schlumberger, estimated to be worth more than $34 billion.

Falih said most of the deals were geared towards developing the kingdom’s industrial sector and logistical services. He said the sector, “the biggest and most important part of Vision 2030,” should generate $427 billion by 2030.

Among those who attended the FII was Jordanian King Abdullah II, Pakistani Prime Minister Imran Khan, Lebanese Prime Minister-designate Saad Hariri and Saudi billionaire Prince Alwaleed bin Talal bin Abdulaziz.

The Saudi stock exchange, known as Tadawul, surged on the last day of the summit, an increase attributed by analysts to Crown Prince Mohammed’s comments on the Khashoggi case and reaffirmation of the kingdom’s drive to reform.

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