Saudi unveils plan to move away from oil

Riyadh / AFP

Saudi Arabia said on Monday it would create the world’s largest wealth fund and sell shares in state energy giant Aramco as it unveiled a vast plan to transform its oil-dependent economy.
The announcement of the long-term reform programme, dubbed “Saudi Vision 2030”, marks the beginning of a hugely ambitious attempt to move Saudi Arabia beyond oil, the backbone of its economy for decades, amid a steep fall in prices. The key architect of the diversification plan, deputy crown prince Mohammed bin Salman, said that if it works Saudi Arabia “can live without oil by 2020”.
In an interview with the Saudi-owned Al-Arabiya news channel after the government approved the programme, the 30-year-old prince outlined a series of measures aimed at reshaping his desert kingdom’s economy.
“We have all developed an oil addiction in Saudi Arabia and this is dangerous and has hampered development in many sectors during past years,” he said. Mohammed said part of the plan is “to sell less than five percent of Aramco” in an Initial Public Offering (IPO), valuing the company at between $2 trillion and $2.5 trillion.
By “selling even one percent of Aramco, it will be the largest IPO in the world”, he said.
Part of the funds from the share sale, Mohammed said, will be used to set up a $2-trillion sovereign wealth fund, which would easily surpass Norway’s $865-billion fund as the world’s biggest.