| 13 July 2024, Saturday |

Saudi Arabia in talks to sell 1% stake in Aramco, says Crown Prince Bin Salman

Saudi Arabia is in discussions to sell 1 percent of state oil firm Saudi Aramco to a leading global energy company, according to Crown Prince Mohammed bin Salman (MBS).

He said in televised remarks on Tuesday that Aramco, the world’s biggest oil company which listed on the Saudi bourse in late 2019, could sell more shares possibly to international investors within the next year or two.

There are talks now for the acquisition of a 1 percent stake by a leading global energy company in an important deal that would boost Aramco’s sales in … a major country,” he said, without elaborating.

“There are talks with other companies for different stakes, and part of Aramco’s shares could be transferred to the (Saudi) Public Investment Fund (PIF) and a part listed … on the Saudi bourse,” he said in an interview aired by Saudi TV marking the fifth anniversary of Vision 2030, the country’s initiative to diversify its economy away from oil.

Diversification plan

The Aramco initial public offering in 2019 was seen as a pillar of the economic diversification programme aimed at attracting foreign investment.

Aramco raised $25.6bn in the IPO and later sold more shares under a so-called “greenshoe option” to raise the total to $29.4bn.

The proceeds of that offer were transferred to the PIF, Prince Mohammed’s vehicle of choice to transform the Saudi economy.

The crown prince is increasingly leaning on Aramco, the world’s biggest oil exporter, to help finance his plan to transform the economy.

Vision 2030 has faced hurdles in recent years, with investors spooked by the kingdom’s domestic political crackdown and the killing of Saudi critic Jamal Khashoggi in 2018, and then with the COVID-19 pandemic last year.

The kingdom last year saw its economy shrink by the most in more than 30 years, according to estimates from the International Monetary Fund. But the outlook has since improved. The country’s budget shortfall is projected to be 4 percent of gross domestic product by the end of this year, narrower than last year’s 12 percent gap.


MBS said the decision to raise the value-added tax rate to 15 percent last year will be temporary, lasting up to five years, with the government’s ultimate target to have it at between five and 10 percent.

The kingdom has no plans to introduce an income tax, he added.

The crown prince said the nation’s unemployment rate will fall below 11 percent this year as the kingdom’s economy goes through a “V-shaped” recovery.

“Unemployment will fall to less than 11 percent this year, then it will reach around 10 percent, then 7 percent in 2030,” he said in the interview on the Rotana Khalejia television station.

Unemployment among Saudi nationals fell to 12.6 percent at the end of last year, after peaking at 14.9 percent in the quarter ending in September.

Foreign relations

MBS also touched on the delicate ties with the United States, where President Joe Biden’s administration has said it wants to re-calibrate a relationship that was a centrepiece of former President Donald Trump’s Middle East strategy.

“There will never be 100 percent agreement between two countries,” MBS said. “Between different White House administrations, the margin of differences could increase or decrease but we agree with the Biden administration” about 90 percent of the time, he added.

Asked about the kingdom’s regional rival, Iran, the crown prince softened his tone from previous statements, saying that Saudi Arabia was working to solve its differences with the its neighbour.

“In the end, Iran is a neighbouring country,” he said, adding that the kingdom wanted Iran to prosper but took issue with its nuclear programme and support for regional militias.

“We’re working today with our partners in the region to find solutions to these issues and we hope to overcome them and have a good and positive relationship with them,” he said.

  • Aljazeera